Case Study: Nestle

Case Study Report - Nestle

Introduction:

The research study on the multinational company - Nestle, which happens to be a FMCG global giant reveals the strategies and the well designed plans of the company wherein it tries to shift its image from a food company compared to that of your nutrition health and welfare company. The moto of the business which includes been that of good food, good life is further extended where in fact the company looks forward to enter the arena of health and nutrition products that will encompass products such as infant food, diet food and also that of healthcare products. Along the way we see that the business in its procedure for diversification of its products have also at times failed to achieve its targets. Nevertheless the general structure of the company is actually large enough to help the business maintain steadily its position as the key healthcare company in world with some of the most noted and successful brands.

Main Discussion:

The research study reveals the well calculated plans of he company Nestle where it had made conscious efforts which would change its very image on the market. It has been reflected through the research study that the then ongoing image where Nestle happened to be a respected brand worldwide in the field of food products looked forward to enter the field of the healthcare foods and also dominate the marketplace in the coming span of your energy. Hence Nestle soon embarked upon a online marketing strategy through it might extensively change its image and develop a graphic of the nutrition, health and welfare fostering company through the tool of its products. Hence quite obviously Nestle set forward to ake up various measures to effect the same. In the process Nestle did and tried a variety of tactuc to achiev the same. It changed the composition of its products by eliminating more than sugar and salts and fats and by incorporating more healthier nutrients in its products. Once again we also observe that Nestle embarked after a way or business pattern of a huge range of acquisitions. Through these acquisitions Nestle tried to buy over certain reputed names of the healthcare product industry and enter the arena on a worldwide scale. It made some of very huge investments along the way of the mergers and acquisitions. In this particular context one point that can be mentioned that could have been a pressing concern for the company especially through the years that immediately preceded the financial meltdown era. The research study reveals that in the entire year 2005 Nestle did make a drive for the market of the healthcare products nutrition food, that was when the business was required to make some huge investments. However as even mentioned by the experts the company cannot expect any immediate returns or profits from these investments. Actually the company needed to struggle considerably to push the quantity of its sales and face a stiff competition from the already existing big layers of the said industry.

Another point that happens to be an addition to the mentioned point is the fact in your time and effort of being a world player in the NHW segment the company did make huge and well diversified investments. This also might have posed an issue to the company especially during the recession period. Actually we also see that as mentioned by the then CEO Bulcke, maintaining the company position in those challenging times been quite critical. In those time we see that the company had taken a strategy that tried to keep up its market index and also improve the sales and business volume so far as possible. Actually we do note that in the strive of being a global renowned NHW segment company and of changing the brand image of the business, the management of the business had invested heavily on various measures of entering the industry of NHW and of fortifying the marketplace position of the business in the said industry segment. Compared to the same much less an aggressive stand was taken by the company in boosting its sales vigor and of taking an equally dynamic marketing endeavors. As result we see that the business even didn't achieve its said initial targets which it had set for itself when it entered the NHW sector.

Once again we also note that the business at least somewhat did digress away from its path of being a NHW company, when it also bought over some fast food chain. That is company said was a calculated measure since it could not do away with the strategy to be a diversified company. Nevertheless the company did induce certain health measures into the fast food items and did incorporate some healthy items in to the menu preparations.

It can be said that the mission of the company happened to be of providing its customers with a good taste and a healthy life-style through its products. To implement the same to a excelled level and also to make mark on the market in the longer run the business did embark after this journey of entering medical and nutrition products. In doing so we see that the business was confronted with a serial of advantages that arose from its strengths and also disadvantages that arose from its weaknesses. In the following area of the discussion we look into both of the considerations

Strengths:

  • The company that is Nestle happens to be a major name which ensures that the brand already comes with an acknowledgment in the market and the consumers or the retailers doesn't need to be briefed regarding the profile of the business. This facet was a particular strength of the business that enabled certain percentage of market penetration.
  • The company had enough capital power that could enable the company to indulge into strategies of acquisition and of elaborate R&D endeavors.
  • Nestle was already into the food industry, which gave it considerable leverage.

Weaknesses:

  • The company went into an extremely elaborate process and method of acquisition and mergers which definitely ate into a great deal of the financial resources of the company. This could have posed a challenge through the financial crunch period.
  • Nestle in its strive to be a world leader in the arena of the NHW sector did not put enough pressure on the marketing part, which resulted in loos of target achievement.
  • It did pose a contradictory figure when the brand bought over fast food item chains. It helped its critics criticize its image as a NHW company.

Conclusion:

Quite surely the strategy of Nestle to enter the NHW sector was a well tailored plan that will yield high returns in the future, nevertheless a more profit oriented endeavor can have helped the business overcome its revenue conditions that did surface during its transition phase.

Recommendation:

It could be recommended to the business that the brand instead of trying various products in the NHW field could single out a more streamlined array of products in which the company will attempt concentrate during its initial period of entering the NHW industry or market segment. This might also help the company streamline its marketing procedure and the company can adopt more aggressive marketing endeavors that will assist the business achieve better sales volumes. With time these returns could again be profitably used in the R&D endeavors that will assist the company produce better and improved brands and also at the same point establish itself as a worldwide, market leader.

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