Smucker's Essay

Smucker’s Case Study 1) Smucker’s corporate strategy is to build a portfolio of brands that are sold in the center of every grocery store. They plan to execute this strategy through the organic growth of their products, the development and introduction of new products, and by acquiring brands. The majority of Smucker’s brands share two strategy elements. First, they are ‘middle of the store’ processed foods. Second, they are often high margin products. Another common element among the brands they acquired is the fact that the brands were all industry leading name brands before they were acquired. Such acquisitions were beneficial to the firm not only by diversifying their product line-up, but it gave the firm more leverage when dealing with chain retailers. The type of products they diversified into made sense for the firm as it did not go against their corporate strategy. Any brands that went against the strategy were divested.

2) Since 2002, Smucker’s has acquired brands such as Jif, Crisco, Hungry Jack, Pillsbury, Carnation, and Folgers, to name a few. I believe Smuckers has made very smart acquisitions
The example of Smucker’s buying Hungary Jack and later acquiring Pillsbury demonstrates this. The firm was already involved in the pre-made baking mix industry and used their industry knowledge to their advantage and presumably created synergies between the two brands. By growing the segment with the purchase of Pillsbury, Smucker’s was able to take advantage of cost sharing through a previously established sales & marketing, distribution, and customer service segments. In addition, Smucker’s can use the addition of Pillsbury to strengthen their bargaining power relative to their suppliers. Skill transfers between the brands is also an added benefit of Smucker’s expansion of their product