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Using the data in Extract D and your own knowledge of business, evaluate and recommend whether Mindful Chef should seek a joint venture with Auchan, France or seek a global merger with companies such as Blue Apron, US. - Edexcel - A-Level Business - Question 1 - 2022 - Paper 3
Question 1
Using the data in Extract D and your own knowledge of business, evaluate and recommend whether Mindful Chef should seek a joint venture with Auchan, France or seek a... show full transcript
Worked Solution & Example Answer:Using the data in Extract D and your own knowledge of business, evaluate and recommend whether Mindful Chef should seek a joint venture with Auchan, France or seek a global merger with companies such as Blue Apron, US. - Edexcel - A-Level Business - Question 1 - 2022 - Paper 3
Step 1
Evaluate whether Mindful Chef should seek a joint venture with Auchan, France
Answer
A joint venture with Auchan could provide Mindful Chef with several advantages. It would allow the company to leverage Auchan's established presence in France, enabling a quicker entry into the market. Through this collaboration, Mindful Chef would benefit from local insights into consumer preferences and market trends, which could enhance the effectiveness of their marketing strategies. Furthermore, sharing resources would help mitigate risks associated with entering a new market, particularly in understanding the French culture and consumer habits.
However, there are potential drawbacks to consider. The integration of two different corporate cultures may pose challenges, leading to possible conflicts over decision-making or operational procedures. Additionally, if local consumer preferences differ significantly from those in the UK, Mindful Chef might face difficulties adapting their product offerings accordingly.
Step 2
Evaluate whether Mindful Chef should seek a global merger with companies such as Blue Apron, US
Answer
A global merger with Blue Apron could provide Mindful Chef with substantial growth opportunities. By combining resources, the two companies could optimize production and reduce costs, potentially leading to higher profits. A merger would also combine technological capabilities and expertise, creating a stronger business entity that could compete more effectively against industry competitors like Gousto.
Nevertheless, this path includes risks. Cultural differences between the two companies may lead to integration challenges. Furthermore, a merger is a significant commitment and could lead to liabilities if not managed properly. The complexities of merging operations across different countries could also incur high costs and distract from overall strategic goals.
Step 3
Recommendation
Answer
Given the points discussed, while both options present unique benefits and challenges, a joint venture with Auchan may be a more prudent choice at this stage. It would allow Mindful Chef to enter the French market with minimized risk while maintaining operational independence. As the company grows and gains more insights into the market, they could later consider a global merger for expanded opportunities. This strategic approach enables a cautious exploration of foreign markets before committing to larger-scale integrations.