DOING BUSINESS IN AN INDUSTRY WITH DIFFICULTECONOMICS—FOOD MASTER'S EXPERIENCE IN DAIRYPROCESSING AND MARKETING IN KAZAKHSTAN

Introduction
' This Discussion Paper used the following quote from investor, Warren Buffett, as part of
the framework for analyzing the experience of Food Master (a dairy processing and
marketing firm) in Kazakhstan's dairy business [3]:
"When a management with a reputation for brilliance tackles a business with a
reputation for poor fundamental economics, it is the reputation of the business that
remains intact."
' Findings relating to favorable and unfavorable economics provide insights about dairy
marketing and processing conditions in Kazakhstan. Food Master, a dominant dairy
processing and marketing firm in the Almaty region of Kazakhstan, and an important dairy
firm in Astana (Akmola region) has found itself in a business with difficult fundamental
economics. And despite having excellent top management and doing many things correctly,
this case firm lost money in 1999 and was forced to restructure. While there have been
positive developments for the business in 2000 ...