Group IV Kraft Part II.doc

8/15/2019 Group IV Kraft Part II.doc

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PHILIPPINE CHRISTIAN UNIVERSITY GRADUATE SCHOOL

STRATEGIC MANAGEMENT

KRAFT - PART 2(Group IV – Rowe! M"r!#!$ Ho%er Deo D!&u E'&!"))o$ M!r"*!r Te)!+

3. External Factors Evaluation Matrix (EFE)

Key External Factors Weight Rating WeightedScore

Opportunities

More people are dining out, and food producers aredevoting more attention to products designed for

restaurants, vending machines, and other foodserviceproviders

0.06 4 0.24

Be able to sell to restaurants at a higher margin 0.07 3 0.21

onsumers are shifting to!ard food containing less trans

fat or fe!er calories, or those containing onl" organicingredients

0.07 2 0.14

Bottled !ater has become !ell established in the mar#etand enhanced !aters containing vitamins or

supplements are gaining popularit"

0.07 3 0.21

onsumer prices for ba#ed goods increased 10.7percent in $anuar" 200% compared to $anuar" 200&

0.06 3 0.1&

'nput costs for ba#ers, included commodities such as!heat, eggs, and natural gas, have declined recentl"

0.04 2 0.0&

(he ).*. mar#et for pac#aged and processed foods hasseen large profits in retail sales, and this number ise+pected to see stead" gro!th

0.0% 4 0.36

orld!ide, demand is also on the rise for pac#aged t"pe

of food as more people adopt a lifest"le that includesless time for the preparation of food

0.0% 3 0.27

(he greatest asset of an" retail and consumer productcompan" is its reputation and perceived value among

consumer

0.06 3 0.1&

Threats


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-besit" is increasing drasticall" in both children and

adults and accordingl" consumers are deviating from

having snac#s, cheeses and such

0.0& 3 0.24

ising costs of petroleum cause an increase in cost forcompanies in the food industr" and in the agriculture

end

0.0% 4 0.36

/ood safet" programs have been adopted recentl" as

issues of chemical and bacterial contamination and ne!foodborne pathogens remain a public health concern

0.07 4 0.2&

Because the industr" is so competitive, it is difficult forthese companies to raise their prices accordingl", and

profit margins have suffered as a result due to !ea#econom" and increase in unemplo"ment, man"

consumers have s!itched from brand name to generics

0.04 4 0.16

ue to increase in fuel, the cost of distribution can

increase as !ell

0.06 3 0.1&

lobal !arming becoming a maor political issue andfood producers are simultaneousl" cast as perpetrator

and potential healer

0.0 2 0.1

Total 1.00 3.19

onclusion! "usiness opportunities #or the $usiness is so high and out%eighs the

threat in the industry.

B. &nternal Factor E'aluation (&FE) *atrix

Key &nternal Factors Weight Rating Weighted

Score

Strengths

1. 5fter t!o incidents of contamination, thecompan" voluntaril" recalled more than 2

million pounds of nuts and has temporaril" shut

do!n its manufacturing plants

0.06 3 0.1&

2. 'ncrease in sale in the developing internationalmar#ets b" 2 percent

0.0& 4 0.32

3. (he compan" operates in different businesssegments snac#s, beverages, cheese, grocer"

and convenient meals

0.06 4 0.24

4. espite economic do!nturn, the compan"s

revenues increased to )*842.2 billion 200&,

!hile earnings increased to )*82.% billion

0.0& 4 0.32

. 'ncrease in current asset from 2007 to 200& b"almost )*8600 million

0.0& 4 0.32

6. ecrease in current liabilities b" around )*86

billion from 2007 to 200&

0.0& 4 0.32

7. 9raft sells over 100 different brand names 0.0 3 0.1


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Wea+nesses

1. or#ers at one of 9raft:s manufacturers in

'llinois turned up a batch of fruits and nuts that!ere contaminated !ith salmonella in

ecember 2007 !ith a similar incident in*eptember 200&

0.06 1 0.06

2. rop in sales in the compan"s snac# division

from 2007 to 200& b" 2.30 percent

0.07 1 0.07

3. rop in sales in the ;uropean )nion mar#et b"4.1 percent from 2007 to 200&

0.06 2 0.12

4. espite %.& percent increase in price, 9raft/oods lost 0.3 percent mar#et share during

200&

0.06 2 0.12

. (he compan" has over )*827. billion in

ood!ill

0.06 1 0.06

6. 'ncrease in longterm debt b" about 0 percent

in 200& from 2007

0.07 1 0.07

7.

Documents

Group IV Kraft Part II.doc