Make a recommendation for Free Range on how it should restructure to Essay

Make a recommendation for Free Range on how it should restructure to take its operations global - Essay Example Before analysing the two strategies, it is important to examine the facts and context of this paper, specifically those pertaining to Free Range. Firstly, the company has been in the market for a considerable amount of time (since the mid-1980s) and has remained sustainable despite similar businesses exiting the industry due to challenging conditions. Secondly, the company is very committed to social responsibility and the environment, which appear to guide its corporate policy. Thirdly, the company is in a good position financially. This is reflected by the fact that its sales have been growing by an average of 20 percent annually; this has given it a huge presence in the American cottage cheese segment. The three facts outlined above show that Free Range would benefit more from takeovers than mergers. Although mergers would give the company a sound platform on which to build its expansion program, there is a significant risk of compromising the company’s values, especially if it partners with much larger firms. Although it is established in the US, the company will face larger and more competitive rivals in the European and Latin American markets (Cartwright & Cooper, 2012). Merging with smaller companies would reduce the company’s expansion momentum while merging with larger firms would deny it the freedom and control it needs to define its corporate strategy. With its significant share of the US market and high sales revenues, Free Range has adequate capacity to successfully execute takeovers. Mergers do not suit the company’s status and profile, considering that the best option would be to partner with larger firms that would suppress its visibility. Takeovers offer more flexibility than mergers and Free Range needs to be as adaptable as possible. Through takeovers, the company can acquire midsized firms in foreign markets and use them