AGEC $453|$ Homework #$2$

Due: April $25$ by $11$:$59$ PM

Total $=50$ points

Bonus $=15$ points

PART I $(30$ points$)$

Scenario: You own a Texas agribusiness and are exporting your product to Canada. You have decided to expand your market presence within Canada. Your product is an instant drink powder made with real sugar you purchase from the local cooperative, and the product is sold to the final Canadian consumer in retail grocery stores like Walmart. There are $3$ producers of similar products in Canada and $10$ other U$.$S$.$ companies exporting similar products. You are considering vertical integration, horizontal integration, and joint venture as a means to meet your goal of expanding your Canadian market presence.

a$)$ Provide some long$-$term objectives $($at least $3)$ that you would take into account when considering market expansion. Please provide examples of performance measures. $8$ points

b$)$ What should you consider with regards to vertical integration? What are the potential benefits of forward integration versus backward integration? $7$ points

c$)$ What are some options for achieving your goals through horizontal integration and what are the expected benefits? $7$ points

d$)$ What are four $(4)$ key factors to consider for a joint venture with a Canadian partner? $8$ points