Ice Cream -> Danish Ice Cream

Danish Ice Cream

History

Andersen's of Denmark Ice Cream was actually first established outside Denmark in Solvang, California in 1978 under the name of The Great Danish Cone Company. The Danish Founders based their presentation about around the original Danish ice cream cone maker, manufactured by their family's traditional good recipes, dating back more than three generations.Danish Ice Cream

Their concept was brought in Australia in 1982 and Singapore in 1989. After a few years of operation, the company realized the great growth potential for the business. Thus, during 1994, a joint venture commenced between Andersen's of Denmark Holdings and Become Holdings to start the franchise system for international expansion.

Comparative Advantage

A situation in which a country, individual, company or region may produce a good at a lower opportunity cost than of a powerful competitor.

Investopedia Says: Let's break this down into a simple example. You could have two firms that both produce two main products: ice cream and the bicycles. The first firm, The Danish Ice Cream and Bicycle Co., is both located in Denmark, where dairy milk is abundant; the second firm, The Gobi Ice Cream and the Bicycle Co., is smack in the middle of the Gobi Desert.

The Gobi Ice Cream and Bicycle Co. should expend a lot of money to make ice cream, whereas The Danish Ice Cream and the Bicycle Co. spend way less to produce the same amount. The two firms are totally dead even in their production costs for bicycles.

Since The Danish Ice Cream and Bicycle Co. have a comparative advantage with the ice-cream production, it should probably consider turning exclusively to ice cream. Along the same vein, The Gobi Ice Cream and Bicycle Co. should probably give up the ice cream and focus on the product in which it is the least disadvantaged.