BUSINESS INSIGHTS

The Top 10 Global Leaders in Food

Increasing market share, revenues and NPD success
Which strategies will help the global food leaders grow most aggressively over the next three years?

Merger and acquisition activity in small, high growth potential market Merger and acquisition activity in developed markets

Growth in new areas such as nutraceuticals or probiotics Category expansion i.e. moving from confectionery to frozen food NPD, innovation and launching new products into lessdeveloped markets Line extensions and new formats of launching current products in developed markets NPD, innovating and launching new products into developed markets Extending current products into new geographical markets

0%

20%

40%

60%

80%

100%

Very unlikely

Not likely

No opinion

Likely

Very likely

Source: The Top 10 Global Leaders in Food Industry Opinion Survey NPD, innovating and launching new products into developed markets is the strategy most likely to deliver growth in the short-term future. Following closely are line extensions and new formats of launching current products in developed markets and extending current products into new geographical markets... Source: The Top 10 Global Leaders in Food Industry Opinion Survey

Just some of the questions this report will answer...

What is the market share for each of the global leaders in food on a company, country and category basis? Which consumer trends had greatest influence on the strategies of the global food leaders in 2003 and what will they be in 2004? Which regions and categories offer you as a leading food company the greatest opportunities for growth in 2004? What are the key strategies and growth areas for global food leaders over the next five years?

The Top 10 Global Leaders in Food

Increasing market share, revenues and NPD success
Rating the global food leaders: Identifying cross-category expansion opportunities
Hersheys International Heinz Kelloggs General Mills Unilever Bestfoods Masterfoods (Mars Inc.) Kraft Danone Cadbury-Schweppes Nestl 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

What new strategies are leading food manufacturers implementing and how will they increase their market share? The Top 10 Global Leaders in Food: Increasing market share, revenues and npd success is a strategic management report analysing how the food leaders are increasingly leveraging the power of their brands in their existing, often saturated markets and when entering new markets. The report reveals what it takes to become a 'leader' in food markets on a global scale, the growth strategies that leaders in food adopt and the NPD strategies they implement.

Very weak

Weak

Average performance

Strong

Very strong

Source: The Top 10 Global Leaders in Food

Over 40% of our respondents believe that Hershey is 'weak' or 'very weak' at expanding across international borders... Source: The Top 10 Global Leaders in Food Industry Opinion Survey

250 pages of company strategy analysis enabling you to benefit from: Comprehensive evaluation of financial performance figures and analysis for 2003 Quantitive comparisons of strategies e.g. competitive re-positioning Geographical strategies with a strong focus on emerging markets and innovation techniques.

This new report will provide you with...

Danone food business performance 2000-2003

The Top 10 Global Leaders in Food will provide you with: SWOT analysis - a concise summary of the key strengths, weaknesses, opportunities and threats facing each of the companies profiled in the report. Market dynamics for each company - revealing the major trends and developments of brands by product segment and country; analysis of size, growth rates and leadership positions of top brands. Comprehensive data analysis - uncover core company data such as financial performance, investments and country coverage. Analysis of corporate strategies - discover the corporate strategies of the ten most influential food companies in the global food market and learn from the best and worst practice of each global leader.

mn Fresh Dairy Products Turnover Operating Profit Biscuits and Cereal Turnover Operating Profit Other Food Turnover Operating Profit

2000

2001

2002

2003

6,530 712

6,945 790

6,276 802

6,185 845

3,255 282

3,371 316

3,232 317

3,071 280

378 49

375 60

356 61

318 57

Source: The Top 10 Global Leaders in Food

Operating profit in the biscuits and cereals division dropped by over 11% in 2003, as sales in the division fell by almost 5%... Source: The Top 10 Global Leaders in Food

What this report will do for you...

Market share versus growth in global dairy markets
250.0% Faster growing markets
Romania

Order The Top 10 Global Leaders in Food now to: Make an instant impact on your revenues - Understand which were the successful and unsuccessful strategies used by your competitors in 2003. Formulate more successful strategies in 2004 by learning form their experiences. Improve your distribution strategies by using the distribution channels that are growing faster than the traditional grocery channels.

Market share Greater market size

200.0% Market Growth 1998-2003

150.0%

100.0%
Indonesia Philippines

Colombia Mexico China Spain Brazil France Italy UK Japan US

50.0%

0.0% 0.0% -50.0%

5.0%
Germany

10.0%

15.0% Market Share 2003

20.0%

25.0%

30.0%

Source: The Top 10 Global Leaders in Food Among the world's larger dairy markets that are also fast growing, China, Mexico and Brazil feature prominently. Whilst China is the world's 10th largest dairy market, it is also the fourth fastest growing...

Discover what made your competitors rank next to you as global leaders in food by analysing financial performances on a division-by-division basis and pinpointing market share data on a company, country and category basis. Forecast the future with confidence by investigating the strategies that will drive growth for the global leaders over the next five years and uncover the regions and categories that will offer them the greatest opportunities in 2004 and beyond.

