Heat in Cook's Kitchen

Chauncey William Wallace ("Tex") Cook is a little like the distressed fellow in the television commercial who says, "I can't believe I ate the whole thing." Cook heads General Foods, which is having trouble digesting all that it has swallowed. Earlier this year General Foods wrote off a $47 million loss on Burger Chef Systems and Rix Systems, a pair of acquired hamburger and roast beef sandwich franchise operations that ran afoul of overcrowding in the fast-food business. As a result, one of the world's biggest processors of food (last year's sales: $2.3 billion from such household names as Maxwell House, JellO, Birds Eye and Gaines) is heading for its first earnings decline in 20 years. Figures are not yet complete for the fiscal year that ended in April, but earnings for the first three quarters were $84 million v. $86.4 million in the equivalent period a year ago.

Neither Cook nor other company officers can expect to collect any executive bonuses this year. That expectation, together with the earnings drop, left them in a dyspeptic mood, and somebody had to take the blame. Last month President Arthur Larkin, 55, took early retirement under pressure, and Cook, 62, already the chairman and chief executive, became president as well. Says Cook: "We have to do the surgery, get it over with, and get on with the business."

Coffee Grounded. Business has been bad on several fronts. The General Foods empire is built largely on coffee--one-third of its sales come from it--but Americans have been imbibing less of it. During the 1960s, annual per capita consumption dropped from 15.8 Ibs. to 13.4 Ibs., as more Americans turned to soft drinks. Maxim, which is General Foods' freeze-dried coffee, is being outsold by Nestle's Taster's Choice. Says Cook: "To get on the shelf, Nestle's had come in with some very attractive inducements"--price deals for grocers, coupons, vigorous advertising campaigns.

One of General Foods' problems is that new products no longer stay unique for very long. Just about any new drink, breakfast food or pudding is almost immediately surrounded by a horde of imitations. For example, General Foods' Toast 'em Pop-Ups were bushwhacked by competitors; the company has recently sold the line to Schulze and Burch Biscuit Co. Cool 'n Creamy frozen puddings were also a disappointment. "We were hoping that Cool 'n Creamy would continue to build, but it hasn't," says Cook.

To bring the company around, Cook has started a major reorganization, giving more power to a few veteran vice presidents and centralizing far-flung product research. He has a salesman's high hopes for several products that are test-marketed: Brim, a decaffeinated coffee; Master Blend, a mix of freeze-dried and spray-dried coffee that would cost less than either Maxim or Taster's Choice; Oven Top, a chicken or turkey dressing that can be cooked without a bird; and Soft-Swirl, a mousse dessert. Meanwhile Cook faces mandatory retirement in less than three years, and the company has to pick a president who will be his heir apparent for the chairmanship. "Obviously," says Cook, "that has to happen--but there is no rush."

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