Nestle Good Food, Good Life: Dessertation Report On

NESTLE: GOOD FOOD, GOOD LIFE
DESSERTATION REPORT ON
NESTLE
GOOD FOOD, GOOD LIFE
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A PROJECT REPORT ON
“NESTLE: GOOD FOOD GOOD LIFE”
SUBMITTED BY
“SANJAY ________”
FOR THE DEGREE OF
THE BACHELOR OF MANAGEMENT STUDIES
UNDER THE GUIDANCE OF
“MISS _____________”
CHINAI COLLEGE OF COMMERCE AND ECONOMICS
_________, MUMBAI – 4000____
ACADEMIC YEAR 2010 - 2011
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DECLARATION
I, SANJAY__________________, OF THE CHINAI COLLEGE OF COMMERCE
AND ECONOMICS, ___________( E ) , HEREBY DECLARE THAT I HAVE
COMPLETED THE PROJECT ENTITLED “NESTLE: GOOD FOOD, GOOD LIFE”
IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE THIRD YEAR OF
THE BACHELOR OF MANAGEMENT STUDIES COURSE FOR THE ACADEMIC
YEAR 2010-2011
I FURTHER DECLARE THAT INFORMATION SUBMITTED BY ME IS TRUE

AND ORIGINAL TO THE BEST OF MY KNOWLEDGE.
DATED: _________
Name of the student
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CERTIFICATE
I MISS ______________ HEREBY CERTIFY THAT SANJAY_________________
STUDYING IN TYBMS AT CHINAI COLLEGE OF COMMERCE AND
ECONOMICS, __________, HAS COMPLETED A PROJECT ON “NESTLE: GOOD
FOOD, GOOD LIFE” IN THE ACADEMIC YEAR 2010-2011 UNDER MY
GUIDANCE.
I FURTHER CERTIFY THAT THE INFORMATION SUBMITTED IS TRUE AND

ORIGINAL TO THE BEST OF MY KNOWLEDGE.
DATED:
Place:
Name of the guide

Examiner’s Sign &Date PROJECT GUIDE
_____________________
College Seal PRINCIPAL
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ACKNOWLEDEGEMENT
I EXPRESS MY SINCERE THANKS TO MISS ______________FOR HER

VALUABLE GUIDANCE IN DOING THIS PROJECT.
I WISH TO TAKE THE OPPORTUNITY TO EXPRESS MY DEEP SENCE OF

GRATITUDE TO PRINCIPAL ___________________________ AND PROF. (Mr.)
________________________ FOR THEIR INVALUABLE GUIDANCE AND
SUPPORT IN THIS ENDEAVOUR. THEY HAVE BEEN A CONSTANT SOURCE
OF INSPIRATION.
FINALLY IT IS THE FOREMOST DUTY TO THANK ALL MY RESPONDENTS,

FAMILY & FRIENDS WHO HAVE HELPED ME DIRECTLY OR INDIRECTLY IN
COMPLETING MY FIELD WORK, WITHOUT WHICH THIS PROJECT WOULD
NOT HAVE BEEN SUCCESSFUL.
Name of the student
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CHAPTER 1
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1. EXECUITVE SUMMARY
Nestlé has been a leading food manufacturer and major purchaser of agricultural raw
materials for over 130 years. Food and agriculture are an integral part of the social
cultural, economic and political context of every community. Today, Nestlé is the
world’s largest and most diversified food company, with nearly 500 factories in 77
countries, producing healthy, enjoyable food products for every stage of life. The present
study has been carried out with the objective of studying Nestle, their brand exercises, the
use of celebrity endorsement as a tool of brand building by firms and the consumers
perception about the brand image of Nestle The research was carried out with the help of
primary as well as secondary sources of data Primary Data has been collected through
consumer survey, among the existing and potential consumers of Nestle Products.
However secondary dats has been collected through Books, Periodicals and Journals in
the field of marketing, branding and Newspapers and the Internet. The only limitation in
this survey was that I could not conduct a survey on a big scale, due to the time
constraint. After all the literature and market research, and analysis I wish to conclude
that the philosophy behind the branding strategy of Nestle has been to develop the brand
so as to attract and retain the consumers. The branding strategies adopted have resulted in
building a sustainable and differential advantage over its competitors.
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2. ABOUT NESTLE
2.1 Profile of the company
Nestlé with headquarters in Vevey, Switzerland was founded in 1866 by Henri Nestlé and
is today the world's biggest food and beverage company. Sales at the end of 2004 were
CHF 87 bn, with a net profit of CHF 6.7 bn. We employ around 247,000 people and have
factories or operations in almost every country in the world.
The Company's strategy is guided by several fundamental principles. Nestlé's existing

products grow through innovation and renovation while maintaining a balance in
geographic activities and product lines. Long-term potential is never sacrificed for short-
term performance. The Company's priority is to bring the best and most relevant products
to people, wherever they are, whatever their needs, throughout their lives.
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2.2 Background
Nestle was promoted by Nestle Alimentana, Switzerland, a wholly owned subsidiary of

