Aveneu Park, Starling, Australia

.1 today world’s leading health, nutrition and wellness company.

.1
Overview

“Good Food, Good Life”
– Nestlé is today world’s leading health, nutrition and wellness company.  Nestlé’s mission is to provide the best
tasting and nutritious choices in extensive range of beverages and food
categories to its consumers all over the world. Today Nestle has 67 brands of
bottled water, produced in 36 countries and its distribution is made in 130
countries worldwide.

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Nestle traces its
origin back in 1866 when Anglo-Swiss Condensed Milk Company opened the first
European condensed milk factory in Cham, Switzerland. One year later, a trained
pharmacist, Henri Nestle, introduced world’s first prepared cereals for infants
in ‘Farine lactee’ in Switzerland. Both of these companies merged in 1905 to be
a company known as Nestle with headquarters based in Swiss town of Vevey –
where it started in the beginning

. Nestlé’s first
customer was a premature infant who was unable to tolerate his mother’s milk as
well as any other conventional substitutes. Henri’s effort was to develop an
alternative source of infant nutrition for mothers who were unable to breast
feed. Thus the cereal was prepared with his experiments on various combinations
of cow’s milk, wheat flour and sugar

1.2
Vision

Nestle’s aim is to meet
the various needs of the consumer everyday by marketing and selling food of a always
high quality.

 

 

Mission

It try to bring   consumer
 foods that are safe of high quality and
provide best  nutrient to meet
physiological needs. Nestle helps provide options  for all individual taste and lifestyle
preferences.

Objectives

1.    
To become a leader in wellness, health
and nutrition.

2.    
 To be trusted by the company stakeholders.

3.    
 To
become the reference for performance in finance within the food industry.

4.    
 The company Seeks to promote leadership.

5.    
To achieve trust simply by satisfying
all the consumer expectations.

6.    
The company believes in the creation of sutainable
values that are long term.

 

Strategies

The business objective of nestle company
is manufacture and then markets its product in a manner that ensure the
creation of value that the company can carry on for a long term for the
employees, partners, consumers and shareholder. The company is conscious of the
fact that success of the organization is a clear reflection of the
professionalism.

 

1.3   Current status

·       
Nestle is one of the most fast growing
company

·       
The company moved from being a
technology led company that produced convenient, tasty foods and beverages for
sustenance, to being a science driven, nutrition, health and wellness company.

1.4
Future orientation

 

2.
 Situational analysis

2.1
Market overview

Nestle is the leader in food and
beverage industry with wide range of products which accompany consumers  live from birth through adulthood, from
breakfast to dinner, at home and elsewhere. This day by day represents them as
a great responsibility and commitment to quality, taste and nutrition across
all their products, to touch lives in a positive way and earn customer’s trust.

They have joined into nutrition, health
and wellness strategy with three fundamental beliefs:

Pleasure and health: Nutrition have
great taste if it is a part of healthy balanced diet. Eating with moderation
and balance:  Nestle products are deigned
to a variety of choices for every moment of the day and for all company
members.

With long term commitment is to enable
customer an informed choices about diets and lifestyles, helping them care for
themselves and their families, nestle is really a leader in nutrition, health
and wellness area.

 

2.2
Competitive situation

1.     Leading
overall market position and number one or two brands in most areas.

2.     The
extraordinarily large cope of nestle’s business provides for significant
economies of scale in manufacturing, marketing and administration.

3.     The
R&D capabilities allow the company to lead the way in innovation and
provides for maximum portfolio flexibility.

Competitors

Food
and beverage: P&G, Mars, Danone, Kraft, ConAgra foods, Sara Lee, Unilever

Commercial
products and pharmaceuticals: Johnson & Johnson, Novartis, Bayer, P&G

Regional
and local Manufacturers: China Yurun Food, Nissan Foods, Indofood Agril

 

2.3
Micro and macro environmental factors

The macro environment of Nestle include
three division:

a.    
Political
factors

It
serves in several countries. The rules set by government is different in
different regions. It should focu on political dynamic like taxation, import
excise duties, government permission to enter the target marget.  It should also consider the changing global
regulation which are yet to adapt by the company.

b.   
Economic
factors

Economies
of countries differs everywhere, so it has to set different economic policies
for different targeted markets. It should made an analysis report on frequent
basis to get the knowledge of the inflation rates and different income levels.

c.     
Social
factors

The
culture , lifestyle , norms and values force nestle to deliver the specific
product to the right segment. It has considered the  social perpective well o far. Nestle has made
a good reputation of understanding and evaluating the consumer behavior and the
related dynamic.

d.   
Technological
factor

Technology
gives many chances for the development of new products or improvement of
existing ones. Nestle uses technology in different business operations like to
maintain databases with the help of software. The frequent use of social site
has lowered the gap between the direct interaction of consumer and company.

 

 SWOT

Strength

Ø It
has experience of more than 140 years in the industry.

Ø It
is one of the world’s biggest brand.

Ø Is
has reached globally

Ø Employee
strength are worldwide

Ø It
has largest research and development network facilitating continuous
innovation.

Ø It
has a strong supply chain network and products are available through groceries,
supermarkets and even online worldwide.

Ø C.S.R
activities for rural development, environment protection, water conservation,
etc.

Ø Strong
marketing and advertising through TVs, print media, online etc.

Ø It
has high brand loyality.

 

Weaknesses

Ø Being
a big global brand, many controversies in different countries of operation caue
issue

Ø Strong
competition by other brands mean limited market hare growth for nestle

 

Opportunities

Ø It
needs to introduce more health based food products to tap the health
consciousness amongst consumer.

