Download - Nestlé India
Nestle India:
Economic analysis of the brand
Submitted by: UDITA DASGUPTA
Acknowledgement and declaration:
The project shows an extensive economic analysis of the brand nestle. The study mainly focuses on the demand analysis of the nestle products. The brand holds some huge range of products from the milk products, chocolates and confectionary to beverages and many more. The study discusses about the fmcg line of products and their demands in various parts of the world.
The study has mainly considered the secondary data. The study has considered the total fmcg chain and it is not restricted to any market or product. In case of any limitations, author solemnly seeks for the forgiveness of the reader.
Moreover a lot of research and hardwork is been invetsed in this report and is completely a work of individual effort and no other report ahs any resemblance with this report.
The author would like to snatch the opportunity to thank the people without whom this project would have been a distant dream. Heartiest thank to my teacher Dr. Renita Dubey who has always been with her students to help out with the project when ever required.
sincerely:udita dasgupta
Table of contents
Serial no. List of the content Page no.1. VISION OF NESTLE
2. MISSION OF NESTLE3. INTRODUCTION OF THE
ORGANIZATION4. HISTORY OF THE
ORGANISATION5. PRODUCT LINE OF NESTLE6. DEMOGRAPHIC TRENDS7. FIVE FORCE ANALYSIS8. SWOT ANALYSIS9. MARKET STRATEGY10 INTERNATIONAL STRATEGY11. COMPETITORS12. PROPOSED STRATEGY PLAN
FOR NESTLE13. MARKET STATISTICS
SINCE200514. EARNING, JOINT VENTURE,
ETHICAL AND EFFORTS 15. MARKETING OF FORMULA
16. NESTLE SUPPLY CHAIN, DEMAND FUNCTION
17. CONCLUSION18. BIBLOGRAPHY
Vision of nestle:
“Nestlé's aim is to meet the various needs of the consumer everyday by marketing and selling foods of a consistently high quality.”
Mission of nestle:
“We strive to bring consumers foods thatare safe, of high quality and provideoptimal nutrient to meet physiologicalneeds. Nestle helps provide selections for all individual taste and lifestylepreferences.”
Introduction of the organization:
Nestle is the world's largest food and beverage company. ]Nestle owns several
major consumer brands such as Stouffers, Nescafe, Kit-Kat, Carnation, Nestle
Water, and many others.[2] All in all, 30 of Nestle's products earned 1 billion CHF
or more during 2010, making Nestle a major force in the global food and beverage
industry.[3] Nestle competes with companies such as Uniliver NV(UN),Hershey
Foods(HSY),Kraft Foods(KFT),Cadbury Schiweppes(CGS), and GROUPE
DANONE(DA) in the packaged food market. With only 42% of its food and
beverage sales coming from North America, Nestle is one of the most
geographically diverse of the major food and beverage companies. In FY 2010,
Nestle generated revenues of CHF 104.6B ($121.1B USD) and net earnings of CHF
9.05B ($10.5B USD).
Although it already occupies the top spot in terms of sales, Nestle is attempting to
continue sales and margin growth by increasing the nutritional value of its
products and expanding into new areas of therapeutic foods for people with
various illnesses. The company's stated goal is to transform itself from a food
manufacturer to the world's leading nutrition, health, and wellness company.[ In
2010, Nestle created a subsidiary that will create food-based products meant to
help prevent and treat various medical conditions such as heart disease and
diabetes
Nestlé India is a subsidiary of Nestlé S.A. of Switzerland. With seven factories and
a large number of co-packers, Nestlé India is a vibrant Company that provides
consumers in India with products of global standards and is committed to long-
term sustainable growth and shareholder satisfaction.
The Company insists on honesty, integrity and fairness in all aspects of its
business and expects the same in its relationships. This has earned it the trust and
respect of every strata of society that it comes in contact with and is
acknowledged amongst India's 'Most Respected Companies' and amongst the
'Top Wealth Creators of India'.
The Company continuously focuses its efforts to better understand the changing
lifestyles of India and anticipate consumer needs in order to provide Taste,
Nutrition, Health and Wellness through its product offerings. The culture of
innovation and renovation within the Company and access to the Nestlé Group's
proprietary technology/Brands expertise and the extensive centralized Research
and Development facilities gives it a distinct advantage in these efforts. It helps
the Company to create value that can be sustained over the long term by offering
consumers a wide variety of high quality, safe food products at affordable prices.
Nestlé India is a responsible organization and facilitates initiatives that help to
improve the quality of life in the communities where it operates.
History of the organization:
Nestlé’s relationship with India dates back to 1912, when it began trading as The
Nestlé Anglo-Swiss Condensed Milk Company (Export) Limited, importing and
selling finished products in the Indian market.
After India’s independence in 1947, the economic policies of the Indian
Government emphasized the need for local production. Nestlé responded to
India’s aspirations by forming a company in India and set up its first factory in
1961 at Moga, Punjab, where the Government wanted Nestlé to develop the milk
economy. Progress in Moga required the introduction of Nestlé’s Agricultural
Services to educate advice and help the farmer in a variety of aspects. From
increasing the milk yield of their cows through improved dairy farming methods,
to irrigation, scientific crop management practices and helping with the
procurement of bank loans. Nestlé set up milk collection centres that would not
only ensure prompt collection and pay fair prices, but also instill amongst the
community, a confidence in the dairy business. Progress involved the creation of
prosperity on an on-going and sustainable basis that has resulted in not just the
transformation of Moga into a prosperous and vibrant milk district today, but a
thriving hub of industrial activity, as well.
The Company started milk collection in Moga in 1961 with a collection of 511 Kgs
of milk from 180 farmers. It has substantially expanded its operations with over
85,000 farmers in its own milk district. Nestlé uses local raw materials and
develops local resources wherever possible. Milk Collection Centers with farm
cooling tanks to preserve the quality of milk were established by the Company.
After nearly a century-old association with the country, today, Nestlé India has
presence across India with 7 manufacturing facilities and 4 branch offices spread
across the region.
Nestlé India’s first production facility, set up in 1961 at Moga (Punjab), was
followed soon after by its second plant, set up at Choladi (Tamil Nadu), in 1967.
Consequently, Nestlé India set up factories in Nanjangud (Karnataka), in 1989, and
Samalkha (Haryana), in 1993. This was succeeded by the commissioning of two
more factories - at Ponda and Bicholim, Goa, in 1995 and 1997 respectively. The
seventh factory was set up at Pantnagar, Uttarakhand, in 2006.