Nestle Holdings Ltd., Nassau, Bahama Islands. Nestle is one of the oldest food MNC
operating in India, with a presence of over a century. For a long time, Nestle India’s
operations were restricted to importing and trading of condensed milk and infant food.
Over the years, the Company expanded its product range with new products in instant
coffee, noodles, sauces, pickles, culinary aids, chocolates and confectionery, dairy
products and mineral water.
Nestle was incorporated as a limited company in 1959. In 1978, the Company issued
shares to the Indian public to reduce its foreign holdings to 40%. Its name was changed
from Foods Specialties Ltd. to the current name in 1981.The parent held 51% stake in the
company as at 2000 end. It has FIPB approval to hike stake by 10% and has been
gradually acquiring shares from the open market. Parent stake in the company as at 2001
end stood at 53.8%. The parent plans to continue hiking stake through open market
purchases.
Nestle India Ltd, 51% subsidiary of Nestle SA, is among the leading branded food player
in the country. It has a broad based presence in the foods sector with leading market
shares in instant coffee, infant foods, milk products and noodles. It has also strengthened
its presence in chocolates, confectioneries and other semi processed food products during
the last few years.
The company has launched Dairy Products like UHT Milk, Butter and Curd and also
ventured into the mineral water segment in 2001. Nestle’s leading brands include
Cerelac, Nestum, Nescafe, Maggie, Kitkat, Munch and Pure Life.
2.3 Company Mission

At Nestle, we believe that research can help us to make better food, so that people live a
better life. Good food is the primary source of good health, so we are trying to make good
food. To provide fresh and pure products to the customers, we introduced (SHE) Safety,
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Health and environment policy to protect health of our employs and keep clean our
surrounding environment
2.4 Company Vision

• Vision of Nestle Milkpak Company is to expand business according to the increasing
demand of market.
• As per our company vision in 2020 production capacity of all plants working in
Pakistan is being increased. So extension of Kabirwala Plant is the example of our
company vision.
2.5 Plant locations
Nestle started its manufacturing operations with Milkmaid in 1962 at Moga factory.
Manufacturing of Nescafe started in 1964 at the same factory. The company set up
another factory at Cherambadi in Tamil Nadu, for manufacture of infant foods, coffee etc.
For almost two decades there were no new additions of manufacturing facilities due to
restrictive policy environment. The company set up its Nanjangad (Karnataka) factory in
1989 and the Samlakha (Haryana) factory in 1992. The Ponda (Goa) factory started
operations in 1995. The Company set up its sixth manufacturing unit in 1997 at Bicholim
in Goa
2.6 Business of the Nestle
Nestle is the largest food company in the world. It is present in all five continents, has an
annual turnover of 74.7 billion Swiss Frances. There are 509 factories are running in 83
countries, having 231,000 employs
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3. HISTORY OF NESTLE
Nestlé was the result of a series of mergers of many small companies. In the mid-1860s,
Henri Nestle, merchant, chemist and innovator, experimented with various combinations
of cow’s milk, wheat flour and sugar. The resulting product was meant to be a source of
nutrition for infants, who could not be breast-fed by their mothers. In 1867, his formula
saved the life of a prematurely born infant. Later that year, production of the formula,
named Farine Lactee Nestlé, began in Vevey and the Nestle Company was formed.
Henri Nestle wanted to develop his own brands and decided to avoid the easier route of
becoming a private label. Henri also wanted to make his company global. Within a few
months of the launch, Henri began to sell his products in many European countries. In the
company’s initial years, Henri took various steps to facilitate research, improve product
quality and develop new products.
Meanwhile in 1866, two Americans, Charles and George Page had founded the Anglo-
Swiss Condensed Milk Company. The company launched a milk based infant food,
which competed with Nestlé’s products. In 1875, Daniel Peter, a friend and neighbor of
Henri developed milk chocolate. Peter became the world’s leading chocolate maker, and
later merged his company with Nestlé. The rivalry between Nestlé and the Anglo-Swiss
Condensed Milk Company intensified but ended in 1905, when the two companies
merged under the Nestlé banner.
World War I created a new demand for dairy products. Nestle grew mainly by executing
government contracts. The end of the war created a crisis for the company as people
started using fresh milk again, instead of condensed and powdered milk. In 1921, Nestlé
recorded its first loss, which was partly due to the worldwide postwar economic
slowdown. Louis Dapples, a Swiss banking expert restructured the company, streamling
its operations and reducing the debt burden.
In 1930, the Brazilian Coffee Institute approached Dapples, seeking new products. After
eight years of research Nestlé developed a soluble powder that revolutionized coffee
drinking around the world. The product was launched under the brand name Nescafe and
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became an instant success. The onset of World War II speeded up the introduction of
Nescafe. The beverage also became a popular drink among American servicemen in
Europe and Asia. The end of World War II triggered off a new phase of growth for
Nestlé. Many new products were added as the company grew through acquisitions.
After 1974, Nestlé’s financial position deteriorated. Oil prices rose and growth in
industrialized nations slowed down. The Swiss franc appreciated and the price of coffee
beans and cocoa shot up. This situation was partially offset by Nestlé’s rapid growth in
emerging markets.
In 1981, Helmut Maucher took over as CEO. His policies had a significant impact on
Nestlé’s style of functioning. Maucher pursued a two-pronged strategy to improve the
company’s financial situation: First he embarked on internal restructuring and
divestments; second he decided to continue with strategic acquisitions. Between 1980 and
1984, he divested a number of non-strategic or unprofitable businesses, amounting to
nearly SFr8 bn. The divestments included certain food products that were not consistent
with Nestlé’s emphasis on high value added segments. To improve the company’s
financial situation, he embarked on a cost-cutting exercise. While the employee strength
was reduced significantly, the inventory and outstanding debt were brought down.
In 1990, Nestlé formed a joint venture with General Mills called Cereal Partners
Worldwide to promote Nestlé breakfast cereals. It covered 70 countries accounting for
about 75 per cent of the breakfast cereal consumption outside the US and Canada. Nestlé
also formed a joint venture with Coca-Cola, called the Coca-Cola Nestlé Refreshment
Company, to market tea and coffee-based ready-to-drink beverages under the Nestea and
Nescafe brands.
In 1996, Nestlé decided to end its 50-50 Clinic Nutrition joint venture with Baxter
Healthcare and established Nestlé Clinical Nutrition to provide orally consumed nutrition
products to hospitals and nursing homes.
Nestlé opened the 20th century by merging with the Anglo-Swiss Condensed Milk
Company to broaden its product range and widen its geographical scope. In the new
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millennium, Nestlé is the undisputed leader in the food industry, with more than 470
factories around the world. Nestlé launched a Group-wide initiative called GLOBE
(Global Business Excellence), aimed at harmonizing and simplifying business process
architecture; enabling Nestlé to realize the advantages of a global leader while
minimizing the drawbacks of size.
The Company’s strategy will continue to be guided by several fundamental principles.