Ø It
should continue with acquisitions and joint ventures to increase its market
share

Ø It
should also  focus on rural markets

Threats

Ø Failure
of the complex supply chain at low levels can affect the business

Ø Increase
in cost of raw materials can affect profit margin

Ø Solid
competition in all product segment.

 

4.       
Marketing
strategy

Objectives

Nestle does the inquiry of the products
and it also helps to execute different studies about its  products. The brand is working hard to know
the eating trends of people and the demand  of the food items which people like to eat
readily. The company is spreading its business in almost all the areas around
the world and its business is getting attention of everyone.

 

STP
strategies

a.    
Marketing
Segmentation

The
market is looking for the basic food trendency  among the people and Nestle is providing its
food products to the customers relating to different segments of society. As
the food items are cheap so they can be available to people of all levels and
these are also available with great ease. The food brand keeps in mind the various
units of people and their needs before introducing of their food products.

 

b.   
Target
marketing

Nestle
is expanding its market in various areas of the world and these food items are
provided in different variety. The company is looking for new market including
the under develop areas, where these food products can be made available
through their effective and quick distribution channels. The food brand is
providing its food products in the target market and it needs to meet the
demands of the customers.

 

c.     
Product
Differentiation & Positioning

Nestle
has prepared its food products in large  range, in which juices, yogurt, milk, butter
and other food items are included. The products of this brand have great essence
 and they are getting popular among its
customers. Nestle is the market leader in the food products and the quality of
the food products is different  and wonderful.
The food brand has unequalled position and the good quality food items or
ingredients are used to make these food products, which can have long counter  life and they can be used for longer time and
these can also be saved.

Marketing mix

a.    
Product

• It is the
world’s largest food and nutrition company almost six thousand products are
being hosted under the brand named Nestle.

 

• Its products are very wide spread
in range counting almost all daily use products as well as occasionally used
products. The products includes  coffee,
bottled water, cereals, pharmaceutical products like lens care solutions,
infant food, beverages, chocolates, candies, ice creams,  refrigerated foods, yogurt, milk cream a very
unusual product that is pet food and the largest selling brand milkman. All
these categories are subheaded to the different 
choices of clients including various sizes and flavors.

• Products that are launched in the
market are at  first screened through high
profile investigation and development sector including food processing, micro
analytical research and proper delivery of functionalities in the food products
thus promising the healthy goods for clients.

• Raw material for its milk
products are UHT treated and packed in tetra packaging, moreover the packaging
is long lasting as well as tempting.

• As hygiene is a basic ethical
question for edible products, so Nestle has a full concern and focus on this
parameter.

• Nestle provides the product
compliance to the customers including all legal supports.

• Nutrition quality is preferably
determined and is provided on the packing of the product to facilitate
consumers to check their preferences along with the expiry dates.

• Complaints if any are timely
responded and suggestions are always welcomed.

 

b.   
Price

• Affordable prices are the major factor
of success of Nestle in global markets for example Milkpak being the largest
selling brand is being sold out at the same price as that of other low quality
products while maintaining its quality.

• Their marketing strategy includes a
wide range of pricing strategy, and by doing this they can maintain their
product rates at a sustainable position.

• Prices are flexible to almost all
types of consumers as they have wide range of single product as in the case of
beverages, fruit juices are flexible to low economy class and expensive tin
packed beverages are also doing business in the market.

• Bulk purchase discount is also provided
at the wholesale markets as well as at the stores.

• Price variations are also seen,
especially in the case of chocolate products, either by upsizing at the same
price or reducing the sale price.

 

c.                 
Place

• The  products have their main business area in
Europe from where they get almost 90 percent of the sales and revenues.

• Nestle is running globally, its setup
being run in 86 countries. So, the sales are also done globally and are
impulsive ones.

• The products are not directly thrown
into the market, rather a full procedure is followed including all the
essentials from Manufacturer, Distributor, Wholesaler, Retailer and finally to
Consumer.

• Nestle products are available in all
its variety at the maximum outlets, as the company is always looking forward to
expand its outlets.

 

d.               
Promotion

• Promotion strategies of the company
are very well planned and they always pay multiples of the expected amounts.

• Advertising on electronic and print
media along with sign boards having tempting figurations of the brand always
proves good for the brand

• Sometimes limited economy offers boost
up the popularity of brand especially in the case when new induction to the
market is made.

 

Action program

 

Financial forecast

Consolidated

Results

2015

2016

Sale

88786

89469

Trading operating profit

13382

13693

As% of sales

15.1%

15.3%

Profit for the year
attributable to hareholders of the parent (net profit)

9066

8531

As % of sales

10.02%

9.5%

 

Balance sheet
and Cash flow statement

Results

2015

2016

Equity attributable to
shareholders of the parent

62338

64590

Net financial debt

15425

13913

Ration of net financial debt to
equity

24.7%

21.5%

Operating cash flow

14302

15582

As % of net financial debt

92.7%

112.0%

Free cash flow

9945

10108

Capital expenditure

3872

4010

A % of sales

4.4%

4.5%

 

Implementation,
control and contingency plan

Having developed a clear strategy, it is
important to implement it. Nestlé will look to ensure that going forward all
its products retain a superior taste profile while providing enhanced
nutritional benefits. This will involve:

i.
retain certain products

ii.
product reformulations (including salt, sugar, fat reduction)

iii. introducing  new products with scientifically proven
nutritional benefits. Nestlé’s product research and development network ensures
it is well placed to meet the challenge of changes in consumer expectations.
The Company’s Wellness strategy is carefully geared to delivering what
consumers want in relation to the foods they eat – a high nutritional value and
a positive contribution to their general wellness.

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