Cereal Partners Worldwide was formed 24 years ago in 1990 in a joint venture with General Mills and Nestle. CPW is the second in the world market for breakfast cereal, hoping to make its way to number one to increase profits and bump Kellogg’s out of the way. In this joint venture, they market as one company internationally. However, in the US and Canada, they have decided to market separately. General Mills is the prominent global manufacturer of consumer food products, while Nestle is the world’s largest food and beverage company in terms of sales. With General Mills and Nestle two strong companies who have different leading industry strengths, they can create international competitiveness by joining forces with Cereal Partners Worldwide.
Starting with the Porter diamond, “The home base is an important determinant of a firm’s strength and weaknesses relative for foreign rivals” (Global Marketing 106). General Mills and Nestle did succeeded by becoming industrial clusters with Cereal Partners Worldwide. They countries in which they were founded are the countries where they are self-regulating and independent, marketing themselves on their own. Internationally, these two companies were smart to operate under CPW. The cereal has been around for quite some time and because of that there is a great deal of variety out there. So they are going to need to become strong with advanced factors such as more sophisticated human resources and research capabilities. They are strong in presence of home demand. They need to work on market size and rate of growth which is not so high. If they create strong relationships with suppliers this will help as well. Looking at General Mills and Nestle alone, they have grown and are powerful companies that are ready to go into international markets because they are extremely successful in their home countries.
More way to create international competitiveness is though firm strategy, structure and rivalry. It will...