Kraft Food Inc's Hostile Takeover of Cadbury

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Introduction A multinational company of Kraft Foods is an American firm doing the business for food and beverage. It produces belong to a global markets and has many brands that over 170 countries (Kraft Foods, 2011). And its brands are divided into five main sectors: snacks, beverages, cheese, grocery, and convenient meals. The major competitors of Kraft are Nestlé S.A.; Unilever; ConAgra Foods, Inc.; Groupe Danone; H.J. Heinz Company; Sara Lee Corporation; etc. One of the world's fourth biggest suppliers of chocolate and sugar confectionery is Cadbury, which merged with Schweppes in 1969. One of its products, which is Dairy Milk and it is very successful molded chocolate in UK. The main products of Cadbury are bars, drinks, ice-cream…show more content…
Bargaining power of suppliers: There are lots of farm in Brazil and South of American, so that the bargaining power of suppliers is low in this industry and the buyers can compare and choose the lower price and quality supplier (International Cocoa Organization, 2012). So, this is positive to the business. Rivalry among established competitors: There are lots of companies around the world for the confectionery industry that lead to this industry violent for the competition. So, this is negative to the business. Bargaining power of buyers: According to the research, it showed that the demand of chocolate confectionery industry had the potential for increasing, as the chocolate sales rose 28% in 2008, and dark chocolate sales rose 12% (National confectioner Association, 2009). Thus, this is positive to the business. Threat of entry: When a company entry to a new industry, a company require lots of capital. Since the company needs to buy the plants, machines, etc. So, it lead a company to have a large economic of scale. Moreover, it is difficult to access to supply and distribution channels. Threat of substitute: In Walmart can find lots of related chocolate products from different companies, that means there are lots of substitute for the customers (Walmart, 2012) Potential partners: There are lots of benefits or advantages for the contractual partnership. The four processes to build contractual partnership are appraising suitable strategic

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