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What Are The Reasons For Nestles Success

1369 words - 5 pages

Nestle was founded in 1866 by Henri Nestle on the launch of an innovative, nutritious baby food. It manufactures around 10000 different products and sells in 130 counrtries around the globe.It has been in existence for almost 150 years and has built a strong image. Since its inception, global demographics have changed drastically. Incomes have risen, life expectancy has increased, health consciousness has increases, living standards have improved and lifestyles have altered. Nestle has adapted quickly and smoothly to these demographic transition and has been striving for health and wellness of its consumers. Nestle’s primary mission of “Good Food,Good Life” implies that it strives to produce goods in most hygyienic conditions which not onlycater the nutritional needs of people, but also contribute to their overall healt hand wellness. Their operations are consistent with how they operate as Nestle spends around CHF 1.5 billion every year on Research and Development in order to ensure that its products are a top priority for its consumers and gurantee maximum health benefits. Nestle has a largest R and D network compared to any food company in the world with 3 science and research centres, 31 product technology centres and RandD centres worldwide with over 5000 people involved in R&D. For nestle safety and quality are non-negotiable. It is commited to produce trustworthy products for its consumers that contribute to improving the quality of consumers lives. Through continuous innovation of new products and renovation of existing products, Nestle is creating and hundreds of products especially in terms of their nutritional benefits.
“First Mover Advantage” has been Nestlé’s core strategy and over the years it has benefitted a lot by acting as a first mover in many emerging markets. Nestle enters emerging markets in both developed and developing markets before its competitors in order to develop its stronghold in them. The company is highly responsive and responds to the both population and potential economic growth in emerging markets. Another strategy of Nestlé has been the acquisition and mergers in which it was highly involved during the 20th century. It acquired Maggi in 1947, entered into an agreement with Coca-Cola in early 1990s in regard to teas and coffees in order to benefit from Coca-Cola’s global bottling system and proficiency in prepared beverages. Mergers and acquisitions together with penetration into emerging markets have allowed nestle to extend its geographical presence and extend its product lines. One of the most current acquisitions involves purchase of Pfizer’s baby food division in 2012. Nestlé takes over local firms when it sees opportunities during the company’s entry into fresh evolving markets. One good example is Nestlé’s obtaining of Rossia, one of the leading chocolate manufacturers in Russia, in 1995.
Moreover, Nestlé also moves into emerging markets by developing its own infrastructure. The most significant...

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