...Overview Sara Lee Corporation has a vision “to be the first choice of consumers and customers around the world by bringing together innovative ideas, continuous improvement and people who can make things happen.” The company’s vision can be summed up simply with their mission: “To simply delight you…everyday.” The company has been trying to achieve these goals since 1939 when the company began. Sara Lee employs a broad differentiation strategy, and has been diversifying since inception, mainly by acquisition. In 2005, the company, in an effort to raise profitability, began to divest eight of its business. The company’s goal was to increase sales to at least $14 billion, and increase operating profit to 12%. The idea was to focus efforts on the good, beverage and household product industry, which were seen as more profitable, and profits would increase. In 2008, Sara Lee launched an initiative called Project Accelerate. This program was designed to cut costs and increase productivity by focusing on overhead costs, streamlining the supply chain and outsourcing. It is expected to save of sum of $350 to $400 million by the end of 2012. By 2010, Project Accelerate had saved the company $180 million. The management team also decided to buyback $2.5 to $3 billion of common shares over a three year period. Despite their efforts, by the end of 2010, Sara Lee has revenues of just $10.8 billion and the operating profit margin was well below the target 12% at 8.5%. In an attempt to boost...
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...Company profile Company name: Sara Lee Corporation Company Address: 3500 Lacey Road Downers Grove, IL 60515 United States Phone: 630-598-6000 Fax: 630-598-8482 Website: http://www.saralee.com CEO/President: Brenda Barnes Founding Year: 1939 Product line Breath: Sara Lee Corporation’s product line mainly consists of food, beverage and household products. ▪ Food & beverage (SLFB) division include Ball Park franks, Dean Sausage, Hillshire Farm deli meats, Sara Lee Breads & bakery products, Sara Lee frozen desserts and Senseo single serving coffeemakers and coffee pods. ▪ Household & body care products include Ambi pure air fresheners, Kiwi shoe care products & Sanex personal care products. Sara Lee also provides Foodservice to their customers. Branches: Sara Lee operates more than 40 countries such as USA, Australia, Newzeland, Netherlands, Philippines & etc. Key competitor: Hostess Brands, Inc; Kraft Foods Inc. (kft); Tyson Foods, Inc. (tsn) Mission: To simply delight you……everyday. Vision: To be the first choice of consumers and customers around the world by bringing together innovative ideas, continuous improvement and people who make things happen. Objective of the company: |Financial Objective |Strategic Objective ...
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...of cheesecakes after his daughter, Sara Lee. In the 1950s, Consolidated Foods bought out his company, where he continued to be the senior executive for many years. In the 1980s, Consolidated Foods changed its name to Sara lee. Sara Lee started out as a small wholesale distributor of sugar, coffee, and tea, then it acquire a food processing, packaging, and distribution, and then retail food business Sara Lee Corporation is now a global manufacturer and marketer of brand-name products for consumers globally focused primarily on the meats, bakery, beverage and household products categories. Its major brands include Ball Park, Douwe Egberts, Hillshire Farm, Jimmy Dean, Senseo and of course its namesake, Sara Lee. The corporation has five segments, namely: North American Retail, North American Fresh Bakery, North American Foodservice, International Beverage and International Bakery. Just as any other organization, Sara Lee has a vision, mission, and values. Their vision is to be the first choice of consumers and customers around the world by bringing together innovative ideas, continuous improvement and people who make things happen. Their mission is “To simply delight you…every day.” Values; Act with Integrity, Use Imagination, Be Inclusive, Work as a Team, Have Passion to excel. *INTEGRITY, IMAGINATION, INCLUSIVE, TEAM, PASSION* (www.saralee.com) This paper’s discussion that includes the corporate strategy and how its retrenchment strategy changed the nature of its business lineup...
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...------------------------------------------------- Sara Lee Corporation in 2011: Has Its Retrenchment Strategy Been Successful? Executive Summary Sara Lee Corporation was founded in 1939 and, as of 2001, had acquired more than forty companies. Sales reached $10 billion in 1988, $15 billion in 1994, and $20 billion in 1998.However, revenues peaked in 1998, as Sara Lee struggled to manage the company’s broadly diversified and geographically scattered operations. In February 2005, Brenda Barnes, Sara Lee’s newly appointed president and CEO, announced a strategic plan to transform Sara Lee into a more tightly focused food, beverage, and household products company. The centerpiece of Barnes’s transformation plan was the divestiture of weak-performing business units and product categories accounting for $8.2 billion in sales - 40% of Sara Lee’s annual revenue. Barnes believed that Sara Lee could benefit from concentrating its financial and managerial resources on a smaller number of business segments where market prospects were promising and Sara Lee’s brands were well positioned. As the first phase of Barnes’s transformation plan, Sara Lee was to exit eight businesses: Direct selling, U.S. retail coffee, European apparel, European nuts and snacks, European rice, U.S. meat snacks, European meats, and Sara Lee branded apparel.The latter was spun off as an independent company, Hanesbrands Inc. Following the disposition of these nonstrategic businesses in 2006, Sara Lee focused on increasing the sales...
