Kraft Splits in 2: Will It Affect Your Oreos?


NEW YORK (MainStreet) — Kraft Foods (Stock Quote: KFT) surprised everyone Thursday by announcing it would split into two separate companies, one of which will focus solely on putting out grocery products like macaroni and cheese and Maxwell House coffee domestically while the other would push snack items like Oreos and Cadbury to markets outside the U.S.

Consumers reading this may wonder if the restructuring will have any impact on the Kraft products they see on supermarket shelves, but according to food industry experts, the short answer is no.

“I don’t think the average U.S. consumer will even notice the change, aside from the headlines in the news today, and it certainly won’t lead to any change in consumption patterns,” said Harry Balzar, a food analyst and vice president of the NPD Group, a market research company.

As Balzar and others point out, the move is being seen as part of the company’s effort to expand into more emerging markets abroad, a goal that several other food companies and retailers are pursuing, and should not affect supply strategies in the U.S.

Indeed, analysts generally expect it to be business as usual for Kraft in the U.S., but consumers living or traveling abroad in emerging markets (countries like India, Russia and China) could see a change in the products offered there in the coming years.

“Internationally, consumers will see a lot more new products [from Kraft] as the portfolio in their snack food business widens out,” said Phil Lempert, a food industry analyst and the editor of Neither analyst would speculate on the types of products that might pop up abroad, but as Lempert puts it, “Do we need yet another double-stuffed chocolate Oreo in the U.S.? No. But internationally, who knows?”

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