nestle juices group 5

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  1. 1. NESTLE JUICES Group 5 : Shaiyanne Mall Sheryar Taqi Muhammad Ahmed Abdullah Shahid Umar Talha
  2. 2. Objectives Introduction Industry Analysis Procurement Process Recommendation
  3. 3. Introduction Nestle is providing safe, quality nutrition for more than 140 years. Nestle is currently operating in more than 197 countries, with 2000+ brands. Their objective is to be the leader in nutrition , health, and wellness. Currently there are 24 fruit juice/pulp processing plants in Pakistan. Capacity of more than 400,000 metric tons back in 2008. Current revenue growth rate of 12% as of 2015 .
  4. 4. Products Nestle has established two brands to combat competitors in two separate target markets, namely : Nesfruta and Fruita Vitals. Pineapple from Indonesia Guava from Pakistan Apple from Turkey Mangoes from Pakistan Red Grape from Italy Peach from Greece
  5. 5. Industry Analysis FMCG industry High turnover, large sales volume, low price High industry growth rate CAGR 18% Nestle has 35% market share Pakistani demographics favor further growth
  6. 6. Market Share
  7. 7. Industry Analysis Juices Nestle Nesfruta vs Country and Shezan Nestle Fruita Vitals vs Malee and Fruitien Seasonal variations
  8. 8. Revenue Trends
  9. 9. Industry Analysis Economic factors: Inflation rate Infrastructure facilitating business Legal and regulatory policies Social Factors Technological factors
  10. 10. Procurement Process Evaluation of supplier through Quality Audits Major factor in supplier selection- flexibility Vendors are approved by the Quality Assurance Department followed by price negotiations Price quotations are drafted containing particulars Transportation of fruits from international suppliers- under Cost and Freight Terms
  11. 11. Procurement Process A year long contract signed with the suppliers Consideration of different factors when forecasting Lead times Foreign Currency Fluctuations Purchase order has been placed Detailing types, quantities and agreed upon prices for products Transportation time of fruits from Europe- 30 days Cost of Shipping- USD 75/ton
  12. 12. Procurement Process Transportation of fruits to the juice processing plants: Sheikhupura Kabirwala Contracts with companies for packaging- Tetrapak, Packages and APL Use of VMI and its incorporation in the firm wide ERP Use of Advanced Planning and Optimization application in the Supply
  13. 13. Procurement Process Supply Chain Management System Functionalities that span different functional areas Demand Supply Matching Transport management In-depth production scheduling Supply Network Planning
  14. 14. Procurement Process Juices on completion of production undergo a Relax Time which is 6-7 days During relax time- Inspection Audits are carried out to ensure quality Division of Target market into 3 zones Central Northern Southern
  15. 15. Procurement Process Transportation of juices to retailers and wholesalers through trucking companies Trucking companies also Quality control departments Major retailers are Hyperstar and Metro who order 3000 tons/ month of Nestle Juices
  16. 16. Recommendations Bridge the gap between planning and procurement The procurement department is a lagging department whereas; it should be the leading one.
  17. 17. THANK YOU