Daily Dispatch: Sara Lee, Starbucks, Whole Foods, and AirTran
- Sara Lee Corp. saw a 7.1 percent increase in sales for 2007 in all six of its divisions. Much of the company's success can be attributed to its new customer-centric sales strategy, which focuses on the vendor as customer. Rather than relying on brokers, the company sells directly to retailers and creates a tailored plan for each store that involves Sara Lee products across all brands.
- Starbucks, in collaboration with Hershey, will start selling "drinking chocolate" nuggets in retail and grocery stores this year. Initial consumer feedback confirms Starbucks' gamble that the rich beverage, similar to the failed in-store Starbucks Chantico, is more successful when consumers can adjust the flavor to their individual tastes.
- The FTC temporarily released confidential information relating to the Whole Foods acquisition of Wild Oats. The documents contained improperly redacted trade secrets, including how Whole Foods prevents suppliers from selling directly to Wal-Mart and that the company plans to close 30 Wild Oats stores in competitive markets. Other retailers will certainly be using this information to compete more effectively against Whole Foods.
- AirTran made a $445 million bid for Midwest, topping buyout firm TPG Inc./Northwest's $424 million bid. Midwest CEO Joe Leonard warns that, if equity firm TPG and Northwest bought the airline, the new company would block competition, raise fairs, reduce employment levels, and reduce service. Midwest's reputation for customer service combined with AirTran's low fares could make the merger advantageous.