• FEBRUARY 17, 2010, 7:17 P.M. ET
Heinz Sees More Coupon Clipping
BY ILAN BRAT
H.J. Heinz Co. Chief Executive William Johnson said Wednesday that consumers have settled into a money-saving mind-set, including using coupons substantially more than in the past and preparing more meals at home.
He said the behavioral changes, particularly prominent among families with children, would benefit Heinz and other packaged-food makers.
I think they are right. I know I have been making more meals at home.
http://www.marketwatch.com/story/heinz-raises-outlook-for-2010-2010-02-17?siteid=yhoof2
Feb. 17, 2010, 5:37 p.m. EST •
Heinz raises outlook for 2010
on Wednesday raised its earnings outlook for 2010 to a range of $2.82 to $2.85 a share, thanks to "dynamic growth in emerging markets." For the third quarter, the ketchup giant said it expects to report a profit of 82 cents a share. Analysts polled by FactSet Research previously forecast a profit, on average, of 72 cents a share for the quarter and $2.82 for the year
Wednesday, March 3, 2010
Week 3 in the Food Industry
Ohttp://www.businessweek.com/managing/content/feb2010/ca2010028_928488_page_2.htm
Tuesday February 9, 2010, 2:58 pm EST
LONDON (AP) -- Kraft Foods Inc. said Tuesday that it will close Cadbury's Somerdale plant in the United Kingdom as the British candy company originally planned, saying the plans were too far advanced to reverse.
Kraft, which got final approval this month to acquire Cadbury, previously said it hoped to keep the facility open.
http://finance.yahoo.com/news/Kraft-to-close-1-Cadbury-apf-2338914089.html?x=0&.v=6
Kraft-Cadbury: Making Acquisitions Work
Most acquisitions don't deliver the expected results, according to RHR Intl's research. Here's how both companies' leadership can boost the chances for success
By Guy Beaudin
After months of negotiations, Kraft (KFT) announced last month that it would acquire U.K. confection giant Cadbury (CBY) with a revised bid of $19.5 billion. The acquisition of Cadbury by Kraft will generate a joint portfolio of more than 40 confectionary brands, each with annual sales in excess of $100 million, essentially creating the world's biggest confectionary company.
Both Kraft and Cadbury have a lot at stake to make this deal work. Statistically, deals this complex have a high rate of failure. In fact, research conducted by RHR International found that 70% of acquisitions fail to deliver the expected results. Despite the discouraging data, there is much the leadership teams at both Kraft and Cadbury can do to put the odds in their favor.
Here is a look at the immediate challenges and what leadership at each company can do to mitigate them.
• The negotiation process was hostile.
Cadbury declined Kraft's initial offer. Compounding the issue was that the dialogue (which was hostile at times) between the two companies played out in the news for months prior to inking the final deal. Fence-mending will need to take place before any real integration can begin.
• They are iconic brands that have long pursued different positioning.
Corporate and national pride behind both companies is strong. For Cadbury, coming to terms with the fact that it may have to merge some of its identity with Kraft could be especially difficult. (Let's face it—Cadbury is nearly as important to British culture as the Beatles.) Although this issue is largely a marketing/positioning question, it will have impact on the reaction of both organizations to the acquisition.
• Perceived dominance.
Cadbury executives might assume that Kraft will adopt a dominant approach. Kraft will have to make their intentions with Cadbury clear as soon as possible to avoid unnecessary speculation.
• There is a learning curve.
Kraft purchased Cadbury to break into emerging markets, and it will take Kraft some time to learn the nuances of working in those markets.
• Tough decisions are inevitable.
Because Kraft borrowed heavily to buy Cadbury, it may be focused on revenue in the short term. Some difficult decisions could be on the horizon.
Making the Deal Work
Putting the challenges aside, the first 100 days after a deal is announced can determine the success or failure of the acquisition. In this situation, one of the best strategies to bring the two teams together is to identify common goals. Experience shows that the more quickly individuals from both companies get to work together on common projects with common goals, the better the integration will work.
At the same time, management must make quick, yet considerate, decisions on divisive issues. There has already been speculation around pending layoffs at both Kraft and Cadbury, which diminishes productivity at all levels. Management will need time to determine the best blend of talent, but it is a top priority and must be executed swiftly so that people can move on as soon as possible.
At first glance, Kraft and Cadbury appear to be very different companies. But the reality is that they have much in common; after all, they are both consumer-product companies that specialize in confection and packaged foods. The leadership team can capitalize on this by having talent from both organizations work jointly on projects. This will encourage employees to focus on their similarities, rather than their differences. Finally, employees at Kraft and Cadbury most likely have preconceived notions about the other based on what they have read in the news or heard through industry chatter. It is essential that the leadership team takes the time to discuss the differences in culture sooner rather than later, so that they can focus on similarities. Our experience shows that these differences begin to pale very quickly if they can be addressed early on.
