Kraft Foods Case Study Summary

Kraft Foods Case Study

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Introduction

Kraft Foods Inc. is a company that deals with products such as snacks, beverages, packed grocery products and convenient meals. The company can be found nearly 155 countries around the globe (Pankey, 2004). In the near past, it was ranked second after Nestle. It has 11 brands which earn the company nearly $1 billion worldwide. Examples of those brands are Cadbury and Nabisco (Pai & Subramanian, 2014). By December 2010, it operated in 75 countries with nearly 233 manufacturing and processing facilities (Pankey, 2004). Currently, it is an independent public company listed in NY stock exchange. This paper is aimed at

First there is need to recognize that Kraft Foods Inc has a clear strategy that build globally and has put them in a good competitive position since 2007. The company 's divestitures and acquisitions have also boosted its market share and profit earning (McDaniel, 2006). The ranking of the company at second position contributes to a long-term attractiveness to the shareholders. Another strong factor that improves its long-term attractiveness is the strong competitive nature of all industries that participate in Kraft (McDaniel, 2006). This means that the companies require a strong distribution and marketing strategy so as to attract consumers ' demand and ensure products are available in the supermarkets (McDaniel,

This is more evident when the restructuring of 2012 is taken into consideration. The restructuring is likely to create two entities. The objective is to have a high growth in foods business and a high margin for the North America grocery business (McDaniel, 2006). ). With these two entities, proper resources will be well placed (Chasser & Wolfe, 2013). The shareholder will also benefit more by having more equity in the company.

Recommendations for Kraft Foods Management

With the restructuring of Kraft Foods Inc into two business entities in 2012, certain recommendations are necessary. First, the company should do away with all operational management positions that were used to collaborate with grocery business units. In addition to that, the company should invest in new product development for local market in the international business units (Chasser & Wolfe, 2013).

The company should keep track and ensure that their products match the diverse and desirable cultures and living styles in the countries they operate in. As well, the company has the opportunity of increasing the North American performance by lowering the cost of goods. This can be done by becoming vertically integrated and owning their supply chain so that the material costs go down and so cost of goods (Chasser & Wolfe, 2013).

The shareholders equity should also be increased at a higher rate. With the new restructuring, this should not be a