Topics covered: Business sectors and stakeholders
• Meaning
• Unlimited Liability
• Tertiary sector.
• Internal and external stakeholders
Black Pot Tea( BPT) is a multinational coffee chain based in the United States. BPT is in discussion with Lankan Tea, a Sri Lankan company, about opening BPT tea shops in Sri Lanka.
BPT and Lankan Tea are considering forming a joint venture or strategic alliance. Though Lankan Tea has been doing very well in Sri Lanka, joint venture may add foreign tag and attract working expats in Sri Lanka.
This proposed joint venture allows BPT to enter Sri Lankan market with branded Lankan Tea and at the same time Lankan Tea has ready market for its surplus tea leaves which are grown in Lankan Tea plantation.
The competition in Sri Lanka is intense. There are two more popular brands such as Silver Tea and Red Tea.
Questions:
a) Define the following terms: [6 marks]
• Multinational company.
• Joint venture
• Strategic Alliance
b) Identify and explain one external factor that may influence the decision of BPT to enter the Sri Lankan market [2 marks]
c) Explain one advantage and one disadvantage for Lankan Tea of forming a joint venture with BPT. [4 marks]
