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Nestle case

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Case: NESTLE: HOW TO KEEP THE MAGIC GOING....

Case: NESTLE: HOW TO KEEP THE MAGIC GOING....

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  • 1. NESTLE: HOW TO KEEP THE MAGIC GOING....Getting to Know Nestlé Presented by, Nishad Kilikkottu PGDM-IB .
  • 2. ABOUT THE COMPANY Founded by Henri Nestlé World’s biggest Food and Beverage Company Developed first milk product in 1867 Merger with the Anglo-Swiss Condensed Milk Company. Was listed number 1 in fortune global 500 as the world’s most profitable organization. Ranked no. 13 in FT global 2011 with market capitalization of $200. Mainly deals in chocolates, milk products, Maggi, soup, sauce, coffee, tea, milkmaid, and mineral water etc.. .
  • 3. Cont.. Nestlés first expansion is into chocolate activity Introduction of Nescafe, a staple drink of US Military In 1947 came the merger with Maggi seasonings and soups. Acquisition of American Food Giant and Dreyer’s .
  • 4. PRINCIPLES AND OBJECTIVES To create value Nestle does not favor short term profit Create trust among the customer Ensures that the highest standards are met throughout the organization. Recruitment of the right people & on going training & development Continue to maintain its commitment .
  • 5. Global Organization Swiss company - global reach. Peter Brabeck CEO of the company-1997. approximately 254,000 people working. Operating in more than 70 countries. World´s leading food & beverage company. People, brands & products are key. .
  • 6. Our ResponsibilityEnvironment Infant Formula Quality Coffee Prices UN Global Policy CompactSustainability Gene Nestlé Water Nestlé in the Technology Donations Community .
  • 7. Marketing and Nestle .
  • 8. Marketing and Nestle Nestle uses the World Wide Web/Intranet/Extranet Nestle – E-commerce- Increased Effieciency Nestle- Interactive Marketing Nestle- EIS Nestle implemented six -SAP modules- purchasing, financial, sales and distribution, accounts payable, accounts receivable and advanced planning and optimization. .
  • 9. Business Strategy Grow existing businesses – focus on priority groups with growth and profit potential – achieve 60/40 – improve brand positioning and communication Develop new businesses – improve innovation & renovation – select acquisition candidates Reduce cost – reduce structure cost – reduce production cost – restructure business portfolio .
  • 10. Benchmarking Benchmarking is the process of comparing ones business processes and performance metrics to industry bests or best practices from other industries. Dimensions typically measured are – Quality – time – cost. .
  • 11. 12 Stage approach to Benchmarking Select subject Define the process Identify potential partners Identify data sources Collect data and select partners Determine the gap Establish process differences Target future performance Communicate Adjust goal Implement Review and recalibrate .
  • 12. CONT.. Benchmarking is a continuous systematic procedure that measures a firm’s product and process against industry leaders. As NESTLE is industry leader in food products, each factory has its benchmark to improve quality. Nestle Milk Pak Kabirwala takes NestleTambula factory Australia as bench mark, which is the best Nestle factory in all over theworld. Nestle Milk Pak Kabirwala is at 2nd number. .
  • 13. How can Nestle effectively utilize benchmarking?How well Nestle is performing compared to other companies? (competitors). What are the best practices? (technology) What improvement opportunities should Nestle focus on? (future)Internal growth rate? (performance) .
  • 14. Swot analysis- strengths1.Nestlé is adapting its industrial base to the changingrequirements of the business environment.History PresentNestlés industrial set-up - operating with a modern  Falling trade manufacturing base,is largely based on the barriers.economic and – economies of scale,  Decreasing – flexibility,political realities of the transportation cost. – appropriate technology60s, 70s and 80s: & design,  Importance of• Local markets IT. Etc. – low cost operation &• Local production location, - Nestlé is striving for an optimized, -industrial base to ensure long-term competitiveness. .
  • 15.  High market share Size and financial power Strong brand portfolio Operational efficiency dedicated & focused company experience & competences consumer insight constant renovation + innovation consistent sales & marketing support specialist brand HQ + Factory + strong R&D team. .
  • 16. Weakness Limited presence inn organic food Subsidiaries difficult to manage. Lack of retailed presence. Too much products distract from core business. Slow growth rate of Chocolate & Dairy products . .
  • 17. Opportunities Continuous growth in US coffee market Further development of global brands. Partnerships & farmer support. Ethical business activities and growth Emerging market penetration. More health based products in Germany & US. .
  • 18. ThreatsPrivate label growthIncreased competition in bottle waterfrom niche brandsGlobal image may harm all brands if One brand fails.New diet trends.Competitors like HUL, DANONE, HERSHEY FOODS, CADBURY SCHWEPPERS. .
  • 19. .