It Includes pestle analysis, porter's five model, internal analysis, SWOT analysis, value chain analysis, same basic ratios and some strategy flashback upon current scenario
2. Introduction
• Most crucial aspect of the business for Survival is LPG
• Analysis of internal and external factors
• Industry competitive analysis
• SWOT Analysis
3. About the company
• It has started in 1912 by entering into dairy business.
• In 1961 Nestlé set up its first factory in Moga, Punjab.
• Nestlé India today has 8 factories across the country. Quality is
the core value that unites them.
• It took Nestlé almost three decades to build a beloved noodle
brand in India.
4. Vision
to be a leading, competitive, nutrition, health and
wellness company delivering improved shareholder value
by being a preferred corporate citizen, preferred
employer, and preferred supplier selling preferred
products.
5. Mission
"Nestlé is...the world's leading nutrition, health and wellness company. Our mission
of 'Good Food, Good Life' is to provide consumers with the best tasting, most
nutritious choices in a wide range of food and beverage categories and eating
occasions, from morning to night."
These statements mirror the organization's long haul business strategy. With regards
to its guaranteed commitment to nutrition to improve health and well-being of its
consumers, Nestlé has also invested into scientific research on the nutritional value
of the products it offers. For instance, it has concentrated the impacts of chocolate
on digestion and gut microscopic organisms. The focus of the company is to meet
needs and desires of today’s and tomorrow’s consumers.
6. Objective
Our objective is to be the leader in Nutrition, Health and
Wellness, and the industry reference for financial
performance, trusted by stakeholders.
8. Political/Legal Segment
Nestlé's products are accompanied with the seal of assurance.
Strict quality control plays important part in political variable as
well.
It gives the guarantee that customer does not purchase any fake
item.
9. Economic Segment
It imparts its knowledge and expertise to local small and
medium organizations.
Nestle works along with the local government to help the
farmers in planting and reaping crops.
It will benefit the customers whereby they will be getting
the products at low prices.
10. Social Factors
Decent eating regimen
Satisfactory food supply
Maintaining health and hygiene
forcefulness of utilizing innovation.
12. Environmental Factors
Conscious to have clean environment
Attention towards the social contribution
Recycling and the issues pertaining to the packing
14. Threat of New Entrants
Economies of Scale
Switching Cost
Government Policies
Capital Requirement
Industry Profitability
15. Bargaining Power of Supplier
Differentiation of inputs
Switching costs
Substitute Products
Supplier concentration relative to industry concentration
Treat of forward integration
16. Bargaining Power of Buyers
Differentiation of outputs
Presence of substitute
Industry concentration relative to buyer
Threat of backward integration
17. Threat of Substitute Products
The relative price performance of substitutes
Switching cost
Buyer propensity to substitute
18. Intensity of Rivalry among Competitors
Industry growth rate
High fixed cost
Intermitted over capacity
Switching costs
Brand Identity
20. Competitive advantage
People culture values and attitude
Unmatched geographic presence
Unmatched research and development capability
Unmatched product and brand portfolio
28. Supporting Activities: Procurement
It provides sustainable and profitable development for
the company
Supply of raw material at specified quality, quantity and
low cost
31. Human Resources Management
Right people with right skill
Almost zero percentage attrition rate of the employees
Trust factor among the employees
Single objective
Management training program to develop young employees
32. Firm Infrastructure
Nestlé India today has 8 factories across the country.
Quality is the core value that unites them.
Manufacturing plants have helped to create large skilled
labor forces in rural areas.
Its infrastructure strives to identify external opportunities
and threats.
33. SWOT Analysis: Strengths
Unmatched research and development capability- Nestlé’s key
competitive advantage is its R&D. It has the largest R&D centres’
with one of the best geographically diversified revenue sources-
Nestlé operates and sells its products in 189 countries, reaching
almost the entire world.
Maggi. Brand awareness helps the company to introduce new
products and sell the current products more easily.
34. Nestlé’s product portfolio is wider than any of its rivals in the
industry.
Environmental sustainability efforts- Nestle pride itself on
company’s sustainability efforts.
