Business Analysis of The Hershey Company: A Detailed Examination

This report provides a comprehensive business analysis of The Hershey Company, examining various factors that influence its performance. It begins with a PEST analysis, evaluating the political, economic, social, and technological factors impacting the company's macro environment. The analysis delves into political stability, economic conditions like inflation and exchange rates, social factors such as consumer preferences, and technological advancements. The report further assesses Hershey's performance across key areas, including human resources, sales, finance, and business operations. It highlights the company's unique approach to employee motivation, distribution strategies, innovation in product offerings like sugar-free chocolates, and recent stock price trends. The business operations section covers the company's segmentation into North American and international markets, along with its diverse product portfolio, including popular brands. References to supporting literature are also provided.

The Hershey Company
Business Analysis

Executive Summary
The discussion deals with the analysis of the
Hershey company and a detailed examination
of its business performance. The purpose of
is to provide a detailed report on various
factors that influences the company and also
a critical representation of the performance
and strategies of the business.

PEST ANALYSIS
The PEST analysis deals the Political,
Economical, Social and Technological
factors that impact the macro
environment of the company(Ho 2014).
It is a strategic tool to understand the
market growth or decline, position and
business potentiality of the company
operations.

Political Factors
The Hershey's is dealing with their products in several countries with different
political environment and risks(Scott, Hawkins and Knai 2017). Hence the
following factors must be closely analyzed before entering a particular market:
•Political stability and influence of other confectionaries in the economy
•Tax rates and incentives
•Trade regulations, consumer good tariffs
•Price mechanism
•Industrial safety regulations for consumer goods
•Level of corruption, Bureaucracy and influence of government in the sector.
•The various risk factors can negatively affect the Hershey's business. The risk
can be long term and short term in nature. This is qualitative factor that can
increase the overheads.

Economic Factors
The economical factors include the macro environment that can affect
the competitive advantage of the organization. The following factors
must be considered while analyzing the environment:
•The type of economic system in the country of operation and its
stability
•The inflation rate, saving rate, interest rate, foreign exchange rate and
economic cycle to determine the aggregate demand and investment in
the economy
• Government intervention in the free market an on the related
consumer goods.
•Efficiency of the financial market and infrastructure quality of the
confectionary industry
•Labor cost and productivity in the economy
•Economic growth rate and rate of unemployment.

Social factors
Social factors refers to the society's culture, attitude, lifestyle
and beliefs of the country. The factors that may impact
Hershey are:
•The level of skill and demographic of the population
•Gender roles and social conventions.
•Environmental consciousness and health of the population
of the country
•Class structure, hierarchy abs power structure of the society.
•The leisure interest the society can influence the business
along with the entrepreneurial spirit.

Technological Factor
The firm should not only analyze the technological
factors but also speed up the same for maximizing
the profit (Martin et al. 2017). The various factors
which must be taken in hand are as follows:
•Recent technological advancement by the
competitors
•Impact of technology on the product
•Rate of technological diffusion.
•New trends in technology.

PERFORMANCE ANALYSIS
The four topics that are to
be covered to efficiently
examine the Business
are:
• Human resource
• Sales
• Finance
• Business operations

Human Resource
The working concepts that Hershey employs to stimulate
the employee innovation and creativity is unique. The
company implements benefits to its workers by providing
benefits in terms of fitness, social responsibility,
education, monetary incentives and recognition of
opportunities. The firm has implemented various learning
practices including Hershey university so that the worker
are efficiently educated and enhance their skills at work.
Hersheys believe that their employees are their greatest
asset, hence investing significant amount of time and
money on them for their motivation and development.

Sales
The giant company of McLane, being the primary
distributer of Hershey product accounts for 25%
of the company's sale every year. The network of
distribution is strategically planned and
distributed at important centers to maximize the
sales(House and Street 2016). To enhance the
sales the company keeps on innovating its
product and increase their variety. For example-
sugar free chocolates for diabetic consumers.

FINANCE
The attached chart shows the recent
trend in the stock price of the
Hershey company(Loutskina,
Shapovalov and Loutskina 2017). The
y-axis represents the adjusted close
and the x- axis shows the date. The
price of the stock rose in the month
of April 2017 continued to fall steeply
till august. The stock price continued
to fluctuate the whole year after that.
However, in the month of December
it reached the highest point and
stared to fall until February 2018.At
present, the company is experiencing
a stable continuous trend in sock
price.

Business Operations
The business operation of Hershey takes place in two
segments- one in North America and the other is
international, in which more than 80 other brands are
sold distributed and marketed. Other types of products
are sold under Hershey's that are included in the
companies chocolate business unit like Hershey kisses
and Resses (Chung, Ahmad and tang 2015). Other brand
franchises that are popular are twizzlers, mounds York,
kitkat icebreakers and bubble yum that fall within
refreshment business unit of compamy sweets.