Hope's Edge_ The Next Diet for a Small Planet - Frances Moore Lappe [78]
THE IMPACT OF YOUR STRATEGY
Americans bought almost $4 billion in salty snack foods in 1979. Since 1949, soft drink consumption has increased almost four times.29
The Popcorn Institute even arranged for joint popcorn-Coke ads on television in the 1950s.30 Enormously successful, the campaign led to more and more Americans munching and sipping in front of their TVs. The connection was completed in 1965, when PepsiCo bought Frito-Lay Corp., makers of Fritos corn chips and Lay’s potato chips, and the first company to sell $1 billion worth of snack foods in one year.31
So far you’ve explored five possible strategies to expand sales. The second path to corporate prosperity is to ring up more profit on every item you sell.
The “Up the Price for the Same Ingredients” Strategy
Raw produce and even unprocessed frozen foods aren’t so profitable. But if you turn these ingredients into some “new” specialty, you can charge more for them. “The biggest growth and profit potential lies in prepared foods—frozen entrees, vegetables in special sauces and ‘ethnic’ combinations—products that command higher margins for the producers,” Forbes advises.32
THE IMPACT OF YOUR STRATEGY
Your strategy means higher prices and more and more processing. In fact, that seems to be a recurring theme here! How else can you take macaroni (55 cents a pound), add a bit of “dried cheese” and some chemicals, and convince consumers that Betty Crocker will stretch their food budget with Hamburger Helper? Hamburger Helper costs $2.38 a pound; a few aisles away hamburger itself sells for just $1.50. (By the way, Hamburger Helper is 23 percent sugar, according to Consumer Reports.)
The “Reduce Your Costs” Strategy
If you can cut your costs while charging the customer the same price, your profits will rise. To do this, you can use fewer expensive ingredients, more of cheaper ones, invent cheap flavorings that taste like quality ingredients, and use synthetic flavor enhancers or MSG while reducing the amount of real, expensive ingredients. You can also try to use fewer ingredients which are imported or in unreliable supply. After all, if the prices of basic ingredients are constantly changing, your financial planning becomes a nightmare.
THE IMPACT OF YOUR STRATEGY
Your strategy has led to more salt, more sugar, more artificial flavors. To clam chowder with an almost invisible portion of clam, but the clam flavor enhanced by one whole teaspoon of salt in every cup. To “chocolate” candy bars with little chocolate. (Cocoa prices are unpredictable.) To soft drinks sweetened with saccharin. (Saccharin costs about one-tenth as much as sugar.) And to raspberry and blueberry pies actually made from apples and flavorings. (Berries are too expensive.)
But What’s Good for Conglomerated …
Your logic as a Conglomerated Foods executive was impeccable. There was only one problem: virtually every one of your sales strategies added one more health risk for everybody who buys your products. More salt, more sugar, more fat, less fiber, more additives (not to mention higher prices and more energy wasted).
Ironically, at least four of our giant food corporations—Borden’s, Nestlé, General Foods, and Kellogg’s—were started by men whose prime motive was to make people healthier. Dr. Kellogg was a strict vegetarian working in a world-famous sanatorium when the first wheat flakes were developed in 1894.33 Yet the logic of corporate profit-seeking is so powerful that today Kellogg’s boasts two of the most sugared cereals. General Foods, the same company that was launched with Postum by a man who wanted to free us from the evils of caffeine, now sells seven brands of coffee plus Pop Rocks and Dream Whip.34
The man I met at the party would respond: “But people buy the stuff. And more than ever. So it must be what they want.”
While he’s right that Americans are buying more and more high-risk foods, this