Cadbury SWOT Analysis 2006
Cadbury Schweppes is the largest confectionery company in the world with a 10% share in the global confectionery market in 2004, a 40 basis points increase over 2003, as compared to Nestlé's share of 7.8%, Kraft's share of 4.9% and Hershey's share of 5.8% in the same period. The company garnered a leading share of 7.8% in the chocolate product segment, 6.9% in the sugar product segment and 26.0% in the gum product segment. The company achieved this as a result of its sound organic and acquisitive expansion strategy, whereby Cadbury Schweppes has strengthened its presence both geographically as well as in product segments. For instance, Cadbury Schweppes' confectionery product portfolio encompasses the entire product range in the market, from chocolate to candy to gum. Cadbury Schweppes improved its capital allocation processes for acquisition and organic investment, and introduced working capital reduction programmes. Cadbury Schweppes' share in the world confectionery market improved to 10% in 2004 also as a result of the Smart Variety initiative. The Smart Variety growth initiative capitalises on the company's strong local brands, product range, manufacturing facilities and geographic presence, by providing processes and decision rules. The company focused on product innovation especially for the Cadbury Dairy Milk brand in South Africa and Canada during 2005. Cadbury Schweppes also introduced centre-filled pellet gum in North America and Europe in this period. Weaknesses
Cadbury Trebor Bassett, Cadbury Schweppes' UK subsidiary, faced problems of excess chocolate inventory during early 2006. The scenario arose after the installation of an Enterprise Resource Planning (ERP) system, which resulted in excess production of chocolate products in 2005. The excessive inventory coupled with a slow-demand pattern in the UK confectionery market in early-2006 compelled the company to introduce heavy discounts for product lines such...
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