Hershey
MAN4894
4/12/2018
HERSHEY 2
Introduction
Hershey’s Cocoa was introducing back in 1894 when CEO Milton Hershey made Hershey’s available to the public and the rest became history. Hershey has open many opportunities to individual and quality of life.
Mission Statement
“Bringing sweet moments of Hershey happiness to the world every day.”
Vision Statement
“Continuing Milton Hershey’s legacy of commitment to consumers, community and children, we provide high-quality HERSHEY’s products while conducting our business in a socially responsible and environmentally sustainable manner.”
Strategy
As an established firm with a long American history with all chocolate lovers, The Hershey Company holds a strong market presence in the snack food industry. To survive as a firm, a high-growth strategy has been identified and implemented in order to deliver predictable, profitable, sustainable growth, expand geographically in target markets, and drive industry-leading growth through product innovation. Focus will be to invest and expand internationally the five core
ands: Hershey’s, Reese’s, Hershey’s Kisses, Jolly Rancher, and Ice Breakers (2017).
The Hershey Company vision states “Bringing sweet moments of Hershey happiness to the world every day.”
The proposed Vision:
“To make the best products that will
ing you back for more.”
This proposed vision statement speaks to all-new consumers that are willing to give the Hershey product a try and to all the others exciting repeat consumers assurance that the product will exceed expectation.
Proposed Mission statement:
“To produce the best quality product while complying with the highest ethical standards.”
This proposed mission exhibits a firm intention to conduct business honestly and ethically. Also creates the impression of being very serious about enforcing rules. This statement will also help Hershey stand out in an industry with high levels of competition.
In every organizations understanding the demands of the product that is being produce is what will help determine the success of the company and it being able to sustain. To sustain, Hershey’s should identify their opportunities and threats. Decades ago chocolate was luxury and on the rich would enjoy, by 1900 Milton saw an opportunity to make his Chocolate more affordable so that everyone could enjoy.
Opportunities
i. Dark chocolate health benefits
ii. Marketing of holidays
iii. Joint ventures outside of U.S.
iv. Organic food market growing
v. Acquisition of companies outside of U.S.
vi. Technological advancements lower manufacturing costs
vii. Changing tastes=new products (richer products, coffee flavouring)
Threats
i. Price of cocoa rising
ii. Price of sugar rising
iii. Easily substitutable products
iv. Health conscious consumers/obesity epidemic
v. Health concerns (peanut allergies)
vi. Unfavorable cu
ency exchange rate
vii. Natural disasters affecting growth of products
Competitive Profile Matrix (CPM)
Hershey’s main competitors are Nestlé and Mars. The critical success factors that make up the CPM are advertising, product quality, price competitiveness, management, financial position, customer loyalty, E-commerce, and variety of product line. Hershey has significantly higher scores in advertising, product quality, and customer loyalty. However, Nestle dominates in the areas of price competitiveness, global expansion, and variety of product line. Mars is also similarly close in scores to Hershey and has an advantage in E-commerce. Hershey’s weighted score is 2.93, Nestlé is 2.75, and Mars is 3.0. These numbers do not necessarily mean that Hershey is not as good as Mars, but it can be used so that Hershey can focus on what needs to be done to gain competitive advantage in this specific industry.
Hershey
Nestlé
Mars
Critical Success Factors
Weight
Rating
Score
Rating
Score
Rating
Score
Advertising
0.14
4
0.56
2
0.28
3
0.42
Product Quality
0.16
4
0.64
3
0.48
3
0.48
Price Competitiveness
0.05
2
0.10
4
0.20
2
0.10
Management
0.08
3
0.24
2
0.16
3
0.24
Financial Position
0.15
1
0.15
3
0.45
3
0.45
Customer Loyalty
0.20
4
0.80
2
0.40
3
0.60
Global Expansion
0.15
2
0.30
4
0.60
3
0.45
E-commerce
0.05
2
0.10
2
0.10
4
0.20
Variety of Product Line
0.02
2
0.04
4
0.08
3
0.06
Total
1
2.93
2.75
3
Hershey’s External Factor Evaluation, EFE, consists of opportunities and threats within their industry. These help to evaluate the economic, social, cultural, demographic, environmental, political, governmental, legal, technological, and competitive factors that can affect them. By identifying opportunities and threats within the confectionery industry, Hershey can assess how well they are responding to the key factors. The opportunities and strengths identified combined gives Hershey a weighted EFE score of 2.28. Hershey is just under, but close, to the average weighted score of 2.5 which shows that they can capitalize more on opportunities and do more to avoid external threats.