The 4 branch offices in the country help facilitate the sales and marketing of its
products. They are in Delhi, Mumbai, Chennai and Kolkata. The Nestlé India head
office is located in Gurgaon, Haryana.
Nestlé has been a partner in India's growth for over nine decades now and has
built a very special relationship of trust and commitment with the people of India.
The Company's activities in India have facilitated direct and indirect employment
and provides livelihood to about one million people including farmers, suppliers
of packaging materials, services and other goods.
Product line of the fmcg
Nestlé India manufactures products of truly international quality under
internationally famous brand names such as NESCAFÉ, MAGGI, MILKYBAR, MILO,
KIT KAT, BAR-ONE, MILKMAID and NESTEA and in recent years the Company has
also introduced products of daily consumption and use such as NESTLÉ Milk,
NESTLÉ SLIM Milk, NESTLÉ Fresh 'n' Natural Dahi and NESTLÉ Jeera Raita. Nestle is
divided into eight units, of which at least four contributed more than 10% to
annual sales. This speaks to not only the company's diverse interests, but also its
strength in each of the respective markets. The four units are as follows.
Dairy products:
Nestlé India has a wide portfolio for Milk Products and Nutrition. Nestlé has a very
clear Charter of ethics and responsible behavior in selling infant nutrition
products.
Milk Products, Nutritional, and Ice Cream was Nestle's largest segment. It includes
the Carnation, Coffee Mate,Dreyer's, and Edy's brands among many others.
Nestle's milk and ice cream brands compete with products such as Brever ice and
store brands. Their nutritional products include Gerber Brand baby food and
Nestle brand yogurts. Nestle's nutritional products compete against brands such
as Dannon Yogurt and store brands. The company's Nutrition segment became
part of Nestle HealthCare Nutrition in early 2011 and will report under this wholly
owned subsidiary in the future.
Nestlé India follows this Charter and also complies with The Infant Milk
Substitutes, Feeding Bottles and Infant Foods (Regulation of Production, Supply
and Distribution) Act, 1992 that guides the sale of infant nutrition products in
India. Nestlé India does not advertise it’s Infant Nutrition products.
List of the dairy products is as follows:
NESTLE EVERYDAY dairy whitener
NESTLE milk
NESTLE slim milk
NESTLE dahi
NESTLE EVERYDAY ghee
NESTLE slim dahi
NESTLE bhuna jeera raita
NESTLE NESVITA Dahi
NESTLE real fruit yoghurt
NESTLE creamy vanilla
NESTLE MILKMAID
NESTLE NESLAC
NESTLE ACTIPLUS
NESTLE stay healthy
Beverages:
Beverages is the second-largest segment after Milk Products, Nutritional and Ice
Cream. Nestle owns several international beverage brands
includingNescafe, Nesquick, Nestea, and Nestle Waters, each of which generated
more than 1 billion CHF in 2007. With more than 400 factories around the world,
Nestle is able to formulate each product to local tastes; "Nescafe" in Switzerland
has a different recipe to the same product sold in the USA. Nestle's strong brand
recognition helps them compete with other brands such as Maxwell house,lipton,
and evian as well as various store brands.
The combination of the recession and upper class consumers' increased
environmental consciousness has lead many customers to cut back on bottled
water in favor of tap water and reusable containers. Industry experts don't expect
bottled water to bounce back anytime soon, and the trend may expand beyond
the US.
Beverages include the very famous NESCAFE instant coffee. NESCAFÉ CLASSIC has
the unmistakable taste of 100% pure coffee and is made from carefully selected
coffee beans picked from the finest plantations, blended and roasted to
perfection. Tag line being “100% coffee.. 100% pleasure...”.
However the other products among the beverages of nestle are:
NESCAFE CLASSIC NESCAFE SUNRISE premium NESCAFE SUNRISE special NESCAFE CAPPUCCINO NESCAFE ICED TEA WITH GREEN TEA NESCAFE ICEDTEA NESCAFE instant hot tea mixes NESCAFE 3in1
Prepared dishes and cooking dishes:
This product line includes the very popular MAGGI. MAGGI 2minutes noodles is
one of the largest and most loved food brands in india. The 2-MINUTE Noodles
range is now available in 6 delectable flavours : Masala, Chicken, Tricky Tomato,
Thrillin Curry, Romantic Capsica, and the all New Guess the Taste Noodles. Each
Pack of MAGGI Noodles also provides Protein & Calcium which are essential
nutrients at all stages of life. 85g of MAGGI Masala Noodles meets 13% RDA* of
Protein and 21% RDA* of calcium for adults.
Nestle's Prepared Dishes and Cooking Aides segment consists mostly of products
that are designed to be ready to eat very quickly, such as microwave lasagna.
[14] Nestle owns brands such as Stouffer's, Lean Cuisine, Hot Pockets, andMaggi.
Nestle has increased the nutritional value of its prepared dishes in order to
compete with products such asDiGiorno, Bertoli, and Kraft Macaroni and Cheese.[15] In 2010, Nestle bought Kraft's frozen pizza business for $3.7 billion.[16] The
purchase added the DiGiorno, Tombstone, Jack's and Delissio brands to Nestle's
stable of products, as well as the license to sell California Pizza Kitchen frozen
pizza. With this acquisition added to Nestle's existing product line, the company
increased its market share to 33% of North American frozen foods
Chocolates and confectionery:
Nestle's Confectionery segment includes confectionery brands include Kit-
Kat and Nestle chocolate. The Nestle Chocolate brand produces famous products
such as Baby Ruth and Nestle Crunch.Nestle's confectionery products compete
with chocolates and candies from Hershey foods and Cadbury
schweppes (recently purchased by Kraft Foods (KFT) and snacks from
manufacturers such as Kraft Foods (KFT), as well as various store brands.
With Kraft Foods (KFT)' purchase of Cadbury in January 2010, Nestle dropped to
the third largest chocolatier.Nestle has its huge range of products in chocolates
and confectionery segment.they are as follows:
NESTLE KITKAT NESTLE MUNCH NESTLE MUNCH POP CHOC NESTLE MILKY BAR NESTLE MILKYBAR CHOO NESTLE BAR-ONE NESTLE MILK CHOCOLATE NESTLE ECLAIRS POLO NESTLE MILKY BAR ECLAIRS NESTLE MILKYBAR CRISPY WATER NESTLE DARK CHOCOLATE POLO-HOLE NEW FASHION
Demographic trends:The market for nestle is targeted nearly all age from young to old people in the
entire six continent. Nestle has served with products like baby products, coffee,
dairy products, boiled water, ice-cream, etc. So the products are very basic in
nature and serve the people from a child to an old man on death bed. The nestle
brand has emerged out to be such a trusted brand, that people all the continents
has faith in this and nestle thus serves worldwide.
