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    Nestle Executive Summary (6997 words)

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    Nestle company is the world’s first company to make infant cereal. Henri Nestle is the chemist who starts to do research on baby food in year 1867. His product soon became known world wide after a baby drink his new product. Later in year 1905, Nestle Company merged with Angle-Swiss Condensed Milk Company and later in year 1904, Nestle Company produced milk chocolate. Because of its variety production, now Nestle is one of the largest food companies in the world, marketing over 8500 brands and 30000 products.

    It operates nearly 500 factories across 5 continents and employs over 200000 employees worldwide. Nestle aims to meet the everyday needs of Malaysian people everywhere and also be the leading multinational company. They produce three key products which are the food products, beverages products and pet care products. Among these varieties of products, Nestle is more concern on milk and food production. Although Nestle is now the leader in the market, they still working hard to produce more and more new product and also to ensure the product’s quality is at a standard by the Research and Development (R&D) department if not the title as market leader will not be long term.

    Currently Nestle operates in almost 100 countries worldwide and the brand is trusted and confident for user to consume. From the analysis of the external and internal environment, I notice that Nestle has successfully directed certain issues to their advantage. From the economic factors view, they collaborate with local government to farmer own raw materials whereby Nestle no longer needs to import raw materials from other country and the consequences to it is Nestle can now cut down costs and increase the amount of production/sales where it is so benefit the company. This wise decision not only beneficial Nestle but also the country. This can be proved by there are more jobs available, people have money, and the money will flows within the country (buyer & seller) because now company needs not to import product from other country where it will help the country to build the economy.

    I also noticed that Nestle did not suffer any losses (Refer to appendix 4). Besides that, Nestle also share its expertise with local company where it will helps the market growth. From social factors view, Nestle has given extra miles out of their ingenuity for the development of the society as a whole. From technological factors view, Nestle has set up its own research and development department to do more extensive research of the product and develop more new product using the advanced technology. It also uses IS/IT in wide scale to suit and to keep up with the more demanding environment.

    Indirectly it contributes to the development of technology. As for the internal environment, Nestle Company handles the 5 forces very well. The 5 forces are done according to the Porter’s Industry and Competitive Analysis (ICA) Model. Looking at the company analysis Porter, knowing that Nestle manage the supplier and buyer power forces well balanced because of their wise market strategy. Look at substitute products and services, it does not affect them too much this is because it already has it own strong brand name in the market whereby there are many consumer loyalty out there. Besides that, it also has a strong connection with its partners so this factor is not a matter to worry about.

    Looking at the SWOT analysis, Nestle knows how to utilize their strengths and opportunities to their advantages as well as minimizing their weaknesses and threats. If Nestle faced great strengths and opportunities, their weaknesses and threats could become a major problem if they do not managed properly. Therefore, it is essential for Nestle to maintain a management which is dynamic yet influential. All the critical factors that might risk Nestle Company has all been identified by using the environmental analysis and it has already been taken it into account. Their competitive advantages have also been identified.

    Nestle Company will still be the leading food company if they continue to strive to be the best by introduce more new products and provide more quality food in the future. Background and AssumptionsBackgroundNestle was founded in 1866 by Henri Nestle, who is a chemist interested in baby food. Nestle is the largest food company in the world, marketing over 8,500 brands and 30,000 products. It operates nearly 500 factories across 5 continents and employs over 200,000 employees worldwide. Nestle’s operations in Malaysia began in 1912, with a branch office known as Anglo-Swiss Condensed Milk Company in Penang, importing and distributing products under the Nestle brand in the region for its ultimate parent company, Nestle SA, Switzerland.

    The original business of Nestle Company was based on milk and dietetic foods for children. The new Nestle grew and disparate its range of products through acquisitions and mergers with better known brands of the time. The other ranges of Nestle product include culinary products, wheat and cereal beverages, breakfast cereals, liquid milk/creamers, mineral water, ice cream, pet food, chilled products as well as confectionery. Today, the Nestle Company still complies with its founder’s beliefs and principles and is; therefore, very much people-oriented, and committed to understanding its consumers’ needs throughout the world in order to provide the best products for their lives. As a World Food Company, Nestle provide the best food for whatever time of the day and for whatever time of everyone life. It is a Company that maximizes the use of good quality local raw materials to produce and sell world-class products of the highest consistent quality, reliability and convenience based on business excellence principles throughout its operations.

