1
Laurent Freixe
Nestlé Europe CEO
Brussels, 9th May 2012
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Disclaimer This presentation contains forward looking statements
which reflect Management’s current views and
estimates. The forward looking statements involve
certain risks and uncertainties that could cause actual
results to differ materially from those contained in the
forward looking statements. Potential risks and
uncertainties include such factors as general economic
conditions, foreign exchange fluctuations, competitive
product and pricing pressures and regulatory
developments.
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Our mission, Our Objective:
Consumers to trust Nestlé to always offer
the tastiest and healthiest choices
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€ 21.5 billion in sales in 2011
95 000 employees
88 factories in 19 countries
Brands and Products for every age, every
occasion
215 000 Customers
Nestlé in Europe
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Our passion for
Consumers
Shoppers is at
the heart of all
what we do,
everyday
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our passion for
our Customers is at
the heart of our
engagement and
commitment to
collaboration,
everyday, everywhere
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SHOPPER &
CATEGORY
CUSTOMER
RELATIONSHIPS
EXCELLING IN
EXECUTION
CUSTOMER FACING
SUPPLY CHAIN
A Global Initiative with Local
Implementations
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Nestlé Shopper Insight Centres
Setting the stage for engagement and collaboration
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Customer Strategy
Trade & Industry Best Practices &
Standards
Nestlé Strategy
...for a sustainable
collaboration
The power of alignment....
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Our engagement with Industry & Trade Organisations
to drive collaboration along the value chain
Global
Regional
Local
The Consumer Goods Forum
GS1
Industry & Trade Collaborative Platforms (ECR Europe, ECR Asia Pacific, etc.)
Manufacturer Associations (GMA, AIM, FoodDrink Europe, FCPC, FIA, etc)
Industry & Trade Collaborative Platforms (ECR Nationals)
Manufacturer Associations
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Foundations
Advanced practices
Innovative practices
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Challenging
times may
slow down
efforts for
collaboration and
implementation
A New Reality
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Europe is increasingly challenging
And impacting on economic prospects
«No growth in Euroland forecast in 2012 »
Source: EU
Source: Goldman Sachs/EU
1.7 1.6
-0.3
1.5
2.0 2.0
5.1
3.83.5
4.24.5
4.7
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
2010 2011 2012 2013 2014 2015
EUROLAND WORLD
Debt exposure without borders
Debt in euro-zone countries in 2010, as a percentage of GDP
Source: Financial Times
Results in austerity measures increasing
UK £ 150 bio cuts in 2016
France € 114 bio cuts by 2016
Netherlands € 18 bio cuts by 2015
Germany € 80 bio cuts by 2014
Italy € 74 bio austerity package by 2013
Spain € 90 bio by 2014
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Understanding the needs and consequences
of ageing populations
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The Middle Class “on the move” in CEE
Middle Class Consumption:
CIS ex Russia
Middle Class Consumption:
Russia
Middle Class Consumption:
CEE*
2015
2,247.0 B
434.3
1,172.1
640.6
2010
1,769.5 B
296.7
940.1
532.6
2005
1,316.2 B
201.7
667.7
446.8
2010-2015 CAGR
5%
5%
4%
8%
70M+
2005-2015
Source: AC Nielsen
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Increasing time spent online
150
170
190
210
230
250
270
290
2008 2009 2010 2011
Min
ute
s/d
ay
Source: eMarketer (March 2012)
TV
Internet and
Mobile
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Social conversation and commerce increasingly linked Digital and the path to purchase are interconnected
Digital coupons
Retailer websites
SEO/SEM
E-commerce
Shopping apps
GPS
Mobile search
Mobile sites
Shopping apps
QR codes
RFID
Paperless coupons
Mobile scanner
Kiosks/Digital signage
In-Home On-the-Go In-Store
Shopper Purchase / Retailer Sales
Internet access increasingly
Mobile (and Smarter)
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Consumer Online Purchase is booming
Note: Numbers in Billions USD, Source: Forrester (2011)
E-commerce
sales growing by
more than 19% a
year and will be
almost $1.4
trillion by 2015
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New Realities,
New Opportunities
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Capitalising the
Knowhow to excel
in execution
Adapting
shopper
solutions
Innovating
Focus collaboration on value creation and
waste elimination along the supply chain
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Products Systems Services
Standardised
Customized Solutions
Innovation is a game changer
Addressing
increasingly
complex
consumer
needs
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Collaboration is a game changer
Step 5
Monitor &
adapt
Step 1
Review the economic and
shopper environment
Conditions
for success
Step 3
Define and
agree 3-year
JAG plan
Step 4
Execute the
JAG plan
Step 2
Review
performance
and agree
growth
strategy
Step 3
Define and
agree 3-year
JAG plan
Jointly Agreed Growth (JAG)
A Pragmatic Approach
for Developing and
Implementing Jointly
Agreed Growth Plans
A
Framework
– Approach focused on Shopper Value
– 3 year + joint category development plan
– Data sharing
– Demand & Supply
– In-store execution
– On-Shelf Availability: service to the shopper
– Monitoring / Joint KPIs
– Joint investment plans
Successfully
implemented with
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LEAN Supply Chain
Value Stream ConsumersSuppliers
Reduce Lead Time
Eliminate Non Value Added activities
Better service
Less stocks
Less cost
Higher
flexibility
ImprovedFreshness
Reduced Complexity
ImprovedService to Shoppers
Distribution CustomerPackagingRaw Material Manufacturing Consumer
• Design and execute the most optimal
and efficient value stream
• Mapped material and information
flows from orders to store shelf
• Identified non value added activities in
the value stream
• Identified key initiatives to eliminate
waste and deliver improvements
across a balanced scorecard of KPI’s
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Sustainable Supply Chain • Reducing the overall environmental footprint
– Transport
– Packaging
– Warehousing
– Etc.
• Example of Sustainable Packaging
– Leverage The Consumer Goods Forum work
in Europe
– One language for common understanding
and metrics
– “Reconcile” the requirements for Shelf Ready
Packaging and Sustainable Packaging
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Open
perspectives
for the future
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Manufacturers and Retailers collaborating…
EU 2020 agenda
•Single Market
•Digital Market
•Innovation to boost
consumption and recover
growth
•Green and inclusive
growth
Trade & Industry Agenda
• Accelerating implementation
of existing best practices
• Product & service Innovation
• Health & Wellness /Ageing
Populations
•Environmental Sustainability
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Thank You