Topics: Coffee, Brand, Sabra Pages: 32 (11776 words) Published: February 2, 2013
Strauss —Elite
Historical Background5
1995-1998 International partnerships and domestic acquisitions5
1998-2001 Reorganization7
2002-2004 A Shift in the Operating Model8
Strauss-Elite's International Activities8
Elite international in the 90s: Central and Eastern Europe9
Strauss-Elite 1997-20019
2002 - 200410
Away From Home (AFH)10
Going forward: Global Trends11
The Next Step: Beyond Coffee12
Sabra Salads in the United States12
Market opportunity13
Entering the U.S market13
Max Brenner13
The dilemma14
Developing the concept14
2005 and beyond15
Sara Lee21

Global Expansion in the 21 Century

In a conference room at the offices of Strauss-Elite in Ramiat Gan, we were introduced to the heart of the organisation by the CEO of the company, Erez Vigoodman. What we were given was a bird's eye view of the entire company as it stood at the end of 2005. It quickly became apparent that the organisation stood poised at a pivotal moment in its long history. In the eight years since the acquisition of Elite in 1997, the company has gone through nothing short of a revolution. Yet despite being transformed from end to end, Strauss-Elite still remains a family-run company with an acute sense of its past and a clear sense of its future, Now, after a long and challenging process of change that has lasted many years, Strauss-Elite looks ready to once again make another bold leap forward. Introduction

There are few Israelis, no matter what age or background, who are not familiar with the products of Strauss and Elite. From the dairy goods of Strauss to the coffee and chocolate of Elite, these two companies are national institutions that have been around since before the State of Israel was born. In 1997 Elite (and the Yotvata dairy) came under the control of the Strauss family, creating Strauss-Elite, the second largest food company in Israel. The newly merged company owns many of the famous brand names in the Israeli food market. Strauss-Elite operates in five main categories: dairy, coffee, confectionary, fresh and chilled salads, and salty snacks. In 2005 the company's reached sales of NIS4.I8bn, and has a market capitalisation of NIS4.5bn (12/2005). It employs 4,700 workers in Israel, 3,600 outside of Israel, production facilities throughout Israel, and coffee production facilities in Europe and Brazil. It operates in 15 countries in Central and Eastern Europe, Brazil and North America. The success of Strauss-Elite has also created the challenges which it now faces. The food market in Israel is growing at a meager rate of 2-3% a year. The industry in highly concentrated with the top five producers accounting for 55% of the overall market, and two retailers accounting for 53% (9/2005) of the retail market.(Exhibits 1-4) The domestic market no longer represents a source of sufficient sustainable growth, and if the company is to continue growing at a strong pace and create value for its stakeholders, it must look elsewhere in order to achieve its aims. It must look to the international arena. Expanding to markets outside the home base is a difficult and risky undertaking for any company. How much more difficult then, when some of your direct competitors have a market value dozens of times your own. Traditional business models of international expansion and market penetration do not apply as well, if at all, when the resources you have at your disposal pale in comparison with those of your competitors. The approach must therefore be adapted to take into consideration the challenges under which Strauss-Elite attempts to meet its objectives. There are three pillars today to...
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