COMPANY ANALYSIS

Prepared By :

Ravindra Deogharkar 07

Vijay More 38

Nivedita Sawant 51

Santosh Shinde 55

Bhushan Surve 57
 Overview of the company
Henri Nestlé was borned in 1814 Frankfurt, Gemany. He began his
apprenticeship as Pharmacist at the age of 15. Then he left Frankfurt and Moved
to Switzerland during the middle 1830’s.
He created the first milk and cereal based infant food Farine Lactée Henri
Nestlé. He founded the Company in 1867

Nestle India is a subsidiary of Nestle S.A. of Switzerland. With six factories and
a large number of co-packers, Nestle India is a vibrant company offering a
number of products in the Indian market. A number of brands are offered by the
company in the country of which while some have already established a strong
hold, many others exhibit enormous prospects to dominate the market and are
only waiting for a favourable opportunity or appropriate and sizeable
promotional campaign by the company. Nestlé grew from a small company
producing powdered milk and cereal products for infants into a global food
company feeding much of the world’s population Nutrition and Wellness are at
the core of Nestlé’s products and manufacturing.

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 Vision and Principles of the company
 To rapidly build Nestlé India as the Respected and Trustworthy leading
Food, Nutrition, Health and Wellness Company ensuring long term
sustainable and profitable growth.

Principles

 Nutrition, Health and Wellness

Our core aim is to enhance the quality of consumers lives every day,
everywhere by offering tastier and healthier food and beverage choices and
encouraging a healthy lifestyle. We express this via our corporate proposition
Good Food, Good Life.

 Quality Assurance and product safety

Everywhere in the world, the Nestlé name represents a promise to the consumer
that the product is safe and of high standard.

 Consumer Communication

We are committed to responsible, reliable consumer communication that

empowers consumers to exercise their right to informed choice and promotes
healthier diets. We respect consumer privacy.

 Human rights in our business activities

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We fully support the United Nations Global Compact’s (UNGC) guiding
principles on human rights and labour and aim to provide an example of good
human rights’ and labour practices throughout our business activities.

 Leadership and personal responsibility

Our success is based on our people. We treat each other with respect and dignity
and expect everyone to promote a sense of personal responsibility. We recruit
competent and motivated people who respect our values, provide equal
opportunities for their development and advancement, protect their privacy and
do not tolerate any form of harassment or discrimination.

Principles of the company

 Safety and health at work

We are committed to preventing accidents, injuries and illness related to work,

and to protect employees, contractors and others involved along the value chain.

 Supplier and customer relations

We require our suppliers, agents, subcontractors and their employees to

demonstrate honesty, integrity and fairness, and to adhere to our non-negotiable
standards. In the same way, we are committed towards our own customers.

 Agriculture and rural development

We contribute to improvements in agricultural production, the social and

economic status of farmers, rural communities and in production systems to
make them more environmentally sustainable.

 Environmental sustainability

We commit ourselves to environmentally sustainable business practices. At all

stages of the product life cycle we strive to use natural resources efficiently,
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favour the use of sustainably-managed renewable resources, and target zero
waste.

 Water

We are committed to the sustainable use of water and continuous improvement

in water management. We recognise that the world faces a growing water
challenge and that responsible management of the world’s resources by all
water users is an absolute necessity.

Performance of the company

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Competitors

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 Food Sales (in billion USD)

0
10
20
30
40
50
60
70
80

Nestlé

PepsiCo

Kraft Foods

Unilever

Coca-Cola

Mars

Danone

Cadbury
Schweppes

General
Mills

ConAgra

Swot analysis of the company

Kellogg's

Sara Lee

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 Strengths:-

Parent Support- Nestle India has a strong support from its parent company,
which is the world’s largest processed food and beverage company, with a
presence in almost every country. The company has access to the parent’s
hugely successful global folio of products and brands.

Brand Strength: In India, Nestle has some very strong brands like Nescafe,
Maggi and Cerelac. These brands are almost generic to their product categories.

