Organizing for International Business Activities
I. Selecting a Global Company Structure
Whole Market Foods (here by called the company) is a domestic company headquartered in Austin, Texas, United States operating 284 stores in the United States and 11 internationally as of September, 2009 (Annual Stakeholders Report 2009). The company is operating through subsidiaries (here by called stores) domestically and internationally and are wholly owned by the company. Local stores domestically and internationally administer operations and values chains set by headquarters. With stores operating actively within the United Kingdom and Canada, a similar approach will be used towards its expansion into Bergen, Norway. As an international company, Whole Market Foods retains overarching control of its stores. A board of directors is elected by the shareholders to oversee the management of the company, its financial business and is responsible for monitoring management's operation of the company's business, overseeing the company's business strategy, and monitoring risks and the Company's control systems. Of this current ten member board, they are also chartered to oversee the Chief Executive Officer (CEO) who is commissioned to manage and set strategy for Whole Market Foods. The headquarters relies on management from each store to report income figures, supply restock for both equipment and products, and human resource information pertaining to the specific location. The stores belong to the only operating segment of the company which is its natural and organic foods supermarkets. Each store is supported by 12 regional offices and the Austin headquarters, regional distribution centers, bake house facilities, commissary kitchens, seafood-processing facilities, meat and produce procurement centers, and a specialty coffee, tea procurement and brewing operation to ensure that products are supplied to the store accurately and within the requested delivery date. It is the company's direction that each store is customized to fit the size and configuration of the particular location and community in which it is located. This localized structure delegates authority for the store to arrange décor, product mixes, changing samples and food mixes. Each store is between 25 to 620 employees who comprise up to 13 self-managed teams led by a team leader. This team leader reports to a store manager which manages the operations of the store. II. Financing Sources for Global Business Operations
Financing for global business operations will be sourced initially through a foreign direct investment from capital from the company into a new international location. Once operational, the store will have the responsibility to operate and report sales; financing is centralized through headquarters which will direct control of capital used to operate the location. As the major source of capital for the company, products are bought from local, regional, national and international wholesale suppliers and vendors, while regional and store buyers focus on local products to meet the unique product mix strategy to maintain the local market feel in the store. Strategies are also used for capital investing and financing. Economic Value Added (EVA) is used for company business decisions. EVA is equivalent to net operating profits after taxes minus a charge on the cost of invested capital necessary to generate those profits (Annual Stakeholders Report 2009). EVA is used for capital investment decisions, including evaluating new store real estate decisions and store remodeling proposals. The company believes that it will only invest in projects that will add long-term value to the company. Being a key risk in the company's planned growth to Norway, financing global outreach may change over time as the company gains maturity in the new global location. While a number of different methods can be used to finance the company's oversees venture, two...
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