http://sbinfocanada.about.com/od/businessplanning/g/missionstatemen.htmhttp://www.businessdictionary.com/definition/vision-statement.htmlhttp://www.ukessays.co.uk/essays/marketing/nestle-company.phphttp://searchcio.techtarget.com/definition/core-competencyhttp://smallbusiness.chron.com/definition-business-objectives-goals-24983.html http://managementstudyguide.com/strategy-formulation-process.htm http://www.pakistantoday.com.pk/2013/06/17/business/pakistan-fifth-largest-milk-pruducer-despite-low-yield/ http://manifestedmarketing.com/2013/10/04/nestle-bcg-matrix-and-brand-divestment/ http://www.lawteacher.net/commercial-law/essays/hm-treasury-s-anti-money-laundering-policy.php http://www.investopedia.com/terms/p/porter.asp http://epaper.chinadailyasia.com/asia-weekly/article-2106.htmlhttp://www.sbp.org.pk/reports/annual/arFY12/complete.pdf http://www.thejaps.org.pk/docs/Supplementary/02/24.pdfhttp://www.thejaps.org.pk/docs/Supplementary/02/24.pdf http://tribune.com.pk/story/701021/moneymaker-milk-could-become-the-countrys-white-gold/http://www.photius.com/rankings/geography/population_density_persons_per_sq_km_2012_0.html http://www.bloomberg.com/news/2012-11-20/pakistan-stocks-best-as-violence-ignored-riskless-return.htmlhttp://finance.gov.pk/survey/chapter_12/highlights.pdf http://www.nestle.pk/asset-library/documents/financial_reports/nestle_ar_2012.pdf H. Rowe, R. Mason, and K. Dickel, Strategic Management and Business Policy: AMethodological Approach (Reading, MA: Addison-Wesley Publishing Co. Inc., 1982): 155.Business Ethics/ Social Responsibility/ Environmental Sustainability Issues

StrategyEvaluationStrategy ImplementationStrategyFormulationGlobal/ International IssuesPerform External AuditImplement Strategies- Marketing, Finance, Accounting, R&D and MIS issuesMeasure and Evaluate PerformanceImplement Strategies- Management IssuesGenerate, Evaluate, and Select StrategiesEstablish Long-Term ObjectivesPerform Internal AuditDevelop Vision and Mission Statements

SMALL COMPANY

SWOT MATRIXSTRENGTHS-S1. Socially Responsible Company2. Nestl products enjoy strong brand image3. Sales force as a major physical resource strength4. Quality product distribution networks in country5. Net Profit after tax margin increased from 7.2% (2011) to 7.4% (2012). 6. Total sales grew by 22% to PKR 79.1 billion. (2012) 7. Price earnings ratio increased from 34.9 (2011) to 36.6 (2012)8. Export sales have reached PKR 6.0 billion (2011: 5.3 billion) recording a healthy growth of 15%. WEAKNESS-W1. Lack of awareness among target market2. Nestle milk always stands at last because of low advertisement.3. Revenue from confectionary decreased 4. Low credit sales and profit margin to retailers5. Weak promotional activities through websites6. Cannot launch expensive brand due to low income groups

OPPORTUNITIES- O1. Few and weak competitors in the market2. Disposable income increased by 2.9% (2011-2012)3. Consumer expenditure on food has increased by 26% average pace the past three years.4. Population density increased by 3.2% (per sq.km) (2011-2012)5. Population density (Persons per sq km 2012) 264.66. Credit policy can be adopted to increase sales7. Potential in cold dairy market8. All companies contribute only 6% to processed milk market 9. Pakistan is the third largest milk producing country in the world with annual turnover of 20 billion litres, according to 2012 official estimates.OS- STRATEGIES

More market penetration through effective sales force (S3+S1) Develop and promote cold dairy products (S2+O7+O9+O3) Create awareness and promote green marketing concept among the people (S1+O4+O5)OW- STRATEGIES

Development of quality products to target the middle class (W6+O2+O3) Increase the sales of confectionaries items through more credit sales to retailers to increase their profit margins (W3+W4+O6)

THREATS-T1. Engro and Haleeb as major competitors2. Market segment growth could attract new entrants3. Taste of the consumer has already developed4. Legal & ethical issues5. Economic slowdown can reduce demand6. Effect of seasonality upon sales7. Strong advertisement by major competitors8. The current growth in population and increasing demand for food has created the need to produce more milk.TS-STRATEGIES

Strong logistics to help counter the competitors through market development ( S4+T2) Related diversification to help in more global expansion (S8+T3)TW- STRATEGIES

Strong advertisement campaigns to communicate the value of Nestl products to the target customers better than competitors (W1+W2+T7) Increase promotional activities more web development to lead the industry (W5+T1)

PKR Million20122011Change

Sales79,08864,824+22.0%

Gross Profit Margin27.2%25.8%+1.4%

Operating Profit Margin13.9%13.0%+0.9%

Net Profit after tax margin7.4%7.2%+0.2%

Net profit after tax5,8654,668+25.6%

Net Profit after tax129.32102.94+25.6%

Table: Summary Financial Performance for Nestle Pakistan in 2012

FINANCIAL POSITION (Appendix )

Nestl Pakistan net sales increased by 22% in 2012 as compared to 20113

Net Profit after tax margin increased from 7.2% (2011) to 7.4% (2012).5

Earnings per share increased by 25.6% in 2012 as compared to 20113

Operating Profit Ratio in 2012 was 14% as compare to 2011 was 13%5

Market Value Per Share increases by 4,733 (2012)4

Average financial strength4

INDUSTRY POSITION

Increase in consumer food industry 5

All companies contribute only 3-6% to processed milk market4

Market segment growth has attracted new entrants to increase profit potential5

Due to ease of entry in market, Engro food, Haleeb are properly utilizing their sources4

Average financial strength4.5

COMPETITIVE POSITION

Nestle enjoy strong customer loyalty-2

Quality product distribution networks in country-1

Nestle extended product life cycle is being ensured due to quality brand extension strategy-2

Nestle product are market leaders in many product categories-2

Average competitive advantage-1.75

ENVIRONMENTAL POSITION

Economic slowdown can reduce the demand-2

Fluctuating rate of inflation in the country-2

Price range of competing products-1

Average Environmental Stability-1.75