Nestlé’s existing products will grow through innovation and renovation while
maintaining a balance in geographic activities and product lines. Long-term potential will
never be sacrificed for short-term performance. The Company’s priority will be to bring
the best and most relevant products to people, wherever they are, whatever their needs,
throughout their lives.
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4. BUSINESS PRINCIPLES
Since Henri Nestlé developed the first milk food for infants in 1867, and saved the life
of a neighbor’s child, the Nestlé Company has aimed to build a business based on sound
human values and principles.
While our Nestlé 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 the
Company, and reflects the basic ideas of fairness, honesty, and a general concern for
people.
People first
Employees, people and products are more important at Nestlé than systems. Systems and
methods, while necessary and valuable in running a complex organization, should remain
managerial and operational aids but should not become ends in themselves. It is a
question of priorities. A strong orientation toward human beings, employees and
executives is a decisive, if not the decisive, component of long-term success.
Quality products
Our focus is on products. The ultimate justification for a company is its ability to offer
products that are appealing because of their quality, convenience, variety and price --
products that can stand their ground even in the face of fierce competition.
Long-term view
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Nestlé makes clear a distinction between strategy and tactics. It gives priority to the long-
range view. Long-term thinking defuses many of the conflicts and contentions among
groups this applies to employment conditions and relations with employees as well as to
the conflicts and opposing interests of the trade and the industry. Of course, our ability to
focus on long-term considerations is only possible if the company is successful in the
struggle for short-term survival. This is why Nestlé strives to maintain a satisfactory level
of profits every year.
Decentralization
Switzerland is home to Nestlé's Swiss subsidiary, its international headquarters and the
registered office of Nestlé's holding company, but Nestlé does not regard its Swiss
headquarters as the center of the universe. Decentralization is a basic principle of Nestlé.
Our policy is to adapt as much as possible to regional circumstances, mentalities and
situations. By decentralizing operational responsibility, we create strength and flexibility
and are able to make decisions that are better attuned to specific situations in a given
country. Policies and decisions concerning personnel, marketing and products are largely
determined locally. This policy creates stronger motivation for Nestlé's executives and
employees and a greater sense of identification with Nestlé's business. It is not Nestlé's
policy to generate most of its sales in Switzerland, supplemented by a few satellite
subsidiaries abroad. Nestlé strives to be an "insider" in every country in which it operates,
not an "outsider."
Uniformity
A very important concern at Nestlé has to do with uniformity: how consistent Nestlé's
principles, policies, rules of conduct and strategies should be, and to what extent they
should differ depending on the country, subsidiary, region, branch or group of products.
In general, Nestlé tries to limit the uniformity of its policy to a requisite minimum. This
minimum is then systematically enforced, unless there are compelling reasons in a given
market that justify deviation from policy.
Diversification
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Nestlé does not want to become either a conglomerate or a portfolio manager. Nestlé
wants to operate only those businesses about which it has some special knowledge and
expertise. Nestlé is a global company, not a conglomerate hodgepodge. We regard
acquisitions and efforts at diversification as logical ways to supplement our business, but
only in the context of a carefully considered corporate marketing policy. Nestlé is
committed to the following Business Principles in all countries, taking into account local
legislation, cultural and religious practices:
• Nestlé'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.
• Nestlé does not favour short-term profit at the expense of successful long-term
business development.
• Nestlé recognizes that its consumers have a sincere and legitimate interest in the
behaviour, beliefs and actions of the Company behind brands in which they place
their trust and that without its consumers the Company would not exist.
• Nestlé 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.
• Nestlé 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.
• Nestlé continues to maintain its commitment to follow and respect all applicable local
laws in each of its
Research and development
The Nestlé research and development centers have two main tasks: to create new
products and manufacturing processes and to improve those that already exist. These
centers play a key role in product safety and quality and also have their role in conserving
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resources and protecting the environment. Environmental concerns are an integral part of
any development process to ensure that our future commercial operations meet the
desired criteria. The Nestlé Research Center provides the scientific support needed to
prevent and solve environmental problems arising in the development groups as well as
manufacturing. In addition, studies are carried out to find new ways of using industrial
residues to create value added byproducts. This will reduce total emissions and effluents.
The Nestlé development centers prepare environmental impact studies for new products
and manufacturing processes. These cover all aspects, from raw materials, through
processing, to the final packed product. These analyses provide additional elements for
use in deciding whether to commercialize a new product, or to introduce a new or
modified process.
Foresight
At present, the world faces daunting questions about its ability to provide enough
wholesome food for everyone. Malnutrition and poor eating habits are still serious
problems in many developing countries. By 2100, the world's population will double.
Will it be possible to feed a world with so many inhabitants? At Nestlé, the big picture is
all about feeding the world and providing food and nutrition for an ever-growing
population. Our response to this situation is to intensify research, strive for innovations
and improve quality.
Flexibility and simplicity
The public's sense of the power and size of a corporation is often inaccurate, for a
company's power is limited by a host of factors including legislation, competition,
regulatory bodies and publicity. From a business point of view, it is desirable for a firm to
achieve the size best suited to a specific industry or mode of production. To be
competitive internationally and make significant investments in research and technology,
a larger company has an advantage. From a strictly organizational point of view, flexible,
simple structures work best and excessively large units should be avoided whenever
possible. In both respects Nestlé has a natural advantage: Although it is a big company, it
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is spread out over many countries and each of Nestlé's factories has its own management
and responsibility.
Handling of raw materials
The Nestlé Group is in principle not directly involved in primary production of raw
materials and other food ingredients. In general we use locally available raw materials
and purchase them either directly from producers or through existing trade channels. Raw
materials have to meet clearly established quality criteria and are checked for possible
contaminants including environmental contaminants. Our purchasing specifications
comply not only with legal requirements but go further to ensure highest safety and
wholesomeness of our products. Whenever possible we give preference to those goods
for which environmental aspects have been taken into consideration. In those cases where
the required agricultural raw materials are not available locally, but the natural
production conditions exist, we encourage local production and provide assistance for
cultivation and dairy farm management. We support plant growing and livestock
husbandry methods which:
• preserve and improve natural soil productivity and economize and protect water
resources
• allow the lowest, most appropriate and safe use of agro-chemicals
• use the least energy.
Packaging
Manufacturing comprises all unit operations necessary to transform perishable raw