Five force model:
Let us consider the five force analysis model of this brand nestle.
New entrants:
The market is completely open and there are so many multinational companies
and domestic companies those who joins the market and exits the market. Thus
there always remains the high pressure in the market and constant monitoring of
the market should be done.
Substitute:
There are so many diversified products of nestle that each segment has its own
substitute. Nestle however is such a brand and the brand positioning of nestle has
been done in such a good manner that it is tough to give nestle a jerk. However
there is always an average pressure on the firm since the market has a free entry
and exit point. However there are so many competitors who create substitutes to
nestle products. They are Britannia, Kohinoor foods, vadilal Ind, Kwality dairy, ADF
foods, and many more.
Suppliers:Nestle has an fmcg product line. Hence whenever the suppliers are concerned,
the few factors that remain very conventional are the contracts with the farmers,
stable suppliers and the other raw material suppliers.
Buyers:The customer demand is something that always needs to be addressed with full
sincerity as any business stands high in the market only on the basis of the
customer strength. The demand issues must be addressed immediately. The
taste and preferences of the customers should be on the priority list of the
company. Innovative ways should be modeled to attract more and more
customers.
Swot analysis:
strength : Their first is that they have a great CEO, Peter Brabeck. Brabeck
emphasizes internal growth, meaning he wants to achieve higher volumes by
renovating existing products, and innovating new products. His explanation of
renovation is that “to just keep pace in the industry, you need to change at least
as fast as consumer expectations.”(Hitt, 2005) And his explanation of innovation is
“to maintain a leadership position, you also need to leapfrog, to move faster and
go beyond what consumers will tell you.” Brabeck has led Nestle into a position to
better achieve the internal growth targets with his. Another strength that Nestle
has is that they are low cost operators. This allows them to not only beat the
competition by producing low cost products, but by also edging ahead with low
operating costs.
Weakness: The main weakness of the LC-1 division of Nestle is that they were not
as successful as they thought they would be in France. The launch in France was
in 1994, but since the late 1980s, Danone had already entered the market with a
health-based yogurt. The second weakness is that LC-1 was positioned as too
scientific, and consumers didn’t quite understand that LC-1 was a food and not a
drug.
Nestle also has multiple critical resources. They have a great research and
development team. James Gallagher and Andrea Pfeifer were the masterminds
behind the research on the La-1 cultures in the LC-1 yogurt. They were also the
two that decided on selling LC-1 as a functional food. This enabled Nestle to
position the product in a way that differentiated it among the other products in
the market. They also have four pillars that Brabeck, Nestle’s CEO has identified
he believes will help their internal growth worldwide. These are operating
excellence, innovation and renovation, product availability, and communication.
One opportunity that Nestle has is that health-based products are becoming
more popular in the world, including in the United States. Consumers are
becoming more health conscious, and realize that living longer isn’t only by luck
and genetics. LC1 has not been introduced in the United States yet. Nestle also
has an opportunity of being even a larger market leader in Germany with LC-1.
Within two years of launching the product in Germany, they had captured 60% of
the market. This was due to the fact that they differentiated the product, and
Germans simply preferred the taste. Another opportunity of LC1 is that, because
they are a market leader, they can introduce more health-based products in
Germany.
A threat to Nestle is the fact that some markets they are entering are already
mature. Danone had an established leadership position in the yogurt market in
France. Since Danone was the first to arrive in the market, they have always been
the market leader there. Also consumers in France liked the taste of LC-1, but
researchers believe they did not repurchase the yogurt because they preferred
the taste of Danone products better. Another threat to Nestle is that there is
intense competition in the United States yogurt market. General Mills’ Yoplait
division is the leader in the yogurt market in the United States. Yoplait has been
the leader for years and is constantly innovating new health products.
General Mills has been a strong competitor of Nestle and they are not short of
experience and strength. One strength that they have is their brand recognition.
One of their main goals has been to deliver brands that consumers trust and value
and they have succeeded. Another strength they have is their distribution. Yoplait
is distributed to more stores in the United States than any other brand of yogurt.
This is one of the reasons why they have been the market leader in yogurt for so
long. Another strength that General Mills has is the fact that consumers simply
know Yoplait is healthy. Yoplait is the only leading brand of yogurt to offer vitamin
D and this vitamin is especially important for adult women.(Yoplait.com) It is not
just a coincidence that Yoplait has vitamin D, but they have purposely added this
vitamin to target female consumers.
General Mills also has some weaknesses. They fact that they are the market
leader in the United States may be hindering them from innovation. They have
been producing Yoplait yogurt for many years, and have offered a series of new
products in the past few years in the nutrition department. Most of these
products however, are very common, and are widely offered in the United States.
The health food industry in the United States has been booming and General Mills
does not offer enough products in the smaller niche markets. They have not
entered into many unknown areas because of their success in the yogurt market.
An opportunity General Mills has is that its Yoplait division is so successful. Yoplait
is the only division of General Mills that is currently earning a profit. They have a
large market share over their main competitors in the yogurt market. Another
opportunity that they share with Nestle is that the health-based and nutritional
food market is booming. They are continually releasing and marketing new
products in these markets and they will continue to do so while the market
continues to yield profits.
The main threat that challenges General Mills is that there is intense competition
amongst the top players in the yogurt and related markets. Nutrition and health is
becoming more and more important to consumers in the United States, and
worldwide. Along with this comes increased competition to gain market share.
Simple supply and demand theories are prevalent in these markets. Another
threat General Mills has is that smaller companies are producing similar products
with the same or added nutritional benefits.
Market strategy:
Nestlé describes itself as a food, nutrition, health, and wellness company.
Recently they created Nestlé Nutrition, a global business organization designed to
strengthen the focus on their core nutrition business. They believe strengthening
their leadership in this market is the key element of their corporate strategy. This
market is characterized as one in which the consumer’s primary motivation for a
purchase is the claims made by the product based on nutritional content.
In order to reinforce their competitive advantage in this area, Nestlé created
Nestlé Nutrition as an autonomous global business unit within the organization,
and charged it with the operational and profit and loss responsibility for the
claim-based business of Infant Nutrition, HealthCare Nutrition, and Performance
Nutrition. This unit aims to deliver superior business performance by offering
consumers trusted, science based nutrition products and services.
