Kraft Questions
Amanda Kluszczynski
Strategic Business 59-620B
Eveanne Lovero
Kraft Questions
March 12, 2015
1. What is Kraft Foods Inc.’s corporate strategy? How has its corporate strategy evolved since its independence in 2007?
Kraft has a strong global strategy. They found themselves operating in more than 80 countries, which included 220 manufacturing and processing facilities and 228 distribution centers. Because of the different regulations in each country related to food, they found themselves in need of several different facilities for the manufacturing of their food products.
By 2007, Kraft was the 2nd largest processed-food company. The company continued to acquire and divest business units that were either extremely profitable or not profitable at all. They tended to divest the units that were essentially cannibalizing their profits. The company continued to address weaknesses in its business lineup. By 2009, the company replaced 80 percent of its management in leadership positions, changed its organizational structure to fix accountability at the business unit level, and boosted its advertising and promotions by $600 million. These changes were t=directed at improving the company’s geographic mix, sector mix, and channel ix to increase its number of products in attractive country markets, product sector categories, and distribution channels. The restructuring resulted in a rapid growth of sales in developing markets. After this restructuring, Kraft was left with more than 80 brands and annual revenues of over 4100 million each and 12 brands with more than $1 billion each in annual revenues.
2. What is your assessment of the long-term attractiveness of the industries represented in Kraft Foods’ business portfolio?
All of the industries Kraft participates in are characterized by strong competitive rivalry that required strong distribution and marketing skills to attract consumer demand and ensure product availability in supermarkets, discount clubs,
Strategic Business 59-620B
Eveanne Lovero
Kraft Questions
March 12, 2015
1. What is Kraft Foods Inc.’s corporate strategy? How has its corporate strategy evolved since its independence in 2007?
Kraft has a strong global strategy. They found themselves operating in more than 80 countries, which included 220 manufacturing and processing facilities and 228 distribution centers. Because of the different regulations in each country related to food, they found themselves in need of several different facilities for the manufacturing of their food products.
By 2007, Kraft was the 2nd largest processed-food company. The company continued to acquire and divest business units that were either extremely profitable or not profitable at all. They tended to divest the units that were essentially cannibalizing their profits. The company continued to address weaknesses in its business lineup. By 2009, the company replaced 80 percent of its management in leadership positions, changed its organizational structure to fix accountability at the business unit level, and boosted its advertising and promotions by $600 million. These changes were t=directed at improving the company’s geographic mix, sector mix, and channel ix to increase its number of products in attractive country markets, product sector categories, and distribution channels. The restructuring resulted in a rapid growth of sales in developing markets. After this restructuring, Kraft was left with more than 80 brands and annual revenues of over 4100 million each and 12 brands with more than $1 billion each in annual revenues.
2. What is your assessment of the long-term attractiveness of the industries represented in Kraft Foods’ business portfolio?
All of the industries Kraft participates in are characterized by strong competitive rivalry that required strong distribution and marketing skills to attract consumer demand and ensure product availability in supermarkets, discount clubs,