materials into finished products, with the aim to make them safe and convenient for the
consumers. The manufacturing activities of the Nestlé Group:
• respect natural resources by efficient use of raw materials and energy

• minimize waste generation and emissions
• ensure environmentally safe disposal of all waste which cannot be recycled.
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Regular assessments of processing practices are carried out. These assessments include:
• evaluation of individual plant performance with regard to operations which have an

impact on the environment
• definition of targets for improvement
• review of plant compliance with local government regulations, company
environmental standards, as well as results achieved in comparison with targets for
improvement
• full investigation of incidents which may affect the environment.
Information on developments in environmental protection technology and practices is

disseminated as required to ensure that all plants are using the most effective
environmental practices for their type of processing. This applies also for co packers.
Marketing and distribution
Marketing is based on the principle of satisfying consumer needs. This is the foundation
also for the environmental marketing approach of Nestlé. Environmental product claims
in advertising, promotional material and on packaging are in accordance with legal
requirements, based on solid scientific evidence and used in a serious and reasonable
manner. Our aim is to minimize wastage in communication, publicity and promotional
material, in particular through more precise targeting of marketing activities. Consumer
promotions and merchandising material such as consumer offers, in store promotions,
display material, leaflets, printed matter, etc. take environmental aspects into account.
This means due consideration of environmental impact in selecting both materials and
printing methods. In distribution, energy efficient and pollution controlled methods are
encouraged wherever possible.
Information, communication and education
Nestlé's policy is designed to provide correct and coherent information on the activities of
the Group. Activities related to the environment benefit from the same treatment and their
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communication is secured through all currently available means inside and outside the
Group. It is furthermore Nestlé's duty to create awareness, to train and motivate
employees on their personal responsibility with regard to the protection of the
environment.
Legislation and Regulations
It is the policy of the Nestlé Group to strictly comply with all laws and regulations
relevant to our activities. We participate in discussions on food legislation and
regulations between international organizations, government representatives, industry, the
scientific world and consumer associations. We also apply this policy to environment
related matters. In doing so, we cooperate with legislators through local industry
associations in order to promote laws and regulations in the field of environment which
are reasonable, rational, realistic, applicable and enforceable. We oppose unjustified bans
and any other discriminatory measures. We favor the harmonization of food regulations
in order to remove existing trade barriers and to avoid the creation of new ones. This
applies also to environmental issues. We favor the exchange of information, of
experience and of knowledge between the various interested parties. Thanks to all these
synergies, we can contribute to valuable discussions and be recognized as an active
partner in helping authorities to formulate comprehensive strategies in the field of the
environment.
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5. NESTLE QUALITY POLICY
Everyday, millions of people all over the world show their confidence in us by choosing
Nestlé products. This confidence is based on our quality image and a reputation for high
standards that has been built up over many years.
5.1 Quality is the cornerstone of our success
Every product on the shelf, every service and every customer contact helps to shape this
image. A Nestlé brand name on a product is a promise to the customer that it is safe to
consume, that it complies with all regulations and that it meets high standards of quality.
Customers expect us to keep this promise every time. Under no circumstances will we
compromise on the safety of a product and every effort must be made to avoid hazards to
health. Likewise, compliance with all relevant laws and regulations is a must and is not
negotiable. People, equipment and instruments are made available to ensure safety and
conformity of Nestlé products at all times. The effort is worth it. Companies with huge
quality standards make fewer mistakes, waste less time and money and are more
productive. They also make higher profits. Quality is their most successful product. It is
the key to their success, today and tomorrow.
5.2 The customer comes first
Nestle want to win and keep customers: distributors, supermarkets, hotels, shopkeepers
and the final consumers. They have very different requirements. Trade customers expect
excellent service, correct information and timely delivery. Consumers consider taste,
appearance and price when they make their choice. Its task is to understand what
customers want and respond to their expectations rapidly and effectively. We serve
various groups of consumers and there is demand for products at different levels of
perceived quality and price. All customers, however, expect value for their money – good
quality at a reasonable price.
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When offering quality to customers we also mean environmental quality. Nestlé shares
society’s concern for the environment and is committed to environmentally sound
business practices throughout the world. Customers are central to their business and they
always respect their needs and preferences.
5.3 Competition
Baby food and Instant coffee are categories where brand loyalties are very strong and
Nestle is the market leader. HLL is a significant competitor to Nestle in instant coffee;
while Heinz is the main competitor in the baby foods market. The market for culinary
products, semi-processed foods such as noodles, ready mixes for Indian ethnic breakfast
and sweets, is largely an urban market. HLL and Indo Nissin Foods are the main
competitors in these product segments. Nestle has also achieved a significant 25% share
in the chocolate/confectionery market. The company has recently expanded its dairy
products portfolio to include, milk, curd and butter. The company also forayed into the
bottled water segment with the launch of its Perrier brand in the premium mineral
segment and Pure Life in the purified water segment.
5.4 Quality is a competitive advantage
We live in a competitive world and must never forget that their customers have a choice.
If they are not satisfied with a Nestlé product, they will switch to another brand. Their
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goal, therefore, is to provide superior value in every product category and market sector
in which we compete. The pursuit of highest quality at any price is no guarantee for
success, nor is a single-minded cost-cutting approach. Lasting competitive advantage is
gained from a balanced search for optimal value to customers, by simultaneous
improvement of quality and reduction cost. Success can never be taken for granted. We
must watch and learn from our competitors. If they do something better, we must
improve our own performance. We can achieve competitive advantage through Quality.
5.5 Quality is a joint effort
Operating companies are fully responsible for maintaining agreed quality standards. Not
only Production units, but also Marketing, Purchasing, Distribution and Sales have a vital
role to play in providing quality to customers. This implies a thorough knowledge of the
products and services we offer. Quality units at different levels of the organization
provide specific support, promote quality awareness, assume guardianship and audit the
system. Quality departments monitor operations against agreed standards and must
intervene in case of non-conformity. Quality policy and principles, the mandatory
standards and the recommended tools for implementation are laid down in the Nestlé
Quality System which is applicable throughout the group. Further directions are given
through instructions, norms and guidelines, often specific to a product. Our business
products, such as raw material producers, packaging suppliers, contract manufacturers
and distributors are expected to share our concern for Quality. They too must set up an
adequate quality system, so as to meet our requirements consistently. The quality efforts
must be shared by every function and department in the company as well as our business
partners.
5.6 Quality is made by people
Adequate equipment, procedures and systems are needed to make Quality; so are
involved and dedicated people. Each and every Nestlé employee must do his best to
provide quality products and services. Training and teamwork are crucial to the
successful implementation of high quality standards. Continuous training ensures that
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everyone understands his tasks and has the necessary skills to carry them out. Teamwork
allows us to achieve results that are greater than the sum of individual efforts. We
motivate employees by demonstrating management commitment to Quality, by setting
challenging goals and by giving them responsibility and recognition. It is through
employee involvement that goals and targets can be achieved in the shortest time. Quality
must be a way of life for everyone in the company.
5.7 Quality is action
Quality is the result of deliberate action. It is the responsibility of senior managers to

