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Trade in International Business: Content Cow Dairy

Details: As a family firm, Content Cow Dairy and Mr. Swanson are worried about the firm's homespun and patriotic image. Mr. Swanson has seen the film clips of protestors at the World Bank and other international meetings calling for fair trade, not free trade and wants to avoid controversy. Explain to Mr. Swanson in a personal discussion the meaning of fair trade. Your 1250- to 1500-word report should include:

Discuss the difference between free and fair trade.
How does fair trade differ from free trade? Identify a product or products that are fairly traded.
Where and how are these products marketed?
Are milk and milk products generally considered fair traded goods?

Scenario:

Content Cow Dairy, Inc. began as a small, family-run dairy farm in Wisconsin in the 19th century, established by a Swedish immigrant, John Swanson. Over the years, the firm has acquired more land and now runs a herd of roughly 1,000 milk-producing cows. The firm is now incorporated for reasons of liability although the Swanson family retains control. The dairy has greatly expanded its production of milk and milk products to the point that Content Cow Dairy has sufficient cash flow to weather most fluctuations in dairy prices. The national Got Milk? campaign run by the industry helped keep consumption of milk products up in the U.S. for a number of years despite popular concerns about cholesterol and saturated fats and competition from other beverages. To maintain the company's growth and decrease its reliance on the mature American market, Karl Swanson, the President and CEO of Content Cow Dairy (and the great-grandson of its founder) is seeking new markets overseas for the company's products, particularly shelf-stable milk beverages and cheeses. Egypt is at the top of the list as a prime market and a focus of Content Cow's future plans.

Currently, no one in the firm has any experience with overseas markets or how to export products. Karl has the idea that countries without the natural endowments needed for raising dairy cattle (ample water and grazing land) might be good markets for dairy products. He is also aware that his family firm is competing for foreign markets with other U.S. firms and firms from leading dairy countries such as New Zealand and Denmark. For these reasons and on the advice of his state's department of commerce, Karl has decided to seek the assistance of a trade consulting firm, Alexander and Kravis (A&K).

A&K, Inc. is an international trade consulting service that has been in operation for the past 15 years. The principals in the firm include attorneys specializing in international trade law, economists, former members of the U.S. Foreign Service, former U.S. customs officials, logistics specialists, and customs brokers. The firm advises its clients on both importing to the U.S. and exporting from the U.S. to various foreign countries.

The firm is especially knowledgeable about business conditions in Latin America, the Middle East, and North Africa although it has access to consultants for other geographic areas. The firm is able to assist its clients in identifying potential markets for its products, developing relationships with foreign distributors, navigating U.S. export and foreign import laws, understanding foreign business practices and customs, and developing a long-term strategy for expansion of the client's business overseas. It provides specialists who can prepare the necessary export and import documents and arrange for transportation and shipping of the exports. Translation services are also available. A&K has a number of large corporations as clients but has identified a niche in serving small to midsize, family-owned firms.

As A&K's account manager for Content Cow Dairy, you are tasked with explaining various aspects of the international business environment and the export process to Mr. Swanson. You will be preparing a series of briefings, memos, and reports to help him understand.

Solution Preview

The response addresses the queries posted in 1671 words with references.

//Before writing about the business aspects of Content Cow Dairy, we will write about the meaning and rationale of 'Fair Trade' and 'Free Trade'. Then, we will write about the products that are fairly traded in the international business environment. It will assist in understanding the importance of fair and free trade in the international business.//

Fair Trade

Fair trade is such arrangements in which the farmers are treated fairly. Fair trade is a commitment to fulfill the social responsibility. Farmers are paid fairly or we can say that farmers get fair prices for their goods, under the fair trade. Social responsibility movement is defined in the term Fair trade. It demands not only the fair prices for the products of farmers but also the products produced by the farmers are also defined in this.

In this social responsibility movement, sustainable environmental practices are pursued and long-term trade relations are promoted. Fair trade describes the trade partnership which endeavors the impartiality in trading art at an international level. The basis of this partnership is transparency, respect etc. In fair trade practices better trading terms are used to endeavor the social justice.

Fair trade is model of worldwide trade. Social and environmental standards are promoted through this social movement. These standards are related to the production of various types of goods. The main focal point of this fair trade is the exports of a variety of products to developed countries from developing countries. Some products which are focused in this movement are honey, tea, coffee, cocoa, fresh fruits, wine, handicrafts, cotton and many more.

The main purpose or intention of the fair trade strategy is to help the producers and workers to achieve the position of the security from susceptibility. The aim of the fair trade is to make the marginalized workers and producers, self dependent on economic basis. Another important aim of the fair trade is to empower the producers and workers so that they turn out to be the stakeholders in their own business. In the global arena, a wider role is played by the fair trade in order to attain the better equity in global trade.

A large group of worldwide religious, social and environmental organizations, development aid are incorporated in the proponents of the fair trade. Some examples of this type of proponents are Amnesty International, Caritas International, and Oxfam etc. Fair trade is also not free from the criticism. Fair trade is controversial. Fair trade itself has proved it controversial. From the view point of the some economists fair trade is like subsidy. Growth is obstructed because of this.

Around ?1.6 billion global sales is accounted in the certified fair-trade sales for the year ...

Solution Summary

This solution discusses the meaning and rationale of 'Fair Trade' and 'Free Trade,' the products that are fairly traded in the international business environment, the importance of fair and free trade in the international business, and the business aspects of Content Cow Dairy. This solution is 1510 Words with six APA references.

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