Hemant,Phillip,Nitin

& Munaf

CONTENT• Vision & Mission• General environment• 5 forces model• SWOT• Business strategy• Competitors• Problems and Solution• Stake holders• Acquisition Strategy• Organizational Structure• Strategic Leadership• Strategic Entrepreneurship

Vision

“Nestlé's aim is to meet the various needs of the consumer everyday by marketing and selling foods of a consistently high

quality.”

Mission

“We strive to bring consumers foods that are safe, of high quality and provide

optimal nutrient to meet physiological needs. Nestle helps provide selections for

all individual taste and lifestyle preferences.”

General environment

• Demographic trends:

- Nearly all age from young to old people.

- All six continents (customers)

• Economic trends:

- Most countries all over the world are affected by the global economic crisis.

General environment

• Political/Legal trends:

- More countries join WTO: allow more free trade across the nations

• Sociocultural trends:

- The world people care more about their health, especially with foods and beverages.

General environment

• Technological trends: - Use most of latest technology( in researching,

producing…) - Try to find new way of create new product - Improve the quality of products.• Global trends: - Improve operational efficiency by integrating

the company’s businesses on a global scale. - “We’re now transitioning to become a

genuinely global food company, to behave as one”

Five forces model

New entrants

• Multinational companies

• More companies joint in domestic market

• High pressure

Substitute products

• Diversity products

• Confectionery, instant foods

• Not many firms focus on pet foods

• Average pressure

Five forces model

Suppliers

• Sign contracts with farmers

• Stable suppliers

• Trust to the big firm

• Low pressure

Buyers

• Variety demands

• Different tastes

• Need to attract customers

• High pressure

SWOT analysis

• Strengths: - Very long history (over 140 years) - Operated factories in 77 countries (all six continents), a

truly global company. - Considered the innovation leader in the global food and

nutrition sector(3500 scientist in company R&D network) - Low cost operators (beat the competition by producing

low cost products, edging ahead with low operating costs)

- Offering thousands of local products. - Have a great CEO, Peter Brabeck, and a very strong

workforces.

SWOT analysis

• Weaknesses:

- Not as successful as they thought they would be in some market (i.e. France)

- Some of their product were positioned as too scientific, and consumers didn’t quite understand (i.e. LC-1 was a food and not a drug)

SWOT analysis

• Opportunities: - Well-known company and strong brandname - Health-based products are becoming more

popular in the world, including in the United States

- Ranked first in nearly all the product segments in which it operated (market leader)

- Unaffected by current economic conditions (its share of the UK confectionery market rise to 15.6 per cent with a 0.5 per cent growth this year)

SWOT analysis

• Threats:

- Some markets they are entering are already mature

- Global competitors.

- There are intense competitions in the United States, especially yogurt market (General Mills)

Business-level strategy

• Nestlé business-level strategy is integrated cost leadership/differentiation

- Wide range of products (over 20 categories: coffee, milk, mineral water, pet foods, cereals…)

- Low cost operators.

Competitors

• Many competitors

• The same qualities

• The same prices

• Unilever, Kraft, Master foods…

• High pressure

Problem

• High market share

• Low growth

• Competitive pressure

• Want to expand

• Don’t have enough resources

Solution

• Cut investment budgets, overheads, frill

• Maximizing existing assets, capacity, distribution

• Target internal growth rate

• Improve supply chain, productivity, optimize planning

PROBLEMS TO NESTLE

• Storm of Melamine in 2008

+ Melamine: increasing high protein affectedly

=> kidney stone, cancer

• Relate with Nestle ???

• 2/10/2008 : Finding Melamine in Nestle powdered milk at Taiwan

=> 6 kinds of Nestle milk products : having Melamine poisoned chemical substance ( little percent)

• Nestle in Switzerland :force to take back baby milk products in France, Spain, Italy

However

• 42 Nestle samples tested in Measured Quality Standard Technique Center: No Melamine

• Nestle products at Vietnam or imported from America, Europe, New Zealand, absolutely not from China

Stakeholders

• Shareholders: profits

• Employees: stable job, promotion

• Consumers: high quality products, reasonable price

• Business partners: long-term, trusted relationships

• Local environment: need Nestle has responsibilities

Acquisition Strategy

• 90’s year: Baby product’s of Nestle were not concerned

• 1998: Peter Brabeck became Director

=> Begin biggest A&M cases:

+ Drerer’s Grand ice-cream Company

+ Rlaston Purina- Pet food biggest North-American : 11 billion USD

Why acquisition???

• Diversifying size of economic:

+ Baby milk

+ Nutrition

+ Cafe

+ Food product

• Expanding the size of company

The most successful A&M

• Buy Gerber, Baby food brand name from Novartis corporation : 5.5 billion $

=> No.1 in Baby food largest market, America.

----->

Not only buy but sell

• Selling the Milk manufacturing Industry in BaVi to Anco Company ( during 1 year)

• Are they right when selling ???

+ The truth : spend money to focus on different field

Invest 4 million$ ( maybe money from selling Milk industry 1 year) to Maggi produce industry

Organizational Structure

Zonal Sales Manager

Regional Sales Manager

National Sales Manager

Area ManagersSystem Support

Executive

System support Officers

Territory in- charge

Event Management

Officer

LoaderDSR

Sales Associates

Event Management

Chiller Technician

Customer Service Manager

Customer Service Officer

Strategic Leadership

• To force the businesses to become more efficient.

• To create a regional manufacturing network.

• To integrate the company’s business on a global scale.

• To reduce marketing expenditures by exploiting the synergies between brands.

Nestle’ strategic entrepreneurship

• Develop R&D network

• Acquisition

Develop R&D network

• >3,500 scientists work on improving existing products and creating tomorrow’s nourishments

• Two thirds of company’s R&D activities are dedicated to renovating existing products, the remaining third is reserved for radical product innovations.

• Improve on operational level• A number of organizational changes.

Acquisition

• Reaching a critical mass in terms of market share

+ the acquisition of Dreyer’s

+ the acquisition of Ralson Purina

+ the acquisition of Jenny Craig• Gain expert knowledge for further expansion into

new product segments.

+ Life Ventures fund

+ The Nestle Growth fund

THANK YOU FOR LISTENING!!!!