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...Over the years, Sara Lee was broadly known for their catchy slogan of “Everybody doesn’t like something, but nobody doesn’t like Sara Lee,” which mainly pertained to the companies bakery group; but Sara Lee Corporation was so much more. The Sara Lee Bakery Group was a division of a larger Sara Lee Corporation which had product lines including such categories as packaged meats, coffee, tea, underwear, intimate apparel, body care, air care, shoe care and air fresheners. In 2006, the slogan was changed to “the joy of eating” to go along with a major transformation of the company into a smaller number of core businesses which focused more tightly on food, beverage, and household products. In February 2005, Brenda Barnes, Sara Lee’s newly appointed president and CEO, announced a strategic plan to transform Sara Lee into a more tightly focused food, beverage, and household products company. The centerpiece of Barnes’s transformation plan was the divestiture of weak-performing business units and product categories accounting for $8.2 billion in sales - 40% of Sara Lee’s annual revenue. Barnes believed that Sara Lee could benefit from concentrating its financial and managerial resources on a smaller number of business segments where market prospects were promising and Sara Lee’s brands were well positioned. As the first phase of Barnes’s transformation plan, Sara Lee was to exit eight businesses: Direct selling, U.S. retail coffee, European apparel, European nuts and snacks, European...
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...Sara Lee in 2011: Retrenchment strategy UNIVERSITY OF MARYLAND UNIVERSITY COLLEGE SUBMITTED BY ALLIE JOSIAH TO: PROFESSOR JON GETTMAN DATE: 24TH APRIL 2013 Introduction Retrenchment Strategy Evaluation After Sara Lee's conservation, the association was ready to concentrate on its sustenance & drink, foodservice and worldwide organizations. Sara Lee's key goals for its remaining organizations were to keep tabs on client needs and managing perfection, while making an in number mark through wide developments and focused estimating. The association truly uses its retail meats, pushing comparative meats to its nourishment administration clients. Its meats have viewed expands in bargains and working salary, while productively making the most of improvements inside perishable things. The aforementioned advancements helped bargains more than $100 million, indeed, when its center items' bargains were even. The association holds a 20% piece of the overall industry in a developing industry of just about $10 billion. Sara Lee is the business sector pioneer in retail breads in North America, while nearly trailing Kraft inside the meat part. New bread bargains bounced more than $600 million inside 3 years, because of the power Sara Lee had with markets to build retire space for its features. Sara Lee furnished imaginative breads for its clients, while commanding the breakfast bread market. While holding a 14% piece of the pie in a $100 billion industry, Sara Lee is positioned...
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...Recommendation to Sara Lee Corporation: IT utilization of e-commerce Lionel Warren & Hamjat Jallomy Bah Consultants Instructor: Professor Herniter Course: IS535 August 15, 2011 Abstract Information technology represents the future of global business. The amount of trade conducted electronically has grown extraordinary with the widespread use of the internet. In order for companies to effectively compete, it is essential that they have e-commerce as part of their selling and buying strategy. Companies should also integrate e-commerce with their Customer Relationship Management. There are several e-commerce software systems on the market place. It is imperative in selecting software for a company that the appropriate decision is made for the type of software required to meet the company’s objectives and goals. Sara Lee Corporation has been in existence since 1956, but does not currently use e-commerce as part of its business strategy. In order to make a recommendation to Sara Lee Corporation, a review of the companies selling and buying methods will be done as well as how it compares to other companies who are utilizing e-commerce. Three Online Customer Management Software tools will be evaluated to determine which to recommend to Sara Lee Corporation. The expectation is that Sara Lee will incorporate CRM with e-commerce to better serve their customer base and improve on their bottom line. Sara Lee is a business-to-business company which means they are mostly...
