Case 16 Sara Lee

QUESTION #1


Sara Lee has been changing its overall strategy with the passage of time. Initially when the company was formed, it acquired different companies to grow and improve its market share. The corporation initially acquired different business categories in order to expand globally and enter into different markets. The corporation first laid its foundation working as a wholesale distributor of different products like tea, coffee and sugar.This business later gave fruits as a result company planned to further diversify its products investing in different business categories for instance acquisition of food processing and packaging was done. This created different ways for the company and it all ended up as the company invested in retail food business. Sara lee’s successes at different stages and markets lead the company to acquire different businesses which were somewhat related and unrelated to their main portfolio. further diversifying in terms of products and geography expansion of the company resulted in creating problems for managers as they were unable to cope with the diversification issue ,this resulted in their retrenching strategy. This practice by the company was to make sure that every business division would be profitable and then the ones that were not would be closed.
This transformation of strategy has been done keeping the view that focus on front line businesses as those businesses have good rewards and have been more profitable to the company

QUESTION #2


Regarding long term attractiveness of industries in Sara Lee’s corporation, my analysis is that the retail industry and the food service industry have lot of potential.Since Sara Lee has a huge name in the retail industry it will definitely be able to increase its market share. As currently the company is very much successful in supplying meat (retail) not only to consumers but also to food service customers. As a result sales of meats have shown increases .and the company is taking...