Kraft May Partner With Fresh Produce Providers

Is the continent's largest packaged foods company considering eliminating a package or two?

A comment made by Kraft Foods CEO Irene Rosenfeld at yesterday's presentation to analysts had some observers wondering if the giant food products maker is working out a way to give on-the-go consumers both the convenience and healthy food they demand.

"We also have some innovative ideas about how to optimize the supply chain by partnering with providers of fresh produce," said Rosenfeld. "The result--branded, prepared salads that offer a whole new level of convenience, freshness and quality." A Kraft spokesperson said later the company would not amplify.

Kraft is working on using its proprietary technologies in concert with its trusted brands, Rosenfeld said, to build complete meal solutions as it does with Oscar Mayer Deli Creations, which are just launching.

"Few people have the time or the energy to plan and prepare meals," she said, adding: "I know I don't. Wouldn't it be a whole lot easier if we could have restaurant-quality food at home, in the office, at a fraction of the cost?"



Rosenfeld, who took over in June, said the company will "hit our stride" by 2009. Kraft is viewed as having a strong sales force, and a presence across the range of key food segments--frozen, refrigerated and on-the-shelf. Rosenfeld has talked of focusing more effort on higher-margin, ready-meal offerings as well as brands such as its "Back to Nature" lineup, which tap into rising demand for healthier foods.

The long-awaited reorganization will include increased marketing spending and a refocus of its product lineup in a bid to boost organic sales growth to 3 to 4% next year.

Sales at Kraft, best known for its cheese slices, Oreo cookies and Maxwell House coffee, rose 0.7% last year. Rosenfeld said yesterday that she would "rewire the organization for growth." From 2009, the company is targeting earnings growth of 7-9% and organic sales growth of 4%.

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