Source: The Top 10 Global Leaders in Food

A global research methodology...

Selecting the Global Food Leaders
Key to Selection Ratings

Industry Opinion Survey The report provides a survey of over 5000 senior level executives in the food and retail industry in the UK, Europe, Eastern Europe, Asia Pacific, US and South America. Detailed company profiles featured in the report include: CadburySchweppes, Danone, General Mills, Heinz, Hershey, Kellogg, Kraft, Masterfoods, Nestl and Unilever Bestfoods. Methodology Research in the report contains primary data in the form of an industry opinion survey and telephone interviews with senior executives on the major issues of the market today and in five years' time. Qualitative, opinion based comments on industry trends were also gathered from brand managers, marketing managers and product managers from food manufacturers. Secondary research took the form of company profile information and latest market developments, web-sites, trade press, news searches and on and off-line publications.

Very Weak

Average

Very Strong

Cadbury-Schweppes

Financial Size

2003 Performance

Category Coverage

Country Coverage

Brand Portfolio

Danone

Financial Size

2003 Performance

Category Coverage

Country Coverage

Brand Portfolio

Source: The Top 10 Global Leaders in Food Cadbury-Schweppes scores relatively low in terms of financial size (food sales only) but higher in terms of its brand portfolio, together with its country coverage. Strong category coverage is limited to confectionery, giving the company an 'average' rating under this criteria... Source: The Top 10 Global Leaders in Food

Sample information from the report

Access to higher growth categories The greatest source of future growth for Cadbury Schweppes is likely to be from the full integration and growth potential of the Adams business. As a result of the acquisition, the company now believes it has leadership positions in sugar and functional confectionery and the number two position in gum while gaining access to major new markets. The acquisition of Adams has taken the company into higher growth categories with greater potential to cross-sell different products in a variety of markets, particularly as chocolate confectionery markets become increasingly mature. The expansion of distribution channels in confectionery also offers Cadbury Schweppes an
Strong brands earn a significant
amount of trust and loyalty from consumers A well balanced portfolio now includes leading brands across the chocolate, sugar, medicated confectionery and chewing gum segments Production and organisational inefficiencies must be addressed Weaker performance in Asian markets in 2003 Analysts question whether a drinks business fits well with global confectionery operations?

Cadbury Schweppes SWOT analysis

Company Strengths Company Weaknesses

Company Opportunities Integration of Adams brings greater

potential to cross-sell different products in a variety of markets Distribution channels in confectionery markets offer margin growth

Company Threats
Will changing consumer tastes, which favour healthy, sugar-free alternatives, limit growth in traditional markets? Must continue to innovate and support brands with high quality marketing to maintain awareness and consumer loyalty

Source: The Top 10 Global Leaders in Food

opportunity to boost sales. Whilst supermarkets are increasing their share of the confectionery market, value growth has not accompanied volume growth as prices have lowered. However, an increase in sales via the impulse market, at convenience stores where overall margins are greater, will see value growth in the market. In October 2003, the company set out its four-year strategic and operational agenda at the heart of which lie the 'Fuel for Growth' cost reduction and 'Smart Variety' growth initiatives. Although these will bring short-term cost increases they are expected to be more than offset by sales growth and margin increases. Threat to indulgence from healthier alternatives Whilst the company has introduced a number of new products over the last two years, aiming to keep the company at the forefront of confectionery developments, it cannot rest easy. In addition to innovation, the company must support its products with high quality marketing if it is to maintain brand awareness and loyalty amongst consumers that are becoming increasingly fickle. Consumers, increasingly aware of the health implications of indulging themselves on confectionery, will start to look to products they see as being healthier or a sugar-free alternative. While the acquisition of Adams in the gum sector, where such products have long been accepted, reduces Cadbury's reliance on chocolate markets, it is only recently that chocolate manufacturers have introduced such alternatives and the company cannot afford to be left behind by such initiatives.

Table of contents for The Top 10 Global Leaders in Food

Increasing market share, revenues and NPD success

EXECUTIVE SUMMARY Introduction Market dynamics Cadbury-Schweppes Danone General Mills Heinz Hershey Kellogg Kraft Masterfoods Nestl Unilever Bestfoods Industry opinion survey Conclusions CHAPTER 1: INTRODUCTION The aim of this report Chapter structure - Selecting the 'Global Food Leaders' CHAPTER 2: MARKET DYNAMICS AND EMERGING MARKET ANALYSIS Summary Introduction - Methodology behind the analysis of global food markets Trends in global food markets - Consumer lifestyle drivers - Industry drivers blur category definitions - Company positioning: global food leaders - Disposing of non-core assets to provide greater focus - Growth through acquisition - A case by case approach - Market positioning: chilled food - Market positioning: confectionery - Market positioning: dairy products - Market positioning: savoury snacks CHAPTER 3: CADBURY SCHWEPPES Summary Introduction About Cadbury Schweppes - History Recent performance - Performance in 2003 - Financial performance in 2003

