Running head: SMUCKER 'S - THE J.M. SMUCKER COMPANY 1 The J.M. Smucker Company Christine Silva-Netto John F. Kennedy University Managerial Economics BUS5052 Edward Torres March 09, 2012 SMUCKER 'S - THE J.M. SMUCKER COMPANY SMUCKER 'S The J.M. Smucker Company History Smuckers was founded in 1897 by Jerome Monroe Smuckers who sold his first product, apple butter, from the back of a horse-drawn wagon. J.M. Smucker Company was incorporated in 1921 and has been a successful family run business for four generations. J.M. Smucker Company 's headquarters is located in Orrville, Ohio and has been there since 1897. The Company has 17 manufacturing locations within North America and four manufacturing locations in Canada. Their sales …show more content…
SMUCKER 'S - THE J.M. SMUCKER COMPANY Exhibit: 1.1: SJM: Product Sales 4 Source: The J.M. Smucker 2011 & 2010 Annual Reports J.M. Smucker Company Shares were listed on the New York Stock exchange in 1965. The ticker symbol is SJM. In 2011, J.M. Smucker Company 's gross profit (excluding special project costs) was $1,852.6 million which was a $11.8 million increase compared to 2010. Their net sales for 2011 was $4,825.7, an increase in five percent, compared to 2010 (The J.M. Smucker Company, 2011, p. 21) (Exhibit 1.2), and compared to third quarter of 2011, their third quarter of 2012 net sales increased 12 percent, driven primarily by the impact of prior pricing actions and acquisitions ("J.M. Smucker Co. Announces Fiscal 2012 Quarter Results," 2012). The increase in net sales offset the impact of overall higher raw material and freight costs and $50.2 million of incremental special project costs including in cost of products sold, consisting primarily of accelerated depreciation (The J.M. Smucker Company, 2011) (Exhibit 1.3). As of SMUCKER 'S - THE J.M. SMUCKER COMPANY 5 February 2012, J.M. Smucker Company 's gross margins in the third quarter fell to 32.6 percent, from 37.4 percent, a year ago, as a result of higher cost of green coffee, edible oils, peanuts and flour. The Company 's third quarter profit fell to $116.8 million, or $1.03 a share, from $132 million, or $1.11 a share, a year ago (Dalal & Nair, 2012)
Braum’s Incorporation is a vertically integrated company (owns multiple segments of industry and merges them together) which allows them to produce their products to the quality and standards they want. The corporation produces meat, dairy products, fruits, and vegetables. They have 280 stores located throughout Kansas, Texas, Missouri, Arkansas, and the majority located in Oklahoma, where their headquarters are (About Us 2016). The chains of stores located in these areas provide hamburgers, ice cream, and a small grocery store for their customers. Although Braum’s provides all of these commodities they’re mainly known for their ice cream.
Smucker's accusation of Jif and Crisco would allow Smucker's to increase consumer consumption of different products owned by the Smucker Company. The acquisition took place in 2002 and the "New" Smucker Company profited greatly in 2003. Revenues had improved 87% from the previous year from $342.6 million to $641.9 million . It was found Jif and Crisco contributed upwards to $260.4 million to the company while the other income came from increases in revenue from all the original products offered from Smucker. The only disappointing product was a 2% sales decline for Crisco oils. These numbers are a great improvement however from their Smucker's previous position. Even with the disappointment of the Crisco
The founhder of the company, Godfrey Keebler, started with jus a small bakery in Philadelphia, PA in 1853. During the next two generations, local bakeries popped up around the country, including Strietmann, Hekman, Supreme and Bowman. With the introduction of cars and trucks (carrying the Keebler logo), bakery goods could be distributed beyond the neighborhood and regional distribution began.
During the last two quarters of 1999-2000, the company has experienced increasing revenues but profit margin contraction. There is insufficient information disclosure in the financials to source the driving factor. However, the largest driver of sales is through its distributors and Bonny Doon’s EuroDoon products (Figure 2). From a P/L standpoint, we believe that the margin fluctuations can be ignored, with a view of focusing on strategic initiatives to maximize revenue and the quantity sold.
DMC needs to identify their main business problems and develop a new strategy along with procedures to address it. Although DMC had grown into a multi-billion dollar company and regularly ranks in the top of the industry, gross margins have decreased steadily between 2010 and 2012. Depicted the Table 1 below, margins ranged from a net income loss of $2.6 billion in 2010, $1.7 billion in 2011, down to just $940 million.
3. Does J. M. Smucker’s lineup of businesses and brands exhibit good strategic fit? What value-chain match-ups do you see? What opportunities for skills transfer, cost sharing, or brand sharing do you see?
So while the company increased its net income, it has done so with diminishing profit margins.
Our profit margin is based off of the companies’ individual years’ total consolidated sales and their net income. We found that the average profit margin of all the years was highest in Constellation Brands Inc. mainly due to their 2014 year numbers, however Mead Johnson CO. was more consistent; producing the same margin three years in a row despite having a dropping overall profit. This shows that Mead Johnson has a much more stable company in means of return based on sales to income, yet Constellation Brands Inc. shows much more promise in potential return as they continuously produce higher numbers than Mead Johnson Co. and improve in overall sales.
So-called Major domestics producers, especially Anheuser Bush, MMBC’s main competitor, are focused on economies of scale in production and advertisement and spend heavily to maintain their own sales level. They dominate the market with 42% of market share in the East Central Region (Case study - Exhibit 3)
Operating profit margin figures in the table above show the return from net sales[13]. However profit margin ratios are high enough for the 3 years, there is a fall from 12.86% to 11.26% during 2011-12. Sales revenue increases with a higher rate than gross profit so there is a poor
In the midst of a global recession, Clayton Industries is challenged by a diminishing demand for their product and rising variable costs. These issues are further compounded by stiff market competition that
In introduction stage KFC-J entered the market using market-skimming strategy as indicated in the U.S standard manual. Their products were high price and targeted only upper class. Gradually in 1972 after heavy losses in Osaka and start-up challenges, as a market strategy, Weston and his team adjusted prices to compete with typical Japanese take-out products. They also adjusted their prices to suit the middle class in order to penetrate the market.
In 2009, the operating profit was 3.56% which was slightly above than the previous year. After deducting all the expenses, the left amount is the net profit and the proportion of net profit in respect to total revenue is the net profit margin. Sainsbury’s net profit margin for the years 2009, 2008 and 2007 were 1.53%, 1.84% and 1.89% respectively. The management thinks that the tough market condition and the other competitors with very cheap pricing have pushed them to squeeze their profit margin ratio. The graph below shows the Return on Capital Employed as well. The ROCE gives the idea about how much return a company is making on its used capital. (investorwords.com) The ROCE for the company was 9.46%, 7.10% and 7.59% for the years 2009, 2008 and 2007 respectively. The year 2009 proved to be a little bit more in context of return on capital employed.
In 2003, the U.S. doughnut industry was a $5 - $6 billion market. American households consumed an estimated 10 -12 billion doughnuts annually; this translates into over three dozen doughnuts per capita. In 2002, doughnut industry sales rose by about 13%. Sales from doughnut outlets rose by about 9%, to approximately $3.6 billion, whereas packaged doughnut sales at supermarkets, convenience stores and other retail outlets staggered in the past five years. A study by Technomic confirmed the growth of doughnut shops and identified this segment as the fastest-growing dining category in the country. Further analysis provided by the following figure shows attractiveness and profitability