Hershey Food

Hershey Food

Deepak Dahal

University of Mary Hardin- Baylor

Managerial Communication

Case Issue

Hershey food was largest American chocolate and confectionary product manufacture founded by Milton Hershey in 1905. Hershey food products groups were chocolates, restaurant operation and confectionary group and other food and service group. The problem in the Hershey began with the death of Milton Hersey in 1945.  Hershey Trust company and Milton S. Hershey School faced different challenges with the death of Milton Hersey. In the beginning of 1970’s Stock dividend of Hershey experienced sharp drop. Hershey Trust company decided to gift $50 Billion Pennsylvania State university to establish Medical school and teaching hospital. But the Townspeople protest against this decision.  Hershey chocolate company lost its driving position in the market to defaces. The arrangement of William lepley in the Trust board was strife for the organization. The company was in huge loss and lost its goodwill in the market.

             Finally, in 2002 trust voted 15-2 to differentiate its portfolio by offering Hershey Food company. The company declared openly its craving to put Hershey Food Corporation available to be purchased. Despite the fact that Richard Lenny was at first against making offering the organization, he was constrained into it by Trust CEO Robert Vowler.

Case Analysis

As you move on case, the decision to put company for sale was not acceptable for investors and other stakeholders. The response was prompt and antagonistic to this decision. There were challenge at the grass root level which incorporate online appeal to and union organized protest. In the case, it seems that management make quick decision to put company for sale. Before making such decision, management should analyze investor, customer and other stakeholders of the company.  When bidding of the Hershey corporation began in august 2002, its has option to go with Nestle and Cadbury or with Wrigley’s company. Hershey accepted $12.5 Billion in cash and stock combination from Wrigley’s Company. But in the same year Hershey management changed their decision and decided to reject all bids. This shows that Hershey board did not analyze the impact of putting company for sale. There was awful reaction from the market and their share price drop down to lowest in 15 years.  Richard lenny realized the company’s brand value in the market and he promised to work for increasing strength and building good will for the company. In the event that there was suitable arrangement thoroughly considered and level of pride kept up so to speak before the demise of Milton Hershey, Hershey chocolate plant would recover its situation as market pioneer.

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