Smuckers Case Study

From the fruit in Ohio resident Jerome Monroe Smucker first pressed cider at a mill he opened in 1897. Then, he made apple butter, which he sold from the back of a horse-drawn wagon. And each any every crock bore Smucker hand-signed seal as his personal guarantee of quality. This led him to the formation a very profitable company.

Gross profit increased $11.8 million in 2011, compared to 2010, as the increase in net sales offset the impact of overall higher raw material and freight costs and $50.2 million of incremental special project costs included in cost of products sold, consisting primarily of accelerated depreciation. Excluding special project costs, gross profit increased $62.0 million, or three percent, yet decreased as a percent of net sales from 38.9 percent in 2010 to 38.4 percent in 2011.

Smuckers American staple are characterized in Fruit spreads, include jams, jellies and preserves. An emphasis is made on the quality and consumer relationships and strategic goals are in place to maintain their place as the leader in the fruit spread market. Consistently increase in revenue throughout the years by keeping up with technology and the latest software enables them to create efficiencies in manufacturing, by their business partnerships and through product development. To maintained appeal Smuckers stays true to 5 values and they are quality, people, ethics, growth, and independence. These values are used to offer customers something more than just a good product like the competition. Although Smucker has competition with reputable corporations such as Conagra Food, General Mills, Kraft Foods and Unilever they are able to be one of the companies on top. For Smuckers to maintaining strong market share they should search for new markets overseas stressing new products including new flavors along with an organic line.

Some of Smuckers big issues include product innovation and the rising costs for raw materials. If they want to stay ahead of their competition research and development should be a top priority. New and improved product and equipment will set Sumckers apart for its competition. Rising Costs of raw materials on the other have Smuckers has very little control over. They must keep looking for the lowest priced product and be flexible to change suppliers quickly and efficiently. This will in turn provide their customers with the lowest prices giving Smuckers an edge over its competitors.

SWOT Analysis

Internal

Strengths Weaknesses

1. Experience in the market

2. Well-known brand name

3. Effective distribution system

4. Reasonable Prices 1. Product Innovation

External