communicate the quality objectives and to provide the resources necessary for their
implementation. It is then up to all employees to make Quality happen throughout the
company. Progress is followed by listening to our customers and by measuring our
performance. Shortcomings and mistakes must be analyzed and corrected. Problems must
be anticipated and prevented before they occur. We also must identify and take advantage
of opportunities. To stand still is to fall behind. So we must strive for continuous
improvement in every area. It is through many small improvements as well as through
major breakthroughs that we will achieve excellence. At Nestlé, Quality is our first
priority. Let us practice it every day.
5.8 As said by Nestle:
• Quality is the foundation of our food, nutrition, Health and Wellness Company.
• A Nestle brand name on product is a promise to the customers that :
• It is safe to consume.
• It complies with all relevant laws and regulation.
• Quality is to win consumers trust and preference.
• We are committed to offering products and services to all customers that meat their
needs.
• Quality is every body’s commitment.
• Our management takes the lead, sets the objectives and demonstrates its commitment
towards quality.
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• All Nestle functions across our value chain are fully responsible to follow mandatory
norms.
• Quality is to strive for Zero defect and no waste.
• We focus on facts and results and we strive for Zero defect and excellence in every
thing we do.
• We adopt “No waste” and we constantly look for competitiveness and opportunities
for continuous improvement of the quality standards delivered to our customers.
• Quality is to Guarantee, food safety and full compliance.
• We enforce food safety, regulatory and quality requirements in every step of our
value chain.
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CHAPTER 2
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1. NESTLE PRODUCTS
Quality and nutritional value are the essential ingredients in all of the nestle’s brands.
Millions of people prefer Nestlé products every day, happy with the addition to their
wellness that they bring. If you are looking for a specific brand our product, just use the
alphabetical index below to jump straight to a listing. Or you can explore by category.
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1.1 Baby Foods
Milk based products and baby food contributes to 43% of Nestle's turnover. For ensuring
regular procurement of good quality milk, Nestle has developed a network around its
Moga factory for collection of fresh milk everyday from the farmers. Nestle has a
dominating 87% market share in the baby weaning foods with its Cerelac and Nestum
brands. Infant milk powder is sold under the Lactogen and Nestogen brands. Brand
loyalties are very high in categories such as infant food and weaning cereals, enabling the
company to command a price premium Other milk products include dairy whiteners
(21% market share) sold under the EveryDay and Tea Mate brands, sweetened condensed
milk and ready to cook mixes for traditional Indian sweets sold under the Milkmaid
brand. The company also markets ghee (6% market share) under the EveryDay brand.
Nestle has expanded its milk product portfolio with the launch of new dairy products
such as UHT milk, Curd and Butter. Huge investments are being made in building a
diversified dairy business and the distribution infrastructure for the same. Milk products
sales registered a 10.6% yoy growth .
The production of infant food goes right back to the origins of the Nestlé Company.
Henri Nestlé's 'Farine Lactée' was the first product to bear the Nestlé name.
In 1867 a physician persuaded Henri Nestlé to give his product to an infant who was very
ill — he had been born prematurely and was refusing his mother's milk and all other
types of nourishment. Nestlé's new food worked, and the boy survived. From the very
beginning, Nestlé's product was never intended as a competitor for mother's milk. In
TY BMS | 2010 – 11 28
1869, he wrote: "During the first months, the mother's milk will always be the most
natural nutrient, and every mother able to do so should herself suckle her children."
