International managerial decision making : nestlé. (anglais) )
International Managerial decision Making : Nestlé.
Introduction :
Nestlé S.A. Is a Swiss multinational company, the world’s leading Nutrition, Health and Wellness company with sales of over $103billion (2008). Its produces a wide range of foods and beverages, and owns a lot of brands such as Nescafe, Kit-Kat. Nestlé was founded in 1866 by the pharmacist Henri Nestlé who in the beginninginvented milk powder to feed babies. Chocolate, confectionery, water, instant beverages, fresh dairy products were added to the activities of Nestlé as it kept growing, in Switzerland as well as abroad. The company wants to be a leading innovator in the field in Europe, its main competitors are Unilever, Kraft Foods, Cadbury Schweppes and Danone. Its headquarters are located in Vevey, Switzerland,and its turnover in 2005 makes it the 53rd largest in the world’s largest companies. Nestle is traded on the SWX Swiss Exchange.
Nestlé’s logo is a nest occupied by three, now two (to remain representative of the average family) birds fed by an adult. The origin of the logo comes from the surname of the founder Henry Nestlé.
In 2005 the group had 487 sites in 84 countries and represented about2% of worldwide turnover of the food industry. It is the largest company in this sector in the world, with nearly 60 billion dollars in sales. However, the figures are worse for the European market because of the hard discounters (Lidl, Ed, Leader Price, Aldi …) and retail brands such as Tesco, Carrefour, Asda, …
Nestlé has a wide range of products across a number of markets includingcoffee, bottled water, other beverages, chocolate, ice cream, infant foods, performance and healthcare nutrition, seasonings, frozen and refrigerated foods, confectionery and pet food.
The company encourages a constant product portfolio diversification and expansion through two aims, innovation and renovation. Which means that the company is incessantly reactive to the needs and requirements of itstargeted customers, and the firm is proactive, to create and implement new consumer trends on the market thanks to innovation.
The company kept its growth and diversification by both acquisitions, for instance the acquisition of the American food giant Carnation (1984), and strategic partnerships, for example Coca-Cola in the 1990s (for ready-to-drink teas and coffees), or L’Oréal for cosmetics.For the future, Nestlé can not be seen merely as an enterprise of food industry, but as a business nutrition and wellness. Like Nike sells no more shoes, but the world of sport and health that goes with the physical maintenance, Nestle will no longer be seen as a company that sells food, but well-being and nutrition.
Section A.
In the early 2000s, the company changed its corporate businessdirections from a “Respected, Trustworthy Food Company” to a “Respected, Trustworthy Food, Nutrition, Health and Wellness Company”. Thus its corporate aims should be adapted to reflect this evolution.
1. Corporate growth.
Since the implementation of its corporate strategy in 1998, Nestlé did quite well. Indeed even the recent figures confirm this trend, in 2008 the company reached anorganic growth of 8.3%, which was above targets, and its EBIT margin increased of +50bp constant currencies ( +30bp reported).
Regarding its strategy Nestlé implements its 4x4x4 roadmap in order to create value. The strategy is to build up four competitive advantages, four growth drivers and four strategic pillars.
The four competitive advantages of Nestlé are its product & brand portfolio, itscomprehensive geographic presence, its industry leading R & D, and its people, culture and values.
Nestlé has a really wide and diversified range of products including strong and famous brands such as Kit-Kat or Nescafé, which allows the firm to have a competitive advantage on his rivals. Indeed even in recent recession climate Nestlé managed to perform well, build loyalty and avoid…