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The Hershey Company

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Joshua Clarke

on 7 May 2015

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Transcript of The Hershey Company

The Hershey Company

Organizational Structure

1. External Analysis
Industry Map
Five Forces
Benchmark Analysis
2. Internal Analysis
Financial Performance
What the CEO Wants
Life Cycle
Corporate Culture Analysis

Situational Analysis
Key Strategic Issues
1. Directional Indicators
I/E Matrix
Space Matrix
Grand Strategy Matrix
2. Strategic Alternatives
Ansoff Matrix
TOWS Strategy Development
Grouping and overarching Strategies
QSPM/Fit assessment
Strategic Analysis
Analysis of Alternatives
Preferred Choices
Three Year Annual Financial Objectives
Contingency Plans and triggers
Mission, Vision, and Value Revisions
Recommendations and Conclusion
Milton Hershey: "The Legend"
Product History
Leading us to today
Organizational Structure
Industry Map
Five Forces
Benchmark Analysis
Opportunities and Threats
EFE Analysis
Financial Performance
What the CEO Wants to Know
BCG Matrix
GE Matrix
Company Life Cycle
Corporate Culture
Strengths and Weaknesses
Internal Factor Analysis
I/E Matrix
Space Matrix
Grand Strategy Matrix
Ansoff Matrix
TOWS Strategy Development
Overarching Strategies
Strategic Fit Assessment/ QSPM
Milton Hershey:
Many Failures
Lancaster Caramel Company
The beginning
Hershey, Pennsylvania
Milton Hershey's Character
Hershey Chocolate Company
The Revolution(1900)
The trademark(1907)
Mr. Goodbar(1925)
Hershey Syrup(1926)
Hershey's Chocolate Chip(1928)
Krackel Bar(1938)
Saving Lives
The Corporate Structure
Corporate Responsibility
Defining values
Hershey's International
Financial Overview
Corporate Structure
Chairman of the Board- James E. Nevels
Board of Directors
CEO- John Bilbrey
President of North American Operations and
President of
International Operations
CFO Patricia Little
Hershey's Mission:
"Bringing sweet moments of Hershey happiness to the world everyday."
Hershey's Vision:
Continuing Milton Hershey's commitment to consumers, community, and children. While providing high-quality Hershey's products while conducting our business in a socially responsible and environmentally stable manner."
Corporate and Social Responsibility
Guiding Principles:
Quality, transparency, community, well-being.
Open to Possibilities, Growing Together, Making a Difference, One Hershey.
Corporate Governance Guidelines
Hershey's International
A commitment to sustainability
The Milton Hershey's School
Hershey's Financial Overview
Preferred Strategies
Grocery Product Expansion

International Expansion
Grocery Product
Expansion in Europe
Expansion in China
Expansion in India
Three Year Financial Objectives/ Projections
Contingency Plans/Triggers
World Travel Retail Team
Grocery Product Segment
Why China?
Hershey's Currently in China
History of Aquisitions
Van Houten
Shanghai Golden Monkey
Jiangsu Liangfeng Food Stuff
Why India?
Hershey India Private LTD.
Major Cities
Total Projections for International Investments
Financial Projections for Grocery Product Investments
1. Product Expansion
2. Expansion into International Markets
Product Expansion
Trigger: Larger confectionery sugar and chocolate distributors use their capital to push Hershey out of the market.
Contingency Plan: Increase consumers already strong brand loyalty with advertisements and strong presence in the American market.
International Expansion: China
Trigger: Buying out an additional Chinese company falls through.
Contingency Plan: Expand on the investments already made in the SGM company.
International Expansion: Europe
Trigger: Forming a partnership with ALDI does not come to fruition.

Contingency Plan: Increase the amount of products exported into the European market.
To provide consumers, worldwide, with Hershey goods that leave all consumers happy and satisfied.
To continue Milton Hershey's legacy by providing consumers internationally with high-quality products, while operating our business in a socially responsible way and produce our products in an environmentally safe manner.
Hershey will provide consumers with an assortment of high-quality products that will leave all consumers satisfied with their Hershey experience.
Hershey will continue to maintain a business structure that resembles the family-oriented values that Milton Hershey implemented in the inception of Hershey which will continue to foster an ethical environment which promotes new ideas and expansion.
Total IFE:
Total EFE:
Overseas Expansion:

Grocery Product Development:
Product packaging (retailers)
Overseas Expansion
Product Development
Supply to demand driven approach
Hershey branding
Baking Supplies
Condiments Shortenings, and Oils
Dry Goods

1. What were your company’s sales during the last year?
Hershey’s sales for last year were $7.422 billion.

3. What is your company’s profit margin? Is it growing, declining, or flat?
Hershey’s profit margin for the end of the year for 2014 is 10.07 percent.

4. How does your margin compare with your competitors? How does it compare with those other industries?
When comparing Hershey’s profit margin to its competitors Hershey is lower compared it its competitors. Hershey is falling behind by 4.6 percent to its largest competitor Nestle.

5. Do you know what your company’s inventory velocity? Its asset velocity?
Hershey’s inventory velocity for 2014 was 21.45 percent. Hershey’s asset velocity was 5.04 percent in the last year.

13. Are you facing new competitors?
Not as of right now, there are no new competitors unless Hershey enters more diverse market segments

Team Orientation
Financial Projection Comparison
Hold and Maintain

Enter foreign markets
Grocery product development
Joint ventures
Competition and Company Issues
Economic and Industry Issues
Economic Issues
Bewildering sea of choices on store shelves for similar profits are lowering overall profits

Strategy to Implement
Hershey's needs to cut back on product choices (i.e. Hershey Kisses) and focus on packaging products effectively and efficiently for retail chains

Industry Issues
Retail chain stores control inventory levels

Strategy to Implement
Must schedule a meeting with retail chain store executives to discuss package sizing, shelving space available, number of alternative flavors that would be sold, number of alternative packages to be sold, etc.
Competition Issues
Hershey's globalization into markets outside of North America will challenging due to existing competition in those confectionery markets

Strategy to Implement
Hershey's must implement a strategy that involves analyzing the markets overseas, examine strengths/weaknesses of the competition, work with local retail chains, and capitalize on the weaknesses of the competition

Company Issues
Supply-driven approach is a major issue the company faces

Strategy to Implement
Move toward a demand-driven approach by analyzing consumer wants, needs, and desires. This will call to utilize Demand Profit Pools. Focus on Engaged Exploring Munchers as a main target market and tap into their wants, needs, and desires in Hershey products
Cash Cows
Question Marks
Full transcript