III.

CORPORATE PROFILE

INTRODUCTION

The yummiest food in the town, Chocolate! Chocolate is one of many

people’s favorite food, not only because it is tasty, but also because it helps

make themselves satisfy by the good benefits it provides. In short, Chocolate is

the ultimate comfort food, a sure-fire stand-by in times of stress, a reliable

source of consolation when life has let us down, and a mood-enhancer in certain

circumstances. These are the reasons why the Cadbury Company chooses to

find the best way to make every chocolates be more extra especial. Cadbury has

been continuing inventing, inspiring and investing in a nation of chocolate lovers

for nearly 200 years.

HISTORY

In 1824, John Cadbury began selling tea, coffee and drinking chocolate in

Birmingham, England. And from 1831 he moved into the production of a

variety of cocoa and drinking chocolates. Later on he became partner with his

brother Benjamin and the company became known as "Cadbury Brothers” in

1847. John Cadbury's sons Richard and George took over the business in

1861. George developed the Bournville estate, a model village designed to

give the company's workers improved living conditions. In 1905, “Dairy Milk

Chocolate” was introduced and it was the bestselling product by 1914.

Cadbury merged with J. S. Fry & Sons in 1919, and to the drinking company

Schweppes in 1969 and form Cadbury Schweppes. Cadbury was a constant

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constituent of the FTSE 100 on the London Stock Exchange from the index's

1984 inception until the company was bought by Kraft Foods in 2010.

OVERVIEW

It aims to provide pleasure, taste and enjoyment through the manufacture

and marketing of a wide range of beverage and confectionery brands sold to

consumers of all ages.

OBJECTIVES

At Cadbury Schweppes, the core purpose is "Working together to create

brands people love". The core purpose captures the spirit of what Cadbury is

trying to achieve as a business, and this is done by collaborating and working

as teams to convert products into brands.

VISION

• To align with its core purpose, Cadbury has defined its Vision as "Life

Full of Cadbury and Cadbury Full of Life“

• Bringing moments of delight to consumers every day and every time.

Therefore, Cadbury strongly believes that the people who create these

products should also have fun while doing so.

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VALUES

• Making, marketing and selling unique brands which give or bring

pleasure to millions of consumers around the world every day.

• An international company, proud of its long heritage, respectful of the

social and natural environment in which Cadbury operates, supportive of its

consumers, customers and colleagues, and above all, Cadbury is passionate

about success.

• This success has been built upon understanding the needs of

consumers, customers and other stakeholders and by operating to a clearly

defined set of values. But as the world changes, the obligations of business to

society have broadened. Yet, at the same time Cadbury want to ensure the

continuation of its own heritage.

IV. PROBLEMS

1. Cadbury’s Supply Chain Issues (Child Labor)

• Cocoa, an important global commodity, is critical to the livelihoods of

millions of rural farmers worldwide. The cocoa supply chain, however, is

fraught with social challenges and risks.

• Thousands of children in Western Africa are trafficked and forced to

work on cocoa plantations, due to low commodity prices that send farmers in

search of cheap labor. More than 284,000 children in Côte d'Ivoire, Cameroon,

Ghana and Nigeria were working under hazardous conditions.

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 • More than 60% of children working on cocoa farms are younger than

14 years of age, some no older than five.

• Child laborers are often forced to work for long hours using dangerous

equipment, exposed to pesticides and subjected to physical abuse.

• Cadbury’s Anti-Slavery Society - adopted policies addressing all

basic labor rights, including forced and child labors.

2. Cadbury’s Worm Infested Issues

• After a thorough investigation of the entire supply chain it was found

that the problem originated at the distribution end.

• Apparently at the retail outlets the infested bars were placed next to

open unpacked items susceptible to worms.

• However, although the problem was not of its own making Cadbury did

take responsibility for the lack in educating retailers on storage and hygiene.

• The company began its multi-pronged campaign on key print, board,

cast and electronic media to regain its lost credibility and almost reestablished

the category.

• It decides to convey that the root of the problem was at the distribution

end, that any food item could face similar infestation.

• Cadbury also roped in Amitabh Bachhan as its brand ambassador --

reputed for his integrity, qualities that Cadbury needed to associate with the

brand.

• A rationally and emotionally connecting television commercial, the star

gave a firsthand account of his visit to the Cadbury factory assuring about the

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quality of the chocolate, in another version of ad, he also emphasized the

safety of the product for children.

3. 2006 Salmonella Scare

• On January 19, 2006, Cadbury Schweppes detected a rare strain of

the Salmonella bacteria, affecting seven of its products. It has been said that it

was caused by a leaking pipe. The leak occurred at its Marlbrook Plant, in

Herefordshire, which produces chocolate crumb mixture; the mixture is then

transported to factories at Bournville (formerly Somerdale) to be turned into

milk chocolate. It was not until around six months after the leak was detected

that Cadbury Schweppes officially notified the Food Standards Agency, which

recalled more than a million chocolate bars.

• In December 2006, the company announced that the cost of dealing

with the contamination reached £30 million.

