Cargill Presentation - March 2.ppt

Cargill Confidential

Nourishing Ideas

Nourishing People


Cargill at a GlanceCargill at a Glance

Cargill Founded1865

Ø Grain warehouse in

Iowa

Core Capabilities DevelopedØRisk Mgmt

ØSupply Chain Mgmt

ØGlobal Mgmt

Core Value EstablishedØTrustworthy

ØCreativeØEnterprising

TODAYØ$59 Billion+ in Gross

SalesØOver $1 Billion in Net

EarningsØNet Worth >$9 BillionØ97,000 Employees in

1000 Locations

Core BehaviorsØCustomer Focused

ØInnovativeØHigh Performing

Integrated Food Products and Food Service Company


Geographic Presence

North America37% of net worth50,889 employees

Latin America16% of net worth15,123 employees

Europe/Africa36% of net worth15,763 employees

Asia/Pacific11% of net worth15,186 employees


Strengths of Cargill’s Businesses

• Reputation for integrity

• Financial soundness

• Knowledge of the food system

• Building for long-term success


Culture & Behaviors

• Ethics/Guiding Principles

• Total Quality• Food Safety• Customer Oriented• High Performance• Innovation

• Engaged and empowered work force

• Customer/Consumer Insight

• Community Involvement


Changing Market Environment

• Agri-food Industry faced with significant changes and challenges– Increasingly complex business environment; faster pace of change– Customers/competitors consolidating – Greater reliance on outsourcing/more sophisticated suppliers– Pressure to deliver top line growth through new product intros vs.

product extensions– Shifting power to consumers (health, wellness, taste, convenience)– Margin pressures; over capacity


Corporate Strategy Guidelines

• Private ownership

• Focus on agriculture and food

• A+ credit rating

• Operating managers

• Grow our competencies

• Maintain basic beliefs


Year Four of a 10-Year Plan

Strategic ActionStrategic Action

“By 2010, Cargill will be the recognized global leader in providing our agricultural and food customers with solutions that enable them to succeed in their businesses.”

-Warren Staley memo, February, 1999


Our Plan – Strategic Action

- 10 year journey, long-term perspective, but short-term urgency

- Internal education: explore, discover, create, deliver

- Cross-organization collaboration and transparency

- Restructuring and aggressive cost management

- Re-focus our portfolio on Ag/Food (exit Rubber, buy Agribrands, form Food System Design)

Capabilities Customer Needs

Commodities Solutions

Transactions

Broad Diversification

Relationships

Agri-food chain as our center of gravity


Corporate

Business Unit Focus

Employee Focus

Collective

Cargill ConfidentialSource: Cargill Strategic Intent Presentation, June 2000

Three Areas of Strategic ActivityCargill will provide Food Chain Customer Solutions in the

following areas:

These new areas of activity would need to be incorporated into Cargill’s existing businesses.

Supply ChainManagement

Food Applications

Nutrition&

Health

Basic NutritionBuilding Blocks

Customer Solutions

Existing Cargill Food Chains


Energize Sport Drink with Trehalose

NUT-NOTSTM

Soy Signature Bar

Performance Breakfast

Women’s and Men’s Bread with AdvantaSoyTM

Innovative Solutions


Outback Steakhouse


The world's first man-made fiber from 100% annually renewable resources.

A fiber that not only touches your skin but also touches your soul.


Focus on Our Strategic Accounts

General Mills


Cargill reached a safety milestone

Cargill’s safety index measures the frequency and severity of work-related injuries based on the number of hours worked. It decreased to a record 1.7 in fiscal 2003.

Success Story - Safety

0

2

4

6

8

10

1993 1995 1997 1999 2001 2003

0

25

50

75

100

125

150

175

200

225

Safety Index Million hours worked


Supply Chain ManagementThe Customer Satisfaction/

Efficiency Paradox

March 2, 2004


Grain Distribution Example

DistributionRaw Material

Production

Raw Material Logistics/

Storage

Processing Manufacturing Customer End

Use

r/C

onsu

mer

Processes/Organization Technology Materials/Cash Information Risk Management

• Grain originated from country

• Transported through elevator system

• Exported and distributed to the customer

Supply Chain Optimization

Product Assurance

New Product development

Raw Material Input


Grain Processing Example


Production


Storage


Use

r/C

onsu

mer


• Grain contract grown and originated from country


• Processed into food ingredient

• Distributed to food manufacturer


Product Assurance


Raw Material Input


Fully Integrated Meat Example


Production


Storage


Use

r/C

onsu

mer


• Specialty formulation fed to animals in feedlot

• Animals tracked through feedlot to slaughter plant

• Processed to product specific specifications

• Distributed to further processing facility

• Distributed to grocery or food service channel


Product Assurance


Raw Material Input


Grain Distribution Discussion


Production


Storage


Use

r/C

onsu

mer


• Grain originated from country


• Exported and distributed to the customer


Product Assurance


Raw Material Input

Satisfy customer’s expectation of ‘guaranteed free of’ at low cost


Grain Processing Discussion


Production


Storage


Use

r/C

onsu

mer


• Grain contract grown and originated from country


• Processed into food ingredient

• Distributed to food manufacturer


Product Assurance


Raw Material Input

How to respond to customer dissatisfaction as a result of new technology implementation?


Fully Integrated Meat Example


Production


Storage


Use

r/C

onsu

mer


• Specialty formulation fed to animals in feedlot

• Animals tracked through feedlot to slaughter plant

• Processed to product specific specifications

• Distributed to further processing facility

• Distributed to grocery or food service channel


Product Assurance


Raw Material Input

Satisfy consumer’s demand for safe, low cost meat


Thank you!

Jenny L. VernerVice President Supply Chain Management

Cargill

[email protected]

952/742-5034

Documents

Cargill Presentation - March 2.ppt