Elaine Watson of Food Navigator-USA interviewed Dr. Kurt Jetta of TABS Group last month regarding the Heinz-Kraft merger. Dr. Jetta weighed in on the merger on several key points:
- Growth: mergers seem to be the only way to growth for many tier one companies, as they've given up on growing through organic innovation
- Cost-Cutting: while a big part of the rationale for the merger is cost-cutting, revenue growth has to play a big role longer-term
- Acquisitions: one possible way to grow going forward is through acquiring smaller, innovative brands
Jetta stated that, while this merger will form a $29 billion giant, the road ahead could be bumpy: "They (large tier one companies) have become so big that they just can't respond to the consumer without pretty radically changing the way they do business, but they can't do that, so they have to make acquisitions..."