Hershey Company

Résumé du document

Hershey Company, a United States-based snack food company has been looking to assume an international role for the past two decades. Founded by Milton Hershey over one hundred years ago, going international has proven to be quite a feat especially when it is chocolate that is the topic for discussion. Currently, approximately five percent of the Hershey Company's total sales result from international business. Principal products sold in the United States, Canada, and Mexico include: Kit Kat, Twizzlers, Rolo Fast Break, Reese's, Hershey Kisses, Oh Henry, Mounds, Swoops and different flavored milks.
The Company manufactures, imports, markets, sells, and distributes its products in over sixty countries worldwide. Primarily focused in North America, the Hershey Company's marketing strategy is to maintain brand equity, induce product innovation and maintain the quality of its products and expertise in manufacturing and distribution.

It is interesting to see how such a well-known company that has been around for one hundred years in North America, faces difficulties in going international. It is common to hear of big-name brands that are doing very well in almost every region of the world, but this company is different from all the others. In the following exposition, different aspects and concepts related to the international expansion and development of the Hershey Company will be presented.

Extraits

[...] Currently, approximately five percent of the Hershey Company's total sales result from international business. Principal products sold in the United States, Canada, and Mexico include: Kit Kat, Twizzlers, Rolo Fast Break, Reese's, Hershey Kisses, Oh Henry, Mounds, Swoops and different flavored milks. The Company manufactures, imports, markets, sells, and distributes its products in over sixty countries worldwide. Primarily focused in North America, the Hershey Company's marketing strategy is to maintain brand equity, induce product innovation and maintain the quality of its products and expertise in manufacturing and distribution. [...]

[...] The Hershey Company Table of Contents I. Foundation of International Management 4 1.The EPRG model of H. Permutter The OLI model of J. Dunning 5 II. Competitive analysis and international Development Competitive Analysis Value Chain Activities Development Strategies By I. Ansoff Strategies of International Development Market Entry Strategies 11 III. Inter-firm Linkages 12 IV. Cultural integration 16 V. Organization and business functions The Corporate Philosophy The Organizational Structure 20 Introduction Hershey Company, a United States-based snack food company has been looking to assume an international role for the past two decades. [...]

[...] Looking globally, in 1991, Hershey acquired the German chocolate maker Gubor Schokoladen, which in the first few years after the takeover failed to meet Hershey's expectations. In 1992, the firm purchased an 18.6 percent interest in the Norwegian confectionery firm Freia Marabou, but then promptly sold the stake the following year after it was outbid for majority control by Philip Morris. Later, in 1993, Hershey acquired the Italian confectionery business of Heinz Italia S.p.A. for $130 million, which primarily gave it the Sperlari brand, a leader in non-chocolate confectionery products in Italy. [...]

[...] Product Development: This is key to its internal strategy; i.e. to grow sales. It is used in the form of innovative new products and limited editions using its key brands such as Hershey's, Reese's and Hershey's Kisses. For e.g. this strategy enabled Hershey's to grow net sales by ahead of an estimated growth in the US during the period of 2003-04. Market Extension: Looking at the immense growth in the Asian markets, Hershey has stepped into an agreement with Lotte, a Korean Company, to set a manufacturing unit in China. [...]

[...] Thus we can see that buyers are very important in this industry. Therefore, companies in the confectionary industry have to work very hard at retaining their loyal customers and this means coming out with new products, promotions, incentives, etc. This makes the business environment even more competitive as firms strive to attract the same consumer to them Value Chain Activities In July 2003, the company announced a number of initiatives to enhance its value chain of activities. Operations: Initially, Hershey's had 10 major manufacturing facilities. [...]