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Case Study - The Oscar Meyer Company

            
             The basic problem with this division of Kraft Foods was that the president of division Marcus McGraw had a vision of growth,(+4% in volume and +15% on operating income),that had become difficult due to the change in the needs of the customers they catered to. The change in needs was responsible for the decrease in sales of their traditional red meat and increase in sales of white meat which was low in fat content. The losses that have been offset by acquiring Louis Rich were beginning to surface again due to increase in competition. The competitors in the red meat have decreased their price which has led to the decrease in sales of Oscar Mayer products. The customers were shifting to healthier products.
             Analyzing the Solutions.
             Alternative 1: This proposed solution was given by Rob Goodman of the Louis rich division. He suggested concentrating on the white meat division which was invariably under Louis Rich. The solution was to increase the awareness about the white meat and its health advantages. For this there was to be an increment in the budget of marketing and promotion of the Louis Rich Division. Also there was suggestion of introducing new product in the white meat category.
             Analysis.
             Concentrating on the white meat is not a good idea though the sales of red meat is declining and the appreciation of white meat is increasing in the current trend but the company's major chunk of income is attributed to the red meat only the white meat's share of volume in the current year is 272 out of 942pounds whereas 650 of red meat pounds thereby contradicting the company's target of achieving a high increase in volume. Reading the solution proposed above the group came to a conclusion that even though it is an attractive proposition since it targets the healthy needs of the customer, it is not the most viable one as it concentrates only on one particular division and does not include the overall strategy of the firm.


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