Cereal Partners Worldwide Strategic Alliance

1) Kellogs the only player in the European market.

2) Early 90s , demand for breakfast cereals in Europe
emerged.
3) Contributing Factors- Thriving super markets and dual
income families.
4) Other factors- Television ads, brand awareness through
media

General Mills and Nestle Alliance

GM in US like Kellogg's in Europe

Early 1990s , Kellogg's occupied 50% of the
European market.
"Tough Battle" for GM.
GM decided to ally with Nestle, the largest food
processing co. In Europe.

Advantages of the ally

Nestle
Brand name
manufacturing plants
Distribution network

General Mills
Knowledge of cerelas technology
Marketing cereals

CPW- A grand success

Each company put in 80 mn US $ to start the

firm.
CPW controlled 25% market share
Number 2 in Europe right now in cereal
technology

Advantages of Strategic alliance

Ease of market entry

Shared risk

Shared knowledge and expertise

Synergy and competitive advantage.