Alliance Grain Traders Inc.: Moving Up the Value Chain (A)

內容大綱
A stock market analyst was reviewing one of his fund’s holdings, Alliance Grain Traders Inc. (AGT). One of the world’s largest traders of pulse crops, AGT was in the midst of entering a new line of business and expanding its non-core operations. On one hand, AGT would have been able to use its dominance in pulse trading as an advantage in expanding up the value chain. On the other hand, it was moving into sectors that were already mature and highly competitive. The key question for the analyst was whether he should continue to hold AGT stock given its stated objectives.<br><br>The case set is split into an “A” case, where AGT’s history and the food value chain are laid out. The “B” case, 9B14A043, provides an update two and a half years later when it became evident that AGT had committed to expanding beyond the trading and distribution of pulses.
學習目標
This case series illustrates the issue of strategic scope. A dominant player in one market is looking to improve both top and bottom lines by moving into an adjacent sector. Students will be able to sketch out the entire value chain for the pulse industry, from field to table. In addition, after reviewing AGT’s resources and capabilities, students can determine whether its comparative advantages are transferable, and, if so, whether its advantages are significant enough to enable it to succeed in new sectors. In discussing this case, students will learn about competitive dynamics.
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