Honest Tea is among the major selling organic tea company in the United States recently. Honest, expanded to other places with triple low-calorie choices. The company chose the fussiest bottled tea drinkers like lemon flavored herbal tea that included honey. Additionally, it added Mango Spiced Herbal tea. The company saw the success of the ready-to-drink product. The company needs proper and wise decisions to make for survival. The CEO lacked the best strategies to scale the production to achieve the best results in the market. Unfortunately, he lacked the support from partners and sponsors. Coca-Cola Company had seen the need and expressed interest in buying Honest Tea. Coke knew the growth potential of organic drinks and food.
Why Honest Tea partnered with Coca-Cola
The wide-scale distribution and production of ready-to-drink organic tea failed to expand. The business failed against the values of survival. The company lacked financial support to scale the business and produce many drinks. Customers and investors expected the development of the global non-alcoholic drink. Naturally, the expectations targeted growth rate of about 6 percent and reached a value of around 1 trillion by the end of 2020. Because many global customers opted for tea, many expectations developed in the minds of the people that the company could contribute to high development in the nation. The need to meet the significantly growing demand for Honest Tea’s product developed a challenge for the firm.
Experts associated the investment with ill-fated ideas. The company management thought of dividing the business and delivering the drinks to the owners of the house. Nevertheless, the company concentrated on producing the organic products like New Leaf Iced Tea. Initially, the firm introduced many services that challenged it to distribute. Such an issue limited the expansion of the company the expected growth. To achieve the dream, the CEO Seth decided to offer Honest Tea to Coca-Cola. He thought because Coca-Cola showed stability in the market, it would support financially and drive the products to the market.
Who could Honest Tea have partnered with?
Seth could have partnered with Bethesda. The idea would enable the company to operate as an individual company and maintain the business culture and trust towards the customers. The management would remain and retain the stake in the company. Reinvestment processes would enable the company to maintain the best returns on the sale of the tea. The entrepreneurs continue to appear significant to them. Nalebuff would maintain their positions as key operators of the company. Customers tend to express bad posture to the customers. The consolidation of the small business is the most important because the two companies grow together retaining the business objectives.
For the case of Honest Tea, it could have collaborated with General Mills and formed the best business in the operation. The speed of consolidation reduced because of few organic companies. However, General Mills and Honest Tea operated an organic business and shared the dream. The similarity would enable them to grow and safeguard the market share. Such an opportunity would improve the financial returns and make the company successful. The growth stability would strengthen when two organic companies work together. In some situations, large food firms would utilize their relationships to establish individual organic products. As a result, Coca Cola will not be the best company to partner with because it will prioritize its’ products. It is therefore significant to partner with the companies sharing similar ideas and operating a similar business.
