The Matching Stage
SWOT (Strength, Weakness, Opportunity, Threat) Analysis
SWOT Analysis
Opportunities
1. Health benefits of dark
chocolate
2. Richer product for
changing taste
3. Acquisition of companies
outside US
4. Marketing of holidays
5. Use of technology to
reduce costs
Threats
1. Rising prices of cocoa
2. Rising prices of sugar
3. Health concerns
(obesity/allergies)
4. Easily substitutable product
5. Changing exchange rates
1
Strengths Weaknesses
1. Strong brand name/ image 1. Downsizing
recognition 2. Heavy reliance on brand
2. Diverse products loyalty
3. Strong partnerships 3. High dependence on US
4. Own R&D market
5. Strong social responsibility or 4. Chaotic relations with
environmental sustainability shareholders
5. Large bonus for CEO in
difficult times
SO WO
1. Products with coffee flavors 1. Increase market share in
2. Market dark chocolate health different regions
benefits 2. Use technology to reduce
3. Joint advertisement with costs
partners 3. Offer Dagaba Organic line
in large retail stores
ST WT
1. Offer 100-calorie bar for 1. Monitor bonuses to
health-conscious people executives until global
2. Develop an allergy-free bar economy stabilizes
for different concerns 2. Increase advertising outside
3. Acquire own land to grow US
resources
SPACE (Strategic Position and Action Evaluation) Matrix

Financial Position Rating

Long-term debt is $1,505,900, an increase of 17.6% from 2007. 1

Earnings per share is $1.41, up .45 from 2007. 4

Net income is $311,405,000, up 45.4% from 2007. 6

Net sales are $5,132,768, up 3.8% from 2007. 5

Total 16

Average 4

Industry Position Rating

Prices of sugar, cocoa, milk, gas, and nuts are up. 1

Confectionery industry grew by 3.6% in 2009. 5

Chocolate accounts for 55.8% of market value in confectionery industry 6

Seasonal sales are growing. 4

Total 16

Average 4

Stability Position Rating

Exchange rates are fluctuating. -3

2
 Natural disasters are affecting the growth of resources. -4

Hershey has weathered recession well according to outside critiques. -1

Hershey has easily substitutable products. -4

Total -12

Average -3

Competitive Position Rating

Hershey has strong brand recognition. -2

Hershey is North America's largest chocolate producer. -1

Hershey's sales were up 5.9% in 2007. -1

Hershey offers a one-of-a-kind amusement park. -3

Total -7

Average -1.75

Conclusion
x-axis: CP + IP = -1.75 + 4 = 2.25
y-axis: FP + SP = 4 + (-3) = 1

3
 FP

Conservative Aggressive

-6-5-4-3-2-1

CP IP

+3

+4

+5
+1

+2

+6
-6

-5

-4

-3

-2

-1

Defensive
+1+2+3

Competitive
(2.25, 1)

SP
+4+5+6

Aggressive Strategy:
Hershey should pursue aggressive strategy. This is because the position on the graph is a result
of adding the average scores, as done above in the conclusion part. According to that, Hershey’s
company ends up in the aggressive quadrant with a x-coordinate of 2.25 and a y-coordinate of 1.
The SPACE matrix helps the company decide which strategy to employ. In Hershey’s case, they
should consider all types of integration, intensive, and diversification strategies.

4
5
 BCG Matrix
Relative Market Share

High 1.0 Medium .50 Low 0.0

High+20 Star
II
Question
Marks I
Industry Sales Growth Rate

(1, 3.6)
Medium
0

Cash Cows
III
Dogs
IV

Low -20

Hershey does not provide divisional information, so the BCG was constructed as a whole. The x-
axis looks at relative market share and the y-axis looks at industry sales growth rate. Hershey is
the market leader when it comes to confectionary items, so their market share is 1. According to
the latest industry growth rate, it is at 3.6%. With these coordinates (1, 3.6), this places Hershey
in the Star quadrant. They should pursue integrative and intensive strategies to maintain and
strengthen their position further.

6
Internal-External Matrix

(2.57,
2.28)

Quadrant V Strategies: Hold & maintain—market penetration, product

development

7
Quantitative Strategic Planning Matrix (QSPM)

Increase joint advertising Increase advertising

within the US outside the US
Key Factors Weight AS TAS AS TAS
Strengths
Strong brand name/ image recognition 0.11 4.00 0.44 2.00 0.22
Diverse products 0.05 2.00 0.10 1.00 0.05
Strong partnerships 0.06 4.00 0.24 1.00 0.08
Own R&D 0.06 - - - -
Strong social responsibility or
0.06 3.00 0.18 4.00 0.24
environmental sustainability
Weaknesses
Downsizing 0.08 - - - -
Heavy reliance on brand loyalty 0.05 4.00 0.20 2.00 0.10
High dependence on US market 0.06 - - - -
Chaotic relations with shareholders 0.06 - - - -
Large bonus for CEO in difficult times 0.04 - - - -
1.00
Opportunities
Health benefits of dark chocolate 0.06 - - - -
Richer products for changing tastes 0.07 3.00 0.21 2.00 0.14
Acquisition of companies outside US 0.05 1.00 0.05 3.00 0.15
Marketing of holidays 0.10 4.00 0.40 3.00 0.30
Use of technology to reduce costs 0.06 - - - -
Threats
Rising prices of cocoa 0.07 - - - -
Rising prices of sugar 0.07 - - - -
Health concerns (obesity/allergies) 0.06 - - - -
Easily substitutable product 0.09 3.00 0.27 1.00 0.09
Changing exchange rates 0.08 - - - -
1.00 2.09 1.37