Case Write up Keurig
It is essential that Green Mountain’s negotiation succeed because the value proposition that comes along a new product like the portion pack system. Keurig is a start up coming looking to expand its business venture and GMCR central location is in the Northeast and they were also looking to expand the company’s geographic existence. With expansion ideas in mind as a common ground for both companies, it would be smart and beneficial for the companies to work towards this specific goal. Keurig would make it feasible for GMCR to sell the K-cups it will eventually produce in parts of the country they are not already connected to once the Keurig goes national. There is major room for them to grow and to be capitalize and monetize on such a partnership with Keurig. An important aspect of GMCR that captures the essence of the company is the quality of the coffee that they sell and after a trail/testing period with K-Cups the management team came to the conclusion that Keruig met all of their standards. All of these reasons make it very important that the negotiations work out because the positives far exceed any negative with this kind of product expansion that will only help expand GMCR’s market share among roaster and create a more profitable business for GMCR. There really does not exist any other BATNA for Green Mountain Coffee Roasters as stated in article “Stiller and Sabol see Keurig as the only option for GMCR in pursing the portion pack opportunity over the next few years. It seems high unlikely that M&M/Mars would ever license rival roaster the right to sell portion packs for it Flavia system, and GMRC management is not aware of any other portion pack system at an advanced stage of development.” (Page 2 GMCR eyes-only) With this framework and understanding in mind it is clear to see that GMRC has everything to gain from a deal with Keurig.
It is important for Keurig that the negotiations succeed but it not a last...
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