Challenge to Kraft's Leadership
To be successful, Kraft needs to have an open and honest dialogue with Cadbury. This will give people a realistic understanding of what is going to happen, allowing them to make informed decisions about future prospects. Building trust is the only way to prevent the defection of talented people. Kraft will face an immediate disadvantage if Cadbury's top talent leaves because no one knows the details of making a company successful better than those who had a role in its success.
As the acquirer, Kraft also has the responsibility to provide a detailed road map for integration. This will ensure that everyone understands the process for joining the companies, which will free up the leadership team to address hidden issues. The plan should provide guidance on the effectiveness of executives and managers, the performance of work units and processes, and the management of organizational change.
Finally, Kraft will have to unite the two companies under one vision. Communications programs that support the new vision must be planned, initiated, and sustained, and employees that support the vision should be rewarded. Executives and work units must be redeployed where they will be the most efficient. Departments will have to be restructured and processes redesigned in order to align with the new company. A system should be put in place for development of team effectiveness, so that teams are cohesive. Conflict-resolution methods must be developed to ensure quick and effective solutions, while workforce standards are sharpened and common business practices established. Adjustments to the culture should be made when necessary.
Challenge to Cadbury's Leadership
Integrating after a merger or acquisition is challenging for any organization, even under the best of circumstances. But after the deal is done, it's critical for leadership of the acquired company to publicly embrace the acquisition and show enthusiasm about the future. By focusing on the benefits of the acquisition, Cadbury executives will be better equipped to communicate the value that Kraft brings to the brand.
Senior executives at Cadbury will need to take symbolic steps to demonstrate their openness to the merger. This might be in the form of meetings, handshakes, companywide memos, public speeches, and even positive quotes about the acquisition in the media.
Ultimately, Cadbury should be proud of its accomplishments over the years. Companies become acquisition targets because they have a reached a high level of success. Executives can retain that pride while still keeping other emotions in check. One thing is for certain: There is no room for egos during the integration process.
While there are many challenges to overcome on both sides of the Kraft-Cadbury deal, strong leadership can help to smooth the process. Executives from both Kraft and Cadbury must remember that if the integration is successful, it will be a boon to both the companies, and to consumers.
Guy Beaudin is a senior partner with RHR International, an organization of management psychologists and consultants who work closely with senior executives to accelerate individual, team, and business performance.
I found this article interesting. I have read quite a few articles about this, but this one really puts it in a business perspective that I can understand.
Tuesday February 9, 2010, 2:58 pm EST
LONDON (AP) -- Kraft Foods Inc. said Tuesday that it will close Cadbury's Somerdale plant in the United Kingdom as the British candy company originally planned, saying the plans were too far advanced to reverse.
Kraft, which got final approval this month to acquire Cadbury, previously said it hoped to keep the facility open.
http://finance.yahoo.com/news/Kraft-to-close-1-Cadbury-apf-2338914089.html?x=0&.v=6
Kraft-Cadbury: Making Acquisitions Work
Most acquisitions don't deliver the expected results, according to RHR Intl's research. Here's how both companies' leadership can boost the chances for success
By Guy Beaudin
After months of negotiations, Kraft (KFT) announced last month that it would acquire U.K. confection giant Cadbury (CBY) with a revised bid of $19.5 billion. The acquisition of Cadbury by Kraft will generate a joint portfolio of more than 40 confectionary brands, each with annual sales in excess of $100 million, essentially creating the world's biggest confectionary company.
Both Kraft and Cadbury have a lot at stake to make this deal work. Statistically, deals this complex have a high rate of failure. In fact, research conducted by RHR International found that 70% of acquisitions fail to deliver the expected results. Despite the discouraging data, there is much the leadership teams at both Kraft and Cadbury can do to put the odds in their favor.
Here is a look at the immediate challenges and what leadership at each company can do to mitigate them.
• The negotiation process was hostile.
Cadbury declined Kraft's initial offer. Compounding the issue was that the dialogue (which was hostile at times) between the two companies played out in the news for months prior to inking the final deal. Fence-mending will need to take place before any real integration can begin.
• They are iconic brands that have long pursued different positioning.
Corporate and national pride behind both companies is strong. For Cadbury, coming to terms with the fact that it may have to merge some of its identity with Kraft could be especially difficult. (Let's face it—Cadbury is nearly as important to British culture as the Beatles.) Although this issue is largely a marketing/positioning question, it will have impact on the reaction of both organizations to the acquisition.