Product Innovation - The company has been continuously introducing new

products for its Indian patrons on a frequent basis, thus expanding its product
offerings.

 Weakness:-

Historically, Russia has been a very volatile market for Nestle, and its overall
performance take a hit often due to this factors.

Supply Chain- The company has a complex supply chain management and the
main issue for Nestle India is traceability. The food industry requires high
standard of hygiene, quality of edible inputs and personnel.

 Opportunities:-

Expansion- The Company has the potential to expand to smaller towns and
other geographies. Existing markets are not fully tapped and the companies can
increases.

 Threats:-

Nestle gets threats or competitions from Amul and Cadburys.

Department
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RESEARCH & DEVELOPMENT

In 1967, nestle created the department of Technological Development (DOTD) the

objective of expanding its research and development capabalities . Later on the DOTD
was merged with the central research centre and NEstec (Nestle Products Technical
Assistance), a wholly owned Nestle subsidiary was formed. The responsibilities of
Nestec staff were to help all the Nestle subsidiary was formed. The responsibilities of
Nestec staff were to help all the Nestle companies in different aspects of the business
such as research and development, production and engineering.

Nestec provided technological assistance to R7D centres around the world. And also
developed technological know-how for the whole group.The nature of the taska
assigned to these centres depend on the nature of their previous expertise in a given
field and proximity to the production facility. These centers were located in regions of
strategic interest to the company. They were important because of the different tastes
and eating habits of the region and developed products on the basis of local preferences,
using locally available raw materials.

Each of the R & D centre was specialized in a particular line or technology. Any work
related to a product was carried out at the centre, which was best qualified for that
activity. Nestle took various steps to avoid duplication of R &D efforts. One of
Nestec;s most important functions was thus coordination of the activities of different
RECOS ( the individual research centers were known as “Recos”). In some cases,
Nestle assigned the same project to more than one centre, provided the research
activities at the different centres complemented each other.

MARKETING

In 1998, Nescafe reviewed its communication strategy. A new advertising campaign

was launched to transform Nescafe from a leading brand into a universal brand. The
campaign addressed young people, and was designed to strengthen the emotional bond
between the consumer and the brand. While the basic campaign was the same around
the world. Local advertisements emphasized the specific fetures of the product in each
country.

During 1998 , Nestle created a new visual identity with a “fond piscine” for its ice
creams . It was a visual produced a feeling of freshness and was designed to covey an
attractive and distinctive brand image.

In 1999, Nestle announced plans for a 3 year ,$100 mn marketing campaign – mostly
through public seminarson water hygiene for its newly launched Pure Life bottled
water. To launch NesQuik cereal in the US, Nestle planned a $16 mn advertising

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campaign, which included TV advertisements, cross-couponing with NEsQuik powder
and distribution of four million trial size packs of the cereal.

FINANCE

Nestle used derivatives to manage exposures to foreign exchange, interest – rate and
commodity price risks. The company entered into hedging agreement with high –
credit quality financial institutions. The instruments used to hedge foreign currency
exposures included forward foreign exchange contracts, options, currency futures and
currency swaps. Foreign exchange gains and losses on hedging instruments were
matched with foreign exchange gains and losses on the underlying asset and liability.
Where derivatives were held for the long term and were used to manage interest rate
risks, they were accounted for on cost basis. Nestle also used commodity instruments
(commodity futures ) to ensure access to raw materials at an appropriate price.

In 1998, Nestle and group companies implemented International Accounting Standards,

IAS 1, IAS 12 and IAS 33 relating to presentation of financial statements, income taxes
and earnings per share respectively.

Human Resources

Nestle used a flat organizational structure, with a minimum amount of systems and
written guidelines. Few job descriptions and definitions of authority aimed to ensure
cross- communication and free flow of information. One principle was generally
followed – whenever in doubt about whether a certain job should be done at the top
level or the lower level, the rule was to do it at the lower level.

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BCG MATRIX ANALYSIS of the company

BCG MATRIX ANALYSIS of the company

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BCG MATRIX ANALYSIS of the company

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BCG MATRIX ANALYSIS of the company

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