Wednesday, November 7, 2007

Ketchup Packets

The Wall Street Journal has a front-page story about investor Nelson Peltz, who owns the Arby's chain and has taken substantial stakes in a number of other companies, including Heinz and Wendy's. The article is generally interesting, I suppose, but I liked this little nugget:
As for H.J. Heinz Co., he felt the company should sponsor a hot-dog eating contest. And why, he asked, couldn't Heinz find a neater way to dispense single-serve ketchup than those messy packets?...

The activist shareholder also took issue with the 11 billion single-serve ketchup packets Heinz sold each year to fast-food chains, schools and sports venues, calling them messy. His suggestion: Sell ketchup in dip cups like those used for barbeque sauce...

As for messy ketchup packaging, Heinz says that apparently unbeknownst to Mr. Peltz, it had already been selling tens of millions of dip cups annually. "He said, 'Why don't we have dip cups?'" the senior Heinz employee recalls. "We do have dip cups." The company is currently developing larger dip cups, it says. ("A Bit at a Time, Peltz Reshapes Food Industry" by Julie Jargon, p. A1)

I've wondered exactly the same thing about those ketchup packets. They're a pain to open, and they are messy. I suppose that Heinz sells 11 billion of them annually while only selling tens of millions of the dip cups because people would rather buy the packets than the dip cups; but for the life of me, I can't understand why.

1 comment:

mamacita said...

The dip cups must be more expensive. They're bulkier, so the shipping alone would be more, but I suspect that the materials cost more as well.