NESTLE Company

1 Introduction

Nestle is the world's largest food and beverage company, headquartered in Vevey, Switzerland. Nestlé's
current products range from mineral water, baby food, coffee and dairy products.

1.1 History of NESTLE Company

Born in the 60s of the 19th century, with the first development from a food for babies who could not be
breastfed, pharmacist Henry Nestle made a splash and product of the company widely distributed
throughout Europe. In 1905, Nestle merged Anglo Swiss condensed milk production company and
expanded many branches in countries such as the United States, Germany, Great Britain, Spain. Along
with that, World War I increased demand for dairy products and helped Nestle's production doubled.
After the war, government contracts dwindled and customer demand for fresh dairy products increased
rapidly, Nestle was quick to respond to customer demand and implement business streamlining
operations. business and debt reduction, expanding new products related to fresh milk such as
chocolate, etc. At that time, Nestle saw the potential of World War II along with the US military's main
drink, coffee, and launched a new product, Nescafe. With this product, production and .The company's
revenue increased strongly and rose strongly in wartime

At the end of World War II, Nestle entered a period of dynamism and rapid growth, acquiring many
companies. In 1947, the company merged with Maggi, a company specializing in the production of soups
and condiments. Those are companies like Crosse and Blackwell, Findus, Libbi. The company started to
diversify its products and started the business of developing products outside the industry when it
acquired Alcon Laboratories.

In 1984, Nestle made a major innovation, triggering acquisition plans, especially two large companies,
Carnation and Rowntree confectionery. In the first half of the 1990s, the company entered a favorable
period of business thanks to the removal of business barriers and the development of markets into low-
trading areas, although the company also made acquisitions of companies such as San Pellegrino (1997),
Spillers Petfoods (1998) and Ralston Purina (2002). In December 2005, Nestlé bought the Greek
company Delta Ice Cream for 240 million euros. In January 2006, the company took full ownership of
Dreyer's, and thus became the world's largest ice cream company. In March, 2010 Nestle bought
Technocom Group and developed into a big corporation until now.

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1.2 Product
Nestle offers mineral water, baby food, coffee and dairy products, soft drinks, frozen food and pet food
products, spices and coffee.

Nestle's products are mainly products that meet daily needs, beverages and food in the family. From the
very first days, Nestle's marketing strategy has wanted to "Bring each product to each family" and
completely cover the market. Therefore, the products created by Nestle meet the needs of every
specific family:

Nestle products from milk: Nestle has many products that are nourished from milk sources such as
Nestle Slim, Nestle every day, ...

Chocolate: This is considered a product that brings great success to Nestle. Featured products are:
Kitkat, Polo, Munch, Eclairs, Milky Bar.

Drinks: Nestle has Nescafe products - This is one of the largest coffee brands in the world.

Condiments: Nestle has lines of cooking by-products like Maggi. Maggi is a product that helps family
dishes taste more perfect. In Vietnam, Maggi products are also trusted and used a lot.

Nestle currently has more than 8000 brands with a wide range of products on the market. This is
considered a strength of Nestle because it will help customers have more choices.
( https://oriagency.vn/cac-san-pham-cua-nestle )

1.3 Vision/ Mission

In terms of vision, Nestle affirms to become a leading company, highly competitive, bringing nutrition,
health, value to customers and shareholders improved by becoming a favorite company, Favorite
employer, favorite supplier selling favorite product.

(https://www.nestle-esar.com/aboutus/missionvision

In terms of the mission, to achieve the vision, Nestle declares that it needs to become the world's
leading nutrition, health and wellness company. The company's mission is "good food, good life"
providing consumers with the best, most nutritious products in the best foods and beverages.

