2. Lovely Professional University
Contents
• Nestlé Overview
• Nestlé Competitors
• Brief Summary of the Case study
• Analysis of the Nestlé
– SWOT Analysis
– Porter’s five force Analysis for Nestlé
• Alternatives available
• Choosing the best alternative
• Recommendations
• Conclusion
3. Lovely Professional University
Nestlé Overview
• Nestlé began in Switzerland in 1867 when
Henri Nestlé, a pharmacist launched his
product (Nestlé’s Milk Cereal)
• Nestlé is a nutritious gruel for children
• Now Nestlé sells baby food, bottled water,
cereal, chocolate and other confections,
frozen food, dairy, drinks, health and sports
nutrition, pet care
• Nestlé is today the world's biggest food and
beverage company and employs 339000
people, operates in 194 countries
4. Lovely Professional University
Nestlé Competitors
• Kraft Foods: “Helping people around
the world eat and live better”
• Unilever: “Feel good, look good and get
more out of life”
• General Mills: “Breakfast of
Champions”
• Groupe Danone: “Bringing health
through food to as many people as
possible”
5. Lovely Professional University
Brief Summary of the Case study
• Nestle as a company has a vision to be the world’s recognized
leader in nutrition, health, and wellness
• And so, the firm grew rapidly through mergers and acquisitions
and geographical expansion
• Targeted strategic acquisitions were followed in infant formula,
coffee, canned and frozen foods, bottled water, ice cream, and pet
foods
• Their goal was to achieve worldwide sustainable competitiveness
through four “strategic pillars” in 1997
• Their research and development (R&D) program was restructured
to be consumer-driven with continuous renovation and innovation
6. Lovely Professional University
• Their products were made affordable by producing locally and
using less packaging
• Initiation of GLOBE, was a revolutionary step that brought
important insights into both the production and the selling sides
of Nestlé’s business
• The company followed a Strong Personal Culture
8. Lovely Professional University
SWOT Analysis
Strengths
• Provide high quality
products at the lowest cost
• Universal availability of the
products
• Initiation of GLOBE
• A Strong personal
decentralized culture
• Reinvigoration of existing
brands
• Strategic acquisitions
Weakness
• Lack of ingredients
information
• Complacency
• The joint venture of Nestlé
and General Mills has
restricted Nestlé to be
innovative
• Feasibility of new
products needs to be
deeply analyzed
9. Lovely Professional University
Opportunity
• Lay more emphasis on health
based products
• Encourage research projects
with transformational ability
• Continuous up-gradation of
products
• Provide incentives to the
retailers to increase their sales
volume
• Right time to increase
production rates to meet
consumer demands globally
Threats
• Market segment growth
could attract new entrants
• Increase in volatility in the
farm prices
• Increase in uncertainty
among the farmers
• Economic slowdown
• Existence of large
competitors
11. Lovely Professional University
Alternatives in solving these issues
Product Solution:
Nestlé's ongoing strategy is to develop a 'Wellness' approach that
builds on its tradition of producing nutritional products. So Nestlé's
Wellness strategy must include:
– E - (Environment) Match the strategy to the Environment in
which the business operates
– V -(Values) Ensure the strategy is consistent with the
organization's Values
– R -(Resources) Ensure the company has the necessary
resources to strategize its operations
12. Lovely Professional University
Public Relations Solution:
• Nestlé’s approach of eco-
efficiency, sustainability and
the policy towards the use of
water projects company’s desire
to ensure a better life for all
Joint Ventures Solution:
• Joint ventures allow the
companies to share their
resources and capabilities to
gain a lucrative competitive
advantage
13. Lovely Professional University
Choosing the best alternative
The following categories need to be addressed in order to provide
the best possible solution:
Product:
Meeting consumer expectations
Maintain a consistent standard
Improve quality control
Ensuring an affordable yet
healthy product
Marketing:
Invest more in advertising
Invest more in public relations
Be transparent with product
values
Be actively involved in fund
raisers and charitable institutions
15. Lovely Professional University
Conclusion
With global retailers such as Wal-Mart and Carrefour continuing
to grow larger and more powerful and consumers around the
world are having access to more sources of information than
ever before, it is very important for Nestle to sustain their
business in the long run and achieve their vision of becoming the
world’s recognized leader in nutrition, health, and wellness.
