There were numerous factors that contributed towards the constant success of Evergreen Natural Markets. The company’s methodology towards growth and expansion is one of the integral factors. Where most companies seek to grow by re-investing their profits back into their businesses (ploughing back), Evergreen adopted a more radical approach by acquiring other competing companies or companies that show potential of growing rapidly. Evergreen designed a strategy that was twofold in nature.
By bringing in rival companies under the Evergreen umbrella, the approach simply eliminated any competition, increased the resources and financial base and made it easier for Evergreen to have a wider scope and reach. Granted, acquisitions have issues with integration of management and operations. However, this approach has been steadily used by Evergreen, and this has resulted in its prosperity as an organic food distributor. As the latest addition to the Evergreen umbrella, Aragula Grocers serve to make the effect of the mother company increasingly widespread.
The recent acquisition can allow the company to lower its prices and engage in aggressive marketing that will make Evergreen more successful. 2. Why do stores improve their performance after being acquired by Evergreen? The main reason for the increased performance after joining the Evergreen was the approach adopted by Evergreen. On the surface, they may seem like clear acquisitions. However, the acquired stores are allowed to maintain their functional systems and procedures. In this way, Evergreen owns the stores but allows them to continue operating in the same way.
The slight modifications that at times were made on the administration and management included branding, change in sales approach, and other minor issues. Using the operational systems of the different stores, Evergreen was able to utilise their combined efforts and attain massive profits. On the other hand, the smaller stores also got to prosper under the Evergreen because of two arch factors. One was the fresh infusion of capital and administrative support provided by Evergreen. Evergreen offered increased investment opportunities by providing the capital, human resources, and other assistance.
The second factor was an advantage of working under a larger company that allows one to work without much competition from the outside. 3. How well does the acquisition of Arugula Grocers align with Evergreen’s established approach to integrating new stores? What modifications, if any, should Norton make? The acquisition of Aragula Grocers is an advantageous addition to the Evergreen group as it offered new opportunities in Nevada, Las Vegas. However, several modifications would serve to improve the situation in their relations.
Firstly, Mrs. Norton should introduce more effective communication measures that will ensure that the link between Evergreen and Aragula Grocers is not severed. It was discovered that the link between these two parties was weak, and this will lead to confusion and dilution of the vision of the mother company. Secondly, Norton also needed to rectify the financial status of the store before investing in it seriously. Aragula Grocers was acquired amid a series of financial issues and complications that showed signs of mismanagement.
Adopting these problems will lead to failure of the store and eventually, losses for Evergreen. Mrs. Norton should also consider making modifications to the management style in Aragula Grocers. The changes should reflect the three proposals that she made concerning all acquisitions under Evergreen. These changes involved investing in improving human resources, maintaining the local setting, and caring about the welfare of the employees and customers. These three proposals would serve to change the atmosphere and approach taken by the Aragula management as they start operations under Evergreen.