Professional Documents
Culture Documents
Strategy
Good food, Good life
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History
RESOURCES :
They have “Expatriate Army” around 247,000
employees. 500 factories are extending the
whole world to deliver the customers needs.
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SALES :
Sales at the end of 2004 were CHF 87 billion,
with a net profit of CHF 6.7 billion. Roughly
38% of its food sales were made in Europe, 32%
in the American and 20in Africa and Asia.
Africa &
Asia
20%
Europe
America
38%
32%
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EXPANSION PLAN :
Nestlé committed to offering consumers high-
quality food products that are safe, tasty and
affordable. The Nestlé Seal of Guarantee is a
symbol of this commitment. Nestlé's existing
products grow through innovation and
renovation while maintaining a balance in
geographic activities and product lines. Now a
day the company focuses on new technology
platform such as non-animal protein
resources or agricultural biotechnology
products.
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SWO T Analysi s
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Strengths :
1. Pioneer of soluble coffee drink
In 1938, Nestlé had been effected by the effects
of 2nd World War. Their profits had dropped
down from $20 million to $6 million in the time
duration by 1938-1939. After that Nestlé started
its most revolutionary journey with Nescafé, the
world ‘s first soluble coffee drink. In that time
Nestlé's production and sales rise in the
wartime economy. Still now Nescafé is the most
offered and prominent coffee in throughout the
world.
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2. Nestlé owns Massive brands
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Nestlé is present in different markets with the following
main brands:
Coffee Nescafé, Taster’s Choice, Ricoffy, Bonka,
Nespresso, Zoégas, Loumidis
Water Nestlé Pure Life, Nestlé Aquarel, Ice
Mountain, Nestlé Vera, Deer Park,
Other Nestea, Milo, Carnation, Libby’s, Caro
beverages
Shelf stable Nestlé, Nido, Milkmaid, Klim, Nestlé
Omega Plus, Bear Brand, Coffee-Mate
Shelf stable Nestlé, Nido, Milkmaid, Klim, Nestlé
Omega Plus, Bear Brand, Coffee-Mate
Chilled Nestlé, Ski, Yoco, Svelty, Molico
Infant Nestlé, Nan, Lactogen, Nestogen,
nutrition
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HealthCare Nutren, Peptamen, Modulen
nutrition
Ice cream Antica, Maxibon, Mega,
Mövenpick,
Frozen foods Stouffer’s, Hot Pockets, Maggi
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3. Extensive R&D
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4. Good number of acquisitions.
Two-third of Nestlé’s growth has come from acquisitions. Some are as follows;
2. Improper forecasting
Nestlé had a good sales and position in Japan.
Japanese were accepted the instant coffee that helped
them to be the dominant coffee product in Japan. But to
compete with soft drinks they launch a new canned
coffee that was not accepted by the Japanese like instant
coffee. Because it was just a coffee flavored drinks rather
than real things.
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Opportunity
• Growth possibilities in different zones.
Development in economic and population growth
simply provide the opportunity to increase the sales and
market shares in some markets such as; eastern
Europe, Asia and Latin America. Though many of
these countries are relatively poor but when economy
will be in the booming condition then the income level
of the people will be rise.
1. Cannibalizing.
2. Strong competition.
3. Price war.
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Co rporate le ve l st rategy
that h as t aken
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Nestlé goal is “to evolve and adapt to a changing world
continuously and reflects the basic ideas of fairness,
honesty, and a general concern for people.”
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2. Global adaptation
Nestlé wants “to adapt in changing world
continuously”. Nestlé uses the global brand (Nescafe)
in some developed countries but when they went to a
developing country they must try to fit processing
technology and ingredients with that particular local
condition.
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4. Decentralize management structure
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5. Growth possibilities in different zones:
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Busi ness le ve l str ate gy
that h as t aken
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Corporate strategies are formulating from corporate
levels managers and translate by individual business
level managers to implement in individual division to
direct functional level managers so that goals can be
achieved.
1.Extensive R&D
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2. Inadequate infrastructure of China
Nestlé established own distribution network among 27
villages to collect milk. Managers also offer the farmers
vans to carry out the milk promptly. The network known
as “Milk Roads” and the factory collection points known
as “Chilling Centers “
3. Government paid less to the farmers
When Government paid less to the farmers it gave a
opportunity to the Nestle to work out the farmers for
themselves. They paid the farmers payment appropriate
and promptly. Farmers become motivated and got
encourage to buy another cow. As a result within 18th
month the numbers of cow increase from 3,000 to
9,000. So more cow helps nestle to get more milk to
produce powder milk.
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Recommendations
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1.Improper forecasting & Cannibalizing
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2. Price war
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Thank you
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