The factors that made baby foods success in the early days of the Nestlé company —
quality and superior nutritional value — are still as valid today for the wide range of
infant formula, cereals and baby food made by Nestlé. The World Health Organization
(WHO) recognizes that there is a legitimate market for infant formula, when a mother
cannot or chooses not to breast feed her child. Nestlé markets infant formula according to
the principles and aims of the WHO International Code of Marketing Breast Milk
Substitutes, and seeks dialogue and cooperation with the international health community
and in particular with the WHO and UNICEF, to identify problems and their solution.
Nestlé's expertise as the world's leading infant food manufacturer, gained over more than
125 years, is put at the disposal of health authorities, the medical profession and mothers
and children everywhere.
1.2 Chocolate & Confectionery
Nestle forayed into chocolates & confectionery in 1990 and has cornered a fourth share
of the chocolate market in the country. The category contributes 14% to Nestle s
turnover. It has expanded its products range to all segments of the market The Kitkat
brand is the largest selling chocolate brand in the world. Other brands include Milky Bar,
Marbles, Crunch, Nestle Rich Dark, Bar-One, Munch etc. The sugar confectionery
portfolio consists of Polo, Soothers, Frootos and Milkybar Eclairs. All sugar
confectionery products are sold under the umbrella brand Allen's. Nestle has also markets
some of its imported brands like Quality Street, Lions and After Eight. New launches
such as Nestle Choco Stick and Milky Bar Choo at attractive price points to woo new
consumers. Chocolate confectionery sales registered a strong 21.5% yoy growth in 2001
aided by good volume growth in Munch, Kitkat and Classic sales. Nestle relaunched Bar-
One during the year. The story of chocolate began in the New World with the Mayans,
who drank a dark brew called cacahuaquchtl. Later, the Aztecs consumed chacahoua and
used the cocoa bean for currency. In 1523, they offered cocoa beans to Cortez, who
introduced chocolate to the Old World, where it swiftly became a favorite food among
TY BMS | 2010 – 11 29
the rich and noble of Europe. Nestle forayed into chocolates & confectionery in 1990 and
has cornered a fourth share of the chocolate market in the country.. It has expanded its
products range to all segments of the market The Kitkat brand is the largest selling
chocolate brand in the world. Other brands include Milky Bar, Marbles, Crunch, Nestle
Rich Dark, Bar-One, Munch etc. The sugar confectionery portfolio consists of Polo,
Soothers, Frootos and Milkybar Eclairs. All sugar confectionery products are sold under
the umbrella brand Allen's. Nestle has also markets some of its imported brands like
Quality Street, Lions and After Eight. New launches such as Nestle Choco Stick and
Milky Bar Choo at attractive price points to woo new consumers. Chocolate
confectionery sales registered a strong 21.5% yoy growth in 2001 aided by good volume
growth in Munch, Kitkat and Classic sales. Nestle relaunched Bar-One during the year.
From the beginning, turning raw, bitter cocoa beans into what one 17th century writer
called "the only true food of the gods" has been a fine art, a delicate mixture of alchemy
and science.
1.3 Ice Cream
There are many myths and stories as to the invention of ice cream: was it Marco Polo
who brought it back from China (along with pasta)? Probably not, considering the most
likely never visited China.
The story of its popularity is however connected with the invention of technology to
make it on an industrial scale, and to keep it cold once made. Before refrigeration
techniques, food was frozen with the aid of ice, mixed with salt, which was either stored
in ice houses or shipped from cold countries. But then at the end of the 19th century, both
TY BMS | 2010 – 11 30
making and freezing it became easier, and together with the invention of the ice cream
cone, made the product boom.
Today, the United States is the absolute leader in terms of volume consumed, but the
highest per head consumers are in New Zealand. Flavours you'd never have thought of
and yet they're commercially available:
• Sorbets - Smoked Salmon, Tomato, Cucumber

