Conduct a strategic analysis of Kraft Foods Company, with special emphasis on Value chain and National Diamond model
Kraft Foods Inc operates in the food and beverages industry. The industry is constituted by those companies that involve in stages of activities from procuring the raw food material after harvest till the retail purchase. The activities involved are the processing of raw food materials, manufacturing, packaging the food products and distributing them. The products may be fresh, prepared foods, packaged foods, alcoholic and nonalcoholic beverages. All the products that are meant for human consumption except the pharmaceutical products ...view middle of the document...
This has paved way for more firms to concentrate on food industry, which is evident from the number of super markets and retail players in the food industry. Kraft Foods is one of such retailers having global presence in the food and beverages industry. Nearly a million times per day, the consumers around 150 countries all over the world reach the Kraft brands.
The Kraft Foods markets its product under various brand names, out of which there are nine brands that produce revenue in excess of US$ 1 billion. Also there is more than 50 other brand that generates revenue in excess of US$ 100 million. Out of these revenues, more than half are from the brands which have a market share twice that of the competitor and around 80% of the these revenue are generated by brands that have the number one position in market share. The total revenue of Kraft Foods in 2008 equals US$ 41.9 billion and 38% of which is from its snacks brands, and 20% are from the Beverages brands (Kraft Foods - Fact sheet, 2008).
The major trends in the food and beverages industry of US that provides growth opportunities to the companies are (U.S. Food and Beverage Industry Growth Predicted, Despite Challenges, 2006):
* Greater focus on innovations and new product developments.
* Shift in consumption pattern of the consumers. The consumers are in look out for quality products with a combination of convenience and value.
* Increased awareness of health and ethnic foods.
* Growing opportunities in foreign market.
* With increasing focus on water usage and energy efficiency, sustaining the position in the market amidst the competition has become important.
Kraft Company Overview:
Kraft Foods Inc is the largest Food and Beverages Company in the United States. The company operates in around 70 countries across the world with around 98000 employees and sells its products in over 150 countries in Europe, Latin America, Asia Pacific, Middle East and Africa through its subsidiaries, Kraft Foods International Inc and Kraft Foods North America Inc (Kraft Foods Global, Inc, 2010).
The company manufactures and markets packaged retail food products like cookies, confectionery, coffee, juices, powdered beverages, cheese products, ready-to-cereals, desserts, convenient meals and processed meats. All these products cover major consumer sectors like Snacks, Beverages, Cheese, Grocery and Convenient Meals under the major brands like Kraft, Jacob’s, Philadelphia, Maxwell house, Nabisco, Oscar Mayer, Post, Oreo and LU.
The company focuses on providing foods that fit the consumers by concentrating on health and wellness, snacking, quick meals and premium products. The Kraft products are sold through various distribution channels like distribution centers, satellite warehouses, company-operated and public cold-storage facilities, depots, and other facilities.
Porter’s National Diamond for Kraft:
The Four basic forces according to the Michael Porter’s...