The Corporate Wellness Unit was designed to integrate nutritional value-added in
their food and beverage businesses. This unit will drive the nutrition, health and
wellness organization across all their food and beverage businesses. It
encompasses a major communication effort, both internally and externally, and
strives to closely align Nestlé’s scientific and R&D expertise with consumer
benefits. This unit is responsible for coordinating horizontal, cross-business
projects that address current customer concerns as well as anticipating future
consumer trends.
International strategy:
Nestlé is a global organization. Knowing this, it is not surprising that international
strategy is at the heart of their competitive focus. Nestlé’s competitive strategies
are associated mainly with foreign direct investment in dairy and other food
businesses. Nestlé aims to balance sales between low risk but low growth
countries of the developed world and high risk and potentially high growth
markets of Africa and Latin America. Nestlé recognizes the profitability
possibilities in these high-risk countries, but pledges not to take unnecessary risks
for the sake of growth. This process of hedging keeps growth steady and
shareholders happy.
When operating in a developed market, Nestlé strives to grow and gain
economies of scale through foreign direct investment in big companies. Recently,
Nestlé licensed the LC1 brand to Müller (a large German dairy producer) in
Germany and Austria. In the developing markets, Nestlé grows by manipulating
ingredients or processing technology for local conditions, and employ the
appropriate brand. For example, in many European countries most chilled dairy
products contain sometimes two to three times the fat content of American
Nestlé products and are released under the Sveltesse brand name.
Another strategy that has been successful for Nestlé involves striking strategic
partnerships with other large companies. In the early 1990s, Nestlé entered into
an alliance with Coca Cola in ready-to-drink teas and coffees in order to benefit
from Coca Cola’s worldwide bottling system and expertise in prepared beverages.
European and American food markets are seen by Nestlé to be flat and fiercely
competitive. Therefore, Nestlé is setting is sights on new markets and new
business for growth.
In Asia, Nestlé’s strategy has been to acquire local companies in order to form a
group of autonomous regional managers who know more about the culture of the
local markets than Americans or Europeans. Nestlé’s strong cash flow and
comfortable debt-equity ratio leave it with ample muscle for takeovers. Recently,
Nestlé acquired Indofood, Indonesia’s largest noodle producer. Their focus will be
primarily on expanding sales in the Indonesian market, and in time will look to
export Indonesian food products to other countries.
Nestlé has employed a wide-area strategy for Asia that involves producing
different products in each country to supply the region with a given product from
one country. For example, Nestlé produces soy milk in Indonesia, coffee creamers
in Thailand, soybean flour in Singapore, candy in Malaysia, and cereal in the
Philippines, all for regional distribution.
Competitors:
Within the industry of yogurt, there are many players in the market. The most
dominant brand name players inside the United States are Dannon, Stonyfield
Farm, and Yoplait. Yoplait, of General Mills, is the number one yogurt in the
United States. They own 37% of the market share through their different brands,
including the Colombo brand. Stonyfield Farm owns 6% of the market share, and
Dannon is right behind Yoplait taking 31% of the market share. Yoplait is the most
prominent player within the market today. General Mills, Inc. has the leading
yogurt company in the United States. Competing in a $2.9 billion industry, they
contain the highest market share amongst their competitors.
General Mills, Inc. has become one of the world’s most trusted brands since their
birth in 1860. General Mills simply began as a milling company, which began in
the Mississippi River. They started with two flourmills and grew to become one of
the largest, most trusted brands in the world. General Mills has become a
prosperous and diverse company that has strived to provide innovative products
to their customers continually throughout the years.
General Mills has six different strategic business units within their company. It
consists of the Big G, Meals, Pillsbury, Baking Products, Snacks, and Yogurt. The
Big G is the cereal division of General Mills; they hold big name brands such as
Cheerios, Chex, and Total. The Meals division has products like Hamburger
Helper, Progresso Soups, and Green Giant. The Pillsbury division was acquired by
General mills and is the leading company within the refrigerated dough market.
The Baking Products division is the home of Betty Crocker, Bisque, and Gold
Medal products. The Snacks division, who holds the top market positions, has
several brands from Fruit Roll-Ups to Nature Valley. Lastly, the yogurt division
runs Yoplait, the number one yogurt within the industry and Colombo.
General Mills operates internationally mainly through
joint ventures, but also through acquisitions. Throughout the years General Mills
has acquired Pillsbury, which is still in the works, and Green Giant. General Mills
also has several joint ventures throughout the world. General Mills has a 50 –50
joint venture with Nestlé in the cereal division where their products are available
in more than 130 countries throughout the world. General Mills also works with
PepsiCo in a joint venture in the snack division. The successful joint ventures have
allowed the companies to share their resources and capabilities to gain a lucrative
competitive advantage. General Mills functions horizontally using the acquisitions,
mergers, and alliance technique. This allows the company as a whole to gain more
market power and coverage throughout the world.
General Mills is a related-linked company. Out of their six separate divisions, none
of them produce more than 70% of the profits. Every division runs within the food
industry, where the products are sold internationally and to foodservice
operators, retailers and wholesalers.
General Mill’s profit has decreased, but Yoplait has carried the company through
some rough times within the last year. Being one of the only divisions pulling
through with a profit and over exceeding the company’s expectations Yoplait has
really made a name of itself. Yoplait has become the star brand for General Mills,
becoming the new core business for the company. In 2004, Yoplait’s unit volume
grew 10%, which is five times more then the Big G division, who used to be
General Mills core division. Over the past decade yogurt sales have increased on
average 9% per year. But studies have shown that household penetration is very
low, so there is a lot more room for growth.
Yoplait is a first-mover in the yogurt industry. They have offered many new
innovative products to their consumers from Go-GURT to their Nouriche
Smoothies. Within the last year of introducing Nouriche, the product’s sales have
increased by 35%. Yoplait just recently began offering a yogurt that contained
sterols, which is a cholesterol-lowering plant. Yoplait Healthy Heart was
introduced in February of 2005 during women’s heart health month. Yoplait
joined with Cergill, Inc. whom manufactures the plant sterols in a horizontal
alliance. Yoplait healthy heart is the latest addition to their line of yogurts.
The full line of products that Yoplait offers today is wide and diverse. They offer a
yogurt line that consists of the original yogurt, grande, whipped, light, and ultra
light. Yumpsters is a line for younger children, which includes a spoon attached to
their yogurt. Go-GURT has become the yogurt for those that are on the go and
always in a rush, which is also available in smoothie form as well. Yoplait created
the first ever yogurt placed in a tube. Lastly, they offer Nouriche Smoothies, which
are rich in calcium, protein, and fiber. Their products come in many different
flavors and sizes to satisfy their customers.