    AssumptionsNestle is the world leading food company with over 90 years of doing business in Malaysia. Nestle has contributed towards the well being of Malaysians through its high quality products. Nestle position as “a trusted food, nutrition and wellness company” and focused on nourishing Malaysians to achieve overall wellness and to bring “Good Food, Good Life” to all members of society (Source: http://www. nestle. com.

    my/Nestle+In+The+Community/). As Nestle aims to produce and sell world class products of the highest consistent quality, reliability and convenience that satisfied the local tastes and cultural flavours in each market, Nestle set up its own Research and Development group to conduct product trial development. Besides R&D, Nestle provides Consumer Services to care for its consumers. Via the toll free line, consumers can give their suggestions and feedback to the Company according to the products they purchased or interested. “Listening” helps Nestle to understand what people want.

    This would help the Company to maintain quality or brand loyalty. However, we would like to emphasise that if the Company does not continue to use its best practices to understand the market trends and what the people want, and fail to go on with the existing Company structure, they would lose their position in the market. Also, they would be easily beat by their competitors. In addition, the marketing department needs to survey the market and provide accurate information to the management before a new product being developed.

    The Company required having well asset management and financial control instead of investing in other new area without planning well. Mission Statement, Goals, and ObjectivesMission statement defines the unique purpose of a company and sets a company apart from its rivals as well as defining its business operations and scope. The mission statements that I manage to retrieve from Nestle’s website are as;#61607;Appendix 1 (Business Principles). ;#61607;Appendix 2 (Corporate Philosophy). ;#61607;Appendix 3 (Our Promise).

    In order to analyze the mission statement of the Company further, we shall use Peter Drucker’s 5 questions. These five questions could help us understand Nestle’s mission statement in depth or clearer. Both the corporate principles and promise justify the Peter Drucker’s five questions. 1.

    What is our business?Produce and sell world-class products of the highest consistent quality, reliability and convenience based on business excellence principles throughout the operations. (Corporate Philosophy)2. Who is the customer?Customer is the audience Nestle intends to market its products to or the grocery stores, supermarkets, mini markets and etc those who would like to retail Nestle’s products. ;#61607;People range from a newborn infant to a growing child and from a budding adult to a ripened senior would be Nestle’s products targeted consumers. 3.

    What is the value to the customer?Nestle’s products are safe to consume, that it complies with all regulations and that it meets high standards of quality. ;#61607;By purchasing Nestle’s products, it will raise the life value of the customers. 4. What will our business be?By answering this question, we can determine the Company short-term goals. Nestle has both research and development department, and consumer’s services to caring its consumers and understand what they want. 5.

    What should our business be?;#61607;By answering this question, the Company long-term goal can be determined. ;#61607;Nestle should conduct marketing survey in order to understand the market trend and launch new products or refine existing product based on the market trend. In addition, it should make decision properly before invest in new area. From these sources, I found that the Company defines sustainable development as the process of improving the world’s access to better quality food, while contributing to long-term social and economic development, and preserving the environment for future generations. Besides that, Nestle’s objective is to manufacture and market the Company’s products in such way as to create value that can be sustained over the long-term for shareholders, employees, consumers, and business partners.

    Environmental AnalysisThe environmental analysis is import for a company or an organization to look on because the company or organization staying in the environment where many factors have an influence on future outcomes. These analyses have to be considered in order to help the organization or company to maximize the effectiveness of any plan. There are two types of environment factors which are remote or external environment and the second type is industry or internal environment. Remote/ external environment means the company/ organization has no or little control over whereas industry/ internal environment means the company/organization have some control over.

