Mondelez International (formerly Kraft Foods Inc.) makes what it takes to survive a global snack attack. The company's pantry of billion-dollar brands includes: Cadbury and Milka chocolates; LU, Nabisco, and Oreo biscuits; Trident gum; Tang powdered beverages; and Jacobs coffees. Mondelez International comprises the global snacking and food brands of the former Kraft Foods following the spinoff of its North America grocery operations (now Kraft Foods Group). The two companies split in a tax-free spinoff in October 2012. Mondelez, with about $35 billion in annual sales and operations in 165 countries, is the larger of the two businesses.
As its name suggests, Mondelez International has a global focus. Indeed, high-growth developing markets account for about 45% of sales (and the lion's share of investment), with Europe contributing more than a third of sales. While it's based in the US, North America is the company's smallest market, accounting for about a fifth of total sales. The company maintains eight manufacturing plants in China in Beijing, Suzhou, Shanghai, Guangzhou, and Jiangmen. Mondelez sells its products in some 165 countries.
Sales and Marketing
Mondelez sells its candy, snacks, and beverages through supermarket chains, wholesalers, supercenters, warehouse clubs, mass merchandisers, convenience stores, drug stores, and other retail food outlets. The company's 10 largest customers accounted for nearly 25% of sales in 2012.
In its first year as an independent company, Mondelez rang up $35 billion in sales and earning from continuing operations of $1.6 billion in 2012.
The separation of the global snacking business from the North American grocery operations paved the way for each business to adopt its own strategy. Mondelez is looking to its 15 global power brands (including Chips Ahoy!, Oreo, Milka, Cadbury, Chiclets and Trident) to drive 70% of its growth. The company holds the number one position globally in biscuits (or as we say in America, cookies), chocolate, candy and powdered beverages. It's number two in gum and coffee.
The company's hard-won battle for UK candy maker Cadbury in 2010 gave the snack business the heft to stand alone. The purchase, valued at about $18.5 million, created a "global powerhouse in snacks, confections, and quick meals, with a large portfolio of leading brands around the world." Cadbury's top brands include Dairy Milk bars, Roses chocolates, Trident gum, Halls cough drops, and the ever-popular Creme Eggs. The union of the #1 US food company and the 200-plus-year-old UK confectioner bumped Kraft up into the top spot of candy makers by revenue, unseating longtime leader Mars. The takeover also made Kraft the #2 US chewing gum maker by revenue (just behind Wrigley) and gave it access to developing overseas markets, such as Brazil, India, Mexico, Russia, South Africa, and China, where Cadbury brands have a solid presence.
The snacks maker is looking to shutter a former Kraft plant in northeast Philadelphia and invest more than $100 million in bakery facilities in Fairlawn, New Jersey, and Richmond, Virginia. Farther afield, amid increasing tensions between the US and Russia over Ukraine, Mondelez announced plant to build a $110-million factory in the Novosibirsk region of Russia with the capacity to produce 50,000 tons of snacks annually. It's also building a $90 million biscuit plant in Bahrain to satisfy increasing demand for its snacks in the Middle East and Africa.