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...Rebecca Christie, Kody Lynn) SUBJ: Sara Lee Corporation in 2011: Has Its Retrenchment Strategy Been Successful? EXECUTIVE SUMMARY: In 2005, Sara Lee placed a strategic plan in action to transform the business into a more tightly focused food, beverage and household products company. This involved the divestiture of weak-performing business and product categories, which included eight business units. Although the divestiture would decrease Sara Lee’s revenues, it was believed that concentrating their financial and managerial resources on a smaller number of business units would be beneficial. Sara Lee struggled at the beginning of the retrenchment strategy but has been progressing upward in the last couple of years. ANALYSIS: Strategy Analysis Sara Lee’s corporate strategy was to transform the company into a more tightly focused company by focusing on their food, beverage, and household products. In order to accomplish this, Sara Lee planned to divest their weak performing business units and product categories which accounted for $7.2 billion in sales. Although the divestitures would decrease Sara Lee’s revenues from $19.3 billion to $12.3 billion, they believed it would be better to concentrate on its financial and managerial resources on a smaller number of business segments. These smaller number business segments had prospective markets and were well positioned. After the completion of the retrenchment strategy Sara Lee focused solely on increasing the sales...
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...BLLOctober 30, 2008Sara Lee CorporationSara Lee retrenched seven of its business units in 2006 in order to focus itsresources on its more profitable industries. The company’s goal is to boost its saleslines by at least 2 percent and increase its profit margin to 12% by 2010. Bydeveloping three competitive capabilities in each of its remaining business units,Sara Lee looks to improve its net profits within the next few years. Divested Businesses Analysis Sara Lee divested seven of its units, including: direct sales, U.S. retail coffee,European apparel, European snacks, and U.S. and European meats. The companyfollowed a strategy which allowed it to increase its corporate profits, since most of its business units it retrenched were unprofitable. By 2006, five business units hadnegative net profit margins and negative operating margins. Four of those unitshad negative margins of more than 10%, with different units seeing steady or sharpdeclines in revenues in profits since 2004. The only two profitable units were the direct selling unit and the Europeansnack lines. These two lines were seeing declining revenues and operating margins,except in 2006, when both lines increased their margins. Divesting the snackbusiness was a correct decision, since it was only producing net profits of $3 million,which would not help the business to increase its shareholders’ wealth. Plus, thecompany received a $70 million after-tax gain, more than 22 times the current netprofit. Selling its direct sales...
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...Sara Lee Corporation ANALYSIS OF THE CASE Sara Lee retrenched seven of its business units in 2006 in order to focus its resources on its more profitable industries. The company’s goal is to boost its sales lines by at least 2 percent and increase its profit margin to 12% by 2010. By developing three competitive capabilities in each of its remaining business units, Sara Lee looks to improve its net profits within the next few years. Summary of the case This case study provides an evaluation of Sara Lee Corporation and particularly its operations of product lines available through the Wal-Mart stores. To begin with, an effective SWOT analysis of the company was conducted where strengths and opportunities are identified while addressing possible threats and improving its weaknesses to avoid giving the competition an aggressive advantage. Marketing requires effective identification of issues as a key factor in devising the best methods of addressing them. Therefore, Kirk Nelson identifies the Basic Hipster style to be a major problem in the market because it was not doing well. Effective establishment of the best possible solution is therefore critical to maintain the corporation’s market share for the Wal-Mart Account. This analysis generates key alternatives that Kirk Nelson as the Sara Lee Wal-Mart Girl’s Panty analyst should consider in getting out of the current deadlock. History Sara Lee Corporation is a fortune 500 company listed on...
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...What is Sara Lee’s corporate strategy? How has its retrenchment strategy changed the nature of its business lineup? Sara Lee retrenched seven of its business units in 2006 – direct sales, U.S. retail coffee, European apparel, European snacks, and U.S. and European meats - in order to focus its resources on it’s more profitable industries. By 2006, these five business units had negative net profit margins and negative operating margins. Four of those units had negative margins of more than 10%. Other units were seeing steady declines in revenues in profits since 2004. The company’s goal was to boost its sales lines by 2% and increase its profit margin to 12% by 2010. The company followed a strategy which allowed it to increase its corporate profits since most of its retrenched business units were unprofitable. After retrenchment, Sara Lee was able to focus on its food and beverage, foodservice and international businesses. The company has successfully used its retail meat unit by selling similar meats to its foodservice customers. The retail meat has seen increases in sales and operating income. Sara Lee is the market leader in retail breads in the U.S., trailing Kraft within the meat sector. Fresh bread sales jumped more than $600 million within 3 years due to the leverage Sara Lee had with grocery stores to increase shelf space for its product line. The foodservice industry provides Sara Lee the ability to use its meats in restaurants and fast-food restaurants. Sara Lee has a...
