As Riboud, the CEO of Groupe Danone says, the firm gets forty percent of its revenues from the EU market as and get the rest from the emerging markets. What is special about this strategy is the fact Riboud is counting on emerging markets for growth while holding on the local EU market for stability. As Cavusgil, Ghauri and Akcal (2012), growing markets come with the risk of uncertainty because there is never a certainty of how things are going to look like in the future. This is probably why Riboud is choosing to not let go of the local market even though the emerging markets have bigger opportunities.
The strategy is in line with the environment in which Groupe Danone operates. Groupe Danone strategy is built around the fact that there are new markets emerging around the world due to globalisation. This is important because the food and beverage industry is a global industry (Wood, 2012). Food and beverage industry is a global industry due to the fact that this kind of products are used everywhere in the world. Food is a basic need for all humans and this means that everywhere where human beings exist; there are is a market for food and beverage (Nedell, 2012). Globalisation of this sector is actually important and has advantages. One such advantage is the fact that all parts of the world can access food items from various parts of the world (Hitt, 2005). ...Show more