Grameen Danone Foods In Bangladesh Case Study


Case Details:

Price:

Case Code:BECG073For delivery in electronic format: Rs. 300;
For delivery through courier (within India): Rs. 300 + Rs. 25 for Shipping & Handling Charges

Themes

Corporate Social Responsibility
Case Length:15 Pages
Period:2005-2007
Pub Date:2007
Teaching Note:Not Available
Organization:Grameen Danone Foods
Industry: FMCG
Countries :Bangladesh

Abstract:

Danone Foods is a major food conglomerate and the Grameen Group is a Bangladesh-based group with interests in the energy, microfinance, fisheries, and telecommunications sectors. The case describes the Danone-Grameen JV, which was to be a social business enterprise. It then discusses the concept of social business enterprise and the reasons why SBEs have to be encouraged. The case ends with a brief discussion on the future prospects of SBEs in general and the joint venture in particular.

Issues:

» To understand the concept of social business enterprises

» To analyze the reasons behind an MNC starting an SBE

» To analyze the future prospects for SBEs

Contents:

Keywords:

Grameen Group, Groupe Danone, Social business enterprise, Corporate social responsibility, Corporate philanthropy, Bottom of pyramid, Marketing to the poor, Dr. Muhammad Yunus, Joint venture, Not-for-profit

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Grameen Danone Foods Ltd. was started as a ‘social business enterprise’ in 2006 after Muhammad Yunus, the founder of Grameen Bank (famous for pioneering micro-credit) and Franck Riboud, the Chief Executive Officer of Danone, decided to begin a business that would bring low-cost and highly nutritious food to the people of Bangladesh. Together, Riboud and Yunus decided to produce a fortified yoghurt to improve the nutrition of poor children in Bangladesh. They also agreed that the partnership should aim to improve the living conditions of some of the poorest communities of Bangladesh by involving those communities in the production, distribution and sales of the yoghurt.

The first micro-yoghurt factory was opened in Bogra in 2007. The yoghurt it produces – Shokti Doi – was developed by Danone, with technical help from GAIN, to ensure that it fulfilled the nutritional needs of children in Bangladesh. Each 60 g cup of Shokti Doi brings approximately 12.5% of RDA in Calcium and is fortified with 30% of RDA in Zinc, Iron, Vitamin A and Iodine. Milk is sourced from a co-operative of micro-farms, financed by Grameen, in the Bogra district. Once the yoghurt is produced, it is distributed in two ways – either to shops which have fridges or cooling boxes or through ‘Grameen Danone Ladies’ a network of micro-entrepreneurs who are trained and coached by Grameen Danone staff. There are roughly 500 women selling Shokti Doi in the Bogra District. These women sell approximately 50 cups of yoghurt a day each, earning roughly 85-100 Bangladeshi Taka a day, the equivalent of roughly $30 a month.

Danone provides the expertise in technical areas such as construction, plant maintenance and yogurt production, while Grameen bring their understanding of the local environment together with their extensive networks. The benefits are multiple: the yogurt is highly nutritious, improving the health and nutrition of children in some of the poorest areas of Bangladesh; the yoghurt is manufactured from products which are locally sourced, thereby providing a source of income for local farms; and Danone Grameen vendors are able to supplement their household incomes. Danone Grameen plan to build up to 50 plants by 2020.
 

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