Strengths:

1. Strong brand image:

Nestle enjoys strong image associated with quality products. It has unmatched brand

image all over the world among the nutrition, health and wellness companies.

2. Well diversified and well recognized food and beverage product portfolio

Nestle owns more than 2500 brands globally. Most of Nestle Pakistans products are

classified into one of its highly diversified product categories which are ambient diary,

chilled dairy, juices and drinks, cereals, infant nutrition, and etc. Moreover, Nestle holds

ownership of some well recognized brands available in the market, such as Nescafe,

Cerelac, Kitkat, Milkpak, Everyday, etc.

3. Presence on global scale:

Operations of Nestl on an international level helps Nestle Pakistan in numerous ways,

such as laying out of Standard Operating Procedures (SOPs), huge capital investment,

and management expertise.

4. Vast sales and distribution channel:

Widespread sales and distribution network enables Nestle to overcome the obstacles in

reaching out to the consumers. As per the Head of Consumer Insights, the newly

launched product reaches the consumers in less than two weeks.

5. Strong supply chain network:

Through continuous improvement in its proactive and flexible supply chain network,

Nestle ensures the freshest product availability in the market.

6. Customer loyalty:
 Association of people with several Nestle brands is far stronger than competitors in

terms of trust, favorability, general acceptability, and awareness.

7. Constant increase in consumer preference over the last 4 years:

As compared to its competitors, Nestle has always been the first preference of consumers

because of strong brand image and customer loyalty

8. High research and development ( R&D)

Nestl Pakistan has made investments of PKR 4.1 billion in 2016 and planned PKR 6.6

billion in 2017 for automation, expansion & development projects, capacity increase in

order to meet consumer demands

9. Several Employee training programs

Several programs, focusing on leadership development, capability enhancement and

employee relations management, are under taken in 2016 with a total of 28700

management training hours.

10. Sales grew by 9.1% in 2016

Nestle continues to perform well financially. Growth of the sales of the company has

been increasing each year for more than a decade.

11. 33.3% of total revenues are distributed as dividends.

Apart from its customers, Nestle also values its shareholders as major chunk of its

revenues, which is around 33.3%, is distributed as dividends to the shareholders of the

company.

12. Strong focus on CSR activities:

The areas on which Nestle mainly focuses on include: Nutrition, Water, Environmental

Sustainability, Rural Development, and People. Several initiatives are taken by the
 company to create awareness about nutrition among the children, women, rural areas and

the schools.

13. Digitalization of Milk Management Syaystem:

Greater efficiency is achieved by incorporating digitalization into the milk management

system which has enabled the company to exchange information regarding the collection

in a real time rather than to rely on manual paper-based work which used take more than

a week.

Weaknesses:

1. Bad publicity in one region affects the whole company

For example, in 2015 the ban on Maggi in India, due to the discovery of lead in the

product, not only affected the Indian market but in Pakistan Nestl had to relaunch the

brand and come up with a new recipe and marketing campaign in 2016.

2. Dependency on a few well-recognized brands.

Nestle Pakistan hugely depends on Milkpak and Everyday which makes it vulnerable to

any sudden changes in consumer behavior.

3. Dependency upon advertising:

To shape consumer opinion and drive traditional sales, Nestle heavily depends on

advertising which can lead to high marketing costs with a questionable return on

investment.

4. Unable to differentiate Milkpak from competitors products:

The term milk pack is often used to refer to all of the UHT milk, which is similar to

Nestls brand name Milkpak. So, inability to communicate effectively with consumers

can be a serious cause of concern for the company

5. Premium pricing:

Nestle charges relatively high prices for its products. So lower middle class and lower

class who cannot afford its products prefer substitute products which results in a loss in

market share.

IFE Matrix

Weights Rating Total

Strengths:
Strong brand image
Well diversified and well recognized product portfolio
Presence on global scale
Vast sales and distribution channel
Strong supply chain network
Customer Lotyalty
Constant increase in consumer preference over the last 4 years
High R&D
Several Employee training programs
Sales grew by 9.1% in 2016
33.3% of total revenues are distributed as dividends
Strong focus on CSR activities
Digitalization of Milk Management Syaystem
Weaknesses
Bad publicity in one region affects the whole company
Dependency on a few well-recognized brands
Dependency upon advertising
Unable to differentiate Milkpak from competitors products
Premium pricing
Total 1.00