GENERAL MILLS SWOT ANALYSIS
GENERAL MILLS HISTORY
Critics criticized Cadwallader C. Washburn idea of starting a milling company. They said demand for flour from Midwestern spring wheat would never match what Washburn’s company could supplies. He didn’t see it that way. Washburn formed the Minneapolis Milling Company in 1856 to lease power rights to mill operators, and 10 years later he built his first flour mill near the falls of St. Anthony on the Mississippi River in Minneapolis. Despite continued criticism, he built a second, even larger facility in 1874. (General Mills)
Within five years Washburn’s mill was destroyed in a floor dust explosion. Undeterred, ...view middle of the document...
com, 2009). General Mills is putting more marketing support behind its brands so as to achieve increased volumes.
The other strength that General Mills has is that they have financial stability. For instance, the company reported higher-than-expected quarterly earnings on Wednesday, which was helped by recent acquisitions and improving trends in the U.S. market, and the maker of Progresso soups and Cheerios cereal stood by its full-year outlook. The company saw some benefits in the quarter from its acquisitions of Food Should Taste Good, Yoplait Ireland, Parampara Foods and Yoplait International. General Mills, whose shares rose more than 2 percent, said it expected further benefits in fiscal 2013, starting in the current second quarter, from its purchases of Yoplait Canada and Yoki Alimentos in Brazil. Its net income rose to $548.9 million, or 82 cents per share, in the first quarter ended on August 26 from $405.6 million, or 61 cents per share, a year earlier. (Yahoo Finance, 2012)
The fact that they are the market leader in the United States may be hindering them from innovation. They have been producing Yoplait yogurt for many years, and have offered a series of new products in the past few years in the nutrition department. Most of these products however, are very common, and are widely offered in the United States. The health food industry in the United States has been booming and General Mills does not offer enough products in the smaller niche markets. They have not entered into many unknown areas because of their success in the yogurt market. They should introduce new and more products to these smaller niche markets so as to capitalize in profits.
General Mills is one of the largest packaged food producers in the world by revenue. The firm owns some of the most recognizable brands in the grocery store, including Cheerios, Progresso Soup, Hamburger Helper, and Fruit Roll-Ups. This results to the company relying on the U.S market for its sales. 70% of the company’s sales are from the U.S market. Like many other food and beverage companies, General Mills faces a market marked by increasing commodities prices. The company is a large purchaser of corn and wheat, and the rise in the price of oil has hurt as well. As the costs of doing business increase, General Mills must either absorb these losses or charge higher prices at the risk of losing market share. In doing so, the company has introduced new products like lower-sodium Progresso soups and Hamburger Helper singles for the microwave, while growing its reach from grocery stores into new channels like supercenters, drug and discount stores, and convenience stores. (General Mills (GIS), 2012)
An opportunity General Mills has is that its Yoplait division is so successful. Yoplait is the only division of General Mills that is currently earning a profit. They have a large market share over their main competitors in the yogurt market. Another opportunity that...