The Austria-based company, Agrana was founded in 1988 with operations consisting of the production of sugar and starch. While relatively small, the company only operated two starch factories and three sugar factories. As the years passed, the company has also focused on the production of fruit preparation, fruit juice concentrate, and ethanol. The new business strategy has enabled the company to not only grow, but expand across multinational borders while increasing the number of buyers to whom they supply their goods and services to. In this paper, an analysis on Agrana’s emergence will be discussed from an industry-, resource-, and institutional-based view. The challenges in which AGRANA might face as it continues its expansion into
An institution-based view is a perspective that argues that in addition to industry- and firm-level conditions, firms also need to take into account wider influences from sources such as the state and society when crafting strategy (p. 93). This includes formal and informal institutions surrounding laws, regulations, cultures and ethics. Early in Agrana’s existence, much of its challenges were a result of the restrictions placed on Western European companies to enter CEE markets and the EU. The opening of the CEE markets, in 1989, presented new opportunities for Agrana and others to expand regionally and internationally. FDI proved to be effective in CEE countries as it lead to be increased profits, production and growth. As stated earlier, Agrana was able to produce goods for major companies; allowing them to better cater to the expanding needs of its corporate buyers (p. 382). As the company reduced its challenges, the EU encouraged the company to diversify its operations in order to grow. Though the EU imposed challenges for Agrana prior to its integration, many of the CEE countries have become members which have helped the company increase its opportunities. However, with a strong EU presence in sugar reforms, regulating prices, and tariffs on imports and exports, Agrana has encountered new challenges and