• Ice Creams - Garlic, Avocado, Sweet corn.
The ice cream cone is the most environmentally friendly form of packaging. A Syrian
from Damascus, Ernest E Hamwi is credited with its invention. Apparently, during the
1904 St Louis World's Fair, his waffle booth was next to an ice cream vendor who ran
short of dishes. Hamwi rolled a waffle to contain ice cream and the cone was born.
1.4 Prepared Foods
Convenience foods — packaged soups, frozen meals, prepared sauces and flavorings —
date back more than a century. With the Industrial Revolution came factory jobs for
women and less time to prepare meals.
The problem was so widespread that it became the object of intense study in 1882 by the
Swiss Public Welfare Society, which offered a series of recommendations, including an
increase in the consumption of vegetables.
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The Society commissioned Julius Maggi, a miller with a reputation as an inventive and
capable businessman, to create a vegetable food product that would be quick to prepare
and easy to digest. The results — two instant pea soups and an instant bean soup —
helped launch one of the best known brands in the history of the food industry. By the
turn of the century, Maggi & Company was producing not only powdered soups, but
bouillon cubes, sauces and flavorings.
Maggi merged with Nestlé in 1947. Buitoni, the authentic Italian brand, which has been
producing pasta and sauces in Italy since 1827, became part of the Nestlé Group in 1988.
1.5 Beverages
Beverages like coffee, tea and health drinks contribute to about 30% of Nestle s turnover.
Beverage sales registered a 15% yoy growth . While about 14% of sales come from
Beverages domestic market, exports contribute to about 16% of sales. Nestle's Nescafe
dominates the premium instant coffee segment. Nestle s other coffee brand Sunrise has
also been relaunched under the Nescafe franchise to leverage on the existing equity of the
brand. Nestle has focused on expanding the domestic market through price cuts and
product repositioning. However it has been losing share in the domestic market, where it
has a 37% market share. Milo, a brown-malted beverage was launched in 1996. It has an
estimated volume share of about 3% in the malted food drink segment. Nestle has
launched noncarbonated cold beverages such as Nestea Iced Tea and Nescafe Frappe
during 2001. Nestle is one of the larges coffee exporter in the country. Key export market
is Russia, besides Hungary, Poland and Taiwan.
TY BMS | 2010 – 11 32
Nestlé’s Nescafe dominates the premium instant coffee segment. Nestle’s other coffee
brand Sunrise has also been relaunched under the Nescafe franchise to leverage on the
existing equity of the brand. Nestle has focused on expanding the domestic market
through price cuts and product repositioning. However it has been losing share in the
domestic market, where it has a 37% market share. Milo, a brown-malted beverage was
launched in 1996. It has an estimated volume share of about 3% in the malted food drink
segment. Nestle has launched non-carbonated cold beverages such as Nestea Iced Tea
and Nescafe Frappe during 2001. Nestle is one of the largest coffee exporter in the
country. Key export market is Russia, besides Hungary, Poland and Taiwan.
1.6 Timelines for launches
1866 Foundation of Anglo-Swiss Condensed Milk Co.

