an empire built on controversy
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AN EMPIRE BUILT ON CONTROVERSY
By: Thomas Liquori
MULTINATIONAL ENTERPRISE
Operate in many host countries
Often conduct R&D activities
MNE’s cut across national borders
Often directed from a company planning center that is distant from the host country
NATIONAL SOVEREIGNTY
A controversial issue involving the conduct of MNE’s is their effect on the economic and political policies of the host and source governments
Many nations fear that the presence of MNE’s in a given country results in a loss of its national sovereignty
CHIQUITA’S COMPANY PROFILE
United Fruit Company was Founded in 1899 Purchased of Nipe Bay
in 1907 and Saetia Sugar in 1912.
Bought Samuel Zemurray's Cuyamel Fruit Company in 1930
United Fruit purchased A&W restaurants and root beer in 1966 and Baskin-Robbins ice cream in 1967
Eli Black, founder of AMK, bought United Fruit Company in 1970 and changed its name to United Brands.
The firm became Chiquita Brands International in 1990
MAIN INDUSTRY
Chiquita’s main industry is fresh fruits, vegetables and processed food
The company grows, procures, markets, and distributes bananas and other fresh fruits and vegetables under the premium Chiquita and other brands
ORGANIZATIONAL STRUCTURE
Fernando Aguirre
Chairman, CEO, President
Jeffrey ZallaSVP, CFO
Waheen Zaman
CIO
Kevin Holland VP
Tanios VivianiCMO
William TsacalisVP
CHIQUITA’S SWOT ANALYSIS
• Increasing oil prices
• Regulations• Legal
proceedings
• Growth in private label products
• Higher demand for organic products
• (EU) banana import regime
• Weak profitability
• Strong market position
• Wide geographic base
Strengths Opportunities
Weaknesses
Threats
BANANA CONTROVERSY
Throughout the 1900’s the term “Banana Republic” has been associated with the banana producing countries of Central and Latin America
In 1974, the company paid a $1.25 M bribe to the President of Honduras in return for an export tax reduction applied to bananas.
CHIQUITA CONTROVERSY
In 1985, Costa Rican environmentalists filed a lawsuit, on behalf of banana plantation workers
Chiquita secretly control dozens of supposedly independent banana companies
Chiquita fruit-transport ships have been used to smuggle cocaine into Europe
BLOODY BANANAS In 2008, the New
York Times described how U.S. based Chiquita reached a $25M settlement over allegations that U.S seniors in Chiquita signed over $1M in payments to death squads in Columbia
Quick Financial Points First quarter financial
report stated Chiquita made a $31.7M profit in 2008, after losing $3.7M the same period the prior year
The actual amount of bananas that people bought dropped by 1% in the U.S & 14% in Europe
Chiquita’s New Endevor In 2008 Chiquita opens
large plantations in Africa, Mozambique , and Angola, to get around the European tariff regulations
Many compare George Bush to the CEO of Chiquita Bananas by not being able to make reasonable statements
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