Cott Corp. has completed a self-examination over the past two months and has come away having learned this lesson: Know thyself.
Cott is North America's top producer of private-label soft drinks. Over the past couple of years, though, it has been focused on building its own brands. No more. The company announced Thursday, during a conference call with analysts, that it will henceforth play to its strengths and concentrate on serving its core customers -- retailers with store brands.
Cott also announced several cost-cutting initiatives and agreed to put Eric Rosenfeld, head of Crescendo Partners -- an activist fund that has been agitating for change at Cott -- on its board.
Analysts generally lauded the moves, an Associated Press survey found. What the company is doing "finally makes sense," said Kenric Tyghe of CIBC World Markets. Marc Greenberg of Deutsche Bank agreed, but added the caveat that "success looks far from certain."
He added what Cott already knows: that it has to improve its relationship with Wal-Mart, which earlier this year cut the amount of shelf space it gives to Cott's "Sam's Choice" brand, sending the already-troubled company into a tailspin.