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Abstract:
Successful companies go through several growth phases before they gain stability in the market place. As a company grows from a small enterprise, it faces many business and operational related challenges. This case study traces the growth of one of the leading edible oils and fats manufactures in Kenya, namely Bidco Oil Refineries Ltd. The company started as a garment manufacturing firm, then moved to soaps, before adding products in the edible oils and fats category. After years of successful operations, the company realised that the Kenyan market could no longer sustain the company's growth goals. Bidco was now looking for growth opportunities beyond Kenya. The Chief Executive Officer (CEO), Mr Vimal Shah, knew that there were many possible approaches to growing the business: the company could export to more countries, develop new products, modify the marketing mix, and/or diversify into other businesses. The CEO was considering two options that seemed to offer most promise to grow Bidco's business. The first option was to build a manufacturing plant in Uganda to produce edible fats, oils and soaps. The government of Uganda was very keen to have such an investment because of the jobs it would create, and the foreign exchange it would bring to the country. The second option the CEO was considering was a US$150 million investment in 30,000 hectares of palm plantation in Uganda. The CEO needed to make a choice on the investment opportunity to recommend to the board of directors.
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