• Perceived dominance.
Cadbury executives might assume that Kraft will adopt a dominant approach. Kraft will have to make their intentions with Cadbury clear as soon as possible to avoid unnecessary speculation.
• There is a learning curve.
Kraft purchased Cadbury to break into emerging markets, and it will take Kraft some time to learn the nuances of working in those markets.
• Tough decisions are inevitable.
Because Kraft borrowed heavily to buy Cadbury, it may be focused on revenue in the short term. Some difficult decisions could be on the horizon.
Making the Deal Work
Putting the challenges aside, the first 100 days after a deal is announced can determine the success or failure of the acquisition. In this situation, one of the best strategies to bring the two teams together is to identify common goals. Experience shows that the more quickly individuals from both companies get to work together on common projects with common goals, the better the integration will work.
At the same time, management must make quick, yet considerate, decisions on divisive issues. There has already been speculation around pending layoffs at both Kraft and Cadbury, which diminishes productivity at all levels. Management will need time to determine the best blend of talent, but it is a top priority and must be executed swiftly so that people can move on as soon as possible.
At first glance, Kraft and Cadbury appear to be very different companies. But the reality is that they have much in common; after all, they are both consumer-product companies that specialize in confection and packaged foods. The leadership team can capitalize on this by having talent from both organizations work jointly on projects. This will encourage employees to focus on their similarities, rather than their differences. Finally, employees at Kraft and Cadbury most likely have preconceived notions about the other based on what they have read in the news or heard through industry chatter. It is essential that the leadership team takes the time to discuss the differences in culture sooner rather than later, so that they can focus on similarities. Our experience shows that these differences begin to pale very quickly if they can be addressed early on.
Challenge to Kraft's Leadership
To be successful, Kraft needs to have an open and honest dialogue with Cadbury. This will give people a realistic understanding of what is going to happen, allowing them to make informed decisions about future prospects. Building trust is the only way to prevent the defection of talented people. Kraft will face an immediate disadvantage if Cadbury's top talent leaves because no one knows the details of making a company successful better than those who had a role in its success.
As the acquirer, Kraft also has the responsibility to provide a detailed road map for integration. This will ensure that everyone understands the process for joining the companies, which will free up the leadership team to address hidden issues. The plan should provide guidance on the effectiveness of executives and managers, the performance of work units and processes, and the management of organizational change.
Finally, Kraft will have to unite the two companies under one vision. Communications programs that support the new vision must be planned, initiated, and sustained, and employees that support the vision should be rewarded. Executives and work units must be redeployed where they will be the most efficient. Departments will have to be restructured and processes redesigned in order to align with the new company. A system should be put in place for development of team effectiveness, so that teams are cohesive. Conflict-resolution methods must be developed to ensure quick and effective solutions, while workforce standards are sharpened and common business practices established. Adjustments to the culture should be made when necessary.
Challenge to Cadbury's Leadership
Integrating after a merger or acquisition is challenging for any organization, even under the best of circumstances. But after the deal is done, it's critical for leadership of the acquired company to publicly embrace the acquisition and show enthusiasm about the future. By focusing on the benefits of the acquisition, Cadbury executives will be better equipped to communicate the value that Kraft brings to the brand.
Senior executives at Cadbury will need to take symbolic steps to demonstrate their openness to the merger. This might be in the form of meetings, handshakes, companywide memos, public speeches, and even positive quotes about the acquisition in the media.
Ultimately, Cadbury should be proud of its accomplishments over the years. Companies become acquisition targets because they have a reached a high level of success. Executives can retain that pride while still keeping other emotions in check. One thing is for certain: There is no room for egos during the integration process.
While there are many challenges to overcome on both sides of the Kraft-Cadbury deal, strong leadership can help to smooth the process. Executives from both Kraft and Cadbury must remember that if the integration is successful, it will be a boon to both the companies, and to consumers.
Guy Beaudin is a senior partner with RHR International, an organization of management psychologists and consultants who work closely with senior executives to accelerate individual, team, and business performance.
I found this article interesting. I have read quite a few articles about this, but this one really puts it in a business perspective that I can understand.
Monday, February 8, 2010
This Week in the Food Industry....
http://finance.yahoo.com/news/Cadbury-shareholders-approve-rb-3255981319.html?x=0&.v=6
Cadbury shareholders approve Kraft takeover
LONDON/CHICAGO (Reuters) - Kraft Foods (NYSE:KFT - News) won control of Cadbury (LSE:CBRY.L - News) on Tuesday as holders of almost 72 percent of the British chocolatier's stock accepted the 11.7 billion pound takeover that will create the world's biggest confectioner.
