Sunnyvale Foods, Inc. Case
1 Present Situation Analysis
Strength
* Long history
It has history of more than 127 years. Its products are popular under the Sunnyvale Foods brand. * Enough facilities
Sunnyvale Foods is the one of the large US food processors operating more than 30 processing plants with total annual sale about $650 million. So Sunnyvale Foods is capable of economy of scale or scope, which can contribute to low cost or price. * Broad product line
Sunnyvale Foods has a product line of 65 items. If this is made use of appropriately, it can contribute to economy of scope.
Weakness
* Sales orientation
The former president said, “as long as new products look like they will increase the company’s sales volume, they are introduced… little, if any, attention paid to margins…profits will come through good products produced in large volume.” Sunnyvale management does not put profit in the first place, but put sales or sales per store in the first place. However, high sales per store or total high sales do not necessary mean high profit. Ironically, even its sales volume has not increased much from the 1990 level.

Despite its relentless pursuit of sales volume, Sunnyvale Foods may have a mistake by implementing a line-forcing policy, which requires that any store wanting to carry its brand name must be willing to carry most of the 65 items in the Sunnyvale Foods line. Pierce Cassedy, a production manager, says about the line-forcing policy, “…the large stores are volume! …the result is maximum sales”. Small retailers are ignored because they are considered too small in potential sales volume per store to be any significance. Sunnyvale loses the support from small retailers and a chance to achieve a better performance in sale either. * No serious consideration before production
Pierce Cassedy says, “… we will can or freeze any