1.4 Core values

With the core value of "Enhancing Common Values", Nestle aims to improve the quality of life of
consumers every day, everywhere by providing the best and delicious food and beverage. healthier , and
promotes a healthy lifestyle . This is clearly demonstrated by Nestle through the company's proposal
"Good food, good life"

2. The microeconomic environment and its impact on the continuation of Nestle

Nestle is one of the world's leading corporations in the field of nutritional foods and beverages. Nestle's
products are all high quality products and the company's culture is clearly reflected in its manufacturing
business activities. Therefore, the selection of strategic partners of Nestle is extremely strict and
thorough. Nestle's service providers need to know how to comply with the rules of business operations.
Therefore, suppliers. Nestle's business are all reputable suppliers and ensure to accompany Nestle for a
long time on the way to bring the best quality products to consumers.

Nestle's five principles are:

(1) Integrity in business

(2) High sustainability

(3) High labor standards

(4) Safety and healthy

(5) The environment is always at its best

Thanks to the above principles, many reputable and famous suppliers and strategic partners have
worked with Nestle. In Vietnam, there is Thanh Dat company in charge of circulation and distribution of
Nestle products, At the same time, this is also a quality transportation provider chosen by many
companies around the world such as Yamaha, VNPT, DHL,…

(https://www.nestle.com/aboutus/suppliers )
-In addition, there are companies that contribute to agricultural production, the social and economic
status of farmers, local communities and improve production systems and ensure that the company's
factories can have a competitive source of raw fuel with satisfactory quality and safety

-Companies that support the adoption of new technologies and agricultural advances, including the
opportunities offered by biotechnology in food safety, the environment and industrial farming methods,
support farming methods for rural development, processes and methods of purchasing raw materials
for a long time

Regarding fuel sources, Nestle uses two main fuel sources, domestic fuel sources and foreign fuel
sources. In which, domestic fuel sources account for 50% of total raw materials. The most commonly
used ingredients by Nestle can be mentioned are coffee, malt sugar and other types of packaging. With
30% of the main import source being raw materials imported from various Nestle in the world such as
powdered flour. milk, cereals and teas. And finally, the remaining 20% of ingredients are imported by
Nestle from many different countries under Nestle's global contracts such as cocoa, MSG flavoring,...

-Because imported materials are often taxed at high prices, when deciding to participate in business
activities, it is necessary to identify the specific market as well as the demand for the products they
supply. Therefore, Businesses need to have the credibility of customers. Realizing that, Nestle has
always researched and developed products to better meet the needs of customers compared to
competitors in the same segment. It is very important to find out the needs and tastes of consumers for
the company's products as well as learn the factors that affect the shopping behavior of customers to
come up with ways to react. flexible response

Research on shopping behavior patterns: Currently, the beverage products on the market are very
diverse. Companies compete with each other by launching products with many different brands and
flavors for consumers to choose from. , so customers have shopping behavior seeking variety .

• Consumers change brands many times , at first they can buy a certain brand without much
consideration , after consuming it , they set the price , comment , then they buy and use another brand .
Beverage products , especially nutritional drinks , with prices and quality not too different today ,
sometimes changing brands is just to seek variety , not because of dissatisfaction .

• Nestle's primary goal is to improve the quality of everyday life for its consumers

• The company is committed to demonstrating honesty, integrity and fairness, respecting Nestle's
uncompromising standards with its customers

-Competitors of Nestle: Nestle has long been one of the famous brands, so it is common to see a lot of
companies counterfeiting products of the company. Besides, there are competing companies. fair to
Nestle such as P&G, Mars, Danone, Kraft, ConAgra Foods, Sara Lee, Kellogg, Unilever.

(https://craft.co/nestle/competitors )

* Nestle's competitive advantages:

-Strong research and development capacity: Nestlé's research and development capabilities stem from
its own R&D network, which has a larger network of R&D centers than any other food and beverage
company in the world. Nestlé's research and development center currently employs 5000 employees
and has more than 34 research facilities. Nestlé currently has 21 research centers globally.