    Remote environment will be discussed in more details below:Remote EnvironmentThere are 5 factors in remote environment. These factors together with its implication are in below:-1)Economic FactorsAlthough Nestle is the leading food company, it shares its knowledge and expertise with local small and medium food companies such as Malaysian International Chamber of Commerce and Industry (MICCI) and Federation of Malaysian Manufacturers (FMM). It helps those entrepreneurs to compete in the new free trade environment which will ultimately benefit the industry and the economy by making the market growth. Besides that, Nestle also collaborates with local government schemes to provide technical assistance to farmers in planting and harvesting crops. This collaboration benefits both parties, as the farmer will get income and Nestle will get to purchase good and fresh raw quality materials to produce their food. By having own local productions, Nestle should no longer needs to import any raw materials from other country where they will save much more money because usually local production will be far more cheaper then those imported (currency difference, taxes).

    It does not only beneficial Nestle, but also local economy because the money will flow within this country and there are more works for the unemployment. It will also benefit the consumers whereby consumers could enjoy the local productions with low price. More consumers will use this product and therefore Nestle will gain more profit from that. Looking at Nestle’s yearly and monthly net profit, it shows that they gain profit. (Refer to appendix 4).

    2)Social FactorsSocial factors seem to have made an important factor here as the global need for food productions. The population growth rates are raising so do the food productions. As the new generation people now are more educated, their lifestyle has changed from previous generation due to their high income. Because of their busy schedule, they do not care about the health and consume whatever without thinking whether the food they take are 100% healthy and after consume the unhealthy food they did not have the time to work out.

    So people nowadays do not have a healthy lifestyle, due to this problem Nestle conduct free public health forums around the country and also organize annual Breakfast Campaigns to promote good eating habits to aware the consumers of the food they take everyday to lead them to a more healthy and safe lifestyle. By joining Nestle Company, employees will be shower with a lot of benefits such as accident insurance, excellent training opportunities, infant feeding scheme and many more. The salary they get is competitive. 3)Technological FactorsInternet and Mobile Technology is currently growing so rapidly and “hot” in the market where almost all of the people nowadays will get contact with it.

    Nestle could use this advantage to benefit them by using it to promote their products over those advanced technology. Besides that, the employees and customers can connect with each other to enable the customer to interact with the company. Customer could get more information about the company from their site. Other than that, Nestle’s employees could use this service (internet) to connect to its industry in other country such as Australia, Singapore, U.

    K and more. In order to improve and stick to their goal (produce good quality food and stay as the world leader food producer) they are need to do more research and development whereby those research rely heavily on advance technology. Nestle company spends more than RM2 billion to invent new products. They will do research using the technology to find information to satisfy the local tastes and cultural flavors in each country market because they believe that no two country shares exactly the same preferences.

    By understanding what each country asks for, Nestle could market difference product according to the customer demand in difference country. It is already proven that the technology factors are important for Nestle Company. 4)Political FactorsPolitical Factors are important especially in food industry. Nestle provide HALAL food assurance which it is certified by JAKIM (Department of Islamic Development Malaysia) to provides assurance to the consumers that Nestle products are manufactured, imported and distributed under the strictest hygienic and sanitary condition in accordance to the Islamic faith.

    Besides that, to ensure that consumers do not buy any fake products, Nestle’s products are always come with the seal of guarantee. By having the seal of guarantees, consumers are now more confident and trust Nestle products. Strict quality control played a role in political factors too. It means that Nestle product’s quality will not be difference with other countries. Consumers are guarantees with full satisfaction of the products all over the globe. 5)Ecological FactorsEcological Factors is an important issue to talk about in any industry.

    As a responsible industry, Nestle Company should ensure that all the waste should be handling in the correct way such as throw those waste in the correct place so that they will not pollute the water. Industry should protect the environment to ensure that all the residents nearby lives healthy and safe. Preserving natural resources and minimizing waste have become a part of day – to – day duty for the industry to handle. Most of the company optimizes the use of locally available raw materials, which must meet both legal and internal quality criteria. Those companies have performed activities such as minimizing the use of environmentally critical substances, recycle waste and dispose of non-recyclable waste in an environmentally friendly manner. For Nestle Company, they also reduce the environmental impact of packing without jeopardizing the safety, quality or consumer acceptance by using the most efficient and appropriate packaging solutions.

