Dean Foods SWOT and PESTLE Analysis

Strength

1. Leading food and beverage company: Dean Foods dominates among the food and beverage companies and is the biggest processor and distributor (direct-to-store) of fresh fluid milk as well as the other dairy and dairy case products in the United States of America, bearing the vision of being the highly admired and trusted provider of healthy and great-tasting dairy items on every occasion. A huge selection of branded and private label dairy and dairy case products, such as fluid milk, cultured dairy products, creamers, ice cream, ice cream mix, etc. are manufactured, marketed and distributed by us to the distributors, retailers, educational institutions, governmental entities and food service outlets across the U.S.

2. Large and diverse product portfolio with power brands: As of 2019, Dean Foods includes over 50 national, regional and local dairy brands and private labels. With the help of all of these included within its fold, the company offers various branded and private label dairy case products like fluid milk, creamers, ice cream, cultured dairy products, ice cream mix, etc. to distributors, retailers, educational institutions, governmental entities and food service outlets across the United States. Further, Dean’s DairyPure brand ranks number one in white milk and TruMoo brand ranks number one in chocolate milk in United States.

3. Presence in the healthy sector: The majority stake of Dean Foods in Good Karma Foods has allowed it to collaborate with and give out healthier options to customers. Good Karma Foods is a dominant brand when it comes to yogurt alternatives and flax-seed based milk. It is a rapidly developing brand in the growing plant-based food and beverage tier. Again, its plant-based alternatives do not pose the threat of having any of the major allergens and they provide solid nutritional benefits. Surprisingly, these products also have a neutral flavour, alongside having a creamy texture that enables Dean Foods to fulfil the needs of the customers searching for other great-tasting options in lieu of the ordinary dairy.

4. Extension distribution and transportation network: Dean Foods has 58 facilities of manufacturing sprawled across 29 states of U.S. and as of January 2019, it distributes its products across all the 50 states. It also owns 5 manufacturing plants in the following countries: Belgium, the United Kingdom, the Netherlands and France. It has a solid workforce of over 7,000. The Company is also a member or part of the American Trucking Association and the National Private Truck Council. Its fleet of trucks is one of the biggest privately-owned refrigerated fleets having 12, 100 vehicles. As our products are perishable in nature, Dean Foods delivers a large number of its products directly to the doorstep or location of the customers through the refrigerated trucks or trailers that we lease or own. This is what is known as the “DSD” or “direct-to-store delivery” system. Speaking of that, Dean Foods has one of the most pervasive and far-reaching refrigerated DSD systems in the U.S.

Weakness

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Opportunity

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Threat

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Political

1. Dean Foods - a probable casualty of U.S.- China Trade War: The ongoing trade war between United States and China as of 2019 has also impacted the dairy industry. Approximately $2 billion in United States exports were targeted as a result of the tariffs imposed by China, according to the reports of the United States Department of Agriculture Foreign Agricultural Service. Again, the dairy industry was targeted by the retaliatory tariffs of China, Mexico and Canada in July 2018, enacted in response to U.S. tariffs on aluminium and steel. By August 2018, the whole of China’s dairy product imports from the U.S. were subjected to tariffs, apart from the normal most favoured-nation tariffs. Almost all the cheese exported from the United States by Mexico is subject to these retaliatory tariffs. If the trade war continues till 2020, it may have a major impact on the dairy producers like Dean Foods in the United States.

Economic

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Social

Technological

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Legal

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Environmental

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