Académique Documents
Professionnel Documents
Culture Documents
Abstract
This report shows how well Kraft Foods Group, Inc. and Kellogg Company do business,
and what their strategies are to develop and manage their companies. These two
companies both are among the top five leaders of the food industry who are powerful
enough to sail drive the industry. They both have effective competitive strategies to
improve their infrastructures and attack their challengers in many ways. This paper will
focus on these two companies strategies, what can impact their companies, and how they
protect their company from competitors.
Company Summaries
Kraft Foods Group, Inc.
Kraft Foods Group, Inc. (Kraft Foods) is one of the largest manufacturing
packaged food companies in North America and worldwide with its net revenues $18.3
billion. It manufactures and sells food and beverage products, including coffee, cheese,
refrigerated meals, refreshment beverages, and other grocery products, primarily in the
U.S. and Canada. There are plenty of brands under this company, such as Capri Sun,
Maxwell House, Kraft and Kraft Deluxe, and so on. These brands make benefits to the
company. The following chart shows the current financial budget of Kraft Foods.
Year
Profile
Net revenues
Cash
Expenses
Net earning
2013
2012
2011
18,218
2,043
557
2,715
18,271
3,035
440
1,642
18,576
2,664
401
1,775
Table 1. Kraft Foods Group, Inc.s financial data. Adapted from Kraft Foods group, Inc. p. 19, by Kraft Foods Group,
Inc. 2014.
As the chart shows, Kraft Food has gained its in profits, an increase of 65% compared to
2012. Although this company exhibits how well it did with its high net earning, it was
Year
Profile
Net revenues
Cash
Expenses
Net earning
2013
2012
2011
14,792
1,807
637
1,808
14,197
1,758
533
961
13,198
1,595
594
864
Table 2. Kellogg Co.s financial data. Adapted from Kellogg Co. p. 15, by Kellogg Co. 2014.
This chart explains how well Kellogg did in 2013 over the previous last year. With
double-gained net earnings compared to 2012, it did its work amazingly, ; in just only
one year, its income rose sharpely from $961m to $1,808m. The revenue has been going
up since 2010. Plus, this company could has been able to control its cost significantly.
The expenses did have not impacted its revenues so much, so that influenced contributed
to the high profits last year. Kellogg also gained a bit of cash, almost $50m. The price of
Kelloggs stock market has been seeing a considerable growth for five years. In fact, it
rose has risen from $36 to $58 per common share. For the stakeholders, even thought it
Current competitive strategies of Kraft Foods Group, Inc. & Kellogg Co.
Kraft Foods Group, Inc.
Kraft Foods has a strong brand portfolio that shows this company is doing very
well in the industry. It offers products encompassing four customer segments: beverages,
refrigerated meals, cheese and grocery. This company sells highly recognized brands in
many of the categories. Kraft Foods has more than 25 brands earning net revenues of
more than $100 million each. It holds 11 of 17 the highest branded market shares, which
contribute over 80% of its net revenues in the U.S.A. (Kraft Foods Group, Inc., 2014).
That means the company has a huge share in the industry. Kraft Foods has reached met
the demand of consumers and improved its market penetration.
In addition, its manufacturing and distribution capabilities are very strong. This
company operates 40 processing and manufacturing facilities in the U.S. and Canada.
According to Kraft Foods Group, Inc.s Annual Report (2014), Kraft Foods produces its
beverage goods in nine locations, refrigerated meals products in nine locations, cheese
products in 13 locations and grocery goods in 15 locations. Also, the company has more
than 40 distribution centers in the U.S. and Canada. Every center has the a great capacity
to store all products. The company uses many ways to deliver the products to consumers,
such as common carriers and its private fleet.
Even though Kraft Foods lost a billion dollars in cash, it still has a robust cash
reserves. Because of its original maturities, the company maintains its credit rating and
References
Graves, T. & Kwon, Y. E. (2013). Industry Surveys surveys Foods foods & Nonalcoholic
nonalcoholic beverages. Retrieved from Business Source Complete database.
Kellogg Company: 10K. (2014). Kellogg Company 10K. Retrieved from
http://investor.kelloggs.com/investor-relations/default.aspx
Kellogg Company: Annual Report. (2014). Kellogg Company annual report.
Retrieved from http://investor.kelloggs.com/investor-relations/default.aspx
Kim. C. W. & Mauborgne R. (2004). Blue ocean strategy. Boston, MA: Harvard
Business Press.
Kraft Food Group Inc.: 10K. (2014). Kraft Food Group Inc. 10K. Retrieved from
http://ir.kraftfoodsgroup.com/financials.cfm
Kraft Food Group Inc.: Annual Report. (2014). Kraft Food Group Inc. annual report.
Retrieved from http://ir.kraftfoodsgroup.com/financials.cfm
database.
Market Line. (2014). Kraft foods group, Inc. Retrieved from Business Source Complete
database.
Porter. E. M. (2008). The five competitive forces that shape strategy. Boston, MA:
Harvard Business Press.