Sara Lee Case Study Argumentative
- Pages: 4
- Word count: 842
- Category: Marketing
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Here are answers you need to put in your own words:
1. At the beginning the company corporate strategy was implementing acquisition strategies to expanding the company’s geographic coverage and into new business categories. The company started as a small wholesale distributor of sugar, coffee, and tea, then it acquire a food processing, packaging, and distribution, and then retail food business. For over 40 years the company had acquired a series of related and unrelated business. Over this course of time, management struggled to manage the company’s broadly diversified and geographically scattered operations.
With the retrenchment strategy, Sara Lee Corporation is able to transform it into a more tightly focused food, beverage, and household products company. Management believed concentrating its financial and managerial resources on a smaller number of business segments in which market prospects were promising and Sara Lee’s brands were well positioned would help the company save cost and more profitable. The company had also implement an outsourcing strategy known as Project Accelerate. It a company-wide cost saving and productivity that focused on outsourcing, supply chain efficiencies, and overhead reduction.
2. Sara lee’s corporate strategy was implementing acquisition strategies. The retrenchment strategy changed the nature of its business lineup from a small wholesale distributor to acquiring retail food business. The business also acquired related and unrelated business. Sara lee corporations was able to transform it into a more tightly focused food, beverage and household products company.
Sara Lee is returning to its roots of food service where name recognition is the strongest. industries represented in Sara Lee Corp.’s business portfolio? The retail, foodservice, and industries represent the most attractive long-term. Sara lee has name recognition in the retail industry. Sales of these products will likely remain high as consumers purchase lunch meats and other foods rather than eating out because of the state of the economy.”
3. The retail, foodservice, and industries represent the most attractive long-term. Sara lee has name recognition in the retail industry. Sales of these products will likely remain high as consumers purchase lunch meats and other foods rather than eating out because of the state of the economy.
The narrowing of focus in the food industry and away from less fitting industries has allowed for value chain match-ups in the form of production technology, shipping logistics and customers. Opportunities for skills transfer, cost sharing and brand sharing include the production of bakery, retail and foodservice goods since many of these are similar or the same products. Producing a large batch of the same product costs less than having to set up and run a separate product line.
4. The 9 cell industry strength matrix shows that there are opportunities for rapid growth and a good potential for winning a much stronger market position. Lee’s business units (attach file containing your table/matrix). What is your assessment of the long-term attractiveness of the industries represented in Sara Lee’s business portfolio? Please see attachment for the 9-cell industry attractiveness/business strength matrix. • Packaged meat industry – $9.6 billion North American packaged-meat industry. Sales of Meats in North America improved by 5% • Fresh bakery business – sales increase $91m in 2003 to $2.1 billion in 2008. 8.3% market share • Frozen Desserts – low projected growth. Market size: approx. $75million
5. Sara Lee managements should continue focusing on the food -based industries and trying to link those industries as much as possible. One of their main strengths is brand recognition. People can expect to get premium quality products when they purchase anything from the Sara Lee product line. Sara Lee is struggling in the bakery industries, both North American and International with the exception of fresh breads, a narrowing of product lines may help make this brand more profitable. They are doing a great job in the International Beverage market, with the number one selling item being coffee.
The global retail coffee market was expected to grow from $51 billion in 2009 to $62 billion in 2013. With this being said this market is a cash cow and Sara Lee management should focus on Coffee and tea in the International Beverage business and they can also create new products to expand the product line. Since they are already the number one seller in single-serving coffeemakers, a good idea would be for them to make single-serve pods that are compatible with any single-serve coffeemaker. With a current market share of 40 percent, this will only help increase their overall market share.
Since Sara Lee is divesting many of their of their product lines and expect to contain growth in operating expenses through reducing inventory, focusing on promising markets and emphasis on efficiency, they will have more money to use in other places like advertisement. They should do more with putting their name out there. Creating a marketing campaign to bring back name recognition that has been overshadowed by competitors will help product sales. They can bring back their slogan “Nobody does it like Sara Lee.”