Kellogg’ s is the leading breakfast manufacture of the US. It alone enjoys a significant market share and does not need to acquire Quaker Oats to make its presence more conspicuous. However, it can’ t be denied that if Kellogg is able to acquire Quaker Oats successfully, it's market share will increase significantly. The company has sufficient funds to acquire this company which in turn will help it to lead in the US as well as in the global market. However, currently, the company is facing some internal and external challenges.
Instead of acquiring Quaker Oats right now, the company must rectify these problems. For example, the most popular products like Corn Flakes, Rice Krispies, and Bran Flakes are fifty years old and require further development. Another challenge is to address the shortage of soybean oil, necessary for producing its core products. The company must make the necessary investments in addressing them. Kellogg’ s has already acquired a decent position in the market. If the company is able to solve its existing problems, it's market position will become stronger. Therefore, under such circumstances, Quaker Oats is not a good strategic fit for Kellogg’ s.
In order to strengthen the strategic fit with Quaker Oats, discuss the key issues that Kellogg’ s should focus on the acquisition of a success. The acquisition of Quaker Oats by Kellogg’ s will develop a significant synergy for the company. The company is expected to gain a stronger market through this acquisition. Quaker Oats has a well-established manufacturing unit and other technical expertise that will enhance the profile of Kellogg’ s. However, in this process, Kellogg’ s may face certain issues that will hinder the strengthening of strategic fit with Quaker Oats.
First of all, management style, structure, and its core operational process may clash with Kellogg’ s. Quaker Oats is also a ready-to-eat food manufacturer and has its own typical style. Kellogg’ s must understand and arrange these factors accordingly. Secondly, after acquiring Quaker Oats, Kellogg’ s must maintain its consistency as operational activity will increase significantly. The company is committed to offering a high-quality product and it should live up to its promise. Thirdly, before conducting this acquisition, the Kellogg’ s must recognize its own internal problems.
Kellogg’ s brand value is higher than Quaker Oats and so is the consumers’ expectation. The consumer will keep looking for further development in its product offering.
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