    Industry Environment (Porter’s Five Forces)We analyze the industry environment which is external analysis by scanning and evaluating various sectors outside the Company. The purpose of industry environment analysis is to identify positive and negative trends that may affect the Company performance. Positive trends would be opportunities that improve the Company performance while negative trends would be threats that hinder the Company performance. Michael Porter’s Five Forces Model is tool that we use to analyze Nestle’s industry environment. The five areas involved are as follow:1.

    Entry Barriers;#61607;One of the barriers may be the direct government restrictions on entry. The licensing fees and the entry duty in Malaysia may be high. In addition, the Malaysia’s government always restricts that the food produced and marketed should be halal. An entrant would need to enter at a large size and with a consequent large addition to the size of output Milk and food industry has large economies of scale in relation to the size of the market. There are already few leading milk and food manufacturers in the Malaysia markets (includes Nestle) and are making large profits and the entry barrier is high, so a potential entrant might forego entry into the market because its entry would substantially drive prices down and cause losses for the entrant.

    Brand loyalty is established by continually advertising the brand and company name, patent protection, high product quality, and after sale service. Strong brand loyalty makes it hard for customers to change to new, competing products and therefore would be example of the entry barriers, too. 2. Supplier PowerIn my opinion, there are lot of supplier over the world that could supply the raw material to milk and food industryHowever, there are also a lot of organizations which manufactures and marketing milk and food.

    Suppliers may not be willing to offer very favorable terms and services to small businesses or new entrants if they have other potential customers. Suppliers may be more willing to offer an existing, large milk and food manufacturer better services. So the supplier power for milk and food industry is moderate. 3.

    Buyer PowerThe buyer power in this industry is high because there are a lot of such organizations providing similar products. For new entrants as well as the existing company, one of the approaches is to reduce the price of the products. However, due to the nature of business, Nestle has created consumer and quality loyalty as well as has a stable position in the market. So, Nestle only need to maintain its products quality or refine the quality, and try to control its production in order to increase revenue. 4.

    SubstitutesBoth direct and indirect substitutes are considered. The Company provides milk, breakfast cereal, culinary foods and chilled products. Bread, fresh milk, fast food, original spices as well as fresh or home cook foods could be the substitutes to the Nestle’s products. ;#61607;Currently there are quite a number of substitute products or services in the milk and food industry.

    These are offered by companies such as Campbell, Kellogg’s and Dutch Milk. In order to counteract the threat, Nestle always differentiate its product from its competitors. The research department always gathers information and identifies current customers’ needs to develop new products and expand their market. ;#61607;In addition, the Company constantly strives to keep abreast with changing consumer preferences.

    5. Competitive Rivalry;#61607;The competition rivalry of milk and food industry is high. ;#61607;There are a number of large sizes Company in this industry, for example, Kellogg’s Co. , Campbell, Danone and Kraft Foods Inc.

    The high intensity of the rivalry among existing competitors declining the market, hence, the new entrants would give up entry to the industry. SWOT AnalysisSWOT analysis is a framework for analyzing the company strengths, weaknesses, opportunities and threats faced by the company. Strengths and weaknesses are called the internal analysis where it is design to examine the capabilities of the company. For opportunities and threats, it is usually called the external analysis whereby it looks at the main points in the environmental analysis by identify those points that pose opportunities for the company and those that pose threats or obstacles to performance. Basically strengths is use to overcome threats whereas opportunities is use to overcome weaknesses. SWOT analysis will be discussed in more details below:StrengthsMarket leader – To maintain as the long term market leader, Nestle outlook in expanding market share and nurturing brand loyalty.