Yoplait offers their customers a way to live a healthier lifestyle through their
products. Yoplait is the leading brand, which has the largest amount of Vitamin D
offerings in their yogurt compared to any other yogurt brand. They also offer
ways to lose weight, the lower your cholesterol, and how to keep your heart
healthy.
Yoplait has been successful by using the focus business-level strategy. This has
allowed the division to take specific action to attack the specific segments of the
market. The have found niches for each line of yogurt product they offer. Yoplait
has mainly aimed their products specifically at women, children, and dieters.
Yoplait, for the most part, focuses on health to appeal to their consumers, and
has been successful at it. Recently, Yoplait stated that yogurt may help burn fat,
to aim at the diet customers. Yoplait has effectively positioned their products as
being portable and convenient, having a number of different health benefits, and
the flexibility to eat yogurt any time of the day. From their healthy heart products
to their ultra light yogurt to Go-GURT, Yoplait has focused each product to
separate niches of the market to become the leading yogurt brand in the United
States.
Proposed strategy plan for nestle:
Nestlé is one of the largest and most successful food companies in
the world. It has successfully introduced many new products into many different
segments of the food and beverage industry. Nestlé possess a product, LC1, which
is innovative, fairly new in the North American perspective, provides healthy
benefits for the consumer, while offering a new avenue for profits for Nestlé.
Nestlé, with its probiotic cultures found in its LC1 product, has an innovation that
is ripe to be introduced into the North American market. Currently LC1 is
primarily offered in Japan and Germany in the form of yogurts, with great degrees
of success. Unfortunately LC1 yogurts were unsuccessful in a number of European
markets, including France and The United Kingdom.
A LC1 powder was introduced into the American market around 2000. The
powder was designed to be mixed into beverages and foods. It was sold at GNC
stores, primarily focusing on consumers who were already health conscious about
their eating habits. Nestlé used print ads, a direct mailing campaign, a smaller
scale campaign targeted at health practitioners, and heavy Internet advertising
(www.herbs.org/current/nestlesup.html). Overall Nestlé’s LC1 powder went
larger unnoticed by the US consumer, and achieved only minimal results.
In designing a strategy that would effectively place Nestlé at the head of the
probiotic industry in North America market would require several key
components. First would be to decide what areas of the Food and Beverage
industry in which we would like to introduce Nestlé LC1 products. Second would
be to educate the North American consumers as to the benefits that the
probiotics possessed in LC1 brings. A strong marketing and advertising campaign
would accompany this. Third would be to quickly conduct all moves and enter
into each market as quickly as possible to gain maximum market share. Fourth
would be to reinvest all profits, over a predetermined amount of time, back into
operations, research and design, marketing and advertising to solidify consumer
trust, market power and market position. In achieving these components of
success we will be employing the six principals described in the book Sun Tzu and
the Art of Business by Mark McNeily.
The first principal brought forth in the book is to “Win All Without Fighting” or to
prioritize markets and determine competitor focus. Nestlé would need to figure
out what areas of the food and beverage industry they are already operating
strongly in and pinpoint some key products to introduce LC1 into. Nestlé is one of
the largest food companies in the world and offers a wide range of products
across many different areas of the food and beverage industry. Nestlé should
choose to incorporate LC1 into one strong performing product in each one of its
SBU’s. For instance they could introduce it into yogurts through their Dairy SBU,
cereals in their Cereal SBU, into chocolate bars in their Confectionary SBU, power
bars through their Nutrition SBU, baby formulas through their Baby Food SBU, pet
foods through their Pet care SBU, into ice cream through their Ice Cram SBU and
into their drinks through their Beverages SBU. Nestlé should choose one product
in each of these SBU’s to introduce to the market. This way there is wide area of
products with in different areas of the food and beverage industry in which the
LC1 product to bring a profit. So if the LC1 does well in certain areas of the
industry, but not another, Nestlé can shift its focus from the weak product to the
strong product. Introducing it to many different products in many different areas
of the food and beverage industry gives LC1 a better chance of achieving success.
Nestlé, already begin a diversified food and beverage company, has the benefit
being able to explore an option such as this.
Nestlé’s primary competition in introducing these products would be General
Mills. General Mills would offer competition in some areas of the industry but
perhaps could be an ally in others. Nestlé already has joint venture with General
Mills in the cereal industry. These may prove to be beneficial to the introduction
of LC1 into a wide variety of popular cereals that the two companies create and
distribute. But, it may prove to be a hindrance if General Mills wishes not help
due to competition strains that result from other areas of the food and beverage
industry.
The second principal is to “Avoid Strength/ Attack Weakness” or to develop
attacks against competitor’s weakness. A beneficial strength of Nestlé’s attacks is
that the probiotic market in North America is very small. In 1999 probiotics total
sales in North America were $67.2 million
(www.nutraceuticalsworld.com/Sept012.htm). Nestlé would have the benefit of
being a first mover or second mover in the industry. A primary weapon to Nestlé’s
introduction of LC1 products, with their probiotic benefits, would be high levels of
education through advertising and marketing. Nestlé had introduced LC1 in 2000
but to little success. According to Steve Allen, vice president, business
development, Nestlé USA, “Nestlé LC1 was too early for the U.S.; the benefits
were too general and the price/value relationship wasn’t there”
(www.nutraceuticalsworld.com/Sept012.htm). Education and consumer
understanding as to what probiotics are and the benefits they bring is the main
roadblock in LC1’s success.
According to Steve Allen: “What is holding us back in the U.S. is that the consumer
does not really have an explanation for probiotics because there is no vehicle or
preexisting knowledge on which to build”
(www.nutraceuticalsworld.com/Sept012.htm). Because probiotic are a form of
bacteria or a culture, trying to get the North American consumer market to agree
that LC1, a form of bacteria, can help them might prove to be difficult. Nestlé
might first want to focus on athletes, mothers of small children, senior citizens
and any other health conscious area of the food and beverage market in which to
market their LC1 products. Nestlé should highlight to them the benefits of using
their LC1 products, such as having an improved immune system or improved
digestive system. An area that limited LC1 success in other Europeans markets
was that some people viewed LC1 products as away to get better from a sickness,
or as a form of medicine. LC1 products are designed to be a sort of body
maintenance or even enhancement device and taken regularly. Nestlé should
stress the importance of LC1 products being similar to other health oriented foods
like nonfat milk or diet soda, which can and should be consumed daily.
In response to competitor attacks, Nestlé can rely on their reputation in European
and Asian markets where probiotics have being prevalent for a number of years.
