Set up in 1996, the Wahaha-Danone joint venture (JV) partnership helped establish Wahaha as one of China’s best-known brands and became a major contributor to Danone’s fast-growing business in China. However, despite the success, in 2007 the companies were embroiled in legal battles and a bitter public feud over Danone’s attempt to gain a share of the non-JV Wahaha group companies. In Chapter 16 of the OWP Book 2008, “Riding the winds of global change”, (to be published in September 2008), Professor Stewart Hamilton and Research Associate Jinxuan (Ann) Zhang outline key lessons from the dispute.
There is no magic recipe for a successful long-term partnership, but sticking to simple principles will help. Danone and Wahaha actually laid out these principles in a joint statement released at the end of 2007: “equality and mutual benefits, seek common ground by tolerating minor differences, reach mutual understanding and strive for success…” Had both parties worked with these principles from day one, perhaps the partnership would never have become troubled.