The Ben and Jerry’s Ice Cream in Russia

Russia has a known reputation in the ice-cream industry. They are known for their flavorful ice creams that are of a wide flavor varieties. The Ben and Jerrys Homemade, Inc. founded in Burlington, Vermont decided to have a franchise in Russia, which longs for modernization of its market economy. Since ice-cream is considered as a commodity, they thought of use it as an entry point to prove their economic growth. The franchise was named Iceverks Ice Cream of Vermont and Karelia.This was also thought of to bring together diplomacy in America and Russia although there were risks on doing such material body of business, even if Vermont and Karelia are sister cities. There was also an effort of change of political systems from strict social, the communist system, to the democratic political system. The management of Iceverks taught the necessary tools to the employees and managers to enclothe them for proper and good management strategies.Then suddenly the climate inside the manageme nt changed, with the lessening of the effectiveness in their management because their local partners have become fall apart in equipment to manage the joint venture. With this, they just decided to donate their equipment to the management and the equity to their local partners (Moss, 2000, p. 136). In 1997, Ben and Jerrys has leave Russia, with the Iceverks no longer using Ben and Jerrys as their brand name.For me, although this happened, we cannot say that the venture was unsuccessful, because the Iceverks was able to maintain their standards for ice cream production and customer satisfaction services, the legacy that the Ben and Jerrys left for Russian and even other foreign customers. The Ben and Jerrys intention was not really on the profit but on the development, because instead of withdrawing all the equipment in the Iceverks because they are leaving, they even donated it to them.The corruption in the Mafia also brought about their withdrawal of management because of the mat ter of philosophy. The Ben and Jerrys did not want to give accord to the bribery or corruption there was just to have protection from the Mafia. The American companies were required to pay 30% more of their profit just to guide the said protection. Again, the economic shift was hard to attain that time.The mind set of the Russian managers was more on the capitalist ideology, which hinders them from being immediately penetrated by the nurture they received from the American managers, which the Ben and Jerrys have given much effort on. Since Ben Cohen, the founder of the Ben and Jerrys, is more of the ideal businessman, he was more of a diplomatic and socially responsible person. He did not care much of the coin involved in the business. But then, there was an observed loss of jobs because the company has enormous money loss that could not support the work force any longer.As mentioned above, the Russian partners, who are in profit maximization, decided to split up with the Ben an d Jerrys, which made B&J just leave and leave their equipment to them. Leaving the Iceverks was somehow a much better decision than staying, because eventually the political system will corrode them with their principles. In fact, they have succeeded in other countries like Japan, France and the UK, applying the same business strategies. It was a good decision to leave also because of the very unstable economy, with hemorrhoid of financial risks, etc.that have affected much of their transactions, from simple packing to large machineries and refrigerators, etc. The big cultural differences also contributed to their decision, because they do not have the conglomeration control and regulation of the political and philosophical missions and visions of the company, since it is a joint venture. Reference Moss, L. S. (2000). Bankruptcy Reform in Russia The Case for Creditor Rights in Russia. Review of Russian Economics, 13, 121-146.