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...What is Sara Lee’s corporate strategy? How has its retrenchment strategy changed the nature of its business lineup? The strategy at Sara Lee is to expand globally, for Sara Lee acquiring new business models to expand into new product categories is how they plan to achieve this goal. For many years Sara Lee has successfully acquired both related and unrelated products, but will now streamline this a little more with the retrenchment strategy. The previous management team struggled with this broad product offering and the disseminated locations. The retrenchment strategy will allow Sara Lee to focus their resources on a smaller, tight knit beverage, food and household business. It will also allow for a change in the model from a wholesale distributor to a larger retail company. 2. What is your assessment of the long-term attractiveness of the industries represented in Sara Lee Corp.’s business portfolio? Sara Lee has the potential to grow. With a focus on core products that are their food company, they have dropped the dead weight of not so profitable products. The food industry will continue to grow within reason due to the requirement of us to have food to survive. It is beneficial to Sara Lee to have established brand power within the market segments as well. If Sara Lee stays active in the market segments and acquires only products that benefit them in the long term, they should keep profits up. 3. What is your assessment of the competitive strength of Sara Lee Corp...
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...Case 16. Sara Lee in 2010: Has its retrenchment Strategy Benefited Shareholders? Question#1. What is Sara Lee’s corporate strategy? How has its retrenchment strategy changed the nature of its business lineup? Sara Lee’s vision is “to be the first choice of consumers and customers around the world by bringing together innovative ideas, continuous improvement and people who make things happen”. Sara Lee’s corporate strategy was to transform Sara Lee into company focused on its food, beverage, household, and body care businesses not only in US also internationally. Continuously, Sara Lee developed its Retrenchment Strategy which is uses to reduce the diversity or the overall size of the operations of the company. First plan was to exit eight businesses that had been marked as nonstrategic: • Direct Selling. Sara Lee sold its business that sells cosmetics, skin care products for $ 547 million cash. • U.S retail coffee. Company sold its well-known coffee brands. • European apparel • European nuts and snacks • European rice • U.S meat snacks • European meats • Sara Lee branded apparel Company expected retrenchment initiatives to generate combined net after-tax proceeds in excess of $3 billion. Next, Sara Lee started to focus to increase the sales, market shares, and profitability of remaining business. Two most important goals were increase sales by 2-4 percent annually to reach $14 billion. Company’s key objectives for remaining businesses were focus on customer...
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...1) What is Sara Lee's corporate strategy? How has its retrenchment strategy changed the nature of its business lineup? Sara Lee’s vision is “to be the first choice of consumers and customers around the world by bringing together innovative ideas, continuous improvement and people who make things happen”. Sara Lee’s corporate strategy was to transform Sara Lee into company focused on its food, beverage, household, and body care businesses not only in US also internationally. Continuously, Sara Lee developed its Retrenchment Strategy which is uses to reduce the diversity or the overall size of the operations of the company. First plan was to exit eight businesses that had been marked as nonstrategic: • Direct Selling. Sara Lee sold its business that sells cosmetics, skin care products for $ 547 million cash. • U.S retail coffee. Company sold its well-known coffee brands. • European apparel • European nuts and snacks • European rice • U.S meat snacks • European meats • Sara Lee branded apparel Company expected retrenchment initiatives to generate combined net after-tax proceeds in excess of $3 billion. Next, Sara Lee started to focus to increase the sales, market shares, and profitability of remaining business. Two most important goals were increase sales by 2-4 percent annually to reach $14 billion. Company’s key objectives for remaining businesses were focus on customer needs and operating excellence, while creating a strong brand through innovations and competitive...
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...Sara Lee retrenched seven of its business units in 2006 in order to focus its resources on its more profitable industries. The company’s goal is to boost its sales lines by at least 2 percent and increase its profit margin to 12% by 2010. By developing three competitive capabilities in each of its remaining business units, Sara Lee looks to improve its net profits within the next few years. Sara Lee, a 58-year-old company that was known as Consolidated Foods Corp. before it adopted its current name in 1985, operates in four industries: packaged meats and bakery items, coffee and grocery goods, household and body-care products and personal products. Its other familiar brands include Hanes, L'eggs and Sheer Energy hosiery; Playtex bras; Kiwi shoe polish; Brylcreem hair products; Jimmy Dean and Hilshire Farm packaged meats; and Champion apparel (Peltz 1). Divested Businesses Analysis Sara Lee divested seven of its units, including: direct sales, U.S. retail coffee, European apparel, European snacks, and U.S. and European meats. The company followed a strategy which allowed it to increase its corporate profits, since most of its business units it retrenched were unprofitable. By 2006, five business units had negative net profit margins and negative operating margins. Four of those units had negative margins of more than 10%, with different units seeing steady or sharp declines in revenues in profits since 2004. Contrary to what has become understood from how the past has evolved...
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