LC1 has been widely popular in countries such as Germany, Italy and Japan.
Nestlé, being a first mover in most of these markets, can highlight the fact they
were hugely responsible for the development and creation of probiotic products
and probiotic markets in the world. They were the ones to create an example
which all other in the industry to follow. Nestlé can counter attacks on LC1
products in the North American markets with advertising campaigns that highlight
their success in foreign markets, using real person testimonials to bolster their
positions. Nestlé might also want to employee the help of professional athletes or
movie stars to be spokesmen for their products, in hopes of gaining consumer
support.
The third principal is “Deception and Foreknowledge” or war gaming and planning
for surprise. For this I feel Nestlé should use the implication wheel as a form of
war gaming. Because no other major food brand, including General Mills, has
probiotic products, the weakness that Nestlé would be attacking would the lack of
products that their competitors have to offer in the probiotic market. Nestlé’s first
attack should be to educate consumers to benefits of using probiotic products.
This educational campaign should be backed with scientific support and with
examples of success from the European market. It should be done through
advertisements on television, at prime time and during popular sports events
preferably, through the newspaper coupled with money saving coupons, and on
the internet through links with health food websites. Nestlé should highlight the
fact that while such things as obesity and fast food are slowly decreasing the
healthy and eating habits of North Americans, LC1 provides products that are
healthy, good tasting, which also help improve the body’s functions. It would
beneficial to LC1 success if popular athletes or movie stars were hired to endorse
the products.
Nestlé’s competitors may respond to these advertisements with their
advertisements that may down play or even deny the benefits of using LC1
products. They may play off the consumer’s misconception that all bacteria are
harmful to one’s health in an attempt to stir LC1 success. Competitors may
respond with advertisements that highlight LC1 lack of success in markets like
France or in the United States in 2000. The may wage an anti LC1 advertisement
campaign in hopes of slowing down any market share LC1 may gain from its
advertisement campaign or to support their own probiotic products. In response,
Nestlé should once again shift the consumers focus to their successes in European
markets, along with their history in the market and the breakthroughs in research
they have found to highlight the benefits of probiotic products in the course of
their operations.
Nestlé could use Sun Tzu’s fourth principal, “Shape Your Competition” or
integrate best attacks to unbalance the competition, to throw competitors off.
Because Nestlé is going to introduce LC1 products in several different areas of the
food and beverage industry, they could only advertise products in one or two
markets. Then as competitors design their defense in those particular markets,
Nestlé would unleash their overall product launch across all the predetermined
areas of the food and beverage industry. This should catch competitors off guard,
leaving them unprepared to defend against the scope of Nestlés attack. Nestlé
may choose not to focus a large amount of resources into the introduction of
products into markets in which they tricked their competitors into defend in.
Nestlé should then focus their resource in to markets where they had not
previously hinted they wished to enter into. These markets should be markets
where Nestlé already has strong performing products like their ice cream or
chocolate bar products.
This introduction of products should be done with Sun Tzu’s fifth principal in mind
which is “Speed and Preparation” or ready your attacks and release them. All
actions should be done quickly and following a schedule. Nestlé’s initial hints of
wanting to enter into the probiotic market should be made know to the industry
about one year before actual product launch. Nestlé, through word of mouth and
small advertisement campaigns could hint at the markets and products it was
going to launch with their LC1 probiotic benefits. This would be time would
competitors would take notice and begin mounting defensive strategies. About six
months before product launch, Nestlé should increase the size and scope of their
advertisements, including a specific date as to the launch of LC1 enriched
products. Here is when Nestlé could start employing the help of Professional
athletes or movie stars. Nestlé should emphasizes, in their advertisements, the
universal benefits that their LC1 products will bring to all people, along with the
fact that these products taste the same as similar products in the same category.
About one month to two weeks before product launch, Nestlé should release
advertisement revealing the full scope of the products in which they are planning
to launch. Between two weeks and product launch Nestlé should hold a party of
sorts where they would invite consumers, retailers, distributors, and
manufactures from the food and beverage industry to sample Nestlé’s new LC1
enriched products. This would be done to create a positive word of mouth and
generate interest within the industry. Nestlé then should release all their LC1
enriched products simultaneously across every food and beverage sector.
For at least a year Nestlé should closely monitor all of its LC1 products, noting
which products are performing better than others and in what market sector.
Nestlé should then reallocate resources from poor performers or dogs in the
market, possibly abandoning certain products or markets all together, to support
products that are performing well as stars in their markets. This would follow Sun
Tzu’s final principal which deals with leadership, reinforcing success and starving
failure. Smart leaders know when to put further assets into products and markets
that are performing well and when it would be better to retreat from them.
Nestlé has a well-established management structure that is support by a strong
reputation in the industry. This, along with the fact that Nestlé is introducing
many products into many markets gives them the edge and flexibility to fine-tune
their management, production and sale of their LC1 enriched products.
(Consumption pie of the consumers)
Market statistics since2005:
Net Sales for the Quarter ended 31stMarch, 2005 increased 5.5%
Reported Net Profit for the Quarter ended 31st March, 2005 increased 21.3%
Focus on long term sustainable and profitable growth, market share and
operational & capital efficiencies
• Continued emphasis on Innovation and Renovation to increase Nutrition,
Health and Wellness across product portfolio.
• Launched New MAGGI Vegetable Atta Noodles to provide the benefits of health
and wellness in a pleasurable manner. “Health Bhi. Taste Bhi.”
Mr. Martial Rolland, Chairman and Managing Director of Nestlé India stated, “I
am satisfied with the direction in which the Company is moving. Net Sales for the
quarter were Rs.6135.3 Million and have increased by 5.5% compared with the
same
period of 2004. Net Domestic Sales have increased by 4.9% and Export Sales have
increased by
11.0%.The reported Net Profit for the Quarter is Rs.780.5 Million. This has
increased by 21.3% compared to the same Quarter of 2004. After stripping out
the effect of exceptional items under “Other Income” and “Current Taxes” as well
as excluding “Provision for Contingencies” and “Impairments”, the adjusted Net
Profit for the Quarter increased 14.7% compared to the same quarter in 2004.
EBITDA as a percentage of Net Sales has improved to 22.6% from 20.8% mainly on
account of the cost of milk solids being lower than that of last year, partially offset
by the increase in prices of certain commodities like green coffee and sugar and
higher energy costs. Price increases taken in the second half of 2004 have also
improved the margins.
The reported Net Profit as a percentage of Gross Revenue increased to 12.6%
from 11% in the same quarter last year. During the Quarter, Nestlé India
maintained market share in most categories and launched some new products.
