Wednesday, January 19, 2011

Kraft – the foodstuffs company

Kraft – the foodstuffs company

•Very brief company history

“Canadian-born and of German origin, James L. Kraft started a wholesale door-to-door cheese business in Chicago in 1903.” By 1914 several varieties of cheeses were being sold and by 1915 pasteurized processes developed a longer shelf life cheese and by 1916 bought its first Canadian cheese company. First corporate listed on Chicago Stock Exchange in 1926 establishing offices in London and Hamburg in 1927. Represented 40% 0f US cheese market in 1930. Ground breaking radio and television marketing campaigns from the 1930s to the 1960s. Diversified buyouts and takeovers throughout its history and in the 1980s including loss leading non-food brands such as Duracell and Tupperware. Became known as Kraft General Foods as of 1988 following buyout by Philip Morris Corporation and merger with General Foods. Name was changed in 1995 to Kraft Foods. Since the 1990s has aggressively pursued food brand takeovers similar to LVMH strategy of buying loss taking but high profile marquee products from other food mega-corporations such as Wrigley’s chewing gum, Group Danone’s cookies and cereals divisions and Cadbury confectioners. Last month Kraft announced it would move Cadbury’s British head office to Switzerland to avoid paying corporate taxes in the UK.

Global Head Office: Northfield, Illinois

•Range of products / services / areas of interest

Over fifty-four marquee food brands of confectionary (such as Cadbury, Toblerone, Cakester) snacks (such as Ritz crackers, Triscuit, Oreos, Chips Ahoy) beverages (such as Tang and Kool-Aid), cheese ( such as Philadelphia, Kraft, Cheez Whiz), and ready meals ( such as Macaroni and Cheese), and grocery items (Maxwell House coffee, Halls, Dentyne).

Kraft continues to grow its international markets now holding only 49 per cent of its total annual business in North America with 25 per cent in developing markets and 25 per cent in Europe.

•Some facts & figures (e.g. annual turnover or net sales, number of staff, locations, etc.)

Kraft is the second largest food business in the world. Annual revenues exceeded $48 billion dollars as of 2009. Its largest brands each generate in excess of $1 billion dollars annually. These include: “Kraft, Jacobs, LU, Maxwell House, Cadbury, Trident, Milka, Nabisco and its Oreo brand, Philadelphia, and Oscar Mayer.” 80% of all revenues come from products holding the leading share of each sales category. More than half of all incopme is generated from products where market share exceeds competitors by more than 50 per cent.

Approximately 140,000 employees

•Company values (with editorial news-speak)

“We understand that actions speak louder than words, so at Kraft Foods:

We inspire trust. (Reliability: but don’t like to pay taxes)

We act like owners. (Responsibility: if we don’t already own it we’ll buy it soon)

We keep it simple. (Simplicity: most of our products dominate their markets with few competitors)

We are open and inclusive. (Inclusiveness: like a giant amoeba that swallows smaller companies)

We tell it like it is. (Honesty: if you don’t like what we sell you can’t buy anything else)

We lead from the head and the heart. (Logic and passion: A dividend yielding cash cow popular with Warren Buffet/Oracle of Omaha.)

We discuss. We decide. We deliver. (Communication, Decisiveness, Provides moments of truth to customers: Gobbles up food brands worldwide) ”

•Anything else you find of interest

A mega-corporation with global reach: I like it more than Nestle because it doesn’t appear to sell breast milk substitutes in Africa which help cause huge infant mortality rates there among other possibly nefarious pursuits.

•why you chose this particular company

This is a familiar brand quite popular with Canadian students for its Kraft Dinner(TM) or affectionately known as “KD” macaroni and powdered/processed cheese mix. Prior to the MTV Age when most Canadian households did not have access to cable television Kraft advertisements dominated prime viewing time with high frequency and reach. I would estimate a majority of Canadian consumers over the age of approximately thirty are brand loyal consumers of many Kraft products with high cost to switch them to competitor brands through any scale of marketing or promotion techniques.

These days "KD" has several flavor varieties and you just add a little milk, butter or margarine and season to taste. Some like it dry, some like it creamy, some like it like soup, etc. It used to cost about a quarter a box. Now I think it’s up to around 99 cents.

•where your information is from [Accessed: January 19, 2011]

•how you think having this kind of information would help with your work in the company

Knowledge of the diversity and core product lines as well as their market shares will help identify departmental or brands-related learning needs. For example, interviews with members of core marketing teams would focus either on North American markets which probably do not require much BE training versus international and European teams which may be a focus of BE training. Rates of local indigenization in upper management would help determine the opportunities for advancement for those taking BE learning programs. Rather than expect BE training as a rewards based system it might have a clear advancement focus and requirement in the company as international assignments might involve quite a lot of expatriate postings and opportunities for intercultural pre-assignment BE training.

•any other resources you may like to suggest for this kind of company research

Online searches for freelance BE training assignments might be available through previous job opportunities listings. However such a large corporation might have in-house BE trainers and therefore seeking to connect with them and enquiring about new opportunities globally might be rewarding.

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