[Recommended]EZ-Pleeze Food Company

  EZ-Pleeze Food Company Company and Industry Profile EZ-Pleeze Food Company provides corn and potato products in the United States. The organization started operations in…

EZ-Pleeze Food Company
Company and Industry Profile
EZ-Pleeze Food Company provides corn and potato products in the United States. The organization started operations in the early 2000s. Its production plant and headquarters are located in Statestown, Illinois. The founder was a produce farmer for over 25 years. Due to his family’s health issues, he will resign as the CEO of the company within the next 12 months. In order to move past competitors, EZ-Pleeze needs to develop both a domestic and global expansion strategy for implementation. The primary factors in the produce industry include, but are not limited to, price, product line, and customer service.
The company went public about ten years earlier. Since EZ-Pleeze started, the market has experienced a downturn, which usually happens every three years. As a result, the organization attempted to focus on the development of other corn and potato products in the processed food market. The market research indicated that consumers wanted healthy foods with great taste. In order to become more competitive and meet consumer demand, the company had to invest in new technology for the preparation of its corn and potato products. The technology investment for this type of produce preparation, however, costs over $20 million. This amount required EZ-Pleeze to raise its prices. The overall business strategy was to produce value-based products with consistent profit margins rather than traditional, lower-value corn, which often had volatile profit margins.
Another strategy that EZ-Pleeze used was to lower the price of its processed corn and potato products with the hope of launching into the market against chief competitors, such as Gold Starch Foods and Prime Spuds Industries. In addition, the organization had to invest heavily in marketing and advertising, averaging $5–7 million per year. The cost of the marketing campaigns, along with the addition of technology, caused a major financial drain on the company. It laid off 10% of its workforce (both administrative and labor employees) in an effort to remediate the financial damage. The business suffered major net losses in recent years. As a result, shareholders began to dump their stock. In fact, EZ-Pleeze came very close to filing bankruptcy. Fortunately, it was able to improve the situation by reducing its primary revenue channel from supermarkets and moving into the food service market (as an alternative to its competitors). It was able to rebound with several successive years of growth. However, the past three years have indicated a decline in corn sales but a slight increase in potato sales. The current marketing budget is $5 million per year and will not increase for a few years. The cost of goods sold is high, and reduced financial stability limits growth and acquisitions.
EZ-Pleeze has been competing for shelf space in grocery store retail chains for many years. The organization offers a diversified portfolio of corn and potato products and believes that the infrastructure is in place to customize new products. It maintains consistent contact with its customers to ensure that its needs are being met. The company now supplies more than 50% of the largest fast food restaurant chains in the United States, many of which are considering overseas expansion. Currently, the organization is already at 66% of its total sales revenues ($11.4 billion) for the current fiscal year.
One of EZ-Pleeze’s potato competitors just announced that it is closing its operations at the end of this year. A corn competitor of EZ-Pleeze was recently acquired by one of its potato competitors. As a result, that potato competitor has now moved up to one of the top five producers of corn and potatoes in the United States. Due to the rapid changes within the industry, EZ-Pleeze must develop an updated strategic plan for the next three years in order to become one of the top three producers of corn and potato products in the United States. Research indicates an increased demand for corn. Corn has significant price advantages over other produce, demand is increasing for prepared corn, and exporting produce can be done. Industry challenges include factors such as increased government regulations, labor-intensive working conditions (which have contributed to negative publicity), strong competition from Gold Starch Foods and Prime Spuds Industries, and thin profit margins. The strategic plan will be presented to the senior executive team for support. EZ-Pleeze is currently the second-largest corn producer in Mexico with sales of $2.28 million.
Company Profile, Philosophy, and Outlook
EZ-Pleeze has a hierarchical structure. The division heads report directly to the CEO/founder. The founder, Tim Burnes, will be stop being CEO at the end of the current fiscal year. Because EZ-Pleeze is a publicly traded company, it also has a board of directors to which it reports. The organization must also adhere to compliance regulations relevant to business operations and manufacturing processes.
image1.png EZ-Pleeze Organizational Chart
image2.pngBoard of Directors Board Chair
Tim Burnes
Executive Assistant
Lisa Tye
Chief of Operations
Brian Jansen
Chief Financial Officer
Karen Haley
Director of Marketing
John Kerrington
Director of Manufacturing and Production
Michael Orenson
Director of R&D
Mary Miller
Audit and Compliance staff
Staff Staff Staff
The senior executive leadership team will serve as the audience at the strategic planning presentation. The audience will include the COO, CEO, CFO, and three director-level leadership positions.
Senior Executive Leadership Team:
Chief of operations: Brian Jansen
Chief executive officer: Tim Burnes
Chief financial officer: Karen Haley
Director of marketing: John Kerrington
Director of research and development: Mary Miller
Director of manufacturing and production: Michael Orenson