    Nestle largest market share for most of its core brands, especially MILO and Nescafe which have consistently maintained very dominant market share for the past 3 years. Nestle’s Maggi range of instant noodles is also a leader in its segment, market share for the past 3 years. Set standards – Setting standards are important. By having the standard set, consumer is more relief to buy the product. Nestle food are all set in HALAL standard whereby the products are manufactured, imported and distributed under the strictest hygienic and sanitary condition in accordance to the Islamic faith. Besides that, all the product will come with seal guarantee to let the consumers identify that the product they buy is approve by the government and is save to consume and most importantly to let the consumer to differentiate the Nestle product with the fake one in case there are fake product in the market.

    Strong brand name – Strong brand name is made possible through early assimilation of Nestle product. It is basically come from good quality product as well as consistent advertising and promotional efforts. Once the product is acceptable by the consumers and it is proved to be good, it will automatically become a demanding product in the market. Customer loyalty will also take place. In addition to that, advertisement about the product is also important because it is use to aware the customers about the new product being introduced in the market. Milo and Nescafe are some of the fine examples of Nestle’s strongest brand name over the years.

    Specialist marketing expertise – As the company is growing bigger and bigger more relevant specialist are needed in order to handle the company well. Therefore more and more people with the required specialized skills are hired. With their professional skill and knowledge they have, together they help the company to successfully build its business to the climax. New, innovative product or services – With the help of the Research and Development department, they will do more research on the consumers needs (what they want from Nestle) and develop the new product according to the consumers taste.

    Once they capture what the consumers’ needs, it is easier to market their products. Reason to do market research is because different country will have different taste for example the product might be very demanding in Malaysia but it is not demanding at all in U. S. When the company always introduced new and innovative products to the consumer, the consumer will always keep an eye on this product.

    Launching a good customer service also played an important part. This is because it allows consumer to give feedback and the company can use the feedback to improve the company. Size and capital backing – Nestle Company gain profits over the past years where it allows them to acquire more production factories around the world. With the backing and tariff incentive from the local government, Nestle’s acquisitions of these factories will receive support from its investors or sponsors. With more acquisitions, it can increase its size and also be able to venture into more diversified areas.

    WeaknessesDamage reputation -Boycott of the product from the customers will leads to damage reputation. Other consumer will stop buying the product. Example: boycott Nestle for using artificial material to make baby milk powered. Even if Nestle make clearance on the statement, it is still damage the company reputation. Size – Nestle’s is looking forward to open more branches all over the business area whereby it potentially might be a problem to the company as they are in danger of becoming too huge to stay nimble and competitive.

    To overcome this problem from coming true, each new branch to be open should carefully considered ensuring that the acquisition will only benefit them not drown them. OpportunitiesMergers or joint ventures – With mergers or joint ventures, the company can gain more profits and become the leader in the market because they produce a lot of varieties of product to the market where no second company able to produce as many products as the leader company. Nestle is one of the biggest merger company where in the end it become a leading company in Malaysia. Nestle originally is just produce baby food and dietetic food for children but later Nestle merged with Anglo-Swiss Condensed Milk Company to produce condensed milk. Years after that, Peter ; Kohler Swiss General Chocolate Company joint venture with Nestle to produce milk chocolate.

    Later MAGGI Company merged with Nestle. With mergers or joint ventures, Nestle successfully became the leading market in Malaysia. Advancements in the communications area – Internet is growing fast all around the world, hereby Nestle can use this valuable communications to help the company to growth. Nestle will continue to benefit as they utilize the Internet fully to support their business. The employees can get information from the Internet easily and it is the best way for the consumer to look for more information about the company via Internet and they could send feedback to the company via Internet. Growing affluence of developing countries – Developing countries are currently growing in terms of its affluence.

    Nestle can now market its product to other countries and Nestle also have the opportunities to collaborate with new partners to develop products suitable for the local market. Moving into new attractive market segments – Nestle has become the top multinational companies with their top brand name whereby there are a lot of small companies would like to be Nestle’s dealers. By this way, Nestle has become a supplier besides just selling the product to the market on its own. Now with the help of dealers, the product could be selling in the fastest way and more profit will be gain by Nestle. ThreatsPrice war – As there is many same type of product by different company to compete in the market, some of the consumer will look at the price to determine which one to buy such as restaurant will surely choose for the cheapest product. Price war will occurs here.

