Kraft Foods Case Study

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for the company.

Kraft Foods’ Portfolio

Kraft Food’s portfolio exhibits good strategic fit. The purchases from suppliers segment has equal purchasing power from suppliers among all business units. The technology component encompasses some sort of food processing technology to each other among all business units. Operationally, all of Kraft’s business units work collectively to improve their unit’s operational performance. From a sales and marketing perspective, all of the business units possess marketing power and distribution paths to enhance selling capacity. Furthermore, all of Kraft’s units share direct or indirect customer service by bearing Kraft’s brandname.

Kraft Foods’ Evaluation

Overall, Kraft’s strategy was to optimize profit growth and generate excellent returns for the betterment of their company and their company’s investors and shareholders. Kraft has done an excellent job of expanding its market share while improving their profit margin. Kraft, a large food company, exhibited much growth rate. Moreover, these business units had major overhead costs which were cutting into the company’s profit margin. Kraft Foods’ spinoff grocery stores were a growing business that would also benefit Kraft Foods with higher returns on expenses. Additionally, the spin-off business unit would possess more flexibility and freedom on operation strategy, which will likely lead to higher performance.

Kraft Foods’ Recommendation

Upon complete execution of the spin-off grocery business unit on 2012, Kraft had renamed to their spin-off grocery store to a new name, which maintains a brand of its own that is still backed by Kraft Foods. The spin-off grocery store still maintains high growth within the snack industry and entered a couple of international markets. However, I feel that there could be a few adjustments made to ensure that the company continues to excel operationally. The first recommendation is to remove operations management roles that were designed to work with the spin-off grocery chains, as those roles seem like they add nothing to the company’s operational growth. The other recommendation is to invest in the development of new products and expansion of existing products for local and international markets to maximize profit margin. The diverse culture at Kraft Foods aids versatility and different flavors and tastes on the products. Thus, it is imperative that Kraft continues testing, sampling, and developing new products to match the desires of the new markets locally and globally.

References:

Thompson, A. A., Peteraf, M. A., Gamble, J. E., & Strickland III, A. J. (2014). Crafting and Executing Strategy: The Quest for Competitive Advantage 19th ed. New York: McGraw- Hil