The company believes that its biggest asset is its employees. As a result, EZ-Pleeze provides health and wellness programming to assist them in performance and productivity. In addition, the organization provides opportunities for professional development and growth (tuition, promotions, and employee credit unions). Additionally, the company consistently strives to be a good corporate citizen with sustainable business practices, as well as community philanthropy and volunteerism. The research and development (R&D) division and lab not only enables the employees an opportunity to contribute creative and innovative ideas for best practices, but also continues to be a leader in industry-related technology for reducing genetically modified crops (GMCs).
To become recognized as one of the top three corn and potato producers in the United States and the world.
EZ-Pleeze is currently the fifth largest corn and potato products company in the United States. In the United States, we lead the industry in research and development (R&D) focused on nutrition, genetic modification, and technologies related to produce products processing. Our business philosophy is to provide the highest-quality products and customer service. In addition, we believe in investing in the quality performance, safety, and well-being of our employees. Most importantly, we take pride in using innovation and creativity to build consistent profitability for our shareholders.
EZ-Pleeze Top Two Competitors
Although there are a number of competitors by segment, based on produce type and preparation, the top two competitors of EZ-Pleeze for corn and potato products are Gold Starch Foods and Prime Spuds Industries. There is a large gap in sales revenues for the top five companies, as the industry is volatile (due to various competitive forces). A brief synopsis of company history, product offerings, business strategy, and SWOT analyses are included for both Gold Starch Foods and Prime Spuds Industries.
Gold Starch Foods
Gold Starch Foods is engaged in the production and distribution of corn, potato, prepared foods, and related allied products. The company primarily operates in the United States. It is headquartered in Orange County, Mississippi, and employs about 115,000 people. The organization recorded an increase in revenues in recent years. The increase in revenues was largely driven by the increase in average sales prices. While all segments had an increase in average sales prices, the majority of the increase was driven by the potato segment.
The current net profit was $780 million, compared to a net loss of $547 million in the previous year. Gold Starch Foods is the world’s largest processor and marketer of corn and potato products and the second-largest food products company in the Fortune 500 list. The business operates with a vertically integrated production process and supplies produce and allied products to customers throughout the United States and 100 other countries. The organization commands 20% and 22% market share of the United States’ corn and potato production respectively. Moreover, its wholly owned subsidiary, Gold-Lucess, is the number one corn stock supplier in the world. Also, Gold Starch Foods holds a significant market share in several prepared foods categories. It is the largest supplier of tomatoes and pizza sauce to the food service industry, and the second-largest manufacturer of flour and corn tortillas and chips in the United States.
Sales Revenues Fiscal Year End (FYE) (in Thousands)
Previous Year
Previous Year
Current Year
Gold Starch Foods produces, distributes, and markets potato, corn, prepared foods, and related allied products. The company operates in three segments: potato, corn, and prepared foods. The business’s integrated operations consist of growing corn, as well as processing, further processing, and marketing these food products and related allied products, including vegan and pet food ingredients. Besides a diversified product portfolio, the company also has a diversified stream of revenues.
A broad and diversified portfolio of products not only enhances market share of Gold Starch Foods across various markets, but it also gives a diverse revenue stream to the company. This advantage also limits the business’s exposure to the risks associated with a particular segment. A diversified distribution channel enhances the organization’s bargaining position.
Gold Starch Foods serves a strong clientele base, including wholesalers, retailers, restaurants, and institutional customers, such as schools and hospitals. Some of the company’s top clients include top retail chains and fast food chains, among others. The organization’s consumer products distribution channel—which comprises U.S. retail channels (including all major grocery chains), wholesale club stores, convenience stores, drugstore chains, and military commissaries—contributed nearly 45% of the company’s sales in prior years.
The food service distribution channel—consisting of major national restaurant chains, including fast food, casual, mid-scale, and fine dining; as well as on-site foodservice venues, including hospitals and school cafeterias—accounted for 34% of sales in the fiscal year. The international export market accounted for 15% of the organization’s sales. Frozen produce and others accounted for the remaining 6% of the company’s sales. Furthermore, a major retailer accounted for approximately 13.4% of the business’s previous sales. No other single customer or customer group represented more than 10% of the company’s prior consolidated sales. The diversified distribution channel and revenue source indicates the organization’s lesser dependence on few customers, which implies higher bargaining power in pricing and shelf space decisions as compared to national and local retailers.
Huge indebtedness negatively impacts the company’s business and liquidity position. The company is subject to high indebtedness, which could have a negative impact on its overall operation. Recently, the organization had increases each year in debt and was forced to utilize its operating cash to repurchase, retire, or redeem $956 million of senior notes. The company’s cash flow of $1.43 billion could be utilized to manage the debt levels; however, this implies diversion of resources from business expansion prospects. Moreover, a higher debt component in the balance sheet would put pressure on the company’s ratings and eventually make additional financing for working capital, capital expenditures, or acquisitions difficult.

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