Business - Smucker's Case Assignment Example | Topics and Well Written Essays - 1500 words

Business - Smucker's Case - Assignment Example It expanded itself beyond jams and jellies so that it can shield itself from becoming an acquisition of any of the larger firm. The company has been successful at expanding its operations, enhancing its sales and revenues by greater margins and increasing the price of the stock (Gamble, J. E., â€Å"Smucker’s in 2011: Expanding the Business Lineup†). The products of J. M. Smucker Company helped it to achieve its long-term goals. The company’s brand demonstrates strategic fit in the sense that all its brands are performing quite well. Smucker’s expected its net sales to augment by 6 percent annually by increasing the sales growth to 2-3 percent resulting from future acquisitions, and increase in sales by 1 percent from the introduction of the new product. It is identified that in the year 2010, the company was capable of becoming the market leader in 11 of its food categories such as fruit spreads as well as dessert toppings, roasted and ground coffee, heal th and natural beverages, peanut butter, cooking oil and condensed and evaporated milk. It can be stated that it is feasible for the company to expand its operations beyond its core competencies in order to fight the competition that it confronts from its rivals. This will help the company to generate high sales and revenues, along with that it will also assist the company to increase substantial market share. Question Two One of the factors impacting the successful operations of Smucker’s is taxation. Changes in the tax rates and laws have a significant influence upon the company. Competition is the other macro environmental factor which hampers the sales and profitability of the company. Nestle and Kraft Foods are the main competitors of the Smucker’s in United States. Economic slowdown and recession in the USA has an impact upon the operations of the firm. It is observed that the first three months of the year 2011 seemed to be promising despite the persistent impac ts of economic downturn in the United States. The revenues of the company were same for the period i.e. first three months in the fiscal year 2010. However, there was rise in the operating income by 5 percent in the first quarter from $185 million of the year 2010 to $195 million in the very first quarter of the year 2011. When the USA faces with the issues related to currency and interest rates fluctuations, the companies like Smucker’s may have to face significant problems since these companies have its branches in many of the foreign nations. There has been change in the consumption pattern of the people of the USA during the period of recession and as a result the organization had to focus upon the budget cuts and concentrate more upon the home made meals rather than readymade meal as sold by Smucker’s. Sudden change in the consumption habit has a significant impact upon the company. Therefore, it is quite significant for the company to take certain initiatives so that it can minimize the negative impacts of such threats and help in the enhancement of the sales and revenues of the company. If such issues are not paid due attention, then the company’s profitability will be hampered to a great extent. Question Three There are many subsectors of processed food industry and each subsector has different growth expectations, competitive intensity, profit margins and business risks. The industry can be identified as attractive in the