CORPORATE STRATEGY
NESTLE
INTRODUCTION
• It was founded in 1867 by HENRI NESTLE.
• Was listed no. 1 in fortune global 500 as the world’s most
profitable corporation.
• Has 449 factories in 86 countries & employees more than
3,28,000 people.
• Mainly deals in chocolates, milk products, maggie ,coffee,
mineral water etc.
NESTLE
The customer groups are divided with respect of their
demand of features in the products. Such groups are called
Market Segments. The firms divide the market on the base
of different factors including region, taste, age group,
gender bases, religion beliefs etc. Firms have started
targeting the smaller groups in order to satisfy the needs of
their customers.
o. Region
o. Taste
o. Age Groups & Genders
NESTLE´s CENTRAL GROWTH STRATEGY
The nutrition business - 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'.
Nestle Nutrition program:
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Products for infants
Young and elderly
Health conscious consumers
Nestle Home Care (high-nutrition foods
and nutrition-related services)
DIVERSIFICATION
According to the Ansoff Matrix, diversification
is the point where the company moves away
from existing market and existing products.
The strategy of NESTLE when launching the
nutrition business is to achieve different
markets through different products.
It is a competitive advantage that NESTLE
has created recently. However this strategy
does not drive NESTLE to a Blue Ocean as it
does not create an unknown market.
The competition still exists in a red ocean,
where many companies try to get greater
share of existing demand.
ACTION FRAMEWORK (Blue Ocean)
Drivers of Internationalization
Cost Drivers
Nestle's market leadership and leading
brands provide economy of scale which
is important as NESTLÉ has high product
development costs. It takes advantages
on country specific differences,addapting
it´s products to the host country´s.
Market Drivers
The presence of global customers
is a market driver that could be
related to NESTLÉ´s need for
internationalization.
Drivers of Internationalization
Competitive drivers
Interdependence between countries
increases the need of internationalization
specially companies like NESTLÉ, which
the parent country´s market is too small
and the competition is fierce. Globalized
competitors would pressure NESTLÉ
to adopt an international strategy,
as they would be competing with them
inside NESTLÉ´s in the domestic market.
Drivers of Internationalization
Government drivers
NESTLÉ´s strategy in foreing markets
avoid the disadvantages of policies
issues, operationg mainly through
joint ventures and partnerships with
local companies avoiding this risks.
“Part of Nestle's recent success
has been down to its ability to weather
currency and raw material price
Fluctuations. Considering the strategy
of acquisition the company will be able
In integration of these acquisitions
will only improve profits further”
THE INTERNATIONAL VALUE FRAMEWORK
Unique capabilities: NESTLÉ exploits
advantages in technologies and
scientific capabilities around the world.
It has strong R&D investments in many
countries. Product tehcnology centers
are present in 34 countries and 4
in-house fundamental research centres
counts with partnerships with
universsities around the world in order
to exchange experiences with their
centres and explore overseas knownledge in the filed of
new technologies and development.
INTERNATIONAL STRATEGIES
NESTLÉ international
strategy is global. The
coordination of the
activities is high and
Cofiguration of
Activities is disperse.
Uses international
value Networks.
ENTRY MODES
Joint ventures and alliances
NESTLÉ owns some world´s
well known brands across
diverse products categories.
It´s diverse portifolio is it´s
global leadership. Enters
foreing countries through
joint ventures and alliances
that avoid the risks of lack
of knownlege on target country
SWOT ANALYSIS
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STRENGTHSWell known company and strong brand name.
Considered the innovation leader in global food and nutrition sector.
Offers thousands of local products, research and development capabilities.
Strong workforce.
 WEAKNESS-
• Inability to provide consistent quality in food products
• Weak implementation of CSR
 OPPORTUNITIES
• Increasing demand for healthier food products
• Establishing new joint ventures
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THREATSGlobal competitors.
Increasing price of raw materials.
Highly competitive market, multinational companies are very organized
and financially strong.