    All of the company will fight with each other by promoting the cheapest price so that their product will be sold fast. Reluctance of users to purchase new product – Most of the consumers do not like to adopt new product because they are satisfy with the one they are having and reluctance to try others. They do not want to waste time to suite themselves with the new product. So even if Nestle may come out with new ideas the adoption of the new product might be slow.

    For example: first approach Nescafe and later Nescafe Arabian. Survey shows consumers prefer the old Nescafe taste. Alliance between major competitors – All types of products rely on customers. Without customers there is no company. Nestle is not an unexceptional case so if its competitors come out with some new and attractive product to attract existing customers, the company could be in trouble from this loss of competitiveness.

    Alternate StrategiesThe alternate strategy looks into the ways Nestle maintain its competitiveness. Nestle aims to re-shape in concentrate on core brands, significant improvements in supply chain and innovation. With the strength identified in the SWOT analysis, Nestle is no doubt capable of maintaining its competitiveness. The objective of the company would be produce and sell world class products of the highest consistent quality, reliability and convenience. To achieve this, Nestle must plan duration to reach to the objective. Nestle plan to achieve it in 2 years time.

    Within this time, Nestle needs to do research and develop the product several times until the product is successful and it meets the objective. It will benefit the company as the consumer will be more loyal to the product as the product is trusted by them. Nestle can also cooperate with other local research and development team from other organization together to do research about the upcoming product. Competitive AdvantagesCompetitive advantages encompass those strengths of the Company which are better than its competitors.

    The following are those competitive advantages of Nestle:1. Leader in the milk and food industryNestle is the world leader when it comes to the field of food research. Nestle marketing over 8,500 brands and 30,000 products. It operates nearly 500 factories across 5 continents and employs over 200,000 employees worldwide. 2. Research and DevelopmentNestle annually spends in the excess RM2 billion to research new products and processes.

    The Research and Development help Nestle better understand the processes of food production – from fresh consumables to finishes products. 3. QualityQuality is the cornerstone of Nestle’s success. ;#61607;Nestle always promise to the customer that it is safe to consume and complies with all regulations as well as meets high standards of quality. ;#61607;Beside food safety, nutrition of the food produced is emphasized.

    4. Supply chain management;#61607;Bernard Teiling, assistant vice president of business process integration for Nestle S. A says supply chain management (SCM) is “both a source of competitive advantage and a lever for profit margins. ” (Source: Supply Chain Management, http://www. outsourcing-information-technology.

    com/supply. html);#61607;Nestle defines SCM as the two-way management of the flow of goods, services and information from suppliers to manufacturers, wholesalers, distributors, stores to the end user. Critical Success Factors (CSF)Critical Success Factors (CSF) is those things that must go right in order to achieve company’s objectives. For Nestle, it make sure that all the products manufactured, marketed as well as imported are of their values and fulfill the standard of quality by applying Nestle Quality System (NQS) throughout the Nestle world. The NQS, covering raw material sourcing, manufacturing, quality control, marketing and delivery, guarantees full satisfaction to every consumer.

    In addition, the research and development is set in order to conduct research activities cover all aspect of nutrition ranging from the study or raw materials to food technology. This complies Nestle is not only emphasize on the quality but also consumer’s daily nutrition. While the consumer services is set to understand what the consumers want and their preferences. Products of Nestle have to satisfy consumers’ taste, too. Products of Nestle are always reviewed by the internal research and development for products refining.

    Besides that, these two components of Nestle also help to survey the market trend for new product innovation and development. Another factor that helps the Company to meet its goal is increase the supply chain. By increasing the supply chain, the prices of the products would decrease and would be more affordable by the consumer. Nestle’s enviable position in the milk and food industry is due to strong product identification which is made possible through early assimilation of Nestle’s products.