• And, in April 2007, Birmingham City Council announced that it would

be prosecuting Cadbury Schweppes in relation to three alleged offences of

breaching food safety legislation.

• At that time, the Health Protection Agency identified 31 people who

had been infected with Salmonella Montevideo. One of the alleged victims had

to be kept on a hospital isolation ward for five days after eating a Cadbury's

caramel bar. An investigation that was carried by Herefordshire Council led to

a further six charges being brought.

• The company pleaded guilty to all nine charges, and was fined one

million pounds at Birmingham Crown Court. The sentencing of both cases was

brought together.

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4. 2008 Melamine Contamination in China

• On 29 September 2008, Cadbury withdrew all of its 11 chocolate

products made in its three Beijing factories, on suspicion of contamination with

melamine.

• The recall affected the mainland China markets, Taiwan, Hong Kong

and Australia.

• Products recalled included Dark Chocolate, a number of products in

the Dairy Milk range and Chocolate Éclairs.

5. 2010 Facing Revolt Over New Dairy Milk

• Cadbury confectionery company founded 200 years ago, but after US

company KRAFT took over in 2010 they have a lot of changes including

the shapes from the old Cadbury it is a classical rectangle to curved

segments and even the taste of an old Cadbury dairy milk from milkier to

nuttier.

• Many parents and customer have claimed the bars are now ‘oily’, ‘too

sugary’ or ‘sickly’, they said that the bar was ‘all wrong” whilst, some have

threatened to jump ship to other brands.

• Tony Bilsborough, a spokesman for Mondelez International, insisted

that they had not tampered with the recipe of that much loved bar, whilst

conceding that they changed the shape to helps improve the melt in the mouth.

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6. 2014 Porcine DNA Crisis

• In May 2014 Facebook became viral that two types of chocolates from

Cadbury such as “Dairy Milk Hazelnut (batch no. 200813M01H12) expiring on

November and “Cadbury Dairy Milk Roast Almond” (batch no. 221013N01R I1)

expiring on January 15, 2015 viral that this two types of chocolate from

Cadbury is contaminated with porcine DNA (pork), it was started on Facebook

rumors, the Facebook user spread the news within 24 hours and it became

viral and caught the Government attention, suddenly Cadbury plunged

themselves into the hottest attention of the media and public.

• And, according to “THE STARS” (a tabloid-format newspaper in Malaysia)

that Cadbury confectionary in Malaysia recalled that the two batches of its

chocolate products have been tested positive for porcine DNA by health

ministry.

• This is a serious issue for the majority Muslim market – consuming pork is

strictly forbidden in Islam.

• According to the local media reports, saying: that Cadbury taken an

immediate action by recalling the products from the above two batches. No

other Cadbury chocolates are affected by this test.

7. 2014 Halal Issues

• Cadbury has been forced to respond to furious customers after an old

picture surface online indicating that its chocolate Easter egg in the UK are

Halal certified.

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 • Customer anger sparked after of its picture, which appears to have

been taken in 2014, of a Cadbury’s employee holding a certificate showing that

their products are certified Halal its surfaced in social media.

• As soon as the image re-shared on twitter some customers accused

the brand of “Muslim appeasement”, while other threatened to boycott it all

together.

• As a result, Cadbury responded to the fierce reaction by explaining;

None of our UK product are Halal-certified and we have never made any

changes to our chocolate specially make them ‘Halal’, they are just suitable for

those following a halal diet in the same way that standard food bread and

water would be.

V. OBJECTIVES

The researchers’ aims are:

 To find an alternative planning for the issues Cadbury has

encountered

 To develop strategies that are different from its competitors so that

Cadbury can maintain their good brand equity in the market

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VI. A. SWOT ANALYSIS

STRENGTHS:

• Well established

• Known for good manufacturing

• Doesn’t need advertising

• Offers diet-based chocolate products

• Sophisticated packaging and consistent taste

• Second largest chewing gum maker

• More than 100 years in business

WEAKNESSES:

• Lot of competitors

• Diabetic and dental problems

• Chocolates have high price demand

• Issues in quality control

OPPORTUNITIES:

• Chocolates and candies for all season and ages

• A lot of variants (ex. Chocolate, gum, and drinks)

• More customers because of offered alternative products

THREATS:

• Competitors offer various products

• Competitors offer same quality with lower price

• Health consciousness is on the rise

• Increasing cost of raw materials needed

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B. PEST ANALYSIS

POLITICAL

• If Cadbury continues non-compliance to proper labor code, this

could hurt the company’s reputation.

• Non-compliance to health and safety laws in the production.

ECONOMIC

• If the country is dealing with inflation, customers will have lesser

buying power and the sales of Cadbury will decrease.

• Tax increase can affect the buying frequency of consumers.

SOCIAL

• People changing into a healthy lifestyle can affect the sales of

Cadbury.

• The rise of obesity among children causes nutritionists to

recommend reducing consumption of chocolate and candy.

TECHNOLOGICAL

• Media, especially social media is a great help to advertise

Cadbury.

• High technology machines help improve the production.