Kraft needed just 50 percent plus one share to take control of Cadbury. Chief Executive Irene Rosenfeld expects to complete the deal in the coming weeks as remaining Cadbury shareholders come forward to accept the cash and stock bid.
There have been so many twists and turns in this takeover...I wonder if this is really a done deal?
http://dealbook.blogs.nytimes.com/2010/02/03/cadburys-chairman-and-ceo-to-step-down/?partner=yahoofinance
Cadbury’s Chairman and C.E.O. to Step Down
February 3, 2010, 11:18 am
Following the success of Kraft’s pursuit of Cadbury, the British confectioner said that its chairman, its chief executive and its chief financial officer will step down.
The planned resignations of the chairman, Roger Carr, the chief executive, Todd Stitzer, and the chief financial officer, Andrew Bonfield, is not unexpected. Cadbury’s top management had repeatedly rebuffed Kraft’s wooing of their company, deriding the American food giant as a low-growth conglomerate.
But Kraft raised its bid for Cadbury last month, changing the board’s mind. On Tuesday, about 72 percent of Cadbury shareholders tendered their stakes to Kraft, for all intents and purposes sealing the deal.
“Together we have fought an excellent defence campaign and delivered substantial value to Cadbury
shareholders,” Mr. Carr said in a statement. “In handing over to Irene Rosenfeld I wish her the very best as she takes on responsibility for continuing to build and develop what is indisputably one of the world’s greatest brands.”
Mr. Stitzer said in a separate statement: “I wish Irene Rosenfeld and her team every success in taking Cadbury and its brands forward. They have pledged they will do their utmost to preserve Cadbury’s unique performance driven, values led heritage, and I urge all my colleagues to do their utmost to help them in this special task.”
Cadbury said that the resignations of Mr. Carr, Mr. Stitzer and Mr. Bonfield from its board hasn’t yet been determined.
http://finance.yahoo.com/news/The-Lunchables-Team-and-prnews-2415461660.html?x=0&.v=1
The Lunchables Team and Animal Planet are Giving Kids a Chance to Lunch, Roar & Score
Sweepstakes Offers a Chance to Win a Trip to Explore the Animal Kingdom with Jeff Corwin
Press Release Source: Kraft Foods On Friday February 5, 2010, 8:00 am EST
BOSTON, Feb. 5 /PRNewswire-FirstCall/ -- Kids who love learning about the animal kingdom may finally have a chance to turn their passion into a reality thanks to the Lunch, Roar & Score Sweepstakes from Lunchables Lunch Combinations. Together with Animal Planet and Jeff Corwin they're giving aspiring naturalists a chance to get an up close and personal look at the animal kingdom.
"My fascination with animals started when I was very young so I'm excited to help other kids discover their inner animal expert," said Jeff Corwin, animal enthusiast and star of the show, "Corwin's Quest." "This sweepstakes offers families a unique chance to see the world of animals through my eyes. It's an awesome opportunity."
Lunchables Animal Planet Sweepstakes
Through May 3, 2010, kids can enter for a chance to win an all-expenses-paid trip to Boston with their family where they'll spend three days with Jeff Corwin, learning about their favorite animals. Entering is easy – simply log onto www.lunchables.com and answer an animal-themed trivia question. Ten lucky winners and their families will get a behind-the-scenes tour of the New England Aquarium and Franklin Park Zoo as well as an exclusive welcome dinner with Jeff Corwin.
"We believe all kids have the potential to do great things," said Darin Dugan, Senior Director of Marketing, Lunchables. "The Lunch, Roar & Score Sweepstakes really focuses on an interest we know kids want to learn more about – animals – so we're excited to provide this opportunity which is exciting and educational."
New Lunchables Sub Sandwiches
Moms can also feed their kids' potential with new Lunchables sub sandwiches. Starting in January, four new varieties hit shelves featuring bread made with whole grain, 100% white meat chicken and turkey made with 100% turkey breast. The new Lunchables varieties are available in the refrigerated section of grocery stores and retail for $1.99.
I think this is such a wonderful sweepstakes! What a wonderful experience this will be for some lucky children. I think profits will definitely rise as children and parents start buying more lunchables in chance of winning this rewarding prize.
Cadbury shareholders approve Kraft takeover
LONDON/CHICAGO (Reuters) - Kraft Foods (NYSE:KFT - News) won control of Cadbury (LSE:CBRY.L - News) on Tuesday as holders of almost 72 percent of the British chocolatier's stock accepted the 11.7 billion pound takeover that will create the world's biggest confectioner.