    With the consistent advertising and promotional efforts, the name “Nestle” is now almost stay in every consumers’ heart in Malaysia. Learning from others is an important factor that leads Nestle lead to success, too. Nestle always learn from others competitors no matter their success story or failure, so that they will gain benefit from others success and learn from the competitors failure. ConclusionIn the conclusion, we know that Nestle is the successful market leader company which bases on its business strategy according to its mission statement. Nestle mission statement and purpose; together with its core values and principles allowed the company to grow from a small company to a huge company with branches all over the world.

    The mergers and joint venture of other company with Nestle is very successful and dare to say almost all of the product sells in the market now are all manufacturers and distributed by Nestle Company. As a market leader, Nestle also move into a new segments whereby besides selling the products by its own, a lot of smaller organization is interested to cooperate with Nestle to help the company to market the product such as Malaysian International Chamber of Commerce and Industry (MICCI) and Federation of Malaysian Manufacturers (FMM). This is beneficial to both the organization and Nestle because it could help Nestle to distribute the product to wider area and the organization will gain profit from being Nestle’s dealer. To sustain in the present competitive, Nestle are needed to increase the supply chain. Since there are so many same kind of product introduced in the market, in order to sustain the top sales, the company must increase the supply chain so that the product price will be decrease and therefore consumer can afford to buy. Good quality and the price is competitive to others organization’s product.

    Besides increase the supply chain, the organization must also study the consumer on what they want and expect from our product. Short to say, product is produce according to the consumers needs and not according to what manufacturer wants it to be because the end user is always the consumers. Once the organization get hold on what the consumer wants and expect from them, it is more easy for the organization to develop a new product to suite the consumer taste and the product will definitely successful in the market. Good quality of the product is the most important issues to create customers loyalty. From looking at the environment analysis, knowing that Nestle reduce the environmental impact of packing without jeopardizing the safety, quality or consumer acceptance by using the most efficient and appropriate packaging solutions.

    Having this decision, consumer will feel more protecting and safe to consume Nestle product. They will most probably later become customer loyalty. Nestle always thinks of consumer’s health issue which is a good idea. By using the technological factors, it will enable the consumer to know the company more in depth and if they have any problems they can send mail to the company. Using the advanced technology, it is convenient both for the consumer or the staff to communicate with each other.

    Nestle would be able to further achieve its success if they kept on produce more quality, attractive and innovative product. They will successful also if they able to exploit their current competitive advantage and keep on progressing within their business strategy. Nestle should now be able to successfully sustain its present competitive when they state to their mission statement, goals and objective. They will stay as the marker leader for long term. References1. At a Glance http://www.

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    nestle. com. my/Nestle+Insights/Group%20Financial%20Highlights/(access date: 8 Sept 2004)17. PEST Analysishttp://www.

    valuebasedmanagement. net/methods_PEST_analysis. html(access date: 8 Sept 2004)18. SWOT analysishttp://erc. msh. org/quality/ittools/itswot.

    cfmhttp://www. valuebasedmanagement. net/methods_swot_analysis. html(access date: 14 Sept 2004)Appendix 1Business PrinciplesSince Henri Nestle developed the first milk food for infants in 1867, and saved the life of a neighbor’s child, the Nestle Company has aimed to build a business based on sound human values and principles. While our Nestle Corporate Business Principles will continue to evolve and adapt to a changing world, our basic foundation is unchanged from the time of the origins of our Company, and reflects the basic ideas of fairness, honesty, and a general concern for people.

    Nestle is committed to the following Business Principles in all countries, taking into account local legislation, cultural and religious practices:Nestle’s business objective is to manufacture and market the Company’s products in such a way as to create value that can be sustained over the long term for shareholders, employees, consumers, and business partners. Nestle does not favor short-term profit at the expense of successful long-term business development. Nestle recognizes that its consumers have a sincere and legitimate interest in the behavior, beliefs and actions of the Company behind brands in which they place their trust, and that without its consumers the Company would not exist. Nestle believes that, as a general rule, legislation is the most effective safeguard of responsible conduct, although in certain areas, additional guidance to staff in the form of voluntary business principles is beneficial in order to ensure that the highest standards are met throughout the organization. Nestle is conscious of the fact that the success of a corporation is a reflection of the professionalism, conduct and the responsible attitude of its management and employees.

