Borden Case Analysis

Borden’s real problem began when Ventres spent nearly $2 billion on acquisitions in 1986 - 1991. This created a few problems that would later amount and become a huge issue that would lead to Borden’s eventual downfall. First of all Borden was left with 91 new small to medium-sized companies under its reign and with just one plan on how to make it all succeed, that was by consolidating manufacturing and distribution and marketing the regional brands into other markets. Second problem was that little to no time (just a few weeks in some cases) was dedicated to do a proper research and analysis on which companies to buy and which not. Possibly some of the 91 companies brought little to no value to Borden and made it harder to define the brand. Third problem was the different management styles and ideas between D’Amato and Ventres. Ventres wanted to expand the company at all cost and was alright with having many uncentralized operations while D’Amato wanted to centralize everything in order to reduce cost and keep better control of operations. Fourth problem was due to the sheer number of new acquisitions that Borden didn’t knew on which companies or products to focus and exploit and therefor left many unexploited opportunities that could have brought them higher earnings. Borden didn’t focus on their well-known and successful brands either, they never push them to innovate and create new products. For example the golden opportunity in 1980 to expand their ice cream in to super-premium ice cream was left completely untouched. The fifth problem was Borden’s inability to adapt with certain changes like the drop in the price of raw milk in 1992. D’Amato thought that because Borden was a well-recognized and leading brand for milk that they didn’t had to lower their prices because their milk was “better” than that of their competitors. It didn’t took long before people realize that milk was milk no matter the brand and that it was absurd to pay such a higher price for the