Jose answered on
May 04 2023
Team Project Report Outline
Business organizations always try to make changes to their strategies and plans. While developing the strategies, the organization has to consider the influence of internal and external factors. This report mainly focuses on the business and strategic analysis of the company called Kellogg's. The US-based company has operations all around the world, and the company is planning to make changes to future operations. In this report, we focus on analyzing the national and international competitors of Kellogg and identifying the strategies developed by the company to manage the competition.
Managing the competition is not easy task the company has to adopt most effective methods and strategies to became the best company in the world. In the case of Kellogg’s we can understand that the company giving more importance to health related products and services. The company is following aggressive production management policies and practices for ensuring the quality of the materials. By reading through this report, we get an idea of the working style of the company.
Overview of the Company and Industry
3.1 Introduction About the Company
Kellogg's is a multinational food manufacturing and distribution company. The company started its operation in the year of 1906. Will Keith Kellogg is the founder of the company, which has operations in all parts of the world. The headquarters of the company are situated in Battle Creek, Michigan, U.S. Steven Cahillane is the chairman and CEO of the company, and he has a good relationship with employees. h planning to make new changes to the company. More than 34000 employees are working in the organization, and the company considers the needs of the employees.
The company's focus on its core business also extended to its international businesses, where executives believed there was the most room for future expansion. In 1991, Kellogg controlled 50% of the non-American cereal market, and 34% of its profits were made outside of the US. It controlled at least six of the top 10 cereal
ands in most of the markets where it was active. Looking ahead, Kellogg's main target markets in Europe, Asia, and Latin America had not yet developed to the same levels as those in the United States, which were seen as being more advanced. In most other markets, the amount of cereal consumed per person each year was less than two pounds, compared to ten pounds in the United States. The gross profit of the company is about $4.615 billion, and the company is planning to expand the operations in to untapped market. The company has developed strong reputation among the customers and customers considered Kellogg’s as the premium
and. Now we can analyse the major events happened in the business journey of Kellogg’s.
The company renamed in to toasted corn flakes company
The budget for the ads were covered $ 1 million
First overseas plant in Sydney Australia
Spent money for sponsoring children program
Founded W.K Kellogg Foundation for providing support to poor people
Operations of the company was restructured to two major divisions USA and International
The company became the world's second-largest snack food company
The company partnered with GLADD
The plant workers of the company started protest the company
Planning to the divide the business in to three separate types
3.2 Overview of the Industry
The company Kellogg’s belongs to the packaged food industry. The company is competing with the national and international players. The company is following the rules and regulations implemented by the industry regulators. Packaged foods are foods that have been prepared ahead of time and packed in a way that extends their shelf life. Consumers regularly purchase packaged food. As a result, customer demand for such products stays consistent. Packaged food goods include ready-to-eat and convenient foods such as snacks, beverages, chips, frozen veggies, and more. While checking US packed food industry we can understand that the packaged food market in the United States is showing the positive trend.
3.3 Major Competitors of the Company
The major competitors of the company includes;
1. General Mills
General Mills, a major Kellogg competitor, is a global producer of
anded consumer foods. Their items are sold in retail outlets. The corporation was founded in 1856 and is headquartered in Minnesota, United States. The company provides
anded and un
anded consumer food goods to the Northern American restaurant and commercial baking industries. It also manufactures pet meals. Their main product lines include quick meals such as pizza, soup, meal kits, side dish mixes, and ready-to-eat cereals, as well as snacks such as grain, savoury snacks, and nutrition bars. HiagenDasz, Cheerios, Pillsbury, Cascadian Farm, and Betty Crocker are their best-selling
and's key strength is its widespread presence in a variety of food processing domains such as baked items, cereals, dough, ice creams, pastries, spreads, and vegetables. General Mills is regarded as one of Kellogg's main competitors due of their availability.
2. Mondelez International
It is one among the world's largest snack corporations, with over $35 billion in yearly revenue. It generates powerful dominant
ands. It continually adjusts its key items in order to market them globally. Snacks, such as chocolate, cookies, gum, and sweets, are their most appealing category. This is a constantly important category. The company believes in one-of-a-kind items. This company's major strength is that it is a
and with a strong potential for revenue generation.
4. Industry Analysis
Kellogg's Five Forces analysis helps to analyses its existing market position based on many internal and external aspects such as competitors, customers, suppliers (vendors and partners), financial strength, future scope, and alternate solutions.
Threat of New Entrants
The threat of new entrants in minimal and the the customers can shift to another without incu
ing huge cost. The new entrants has to follow strict rules and regulations for entering in this industry and they also has to spent huge fund for the same.
Threat of Substitutes
Threat of substitutes is high, in market different types of products are avaialbel. Customers are gravitating towards healthier products because switching costs are low. Furthermore, the company's business is threatened by the busy and mobile lifestyle. As a result, Kellogg's faces tremendous competition from its replacements and must handle this by focusing on
and loyalty, increasing quality, and maximizing value for money. It must focus on customers and adopt retention strategies through R&D innovation.
Customer Bargaining Power:
Customers have little bargaining power. They do not have a direct influence on cost reduction, but there is an indirect influence because other competitors provide customers with an option, making the industry cost competitive. Customers' switching costs are low, posing a danger, yet Kellogg's offers marginally differentiated quality items that enable them retain their consumer base. The company is giving more importance to the aspects of
1. New product development
2. Innovation to improve the consumer experience.
Supplier Bargaining Power:
The bargaining power of the suppliers is minimal because;
1. More number of suppliers are there to provide materials
2. Switching cost is less
3. Supply cost is less
4. Suppliers does not have dominant position
Rivalry in the marketplace:
Kellogg's maintains market competitiveness by supplying unique products at lower prices through the use of economies of scale. Kellogg's outperforms its cereal competitors by a significant margin in international markets. Almost 70% of its revenue comes from the US, Europe, and Latin American markets. Kellogg's business strategy of distinctiveness and cost leadership, along with a focus on continuous market research to ensure sustainability, contributes to a higher market share. To counter the continual global competition, Kellogg's might also focus on partnering with its competitors to enhance sales.
5. Internal Analysis
5.1 Company’s Market Position Relative to its Two or Three Major Competitors
Kellogg's, which originated in the United States, has long been known over the world. The organization has been in the worldwide market for a long time, and its capacity to compete locally is outstanding. It is easy to establish...