Market positioning - Expanding the portfolio in 2003 - The Americas - Asia-Pacific - Eastern Europe - The Middle East and Africa - Western Europe - Global confectionery brands Strategies for growth - Acquisitions and disposals play a key role - NPD and brand repositioning SWOT analysis - A trusted brand that has diversified its portfolio - Action to remedy production and organisational inefficiency - Access to higher growth categories - Threat to indulgence from healthier alternatives CHAPTER 4: DANONE Summary Introduction About Danone - History Recent performance - Performance in 2003 Market positioning - Dominant positions in every region - Leading brands at Danone Strategies for growth - A focus on high growth segments that match consumer needs - Success in NPD - Online purchasing accounts for one-quarter of purchases SWOT analysis - Leadership brings competitive advantages - Over reliance on regions, brands and categories - Expanding into emerging markets - Growth of private labels and legal action in Spain

Table of contents continued...

CHAPTER 5: GENERAL MILLS Summary Introduction About General Mills - History Recent performance - A good performance in 2003 despite problems in bakery Market positioning - A portfolio of international brands Strategies for growth - Innovation and international expansion will drive sales - NPD targets consumer megatrends in 2003 SWOT analysis - Strong brands across several categories - Weaker markets and higher commodity costs - Joint ventures and international expansion - Threats CHAPTER 6: HEINZ Summary Introduction About Heinz - History Recent performance - Greater focus boosts performance in 2003 Market positioning - Global brand reach Strategies for growth - A focused portfolio - NPD targets changing consumer requirements SWOT analysis - Strong brands and a focused approach CHAPTER 7: HERSHEY Summary Introduction About Hershey - History Recent performance - Performance in 2003 Market positioning - Higher margins in confectionery - The Americas - Outside the Americas Strategies for growth

- Hershey's customers and competitors - Private label - no concern - NPD tracks consumer megatrends in 2003 SWOT analysis - Strengths - Weaknesses - Opportunities - Threats CHAPTER 8: KELLOGG Summary Introduction About Kellogg - History Recent performance - Performance in 2003 Market positioning - Meeting consumer needs in cereals, snacks and health foods Strategies for growth - Three fundamental targets - NPD focuses on helping modern, busy consumers SWOT analysis - Strengths - Weaknesses - Opportunities - Threats CHAPTER 9: KRAFT Summary Introduction About Kraft - History Recent performance - Performance in 2003 Market positioning - Coverage across five global product sectors Strategies for growth - New structure for 2004 - Brand strategies drive performance - Initiatives respond to health concerns SWOT analysis - Scale and leadership brings advantages - Difficulty launching new brands - Opportunities - Threats

Table of contents continued...

CHAPTER 10: MASTERFOODS Summary Introduction About Masterfoods - History Recent performance - Performance in 2003 Market positioning - Household names in confectionery, pet food, snacks, rice and vending Strategies for growth - NPD plays a vital role in growth SWOT analysis - Brand names carry cross-category - High dependency on chocolate - Further potential for brand extensions - Mature markets and health-wise consumers CHAPTER 11: NESTL Summary Introduction About Nestl - History Recent performance - Performance in 2003 Market positioning - "Factories or operations in almost every country in the world" Strategies for growth - Driving growth and improving margins SWOT analysis - A global perspective - Health implications for indulgent products CHAPTER 12: UNILEVER BESTFOODS Summary Introduction About Unilever Bestfoods - History Recent performance - Leading brand growth revised downwards in 2003 - Board changes announced in February 2004 Market positioning - From soups and dressings, to frozen food and ice-cream - Greater brand focus on brands with strong potential - Brands can be local and also spread across categories - NPD plays a key role Strategies for growth - Leading brands account for over 90% of total

business - Looking beyond the Path to Growth SWOT analysis - Strength demonstrated by core brands - Underperforming businesses remain - Brand extensions and emerging markets - Low-carb diet threat to Slim Fast CHAPTER 13: INDUSTRY OPINION SURVEY Summary Introduction Food Leaders: 2003 Performance - Product innovation drives growth in market share - Food Leaders: Competitive positioning - Convenience shapes strategy ahead of brand recognition and pleasure - Danone and Unilever react more quickly to customer trends - Unilever perceived as the leading innovator - Cadbury and Hershey can do better at spotting cross-category opportunities - Hershey is perceived to be relatively weak at moving into new markets - Nestl leads the way in terms of marketing strength Food Leaders: Geographical strategies - Asia-Pacific offers the greatest growth potential Food Leaders: The future - NPD and innovation is the best way to deliver growth - Danone is the company most likely to deliver growth CHAPTER 14: CONCLUSIONS Summary Introduction The global food industry - Convenience remains most important - Asia-Pacific and Eastern Europe are top targets for expansion Strategies for success - Focus on core brands and strengths - Growth through acquisition - Expansion and cross-category - NPD will be the main driver of growth CHAPTER 15: APPENDIX Primary research methodology Terms and abbreviations used in this report Food segmentation table Index

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