-World famous brand: Nestlé operates and sells its products in over 197 countries, reaching virtually the
entire world. Nestlé has divided its business into multiple geographies such as the Americas (AMS),
Europe, the Middle East and North Africa (EMENA) and Asia, Oceania and Sub-Saharan Africa (AOA).
However, no region earns more than 50% of total revenue

-Worldwide distribution system: Nestle has successfully penetrated the market, urban as well as rural.
Nestle has distribution plans suitable for each locality and decentralization in the supply chain such as
street vendors, mobile vending carts, distributors, medical stores, etc. to bring its products to the
market. . Nestle currently has more than 8000 products and brands, ranging from beverages such as
coffee, mineral water, breakfast cereals, etc.

-Various categories of brands and products: Nestlé has a broader portfolio of brands and products than
any other competitor in the industry. The company offers more than 2000 different product selections in
7 main categories

-Large workforce: Nestle has employed 340000 retail workforce globally who are continuously working
to deliver its products in every corner of the world.

-High brand value: this is the 37th highest ranked brand in the world, which says a lot about the brand
value of the company until 2016

-Efforts for green industry: Nestlé has saved 500 million kilograms of packaging material by redesigning
the packages produced by the brand. Nestlé is committed to using recycled materials and selecting
materials from renewable sources whenever possible

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3.Nestle's macro environment and its effects on the company's marketing

3.1 Political/laws: Politics/Law in many countries are developing a commodity economy with many
components following socialism, especially in Asian countries, including Vietnam. At the same time, that
creates a stable political environment along with an increasingly complete legal system along with
government policies to encourage investment, establishment and business development. These
favorable conditions are the key to helping domestic and foreign enterprises to boost production and
invest in the market, including Nestle. Along with that is the government's salary increase policy. income
level and economic conditions to improve purchasing power in the market and essential products such
as food and drink will have the opportunity to develop to help nestle improve its position in the market.

3.2 Demographic: In the fast-changing life environment in all aspects, the population of countries is
increasing, along with it are government policies that limit the birth rate of people, thereby leading to As
a result, children will be born with fewer siblings and will enjoy more parental care as well as inherit
higher material needs, which helps some industries develop. Especially in the food industry, nestle is
one of the leading companies in this field.

3.3 Economic: With the government's wage increase policies have contributed to improving the
purchasing power and economic quality of the people. And when they can afford to pay for higher
products, they will be interested in these aspects. other issues such as nutrition, health and product
quality. Based on that reason, Nestle always offers new products with quality to meet the increasingly
diverse needs and wishes to bring the best nutrition and contribute to improving people's health.

3.4 Nature: For nature, this is one of the necessary and important factors affecting the company's
marketing issues, and with each different geographical area as well as the climate of each place, the
company needs to know. adapt research and produce products that can meet the tastes of consumers.
Scarcity of fuel sources in the natural environment can cause high production costs as well as adversely
affect the environment.

3.5 Technology: Advances in technology can bring a lot of benefits, both in marketing to help more
people know about products and to improve product quality. It is technology that has helped improve
product quality and help many people. people know more about Nestle, thereby making users feel more
secure and confident in Nestle's products.

3.6 Cultural factor: In terms of culture, it is possible to mention the countries that have been ravaged by
wars, especially Vietnam with 2 wars with the US and France, which has made people have the desire
and need to eat well and live well. Nowadays, with the development of daily communication media,
people have become somewhat more aware of daily nutrition. These changes have opened up a
promising market that Nestle can easily acquired by enhancing products and tailoring them to customer
needs

4 Conclusion

In general, Nestle is one of the leading corporations in the world and in the country in the field of food
nutrition. With its competitive advantage and the mission and vision of always considering the
customer's experience first, although there are a few mistakes in Nestle's way of doing business, it does
not affect much to the competitive advantage of Nestle. Nestle .In contrast, with the market becoming
more open and increasing consumer demand for product quality, Nestle has more opportunities to
develop products as well as meet the needs of customers. the best way to increase its position in the
food segment market.