NESTLÉ MUNCH Coconut, with real coconut flakes, was launched at Rs. 5/- to
further enlarge the preference opportunity for NESTLÉ MUNCH, which is the
largest selling SKU in the category. The Company also launched NESTLÉ MILKYBAR
CHOO in strawberry fruit flavour also at Rs.5/-.
During the Quarter, Nestlé India launched MAGGI Vegetable Atta Noodles. An
innovative product and the first of its kind in India, MAGGI Vegetable Atta
Noodles has been developed based on consumer needs and evolving trends for
more whole grain based products. Nestlé India has used the Nestlé Group’s
extensive Research and Development expertise to develop MAGGI Vegetable Atta
Noodles as a new concept for the Indian consumer when they want to include
health and wellness in their foods, in a convenient manner. MAGGI Vegetable
Atta Noodles will provide the dietary fibre of whole wheat to facilitate good
health and wellness in a pleasurable manner and will further strengthen the
MAGGI brand. Progress on the GLOBE initiative was satisfactory and on schedule.
Implementation is planned in the second calendar Quarter of 2005. GLOBE
implementation is likely to adversely impact the cost of nestle india in short run ,
to reap benefits going.
Now the summary of NI’s 2007 full year results below:
• Net sales growth 24%
• Net earnings 31%
• ROE 99%
• Payout ratio 77%
A stronger rural economy, increasing disposable income, and a shift to branded
products will mean higher growth rates for the FMCG industry in the coming
decade. India’s population is over one billion, which means that one in every six
people in the world is Indian. This population is young (70% \below 35 years) and
there is a burgeoning middle class – good demographic tailwinds. Demand for
Nestlé’s products has typically kicked off in a big way in countries where GDP per
capita has crossed the US$1,000 threshold. India’s GDP per capita is around
US$700-800 and growing at 6% per annum. In this respect the ‘plus US$1,000’
market is growing every year and is expected to continue growing for decades.
The Indian consumer’s aspirations are changing. This can be gauged by growing
urbanization, exposure to media, rising ownership of consumer durables and
greater use of credit. Declining birth rates, increasing education of women, and
rising per capita income are all delivering a ‘demographic dividend’. This is
expected to translate into rising consumption of convenience foods and out-of-
home eating. The increasing confidence and changing lifestyle of the Indian
consumer bode well for the long term growth of NI .Nestle market share growing
despite the economic turn down.(2008)
In 2008, the returns of nestle was pretty high and the returns showed an
increasing tend.
As the above graph shows that the turnover experienced an increasing trend
since 2007 to 2008 even when the recession hit the market.
EarningsIn 2009, consolidated sales were CHF 107.6 billion and net profit was CHF
10.43 billion. Research and development investment was CHF 2.02 billion.
Sales by activity breakdown: 27% from drinks, 26% from dairy and food
products, 18% from ready-prepared dishes and ready-cooked dishes, 12%
from chocolate, 11% from pet products, 6% from pharmaceutical products and
2% from baby milks.
Sales by geographic area breakdown: 32% from Europe, 31% from Americas
(26% from US), 16% from Asia, 21% from rest of the world.
(The nestle market share in the respective year)
Joint venturesNestlé holds 26.4% of the shares of L'Oréal, the world's largest company
in cosmetics and beauty. The Laboratoires Inneov is a joint venture in nutritional
cosmetics between Nestlé and L'Oréal, while Galderma is a joint venture in
dermatology with L'Oréal. Others joint ventures include Cereal Partners
Worldwide with General Mills, Beverage Partners Worldwide with Coca-Cola,
and Dairy Partners Americas with Fonterra.
Ethical and sustainable efforts
In 2000, Nestlé and other chocolate companies formed the World Cocoa Foundation. The WCF was set up specifically to deal with issues facing cocoa farmers, including ineffective farming techniques and poor environmental management (disease had wiped out much of the cocoa crop in Brazil). The WCF focuses on boosting farmer income, encouraging sustainable farming techniques, and setting up environmental and social programmes.
Nestlé is a founding participant in the International Cocoa Initiative (ICI), an independent foundation set up in 2002 and dedicated to ending child and forced labour in cocoa growing, and eliminating child trafficking and abusive labour practices. However, there is little evidence that Nestlé has reduced any of its child labour practices in countries such as the Ivory Coast.
In October 2009, Nestlé announced its Cocoa Plan. The company will invest CHF 110 million over ten years to achieve a sustainable cocoa supply. On 23 October 2009, Nestlé and CNRA (the Ivorian National Centre for Plant Science Research), signed a frame agreement for cooperation in plant science and propagation, with a target of producing 1 million high-quality, disease-resistant cocoa plantlets a
year by 2012. The aim is to replace old, less productive trees with healthier new ones.
Nestlé is launching a Fair Trade-branded Kit Kat in the UK and Ireland from January 2010.[
Marketing of formulaOne of the most prominent controversies involving Nestlé concerns the
promotion of the use of infant formula to mothers across the world,
including developing countries – an issue that attracted significant attention in
1977 as a result of the Nestlé boycott, which is still ongoing. Nestlé continues to
draw criticism that it is in violation of a 1981 World Health Organization code ] that
regulates the advertising of breast milk formulas. Nestlé's policy states that
breast-milk is the best food for infants, and that women who cannot, or choose
not to, breast feed, for whatever reason, need an alternative to ensure that their
babies are getting the nutrition they need.
Nestlé India (NI), with a market cap of US$3.6bn, is the 62% owned listed
subsidiary of Nestlé S.A., the world's leading nutrition, health and Wellness
Company.
NESTLE SUPPLY CHAIN:
Nestlé may be known best for its chocolates, coffee, infant formula and
condensed milk. But it's a lot more complex and sizable than that.
It's the world's largest food company, with almost $70 billion in annual sales. By
comparison, the largest food company based in the U.S., Kraft Foods, is less than
half that size, with $33 billion in annual sales. Nestlé's biggest Europe-based
competitor, Unilever, has about $54 billion in sales.
The real trick: Nestlé gets to its huge size by selling lots of small-ticket items-Kit
Kat, now the world's largest-selling candy bar; Buitoni spaghetti; Maggi packet
soups; Lactogen dried milk for infants; and Perrier sparkling water.
Nestlé operates in some 200 nations, including places that are not yet members
of the United Nations. It runs 511 factories and employs 247,000 executives,
managers, staff and production workers worldwide.
