...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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...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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...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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...Background Charlie Lubin an entrepreneur named his line 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...
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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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...Analysis of Sara Lee Corp. | Retrenchment Strategy Review | | [Type the author name] | [Pick the date] | Introduction Sara Lee Corporation, then known as C.D. Kenny Company, was established in 1939 and had net sales of $24 million. By 1998-1999 the company had acquired over forty related and non-related businesses and had peaked at revenues of $20 billion. During the late 1990’s Sara Lee managers began to experience a difficult time in managing the company and increasing profits. This was due to the highly diversified and globally scattered operations that Sara Lee Corp. had developed into. (Gamble & Thomson, 2010) Over the next decade Sarah Lee would begin to transform the company into a streamlined, less globally and industrial diverse company; with a focus and commitment on superior products and customer service. The transformation would include divesting of businesses that contributed to approx. 37% of annual revenue and a spin-off of branded apparel into a new business, Hanesbrand, with the expectation that the retrenchment initiatives would generate $3 billion in net after-tax proceeds. With the introduction of a new CEO in 2000, Steven McMillan launched a new strategic initiative to narrow Sara Lee’s focus by divesting of unrelated business assets and companies that were not key to the organizations focused industries. In 2005 Brenda Barnes was appointed as President and CEO of Sara Lee Corp and with her appointment the announcement that Sara Lee Corp...
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...Sara Lee’s Retrenchment Strategy Case Study Vinh Tran Strategic Management April 28, 2013 Sara Garski Southwestern College Professional Studies Introduction Sara Lee started out as a small company in wholesale distribution that gradually grew to a series of related and unrelated businesses. For the next 40 years, the company expanded to food processing, retail food, and household products to more than 40 countries. Their broad differentiation strategy and geographically spread operations has management struggling to operate efficiently. Even with the vast company’s portfolio, it did not help with building shareholder value. With the declining profits worldwide, Sara Lee’s retrenchment initiatives is divest eight of its business units to raise profitability through operating profit and sales. Strategies Sara Lee’s retrenchment strategy is required in order to focus its resources on more profitable industries such as the beverage, food, and household products company. Their plan on separating themselves from weak performing business units and product categories will put the company in a better financial position. Management will be able to focus their resources to boost their profitability, sales, and market shares on the remaining products. The spin-off of Hanes brands was a smart move even though the operating profit margin was still a moneymaker. The cash payment needed to eliminate the note payable to Hanes brand from Sara Lee and it did not...
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...Sara Lee’s Retrenchment Strategy Case Study Vinh Tran Strategic Management April 28, 2013 Sara Garski Southwestern College Professional Studies Introduction Sara Lee started out as a small company in wholesale distribution that gradually grew to a series of related and unrelated businesses. For the next 40 years, the company expanded to food processing, retail food, and household products to more than 40 countries. Their broad differentiation strategy and geographically spread operations has management struggling to operate efficiently. Even with the vast company’s portfolio, it did not help with building shareholder value. With the declining profits worldwide, Sara Lee’s retrenchment initiatives is divest eight of its business units to raise profitability through operating profit and sales. Strategies Sara Lee’s retrenchment strategy is required in order to focus its resources on more profitable industries such as the beverage, food, and household products company. Their plan on separating themselves from weak performing business units and product categories will put the company in a better financial position. Management will be able to focus their resources to boost their profitability, sales, and market shares on the remaining products. The spin-off of Hanes brands was a smart move even though the operating profit margin was still a moneymaker. The cash payment needed to eliminate the note payable to Hanes brand from Sara Lee and it did not...
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...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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...Sara Lee Equity Analysis and Valuation Valued at 1 April 1, 2007 Analysts: Todd L. Ehlers: todd.ehlers@ttu.edu Michael D. Estes: mikestes@sbcglobal.net Daniel W. Taylor: dtaylor1184@yahoo.com Joseph R. Torres: rhyno1112@sbcglobal.net Table of Contents Page Number Executive Summary……………………………………………………………………………………………… 2 Analysis Snapshot............................................................................................ 2 Company and Industry Overview…………………………………………………………………… 3 Accounting Analysis………………………………………………………………………………………. 3 Financial Ratio Analysis…………………………………………………………………………………. 4 Analysts Evaluations……………………………………………………………………………………… 4 Overview of Firm and Industry............................................................................... 5 Industry Overview and Analysis………………………………………………………………………….. 8 Rivalry Among Existing Firms………………………………………………………………………….8 Threat of New Entrants…………………………………………………………………………………. 15 Threat of Substitute Products………………………………………………………………………… 17 Bargaining Power of Buyers…………………………………………………………………………… 18 Bargaining Power of Suppliers……………………………………………………………………….. 20 Characterization of Industry……………………………………………………………………………20 Value Chain Analysis: Key Success Factors…………………………………………………………. 21 Competitive Advantage Analysis…………………………………………………………………………. 23 Cost Leadership……………………………………………………………………………………………. 24 Differentiation……………………………………………………………………………………………….27 Accounting Analysis………………………………………………………………………………………………...
