Tetra Pak in China

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In a way or another, several large corporations sell their products to other organizations. Even large consumer products companies, which make products meant for final users, also sell their products to other businesses. The business market is huge. In fact, business markets involve far more dollars and items than do consumer markets. However, business markets differ in many ways from consumer markets. The structure and demand are different; so are the nature of the buying unit and the types of decisions and the decision process involved. Case Study: Tetra Pak in China

Tetra Pak, a multi-national company headquartered in Sweden, is a world leading company in producing machines and materials for packaging beverages. As a supplier in B2B market, Tetra Pak holds about 75% shares of world’s aseptic packaging market. In 2005, its net sales income was about 8.1 billion Euros. In 1985 Tetra Pak officialy entered China and founded Tetra Pak China Ltd. Co. Was founded in 1985. Based in Hong Kong initially, it set up representative offices in Shanghai and Beijing in 1993. By 2002, Tetra Pak had occupied nearly 90% of China’s aseptic packaging market, after becoming the largest soft packaging supplier. With the rapid development of China’s soft drinks and dairy produce markets, Tetra Pak won many important clients from these two industries. Yili, China’s biggest dairy producers, has to pay Tetra Pak 0.5 yuan for every cardboard package to contain the milk, which in turn is sold at 2.3 yuan. The cost of Tetra Pak’s package makes up about 40% of the price of the milk. Besides its Shanghai headquarters, Tetra Pak now has three joint-ventures and nine offices located in Beijing, Hong Kong, Xiamen, Harbin, Xian, Chengdu, Kunshan, and Foshan. Tetra Pak also has sales and marketing offices. Together, these offices make up a distribution network covering the whole of China. Tetra Pak has one solely-owned factory in Kunshan, two joint-venture factories in Beijing and Foshan, as...
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