This is an interesting case where The Candelstik company of Canada wants to strike a deal with a departmental store chain in Mexico for supply of their goods. The problem with the deal is there is a cultural difference in both the companies as they are from different counties. Even the economies are different as Canada is a developed economy whereas Mexico is a developing economy. Both the team wants the best deal for their respective companies.
In the case discussed the problems faced is to understand the cultural difference. The major difference in culture between developed economies and developing economies. Usually the developing economies like Mexico are a price conscious market compared to a developed economy like Canada. Developed economies are more quality conscious than that of developing ones. For example, when Uniliver and P&G entered Asian markets like India, China, Pakistan, Bangladesh, which are developing economies they had to price their products very carefully. They came up with smaller packs that were attractive in terms of price per unit, but these products were not cheap only the unit size was cheaper.
Similarly, the Candelstik company team has to carefully understand the culture of the geography that they had to cater to. As this is a vital deal for both the companies, for Candelstik company it is an important new client to be acquired which will give it access to a new geography. It is also important for Candelstik company to maintain its margin and ensure the deal is profitable for their organization. The Mexican departmental store chain gets access to superior quality product which can help it differentiate its product offering to its clients. It also needs to buy the product at a reasonable price so that it can resell it to its clients at an attractive price whit reasonable margin.
