What is Sara Lee’s corporate strategy?
The corporate strategy is to focus strategic initiatives to narrow Sara Lee’s focus on a smaller number of global branded consumer packaged-goods segments; food and beverage, intimates and underwear, and household products. This would be related diversification and they are getting rid of unrelated divisions such as apparel.
How has its retrenchment strategy changed the nature of its business lineup?
The retrenchment strategy was to exit eight businesses that had been targeted as nonstrategic. They are 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. They expect the initiatives to generate combined net after tax proceeds in excess of $3 billion and get rid of high company costs.
What is your evaluation of Sara Lee’s retrenchment strategy and its lineup of businesses in 2010?
Their goals for 2010 are to boost top line sales by 2-4 percent annually to reach $14 billion and achieve a 12 percent operating profit margin. They believe that competitive pricing, innovative new products and brand-building capabilities were essential to its efforts to please consumers. This strategy is a good choice for their business as they will be in more stable profitable sectors and can combine business operations such as marketing and distribution. They are centralizing more business functions.
Has the company’s retrenchment strategy placed it into attractive industries?
The North American Retail division included such products sold in supermarkets and discount stores as lunch meats, breakfast sausage, smoke sausage, frozen desserts, and single-serve coffee. The North American fresh bakery division included fresh breads, buns, and bagels sold in supermarkets. The North American Foodservice included the sales of meat products, bakery products, and coffee and tea products sold to food service accounts in North America. The...