Internal Analysis Project
Kellogg’s is a food manufacturing company whose principal products are ready-to-eat cereals and convenience foods, such as cookies, crackers, toaster pastries, cereal bars, fruit snacks, frozen waffles and veggie foods. These products are manufactured in 18 countries and marketed in more than 180 countries. The cereal products are generally marketed under the Kellogg’s name and are sold principally to the grocery trade through direct sales forces for resale to consumers. (Kellogg's, 2010)
In this report I will primarily be looking at Kellogg companies financial reports for the last five years. I'll be analysing the trends survey predictions can be made the future. These …show more content…
The research I have read, Kellogg's market share is still growing. This puts them in a very strong position. Swot analysis. The Kellogg Company has many strengths, weaknesses, opportunities and threats. Here I will just briefly look at a few of them. Strengths: The Kellogg Company’s biggest strength is their brand name. It's a name recognised worldwide as a symbol for cereal-based food products that are of high quality. The company should do their best to maintain the good connotations people have with the Kellogg's brand. They should do this by keeping the brand fresh and current and operating at industry best practice levels. Weaknesses: None. Opportunities: The eat at home market. During the recession and even now people have been cutting back. It has been less popular to go out and eat in a restaurant, whether that be for breakfast, lunch or dinner. Kellogg's might want to capitalise on this situation. They could increase their product line from cheap but tasty breakfast meals at home. Threats: I've come up with a few different threats the Kellogg's company, the first being advertising unhealthy foods to children. Many governments are now bringing in legislation to prevent companies advertising unhealthy foods to children. Kellogg's should look at making their products healthier. Another threat is increasing fuel prices. As the fuel prices increase, so too will the Kellogg's company's distribution costs.
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The ready-to-eat (RTE) sector has increased sales and therefore have given the Breakfast cereals market an advantage to have a higher market share of 4.2% in 2013. The emphasis is more to the value and the convenience of cereals rather than the quality. However people are starting to be more heath conscious and are going to the higher nutritional brands which tend to be the well-known ones such as Kellogg 's, Weetabix and Nestle.
External Environmental Analysis We chose Kellogg’s cereal category because Kellogg’s has over 100 years history and we have14 kinds of breakfast cereal products. Our products sell to 180 countries across the world. Our mission is still to provide you and your family with better breakfasts that lead to better days, and now you eat flake corn is the same way W.K. did back in 1898. It just tastes better that way. Kellogg’s cereal provides a variety of nutrition’s cereals that deliver the benefits of grains, and provide important nutrients like iron, B vitamins, zinc and fibre.
The cereal market is a booming industry. It has been around for over one hundred years and continues to attract millions of customers’ everyday. The market structure of the cereal industry is an Oligopoly. This is because there are four large firms, Kellogg, General Mills, Post, and Quaker Oats, which dominate the industry.
The threat of customers finding substitute products from other manufacturers in the food industry is high. In the ready-to-eat breakfast cereals segment, General Mills’ primary business focus, there are a variety of similar products being
Special K is a successful brand, with a good level of innovation and communication. It has reached many consumers; especially women aged 20 to 40 yearsold, focusing on key elements such as beauty, shape, and weight loss. People are ready to pay more for Special K cereals, positioned as high quality products, with higher prices as competitors’. As the
Kraft Foods Group produces annual revenues of about $18 billion or more. CEO, John T. Cahillore ensures that “with the spirit of a startup and the soul of a powerhouse, we are on a mission to be the best food and beverage company in North America.” Kraft exists around that statement and every decision made for the business should reflect being a powerhouse in food and beverages. So far, this company’s strategies have made that statement true.
Kellogg’s seeks to concentrate on nutrition and physical fitness through product donation for the hungry, as well as programs that educate families about nutrition that nourishing families so they can have a healthy living’(Kelloggcompany, 2011).
In the RTE cereal industry, there were three large manufacturers, General Mills, Kellogg and Philip Morris that had a strong presence in the market. They were extremely profitable with pricing power and dominated the whole market with great market share; all this made it unattractive
Kellogg’s is highly a profile company which is hugely known not only in the UK but in the world at large. It is one of the largest breakfast companies in the word, not only that but it is also financially it is a stably and well organised company. Kellogg’s profits have been stable if not increasing for the better from what it was 5 years ago.
Mission: Kellogg is a worldwide business dedicated to construct Long-Term expansion in their bottom-line and to ornament its universal Leadership Position by supplying healthful Food Products of better-quality worth.
Kellogg’s cereal provides a variety of nutrition’s cereals that deliver the benefits of grains, and provide important nutrients like iron, B vitamins, zinc and fibre.
Special K enabled Kellogg’s to be alert to current consumer trends such as social trends and changes in technology. The research enabled Kellogg’s to identify consumer perceptions of the brand and what developments consumers would favour. Armed with this consumer and market focused knowledge, Kellogg’s was best placed to inject growth into the product life cycle.
Sales of private label cereal grew 50% from 1991-1994 in the Ready-to-Eat breakfast cereal industry. Some of the factors that contributed to the entry of private label cereal manufacturers and their subsequent growth include - lower costs related to manufacturing, packaging, marketing, R&D compared to the Big 3 cereal companies, product quality approaching that of branded products, higher margins for grocers, lower priced products. Some observers blamed higher prices and elaborate expenditure on coupon printing, distribution, redemption and reimbursement of grocer's handling fee for market share gains made by private label cereal products. The policy of "price up and spend back" seemed to hurt the Big 3 firms.
Overall, we can say that Krispy Kreme has still a strong position in the market. Although it is a smaller company with less financial backing, it remains competitive as its breadth of products appeals across all major demographic groups (including age and income). Its doughnuts have also stirred a cult-like following. Yet its recent problems in strategies (over expansion, unethical accounting procedures) and management could