McCormick & Company, Incorporated MKC

The business

McCormick sells the small red-capped tin of paprika and it sells the flavour system inside somebody else's chicken sandwich. The Consumer segment carries the brands people know: McCormick, French's, Frank's RedHot, Lawry's, Old Bay, Cholula, Zatarain's. Flavor Solutions sells seasoning blends, coatings and flavourings to food manufacturers and restaurant chains who mostly do not want their supplier named on the packaging.

The economics are shelf space and formulation lock-in. A grocer allocates the spice aisle once and rarely revisits it, which is worth a great deal. A food manufacturer that has reformulated a product around a specific flavour blend does not casually change suppliers, which is worth more but grows slower.