    Therefore recruitment of the right people and ongoing training and development are crucial. Nestle continues to maintain its commitment to follow and respect all applicable local laws in each of its markets. Appendix 2Corporate PhilosophyBe the leading multinational company in food, nutrition and wellness. Produce and sell world-class products of the highest consistent quality, reliability and convenience based on business excellence principles throughout our operationsMaximise the use of good quality local raw materialsBe an exemplary employer with a progressive human resource and social policy; with a management style that is based on “Management Commitment and People Involvement”Be a responsible corporate citizen, fulfilling all obligations to Government, shareholders, customers, communities and consumers.

    Protect the environment by being committed to environmentally sound business practices, and taking into account the need to preserve natural resources and save energy. Guarantee that all products manufactured, imported and distributed by Nestle Malaysia are certified HALAL by JAKIM. Deliver shareholder value through the achievement of sustainable and profitable long-term growthAppendix 3Our PromiseGood Food, Good Life the Nestle promise to its consumers. A promise that consumers can always expect consistency in quality, taste, texture and freshness from any product manufactured, imported and distributed by Nestle. The Nestle Seal of Guarantee. Whenever you examine the labels on any Nestle product, you will note one very meaningful feature; the distinctive blue band with the familiar Nestle logo.

    This is our Seal of Guarantee, which represents a very important consumer privilege – the right to only the best quality. This privilege also includes the consumer’s right to inform Nestle as to whether it is delivering on that quality. Consumers are invited to contact the Nestle Consumer Services with feedback about Nestle’s products and services. It is a commitment the Company makes for every single product in its range. At Nestle, we build our success on the foundation of quality.

    Everyday, millions of people show their trust in this quality by picking up Nestle products, and we honour and reciprocate this trust by way of the Nestle Seal of Guarantee. Strict quality control. Quality is the cornerstone of Nestle’s success. There is no difference in the quality of a Nestle product made in Malaysia, South Africa, Russia or Switzerland because the stringent Nestle Quality System (NQS) is applied throughout the Nestle world. The NQS, covering raw material sourcing, manufacturing, quality control, marketing and delivery, guarantees full satisfaction to every consumer. Commitment to research and development.

    Consumer satisfaction is the key to successful products. This means understanding what the consumer wants and meeting the needs of all consumers, from the very basic to the very sophisticated. Nestle’s strength lies in its understanding of local preferences through consumer research. The needs identified are then translated into product concepts which are explored extensively at its research centres. Research activities cover all aspects of nutrition ranging from the study or raw materials to food technology -“from farm to fork”. Worldwide, the Nestle Group invests more than RM2 billion annually and employs 3,500 specialists, experts and technical support staff who serve a global network of 17 R;D centres.

    The Nestle Research Centre in Lausanne, Switzerland is the leading research centre in the food industry. Today the consumer can expect more and more food products with added health benefit, without turning food into medicine. The pleasure of eating and increased convenience will be our top priorities. New products initiated by Nestle R;D may offer health benefits in areas such as diabetes, osteoporosis, obesity, cardiovascular health, skin quality, amongst others. “Good food and nutrition adds years to our lives,and life to our years.

    “Providing the HALAL assurance. Nestle Malaysia was the first multinational to voluntarily request for Halal Certification of all its food products when it was first introduced in 1996. This does not imply that Nestle products in Malaysia were not halal prior to that. The certified Halal status for all Nestle Malaysia products by JAKIM (Department of Islamic Development Malaysia) provides assurance that Nestle products are manufactured, imported and distributed under the strictest hygienic and sanitary condition in accordance to the Islamic faith. Caring for the EnvironmentNestle cherishes the environment and is therefore, committed to environmentally-sound business practices throughout the world in recognition of the pressing need for natural resource preservation and energy conservation.

    Towards this aim, Nestle has invested in various environmentally friendly projects to specifically achieve savings in energy and resources as well as reductions in all forms of wastes and effluents produced.

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