Weak sales, a trend toward simpler ingredients and online grocery shopping have left America's largest food companies in need of a new playbook, according to an analysis by The Wall Street Journal.
For many of the companies, shaking up their C-suite has been part of the strategy. During the last two years, the CEOs of at least 16 major packaged food and beverage companies have left their posts, WSJ found. Executive moves included Campbell Soup's chief Denise Morrison's departure in early May, which followed CEO changes at General Mills, Mondelez International, Kellogg, Nestlé, Hershey, J.M Smucker and Hostess.
Greg Wank, a partner at advisory firm Anchin, told WSJ the number of moves within two years may be unprecedented. "I don't think we've ever seen something like this," he said.
Meanwhile, the S&P 500 Packaged Food & Meat subindex plunged 15 percent in the past two years, as the S&P 500 has jumped 30 percent. At the same time, the country's top 25 food and beverage companies continue to see their market share shrink, with average annual sales growth of 2 percent from 2012 through 2016, WSJ reports, citing consultancy A.T. Kearney.
Some investors see the CEO exodus as a step in the right direction, especially when the next chief arrives from a different industry. Jacob Gamerman, senior research analyst at Neuberger Berman Group, told WSJ, "There's always a bit more intrigue when you have an external hire come into a company that's been around for 100 years." However, many of the brands changing CEOs during the past two years have selected internal candidates.
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