External Factor Evaluation (EFE) Matrix
Key External Factors
Weight
Rating
Weighted Score
Opportunities
1. Dark chocolate health benefits
0.06
1
0.06
2. Marketing of holidays
0.10
4
0.40
3. Joint ventures outside of U.S.
0.09
3
0.27
4. Organic food market growing
0.05
2
0.10
5. Acquisition of companies outside of U.S.
0.05
3
0.15
6. Technological advancements lower manufacturing costs
0.06
2
0.12
7. Changing tastes=new products (richer products, coffee flavoring)
0.07
3
0.21
Threats
1. Price of cocoa rising
0.07
2
0.14
2. Price of sugar rising
0.07
2
0.14
3. Easily substitutable products
0.09
3
0.27
4. Health conscious consumers/obesity epidemic
0.05
2
0.10
5. Health concerns (peanut allergies)
0.06
1
0.06
6. Unfavorable cu
ency exchange rate
0.08
2
0.16
7. Natural disasters affecting growth of products
0.10
1
0.10
Total
1
2.28
Strengths
I. Hershey’s is a strong well-known
and.
II. Hershey’s produced varied products such as chocolate, candy, mints bu
le gum and much more.
III. Hershey’s has a large production of pasta.
IV. Hershey’s produces product for our Military such as Military Chocolate.
V. Hershey’s promotes its
and by contributing in many segments of different industries such as entertainment, restaurants, commercials and more.
VI. Hershey’s has housing facilities and schools for Employees.
VII. Hershey’s has a toll-free number devoted in promoting research and education.
Weaknesses
I. Hershey’s has had an increase in advertising expense, up to 46%.
II. Hershey’s has a large debt compared to its competitors.
III. Hershey’s is easy to duplicate, causing copies in other parts of the world.
IV. The Coca beans are increasing in price causing concerns for the company. Specifically, because Hershey’s does not necessarily practice fair trading.
V. Hershey’s geographic coverage is becoming so enlarged that it is leading to weakening authority.
Conclusion
The company has high profitability and is efficient in its working, but the company has very low liquidity and high solvency which can lead to the bankruptcy of the firm. It is important that the company improve on its debt proportion to help the company to save from financial crisis. We would invest in the company as the company has high profitability and efficiency.
References
Hershey's. (n.d.). Retrieved April 10, 2018, from https:
www.hersheys.com/en_us/our-
ands.html
Seiber, V. (n.d.). Hershey and Pasta: An Interesting Relationship. Retrieved April 10, 2018,
https:
hersheystory.org/hershey-pasta-interesting-relationship/
A. (2012, November 17). SWOT analysis on Hersheys. Retrieved April 10, 2018, from http:
www.freeswotanalysis.com/food-agricuture/515-swot-analysis-of-hershey.html
(n.d.). Retrieved April 11, 2018, from https:
www.hersheys.com/en_us/our-story/our-history.html
Hershey Details Strategy for Continued Growth and ... (n.d.). Retrieved April 12, 2018, from http:
www.bing.com/cr?IG=099B0324F4BB4C52A539F4155AECDBE9&CID=3F4E52677252695037C959A873FD688D&rd=1&h=9lv-xuAkb3mNQkdFGXelDYHg8xPMXsamlAE5qMtNzk&v=1&r=
http:
www.businesswire.com/news/home/ XXXXXXXXXX/en/Hershey-Details-Strategy-Continued-Growth-Announces-Long-Term&p=DevEx,5057.1
Hershey Details Strategy for Continued Growth and ... (n.d.). Retrieved April 12, 2018, from http:
www.bing.com/cr?IG=099B0324F4BB4C52A539F4155AECDBE9&CID=3F4E52677252695037C959A873FD688D&rd=1&h=9lv-xuAkb3mNQkdFGXelDYHg8xPMXsamlAE5qMtNzk&v=1&
http:
www.businesswire.com/news/home/ XXXXXXXXXX/en/Hershey-Details-Strategy-Continued-Growth-Announces-Long-Term&p=DevEx,5057.1