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...The Concept Of Influence Processes Influence is defined as the force one person exerts on another person to induce a change in the targeted individual. Influencing can change a person's behavior, attitude, goals, opinions, needs and values. Influence is a necessary part of leadership. It is concerned with how the leader affects followers. Influence is a necessary ingredient of leadership, without influence, leadership is non-existent. The influence dimension of leadership requires the leader to have an impact on the lives of those being led. To make a change in other people comes with an enormous amount of social and ethical burden. Various types of influence processes and the factors affecting them Leaders use variety of influence process to alter the behavior of people. The influence process changes according to the demands of the situation. Influence processes refer to the five ways leaders shape organizational variables including people and resources. The five influence processes are direct decisions, allocation of resources, reward system, selection and promotion of other leaders and role modeling. Each will be discussed in detail in the following paragraphs Direct decisions: Direct decisions provide the leaders the ability to influence the choices of their followers. This ability to influence comes with the control leaders have in formulating mission and vision aspects of an organization. The most important aspect giving power to leader in the organizational structure...
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...Company Background of Coach Business Strategy – BU-4193 Marie Kight January 20, 2013 History Coach, Inc. is the manufacture of the leather good company that got its start from manufacturing small leather goods. They’re known for ladies handbags, luggage, briefcases, wallets, and other accessories. Coach was founded in 1941 in New York City with a partnership called Gail Manufacturing Company. They began as a family-owned business with six leatherworkers that made small leather such as wallets and handbags. In 1946 Miles and Lillian Cahn joined as owners being very knowledgeable about the leatherwork business. By the 1950’s the Cahn had taken over the Coach business and was running it by themselves. In 1960 Cahn hired Cashin a well-known fashion designer who worked for Coach from 1962 to 1974 in which she brought their design out to the world. She instituted the coin purse and brighter colors as opposed to the brown and tan color they were using. She also designed matching shoes, key chains, eyewear, and the silver toggle that became Coach hallmark. In 1963 because of their success they were able to run their first ad in the New Yorker. In 1970 they ceased the production of their handbags in New York and moved and changed their name to Coach Products, Inc. From the 70’s to the 80’s Coach products was in very high demand and with a new vice president they started a mail-order business and specialty stores. Because the sales increased...
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...Jingwa Pan Introduction US corporations has been using loopholes to minimize their tax reported annually, however, recently president Obama have claimed that some actions should be taken to avoid those corporations taking advantages of these loopholes in tax regulations which have helped them avoid tax duties. Corporations’ taking advantage of such tax duties can cause unexpected results. Other hardworking corporations and individuals may have sense of unfair. This report will analyze the problems that exists about those corporations escape tax duties using the loopholes of tax regulations as well as an explanation on President Obama’s new claim about tax returns. Problem statement Inversions are transactions in which a U.S. company merges with a foreign company overseas to lower its tax burden.(citation 1) So far, tax avoiding corporate inversions lowers companies’ tax bills by allowing them to redomicile overseas even though their core operations and management usually remain in the United States. (citation 2) This is a loophole in tax regulation that corporations will take advantage of it by reincorporate overseas while lawmakers haven’t notice about it. A lot of investors and entrepreneurs has been looking for a good way to reduce the tax duties as much as possible. Since the U.S. has one of the world’s highest top rates which is 35%, although effective rates everywhere can be substantially lower depending on tax breaks and other incentives, the U.S. also is one of the...
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...Summary of JADS transactions over the past three months: Overall Portfolio Performance Month | Monthly Returns | September | 467,414.43 | October | 402,622.24 | November | 330,099.25 | Total | 1,200,135.92 | Over the past three (3) months, JADS group performed quite well in comparison with other groups. There were at least 2 members who made significant returns on investment. There were some stocks trades which resulted in high gains whilst there were others which incurred losses from the moment of purchase until they were sold. The group noticed that the trading environment relied heavily on both internal and external news surrounding the companies which traded on the stock market and as a result, constant monitoring of the financial news was required to keep adequately abreast in an effort to facilitate financial decisions in a timely manner. JADSjanella: * Best stock bought: Hewlett Packard(HPQ),although the stock price has been decreased from $27.94 to $25.39 this has been due to the fact that most of the leaders in the sector gave up their gains for the thanksgiving holiday. * Worst stock bought: The worst stock was Texas Instrument (TXN), because it fluctuates frequently as a result it had to be monitored frequently. The stock fell drastically over the past few weeks when compared to the price it was about one month ago. What I have learnt overall: 1. to make money on the stock market you have to monitor the market regularly 2. read...
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...Green Mountain Coffee Roasters Presented Opportunity: International Expansion to Brazil Dear Mr. Kelly, Green Mountain Coffee Roasters (GMCR) is a company that is in need of a change. As we combed through the company’s most recent 10-K, we were presented with two possible domestic challenges, the first being that GMCR was about to lose its patent rights to its Keurig K-cup model and that there were stagnating sales. Upon further research and analysis, we found that GMCR has come up with solutions to counter both challenges. In response to the impending patent loss, Green Mountain Coffee has a new machine in the works that will only recognize the brand’s specific Keurig K-cup products through RIFDs. This new machine will enable GMCR to combat any possible competitors or imitators and will allow the company to avoid what was almost a crisis situation. Additionally, the projected sales forecast for the next few years is anticipated to grow exponentially. With the company’s most imminent challenges solved, it seems logical that GMCR look at its possible opportunities and embark on a new business venture. Green Mountain has an extremely weak international presence, with its major sales coming predominantly from North America. The company needs to take advantage of an incredible opportunity it has been presented with and bring its coffee, Keurig machines and K-cups to the international market of Brazil by way of a flagship café based out of Rio de Janeiro. Green Mountain can...
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