(THE ABOVE FIGURE SHOWS THE SUPPLY CHAIN OF NESTLE)
For Nestlé, nothing is simple. The closest product it has to a global brand is
Nescafé; more than 100 billion cups are consumed each year. But there are more
than 200 formulations, to suit local tastes. All told, the company produces
127,000 different types and sizes of products.
Out of this complexity, Brabeck, Nestlé's CEO since 1997, wanted to bring some
order, at least in how the company operates the businesses that support the
marketing of its vast array of brands, products and factories.
Keeping control of its thousands of supply chains, scores of methods of predicting
demand, and its uncountable variety of ways of invoicing customers and
collecting payments was becoming ever more difficult and eating into the
company's bottom line.
From 1994 to 1999, the amount spent on its information systems went up by a
third, from approximately $575 million to $750 million a year. Those costs were
escalating, while the company was shrinking. Nestlé, under Brabeck, had been
selling off some properties, such as Carnation, that it no longer felt were strategic.
As a percentage of sales, keeping track of what Nestlé was selling, how it got to
market and how it got paid had risen from 1.2% of its $48.1 billion in sales in 1994
to 1.6% of $46.9 billion in 1999.
One of the culprits, according to Olivier Gouin, at the time chief information
officer for the company's business in France, was uncoordinated introductions of
planning and management systems from SAP, the progenitor of enterprise
resource planning software. In 1984, Nestlé introduced its first SAP system. By
1995, 14 countries ran their businesses on SAP. And each implemented the same
software, known as R/2, in a different way. Data was formatted differently. Forms
were handled differently. As a result, the company's costs to maintain the system
were going up, and the process of consolidating reports-to determine overall
financial results-was becoming more difficult, not easier.
Enough was enough. By April 2000, Brabeck, then-chief financial officer Mario
Corti-who a year later would move to Swissair in an attempt to rescue that
company-and Nestlé's entire executive board would back a $2.4 billion attempt to
force its confederation of global businesses to operate as if they were a single
unit.
DEMAND FUNCTION OF NESTLE:
The price of raw foods such as corn, wheat, and dairy can change due to factors
such as weather and demand from other industries. Nestle's ability to pass cost
increases on to consumers will play a big role in their ability to maintain their
current profit margins. Commodity prices have not yet stabilized and continue to
rise. The company has been gradually increasing prices since 2005, foreseeing the
major rise in commodity prices, however it has been combating higher input costs
by reducing the cost of packaging, increasing efficiency, and introducing high-end
products with higher price points.
Nearly all of Nestle's revenues come from sales of food and beverage items. Thus,
changing consumer demand for different types of food and beverage items can
have an impact on Nestle's sales. These changes can be seasonal; for example,
consumers tend to demand more hot beverages such as coffee during the colder
winter months.Long term trends also affect consumer demand. For example, the
National Restaurant Association says that consumers have been demanding
healthier food options when dining out, which reflects the larger trend of growing
public concern for health and wellness in general. Nestle is attempting to take
advantage of trends such as these by putting the "Nutritional Compass", which
prominently displays nutritional information, on over 90% of its products'
packaging, and repositioning itself as a nutrition and health company.
Nestle's creation of the Nestle Health Science company illustrates their
commitment to nutrition, health, and pharmaceutical foods. This wholly-owned
subate food-based products meant to help prevent and treat various medical
conditions. The company will also oversee the Nestle Institute of Health Sciences
which will undertake research aimed at bridging the gap between
pharmaceuticals and food and unraveling the web of connections between food,
drugs, and disease. Nestle's existing Healthcare Nutrition segment will now
become part of the new subsidiary.
Nearly all of Nestle's sales happen outside of Switzerland, but the company
reports its income in Swiss francs. As such, changes in the exchange
rates between the Swiss franc and other world currencies can greatly impact
Nestle's revenue. When foreign currencies depreciate relative to the Swiss franc,
any transactions denominated in those currencies will convert to a smaller
number of francs, meaning less revenue for Nestle. The opposite is true as well,
with a weak franc boosting Nestle's international sales. In order to help minimize
the effect of fluctuating exchange rates, Nestle purchases currency
futures, swaps, forwards, and options.
Recognizing the important of emerging markets, Nestle is investing heavily in
production capacity in new markets, such as South Africa, Brazil, Russia, and India.
Nestle's expects emerging markets to account for 60% of future
growth. Additionally, company has introduced its "Popularly Positioned Products."
These products are lower cost and are priced at a level where poor consumers in
the developing world can purchase them every day. With the explicit goal of
having emerging market sales account for 45% of revenues by 2020, Nestle is
heavily investing in Brazil, Russia, and India from 2010-2012, and encouraging
local acquisitions by their geographic subsidiaries. The company has also
expanded its manufacturing facilities in Africa with new/expanded factories in
Kenya, Zimbabwe, Angola, Mozambique, and other countries. The company plans
to increase sales of locally made products in Africa to 52% in 2012 and 76% by
2016.
Thus the demand function can be given by:
Demand of nestle =function of( weather , demand of raw materials from other
companies, price of the raw materials, substitution effect by the product of the
other company products, competitors pricing strategy, and many more)
(Market share of NESTLE compared to the other companies in competition)
Conclusion:
The food processing business in India is at a nascent stage. Currently, only about
10% of the output is processed and consumed in packaged form thus highlighting
huge potential for expansion and growth. Traditionally, Indians believe in
consuming fresh stuff rather than packaged or frozen, but the trend is changing
and the new fast food generation is slowly changing.At Rs 604, the Nestle stock
trades at nearly 25 times annualized 9mCY04 earnings and market cap to sales of
2.4x. The stock trades at a premium valuation over peers owing to its superior
growth and quality product profile. Nestle is a leader in food processing in India
and given the opportunity of growth along with the parent’s keen interest in
developing its Indian subsidiary, the company is likely to continue being a
dominant force in the Indian FMCG space.
(nestle market all round the world)
Bibliography:
http://nestle.in/nestle_india_landing.aspx
http://www.baselinemag.com/c/a/Projects-Processes/Nestleacute-Pieces-Together-Its-Global-
Supply-Chain/1/
http://www.equitymaster.com/detail.asp?date=02/17/2005&story=5&title=Nestle---A-SWOT-
analysis
http://www.allardpartners.com/upload/documents/allard/case%20studies/NestleAGF.pdf
http://en.wikipedia.org/wiki/Nestl%C3%A9#Marketing_of_formula
http://www.nestle.com/Investors/CorporateGovernance/CodeOfBusinessConduct/Suppliers/
Pages/SuppliersHome.aspx
http://www.wikinvest.com/stock/Nestle_(NSRGY)