Green Giant and the Move to Mexico
The Minnesota Valley Canning Company started in 1903, and was one of the first companies to be recognized through their advertising personality, "The Jolly Green Giant." As consumers became familiar with the marketing character, the Minnesota Valley Canning Company soon changed their name to The Green Giant Company. The company became a well-known canned and frozen vegetable foods vendor. To lengthen the growing season, the company expanded from Minnesota into California during the 1950 's and 60 's. Along with the expansion came the construction of a freezing vegetable facility located in Salina, California. In 1978 Pillsbury, a company that specialized in baking goods acquired the Green Giant Company to expand their market and product lines. Nine years later, Grand Metropolitan Company of Great Britain, a producer of alcoholic beverages, acquired Pillsbury and The Green Giant Company through a hostile takeover for $5.6 billion. Following the takeover, Green Giant executives were told to increase their profits significantly to help service the large amount of debt that resulted from the acquisition. This left the executives of the Green Giant Company with some difficult decisions to make. They knew Grand Metropolitan Company expected positive results quickly. After all, Grand Metropolitan 's reputation was characterized as "a light but firm hand upon the throat". Green Giant executives knew if their attempts failed, it could result in their careers. Although Green Giant held 14 percent of the market share in their industry, it would be difficult to increase market penetration because many considered frozen and canned vegetable goods as commodities. The growth in this industry had slowed to an all time low level. Executives at Green Giant realized that the options to meet Grand Metropolitan 's expectations meant they had to realize a significant decrease in operating costs, possibly by moving the plant operations to Irapuato, Mexico.
References: Henriques, G. & Patel, R. (2004). NAFTA, Corn, and Mexico 's Agrivultural Trade Liberalization. IRC Americas Special Report. Hohmann, J. (August 10, 2006). Chill descends as jobs vanish. Retrieved September 14, 2006 from http://mercurynews.com/mld/mercurynews/news/local/states/caifornia/central_coast Hosmer, L.T. (2006). The Ethics of Management (5th Ed.). New York: McGraw-Hill Irwin. Rae, S. & Wong, K. (1996). Beyond Integrity A Judeo-Christian Approach to Business Ethics. Grand Rapids, MI: Zonderva Publishing House. The Ten Year Track Record of the North American Free Trade Agreement – U.S., Mexican, and Canadian Farmers and Agriculture. Retrieved September 17, 2006 from http://www.citizen.org/documents/NAFTA_10_ag.pdf. Wright, D. (2005) The Donella Meadows Archive Voice of a Global Citizen: When Free Traders win, the Nation Loses. Sustainability Institue.