Case summary:
Person ER has found a way to generate profit from the slaughterhouse meat trimmings. The by-product from the slaughterhouse meat was used in cooking oil and pet food stuffs. This beef product is known as “Lean finely textured beef” (LFTB). This LFTB makes ground beef leaner and inexpensive. It was given a name called “pink slime” by the health safety inspector.
The consumers came to know that they were eating unappealing beef parts, which was soaked in ammonia. As a result, the sales of the ground beef fall tremendously to 11% in a month. The producer of the ground beef (AFA Foods Company) was under bankruptcy protection. The CL Company even lost 80% of their customers.
Character in the case:
- Company CL
- Company AFA Food
- Person ER
To discuss: The type of buying situation that is faced by the companies that dropped the use of LFTB and buying decision process.
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