Milling & Baking News - August 10, 2021 - 7

TUES | 08 10 2021
Editorial
Mondelez International recommits
to grain-based foods
A
ny time a major consumer packaged
foods company eyes a grainbased
foods segment as an opportunity
for growth, the industry takes
note. That the company in question is
Mondelez International, Inc. and that the
category is packaged cakes adds layers of
intrigue to recent developments.
In late May, Mondelez reached an
agreement to acquire Chipita SA, a
global baker of cakes and pastries.
About a year earlier, Mondelez completed
an acquisition of a majority interest
in Give & Go, a baker of sweet baked
foods, including brownies.
It would be understandable if the
transactions initially drew only limited
attention. Neither deal could be
described as transformational for
Mondelez. With annual sales between
$500 million and $600 million, revenues
of each of the two companies equate to
between 1% and 2% of the nearly $28 billion
Mondelez generates annuall y. Also
diminishing attention directed at the
deals, Give & Go's business is focused on
in-store bakeries rather than branded
product sales, and Chipita's presence in
the United States is limited.
Mondelez appears to see the acquisitions
as platforms for deeper expansion
into the cake business, leveraging its
own enviable portfolio of brands. Noting
that the in-store bakery market is
" equal to, if not slightly greater than
the overall cookie market, " Glen Walter,
president of the North American
business of Mondelez, said in June that
Mondelez brands like Oreo already are
beginning to appear on packages of Give
& Go bakery products and kits. Dirk Van
de Put, chairman and chief executive
EDITORIAL STAFF
Executive Editor, Markets
Neil N. Sosland
Editor
L. Joshua Sosland
Managing Editor
Eric J. Schroeder
Senior Editors, Markets
Jay S. Sjerven
Ron Sterk
Senior Editor
Jeff Gelski
Associate Editor, Markets
Matt Noltemeyer
Digital Media
Associate Editor
Rebekah Schouten
Markets, Graphic Designer,
Purchasing Seminar
Coordinator
Christina Sullivan
bakingbusiness.com
Publisher
G. Michael Gude
Associate Publishers
David DePaul
Bruce Webster
Matt O'Shea
National Account Executive
Russell Brody
Account Executive
Tom Huppe
Sales Enablement Specialist
Whitney Hartman
officer of Mondelez, in late July identified
the bakery, pastries and bars categories
as natural extensions of Mondelez's
snacking portfolio. He said the case
for a move into the packaged cakes and
pastries business is compelling - it is a
$65 billion market growing faster than
Mondelez's current core categories, generates
greater revenue per pound than
cookies and is a " fragmented category, "
suggesting an opening for a new player.
Giving added importance to the
company's decision to pursue the cake
No company has been more single-mindedly
focused on growing in the snack business
over the last 20-plus years than Mondelez
International.
business is no company has been more
single-mindedly focused on growing
in the snack business over the last
20-plus years than Mondelez International.
When Kraft Foods Inc. acquired
Nabisco Holdings Corp. in 2000, the
rationale expressed by the buyers was
it would more than triple Kraft's share
of the snacking market to 20% of sales
from 6%. When Kraft decided in 2011 to
break up the business into two separate
companies, it was to create a pure-play
snacking business unshackled from
slower-growing brands such as Kraft
cheese, Oscar Mayer hot dogs and Maxwell
House coffee.
In addition to the star power Mondelez
brings to the cake business, its underlying
Nabisco heritage has deep-rooted ties
to grain-based foods. While principally
a cookie-cracker baker today, Nabisco
continues to operate a large flour mill.
During the 20th century, the company
PUBLISHING STAFF
Director of
Audience Development
Michael Barbee
Audience Development
Analyst
Dustin Pickman
Audience Database
Specialist
Jonathan Hawley
Audience Development
Coordinator
Lauren Juliana
Director of Digital Media
Jon Hall
Digital Advertising Manager
Carrie Fluegge
Advertising Manager
Nora Wages
Advertising Coordinator
Annie Fournier
Design Services Manager
Elisabeth Spillman
Production Specialist
Marj Potts
Senior Design Consultant
Becky White
Promotions Manager
Jim White
Promotions Media Designer
Abby Chronister
participated in nearly every corner of
grain-based foods. Consumer products
sold by the company through much of
the 1900s included sliced bread, salty
snacks, ice cream cones, ready-to-eat
cereal, family flour, cake mix and cake,
as well as cookies and crackers. In 1929,
Nabisco quietly announced, " Our cake,
which we have been developing in a
small way over the past few years, is
making such a place for itself with the
housewife that it has become necessary
to take the first step in the expansion of
this line. " Nabisco opened a cake plant
in New Jersey in July 1930 and continued
selling products such as NBC brand
donuts and " Snow Peaks " far into the
twentieth century.
Into the " adjacent " category of packaged
cake in the United States, Mondelez
joins four large companies/brands
with proud legacies in the business
as several smaller successful players.
Competition has been fierce in the
category in recent years, and the new
entrant promises an injection of dynamism
it is hoped will further raise the
marketplace profile of indulgent grainbased
treats. MBN
Josh Sosland, Editor
We're eager to get your feedback.
Email editor@sosland.com
CORPORATE
Chairman and CEO
Charles S. Sosland
President
L. Joshua Sosland
Chief Financial and
Administrative Officer
Staci Greco
Chief Operating Officer
and Executive Editor
Meyer Sosland
Chief Marketing Officer
Jim Saladin
MILLING & BAKING NEWS 7
Milling & Baking News - August 10, 2021

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