Ownership of some of the most recognizable brands in the world-
Nestle owns and markets a few well recognized brands, such as
Nestlé, Nescafé
35. Weakness
Criticism over high water usage, selling contaminated food, anti-
unionism, forced child labour and using other unethical practices
Contaminated food recalls- In 2015, Nestle recalled and
destroyed 35,000 tons of contaminated Maggi noodles in India.
This resulted in hundreds of millions in lost sales and damaged
brand reputation
Complex supply chain configuration.
36. Opportunities
Nestle, which has a history of providing misleading nutritional
information on its labels should improve its practices and clearly label
the products.
Nestlé could start sourcing all of its materials from sustainably grown
plantations and farms.
where the established brands are losing sales and the capital is still
very cheap, Nestlé could increase its investments in start-ups that will
help the company to meet the future challenges and increase the
sales.
37. Threats
In the future, water scarcity will likely become a more significant
problem that will negatively impact company’s operations.
Food and beverage markets are growing very slowly and with so
many new start-ups, Nestle will find it hard to compete in the future.
Nestlé’s profit margins are dependent, to some extent, on the price
of coffee beans, which over the past several years has been very
volatile
41. Net Profit Margin has significantly decreased in 2015 by almost
half proportion. This is because of the huge losses Nestle Maggi
has incurred due to its ban in June, 2015. Almost 35000 tonnes of
Maggi was called back and destroyed.
This has also reduced return on equity for shareholders.
Inventory turnover ratio has also decreased in 2015 due to
reduction in inventories.
Earnings per share has also decreased substantially in 2015
42. Strategy
Your Company’s objective is to provide consumers with the best
tasting, most nutritious choices in a wide range of food and
beverage categories and eating occasions and help consumers
maintain optimum Nutrition, Health and Wellness. Your Company
has access to the extensive global network of Nestlé R&D. This is a
competitive advantage in the rapidly emerging areas of technology
and scientific research and enables your Company to provide safe
and nutritious products of very high quality.
43. The ‘Chocolate and Confectionery’ business worked on
improving consumer insights and has been working with
Nestlé R&D to innovate and renovate products that will
strengthen its portfolio. The focus was also on portfolio
optimization for long term benefit, though it impacted
short term growth.
Towards the end of the year it launched MUNCH NUTS, a
new extension of the ever popular MUNCH.
44. Nestlé ‘Start Healthy Stay Healthy’ reached out to the
supporting eco system of mothers to emphasize the
importance of their role in continued breastfeeding with
the objective to build greater awareness and advocacy.
The key message was‘Breastfeeding is not just a
mother’s responsibility’. The campaign received 9.1
million views out performing industry benchmarks.
45. During the year your Company enhanced labelling of products
with QR codes. This enables consumers to use their mobile
phones to scan the QR code on the label for information on
Nutrition, Environment and Community as relevant to the
product.
During the year your Company also created ‘The Design Lab’ to
inspire a strategic shift in packaging design keeping the
consumer experience in mind and to achieve operational
excellence.
46. During the year, 54 Energy reduction projects and 40 water
reduction projects were completed in factories.
During 2015 your Company consolidated and further
accelerated the current improvement programs. It
continued to upgrade its warehousing infrastructure with
key distribution centers ready to operate in the future with
proper infrastructures, systems, processes and a sound
safety
47. During the year your Company has successfully piloted a new
demand forecasting system based on analytics and also
automated the replenishment to the distribution centres in all
factories, improving accuracy and people productivity.
The roll out of the ware house management systems (WMS)
with Radio Frequency (RF) technology has been extended to
additional factories. During the year your Company focused on
further improving freshness of products ‘on shelf’ for
consumers and reduce waste.
48. Nestlé’s approach to business is Creating Shared Value or
‘Saanjhapan’ as used by your Company and it is about
the impact of the business and engagement through it.
Your Company has been conducting business in a way
that both deliver longterm shareholder value and benefit
society under approach of “Creating Shared Value”
(hereinafter ‘CSV).
49. Strategy
2013 focused on Nutrition, product development
2014 Renovation and innovation, market development,
product development
2015 Renovation and innovation, market development,
product development
Continually development in supply chain