Sara Lee’s transformation from being, essentially, a decentralised holding company to becoming an integrated operating company with a focused portfolio of brands is progressing on schedule, chief executive Brenda Barnes said at the Sanford C. Bernstein & Co. Strategic Decisions Conference.
“As we stand right now we are seeing great signs of our core businesses improving,” Barnes commented, drawing on the company’s food and beverage segment to illustrate her point. “This group probably went through the most turbulent change,” she observed – referring to the integration of bread and meat segments when the business was relocated to Chicago.
“Our top-line is growing at the rate we’d like it to and out operating profit is significantly improved,” she observed, stating that improved performance was the result of a change in company culture, with the introduction of more centralised procurement, sales and marketing and IT.
Sara Lee believes that the complimentary nature of the bread and meat business means that it is logical for the two businesses to be united.
“We had an amazing discovery,” Barnes said ironically. “If you have bread and you have meat, you can make a sandwich.”
Barnes said that previously Sara Lee had never conducted a joint bread and meat production. Over Memorial Day weekend (27-29 May) Sara Lee stand-alone bread displays were placed near refrigerated Sara Lee deli meats. “This simple cross-promotion really was not possible before we brought these companies together since they did not talk to each other,” she said. “In fact, we had our bread company doing peanut butter and jelly tie-ins, not our own company meat tie-in.”