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C. PORTER FIVE COMPETITIVE ADVANTAGE

RIVALRY:

1. THREAT OF NEW ENTRANTS: Low

• Cadbury is a well-established brand

• Competition within the established brands is already high

• The supply chain of the chocolate industry is complicated for

new aspiring brands

• There is a huge capital requirement for this type of business

2. CURRENT RIVALRY: High

• Many businesses are competing against Cadbury.

• Premium brands like Mars, Hershey’s, Nestle, Ferrero are

main rivals.

3. THREAT OF NEW SUBSTITUTES: Moderate

• Local chocolate products like Goya and Ricoa are great

substitutes because of its quality taste and affordable price.

• Threat from wide range of confectionery products like

candies, lollipops, cookies, cupcakes, etc.

BARGAINING POWER:

1. SUPPLIERS: Low

• Cadbury is a well-established company, meaning they have

made many supplier connections around the world.

• Cadbury is considered a premium brand, meaning it has a

large purchasing power.

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 2. BUYERS: Moderate to High

• Cadbury have buyers all over the world.

• Increasing number of competitors that offers good quality of

chocolates with a lower price.

VII. STRATEGIC FORMULATION

STRATEGY DESIRED BEHAVIOR COMPETING BEHAVIOR

Scholarship Build a foundation for Once the members of this

program for child labor victims to program graduates,
victims of child finish schooling Cadbury will give them job
labor opportunities in the
company.

Proceeds from Proceeds will be used to Helping and doing good

Cadbury buy school supplies for things to others.
less fortunate children

Join a cause A cooperative effort with Assures consumers that

marketing that a non-profit organization Cadbury shares the desire
helps save to help stop child labor to make the world a better
victims of child place.
labor

Organize a free Conduct free dental Assures consumers that

dental checkup checkup during nutrition Cadbury cares for health
month in schools condition of its consumers.

Donate-a-book Cadbury buyers who will The collected reading

discount donate a book will be materials from the
given a discount donation will be given to
children who cannot afford
to attend school.

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VIII. STRATEGIC IMPLEMENTATION

PROGRAM KEY PLAYERS TIME FRAME BUDGET

Build a school in Top executives January 2020 – 300,000,000

West Africa for April 2021
the victims of
child labor

Build free housing Top executives March 2020 – 100,000,000

near school’s Januray 2021
location

Hire educators HR Team May 2020 – 10,000,000

December 2020

Create a HR Team September 2020 1,000,000

partnership with a – December 2020
non-profit
organization to
fundraise books
needed in the
school library

Co-curricular Research and April 2021 – so on 10,000,000

activities to help Development
the children find Team
their own
interests &
develop more
skills

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 IX. EVALUATION CONTROL

Balance Score Card

PERSPECTIVE OBJECTIVES MEASURES TARGET INITIATIVE

FINANCIALS - To High up the - balancing the - The current -Increase the

Revenue that comes timing and assets minus company’s
from sales and amount of every current Liabilities investment with
marketing activities. costs with should be strong job-creation
income. greater than potential.
- lower the 50% (>50).
company’s cost and - knowing and - continue to
unnecessary analyzing the - The Business encourage the
expenses by finding company’s standard should overall
and building profitability ratios. be accurate into manufacturing,
relationships with assets Market processing and
reliable suppliers of - Measuring the Value. tourism.
raw material in the efficiency of the
manufacturing company’s - Business plan
procedure of business assets.
- Increase
Cadbury chocolate. - Operating Financial
- Maintain income expenses Margin stability.
levels consistent.

CUSTOMERS - High Expectation - Increased - addition of - Effective business

for their customer’s customer loyalty product line that strategies,
experience by doing a repeat is more
satisfaction. purchase of innovative and - relevant services
Cadbury’s attractive than its - Maintaining Good
- Good Customer products. competitors.
Service products.
- No of distributed - Modern - Doing an effective
- Good Company product per year Machineries and
Reputation. marketing strategy.
equipments in
- Essential works manufactured
- High brand
awareness to build products.
its stronger brand - Updated and
equity. unique
packaging that
suits in every

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 occasions.

Cultivating and
maintaining a
strong
relationship with
your customers.

INTERNAL - Increased - meeting the - Top of mind in - improved

BUSINESS company’s market customer needs. the customers distribution and
PROCESS share. mind. marketing
- Quality of the processes.
- Creation and products. - New and
deliverance of the competitive - Automating
customers value - Increased strategies workflow and
proposition. market share and business
look forward for - increased sales processes
- Providing an the return on its
opportunity to help investment - positive - effectivity and
customers with the reputation efficiency.
product
-Good automation
of work flows.

LEARNING - satisfying each - make each goal - strategic - Do a products

AND GROWTH customer. be relevant to the objectives continous
success of the improvement.
- process business. - Long term
improvement and success - always consider
achieve financial - acquisition of the competitors
goals. new customers - regular tracking strength and
of the business weaknesses in
- employees skills - good cash flow growth. running their
development for the analysis market.
betterment of the - perormance
company. measurement - Do a research
systems. before conducting
an implementation.

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sugary.html)

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