NESTLEStrategic Management Presented to: PARAKHIYA VASANT
INTRODUCTIONNestlé is aSwiss company,founded in 1866by Henri Nestle.
Brands of Nestle…
Did you know … Nestlé markets its products in 130 countries across the world Nestlé manufactures around 10000 different products and employs some 250000 people Nestlé sells over a billion products everyday
People, products,brands What makes Nestlé the world’s largest food company are the millions of consumers across the globe who put their trust in its products, bite after bite, sip after sip, day after day.
Nestle India a subsidiary of Nestle S.A. of Switzerland Incepted in 1962 manufactures a variety of food products such as infant food, milk products, beverages, prepared dishes & cooking aids, and chocolates & confectionary Presently the worlds largest and most diversified food company
VISION Being the best in everything they touch & handle
MISSION Continuously excel to achieve and maintain leadership position in the chosen businesses; and delight all stakeholders by making economic value additions in all corporate functions
Competitive advantages A pool of qualified suppliers that understand and support Nestlé’s commitment to excellence. A pool of qualified suppliers that are directly aligned with underrepresented and emerging communities and can promote positive relationships with our customers Better quality goods and services at a lower price as a result of increased competition and an extended supply base Access to new capabilities and innovations A competitive advantage as we seek government contracts, and assurance that we are in compliance with the diversity expectations of our public sector contracts.
Major Competitors AMUL CADBURY BRU
The Internal Assessment
Nestlé describes itself as a food, nutrition,health, and wellness company.Recently they created Nestlé Nutrition, aglobal business organization designed tostrengthen the focus on their core nutritionbusiness.They believe strengthening their leadershipin this market is the key element of theircorporate strategy.
In order to reinforce their competitiveadvantage in this area, Nestlé createdNestlé Nutrition as an autonomous globalbusiness unit within the organization, andcharged it with the operational and profitand loss responsibility for the claim-basedbusiness of Infant Nutrition, HealthCareNutrition, and Performance Nutrition.
The Corporate Wellness Unit wasdesigned to integrate nutritional value-added in their food and beveragebusinesses.This unit is responsible for coordinatinghorizontal, cross-business projects thataddress current customer concerns as wellas anticipating future consumer trends.
Nestlé’s competitive strategiesare associated mainly with foreign directinvestment in dairy and other foodbusinesses. Nestlé aims to balance salesbetween low risk but low growth countriesof the developed world and high risk andpotentially high growth markets of Africaand Latin America.
When operating in a developed market,Nestlé strives to grow and gain economiesof scale through foreign direct investment inbig companies.In the developing markets, Nestlé grows bymanipulating ingredients or processingtechnology for local conditions, and employthe appropriate brand.
Another strategy that has been successfulfor Nestlé involves striking strategicpartnerships with other large companies. Inthe early 1990s, Nestlé entered into analliance with Coca Cola in ready-to-drinkteas and coffees in order to benefit fromCoca Cola’s worldwide bottling system andexpertise in prepared beverages.
In Asia, Nestlé’s strategy hasbeen to acquire local companies in order toform a group of autonomous regionalmanagers who know more about the cultureof the local markets than Americans orEuropeans.Nestlé’s strong cash flow and comfortabledebt-equity ratio leave it with ample musclefor takeovers.
Marketing Target Market Male and Female; Have many brands and products to meat the taste of each type of consumers. Have high allocation of advertising budget for endorser contract, TVC, print ads, and sponsorship activities. Have top endorsers who have a good image in the soap industry.
Distribution Nestle has worldwide distribution line Nestle has good distribution line to retailer Nestle has new ordering system, named Futures Ordering Program
STRENGTHS strong support from its parent company the world’s largest processed food and beverage company a presence in almost every country strong brands like Nescafe, Maggi and Cerelac continuously introducing new products for its Indian patrons on a frequent basis, thus expanding its product offerings
WEAKNESSES complex supply chain management
OPPORTUNITIES Expansion- potential to expand to smaller towns and other geographies Product offerings- The company has the option to expand its product folio by introducing more brands Global hub- Cheaper manufacturing facility at India than in other parts of the world
Competition- immense competition from the organized as well as the unorganized sectors Changing consumer trends- increased consumer spending on consumer durables resulting in lower spending on FMCG products Sectored woes- Rising prices of raw materials and fuels, and interns, increasing packaging and manufacturing costs
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