Kraft needed just 50 percent plus one share to take control of Cadbury. Chief Executive Irene Rosenfeld expects to complete the deal in the coming weeks as remaining Cadbury shareholders come forward to accept the cash and stock bid.
There have been so many twists and turns in this takeover...I wonder if this is really a done deal?
http://dealbook.blogs.nytimes.com/2010/02/03/cadburys-chairman-and-ceo-to-step-down/?partner=yahoofinance
Cadbury’s Chairman and C.E.O. to Step Down
February 3, 2010, 11:18 am
Following the success of Kraft’s pursuit of Cadbury, the British confectioner said that its chairman, its chief executive and its chief financial officer will step down.
The planned resignations of the chairman, Roger Carr, the chief executive, Todd Stitzer, and the chief financial officer, Andrew Bonfield, is not unexpected. Cadbury’s top management had repeatedly rebuffed Kraft’s wooing of their company, deriding the American food giant as a low-growth conglomerate.
But Kraft raised its bid for Cadbury last month, changing the board’s mind. On Tuesday, about 72 percent of Cadbury shareholders tendered their stakes to Kraft, for all intents and purposes sealing the deal.
“Together we have fought an excellent defence campaign and delivered substantial value to Cadbury
shareholders,” Mr. Carr said in a statement. “In handing over to Irene Rosenfeld I wish her the very best as she takes on responsibility for continuing to build and develop what is indisputably one of the world’s greatest brands.”
Mr. Stitzer said in a separate statement: “I wish Irene Rosenfeld and her team every success in taking Cadbury and its brands forward. They have pledged they will do their utmost to preserve Cadbury’s unique performance driven, values led heritage, and I urge all my colleagues to do their utmost to help them in this special task.”
Cadbury said that the resignations of Mr. Carr, Mr. Stitzer and Mr. Bonfield from its board hasn’t yet been determined.
http://finance.yahoo.com/news/The-Lunchables-Team-and-prnews-2415461660.html?x=0&.v=1
The Lunchables Team and Animal Planet are Giving Kids a Chance to Lunch, Roar & Score
Sweepstakes Offers a Chance to Win a Trip to Explore the Animal Kingdom with Jeff Corwin
Press Release Source: Kraft Foods On Friday February 5, 2010, 8:00 am EST
BOSTON, Feb. 5 /PRNewswire-FirstCall/ -- Kids who love learning about the animal kingdom may finally have a chance to turn their passion into a reality thanks to the Lunch, Roar & Score Sweepstakes from Lunchables Lunch Combinations. Together with Animal Planet and Jeff Corwin they're giving aspiring naturalists a chance to get an up close and personal look at the animal kingdom.
"My fascination with animals started when I was very young so I'm excited to help other kids discover their inner animal expert," said Jeff Corwin, animal enthusiast and star of the show, "Corwin's Quest." "This sweepstakes offers families a unique chance to see the world of animals through my eyes. It's an awesome opportunity."
Lunchables Animal Planet Sweepstakes
Through May 3, 2010, kids can enter for a chance to win an all-expenses-paid trip to Boston with their family where they'll spend three days with Jeff Corwin, learning about their favorite animals. Entering is easy – simply log onto www.lunchables.com and answer an animal-themed trivia question. Ten lucky winners and their families will get a behind-the-scenes tour of the New England Aquarium and Franklin Park Zoo as well as an exclusive welcome dinner with Jeff Corwin.
"We believe all kids have the potential to do great things," said Darin Dugan, Senior Director of Marketing, Lunchables. "The Lunch, Roar & Score Sweepstakes really focuses on an interest we know kids want to learn more about – animals – so we're excited to provide this opportunity which is exciting and educational."
New Lunchables Sub Sandwiches
Moms can also feed their kids' potential with new Lunchables sub sandwiches. Starting in January, four new varieties hit shelves featuring bread made with whole grain, 100% white meat chicken and turkey made with 100% turkey breast. The new Lunchables varieties are available in the refrigerated section of grocery stores and retail for $1.99.
I think this is such a wonderful sweepstakes! What a wonderful experience this will be for some lucky children. I think profits will definitely rise as children and parents start buying more lunchables in chance of winning this rewarding prize.
Saturday, January 30, 2010
The Food industry is focusing on "GREEN."
There was not much fluctuation in the food industry this week, but there does seem to be a trend that companies on a whole are focusing on. The focus; being more "green." Not only does this help with environmental waste, but also the cost of production. I think on a whole this will help raise stock prices. The industry will spend less and profit will remain the same, leading to greater profit margins.
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