Chiquita Brands International Essay Example
1. How strong Chiquita Bananas was before the trade war began?
Chiquita Bananas (and its predecessor United Fruit Company UFC) was very strong before the trade war began. They have been one of the front bearers of the banana industry and dominated the international banana trade and affected the economic and social conditions of the Caribbean and Latin America. The following points illustrate Chiquita Bananas position before the trade war:
• They were the largest supplier of banana in the world with the highest market shares in all the markets they operated. European Union was their largest customer.
• They had a very strong presence in Latin America which was the largest exporter of banana in the world. Chiquita was responsible for development and communication infrastructure in the area and employed thousands of workers at wages that exceeded local rates with excellent social care. They had a very strong control of the region. In some of the countries, Chiquita’s (UFC) business was much bigger than the countries revenues.
• The company had extensive political connections in US and in Latin America. Because of how they worked with banana producing countries, they were responsible for the tag of “banana republic” to those countries. Minor Keith, VP of UFC (earlier name of Chiquita) had various names like Green Pope, the uncrowned king of Central America.
• Chiquita was vertically integrated across all value chain of the banana trade industry. They owned and developed vast lands in producing countries for banana cultivation, most of it in dangerous jungles with poor infrastructure, and natural and medical calamities. They had complex logistical systems because of the perishable nature of banana with vast network of roads, rail lines, ports and shipping owned by the company. They also invested in communication systems like telegraph, telephone and computers in the region. Since the company had established all this, it was impossible for someone else to enter
Chiquita Bananas (and its predecessor United Fruit Company UFC) was very strong before the trade war began. They have been one of the front bearers of the banana industry and dominated the international banana trade and affected the economic and social conditions of the Caribbean and Latin America. The following points illustrate Chiquita Bananas position before the trade war:
• They were the largest supplier of banana in the world with the highest market shares in all the markets they operated. European Union was their largest customer.
• They had a very strong presence in Latin America which was the largest exporter of banana in the world. Chiquita was responsible for development and communication infrastructure in the area and employed thousands of workers at wages that exceeded local rates with excellent social care. They had a very strong control of the region. In some of the countries, Chiquita’s (UFC) business was much bigger than the countries revenues.
• The company had extensive political connections in US and in Latin America. Because of how they worked with banana producing countries, they were responsible for the tag of “banana republic” to those countries. Minor Keith, VP of UFC (earlier name of Chiquita) had various names like Green Pope, the uncrowned king of Central America.
• Chiquita was vertically integrated across all value chain of the banana trade industry. They owned and developed vast lands in producing countries for banana cultivation, most of it in dangerous jungles with poor infrastructure, and natural and medical calamities. They had complex logistical systems because of the perishable nature of banana with vast network of roads, rail lines, ports and shipping owned by the company. They also invested in communication systems like telegraph, telephone and computers in the region. Since the company had established all this, it was impossible for someone else to enter