Odwalla Juice Case Study

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Introduction
The Odwalla Juice Company was founded back in 1980 when three friends Greg Steltenpohl, Gerry Percy and Bonnie Bassett started squeezing fresh oranges on a hand juicer. It did not take long for the people of Santa Cruz to start talking about the fresh taste of Odwalla. The company established tremendous brand loyalty and profits were rising 30% per year. Before they knew it, the company that the three friends had built from home was worth more than 90 million dollars (Baker, 1998). The Odwalla juice buzz spread quickly around the increasingly health concious market because of they unique acid based rinsing technique they used. The majority of other companies used a pasteurization method which the Odwalla team argued that pasturization “affected the taste of the juice and was unncecessary” (Melvin, 2011, Pg. 656).
E-Coli Outbreak
Odwalla had enjoyed 16 years of fame and fotune and reigned king of the freshly squeezed fruit juice drinks up until October 1996 (Melvin, 2011, Pg. 656). There was a massive E-coli outbreak up and down the western part of the United States and western part of Canada which was soon traced back to Odwalla fresh apple juice. Washington state health officials confirmed the link between the E. coli 0157:H7 cases on Novemeber 5th. Odwalla found itself on the brink of a collapse; as the event played itself out, more than 60 people became sick after drinking the juice and a 16 month old child died. Instantly Odwalla’s stock price feel over 30% and sales plummetted by 90%. Just when it could not get any worse, personal injury lawsuits started piling through the door (Baker, 1998).
Picking up the Pieces
Odwalla did not hesitate to address this tragedy, beginning w...

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... to Williamson’s quick reaction plan, Odwalla recovered without going out of business. The Odwalla Juice Company is now backed and owned by Coca-Cola an industry leader when it comes to business ethics. If Odwalla leadership would have addressed their acid-rinse method and the 8% of bacteria found in their fruit this could have all been prevented. Former Odwalla CEO, Williamson did a an amazing job in salvaging what little reputation the company had left and kept the company in business which only suffered one year of harsh losses and criticism. The consumption of Odwalla into the Coca-Cola company insured that the Odwalla experience lives on and may have be good for them in the long run. Odwalla was a wake-up call to the food and beverage industry and will remain an example for years to come. E-coli are very deadly bacteria and should not be taken lightly.

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