1867 Henry Nestlé's Infant cereal developed
1905 Nestlé and Anglo Swiss Condensed Milk Co. (new name after merger)
1929 Merger with Peter, Cailler, Kohler Chocolates Suisses S.A.
1934 Launch of Milo
1938 Launch of Nescafé
1947 Nestlé Alimentana S.A. (new name after merger with Maggi)
1948 Launch of Nestea and Nesquik
1969 Vittel (initially equity interest only)
1971 Merger with Ursina-Franck
1973 Stouffer (with Lean Cuisine)
1974 L'Oréal (associate)
1977 Nestlé S.A. (new company name)
Alcon (2002: partial IPO; 2008: partial sale)
1981 Galderma (joint venture with L'Oréal)
1985 Carnation (with Coffee-mate and Friskies)
1986 Creation of Nestlé Nespresso S.A.
1988 Buitoni-Perugina, Rowntree (with KitKat)
TY BMS | 2010 – 11 33
1990 Cereal Partners Worldwide (joint venture with General Mills)

1991 Beverage Partners Worldwide (joint venture with Coca-Cola)
1992 Perrier (with Poland Spring)
1993 Creation of Nestlé Sources Internationals (2002: Nestlé Waters)
Creation of Nutrition Strategic Business Division (2006: Nestlé
1997
Nutrition)
1998 San Pellegrino and Spillers Petfoods
Launch of Nestlé Pure Life
2000 PowerBar
2001 Ralston Purina
2002 Schöller and Chef America
Dairy Partners Americas (joint venture with Fonterra)
Laboratoires innéov (joint venture with L'Oréal)
2003 Mövenpick and Dreyer's
2005 Wagner, Protéika and Musashi
Creation of FoodServices Strategic Business Division (2009: Nestlé
2006
Professional)
Lactalis Nestlé Produits Frais (associate)
Jenny Craig, Uncle Tobys and Delta Ice Cream
2007 Novartis Medical Nutrition, Gerber and Henniez
2009 Vitality Beverage business
2010 Kraft Pizza
2. COMPETITIVE ANALYSIS
Competitive analysis, as the name implies, is an exploration of the companies in a given
industry sector or market niche that are competing with your company s products or
services for market share. The analysis may be an in-depth exploration of the top five
competitors, or a larger number of competitors could be examined (typically with less
depth in the analysis). In most cases, the client will have identified the target competitors
for you. While this project focuses on competitive analysis in the for-profit arena, it is
worth noting that non-profit organizations can benefit equally from this analysis (which
they might term a comparative analysis, if they viewed the other organizations as
working toward a common goal with them).
2.1 Understand the competition
TY BMS | 2010 – 11 34
The primary benefits of any competitive analysis are a better understanding of what your
competitors are doing, what they are offering to customers, and how to maintain your
competitive advantage. The findings from this analysis are likely to factor strongly into
your own company s strategic planning. However, this is definitely not the only take-
away from the process of analyzing competitors. The analysis offers information about
content and functionality that they have probably not considered. This is especially true
for newcomers to your industry and should be fairly common; not everyone will be a
subject matter expert. Looking longer-term, this educational process benefits not only the
current project, but also any future project in that same industry.
Doing this project has really enhanced my performance for the next project ever will be
held in my career. It has given me the practical exposure while working in such
competitive market
3. DISTRIBUTION NETWORK OF NESTLE INDIA LTD
TY BMS | 2010 – 11 35
3.1 Description Of Distribution channel
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Nestle India Limited is the primary company in India involved in the production of food
products. It is very prestigious company its food products are regarded as quality food.
Nestle India Limited has a wide distribution network operating on a national basis. The
various channels of physical distribution for nestle are Mother Godown. Clearing and
Sales Agents, Cash Distributors and Retailers(outlets) .
3.2 Mother Godowns

This is the first line agent in the distribution network for channels.Stocks are moved on
consignment basis from the main factory to the different regions. These Mother godowns
are the transshipment points. Nestle enters into a contract with the mother godownns.
These agents in the form of mother godowns are given at flat fees by the principal
company i.e. Nestle.
3.3 Clearing and Sales agents ( C & S )

These are the second line agents in the distribution channel. Clearing & Sales agents
generate invoice on the basis of the requirement of the cash distributors. Once the invoice
is generated by C&S agents and communicated to Mother Godown then stocks are
released by mother godown to C&S.
3.4 Distributors
These are the third line agents in the distribution network. They are regarded as business
partners by the company. The distributors send orders to C&S agents on weekly basis.
The C&S Agents generate invoice, get the stock from mother godown & supply them to
the distributors. Nestle never provides goods to cash distributors on credit. Distributors
have to pay directly to the company by demand draft or cheque. Distributors has to work
within the overall guidelines provided by the Company.
3.5 Retailers
This are the fourth final line agents in the distribution network. Categories of the retailers
are the following:-
1. Wholesellers
TY BMS | 2010 – 11 37
2. grocery shop also called (Kirana shop)

3. Medical shop
4. Non-conventional outlets like panwalas
The distributors are responsible for the collection of money from the retailers. The
retailers are not at the direct linkage with the principle company, i.e. Nestle retailers are
link up with distributors.
TY BMS | 2010 – 11 38
CHAPTER 3
1. SWOT ANALYSIS
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Nestle India Limited is the Indian arm of Nestle SA, which holds a 51% stake in the
company. It is one of the leading branded processed food companies in the country with a
large market share in products like instant coffee, weaning foods, instant foods, milk
products, etc. It also has a significant share in the chocolates and other semi-processed
foods market.
Nestlé's leading brands include Cerelac, Nestum, Nescafe, Maggie, Kitkat, Munch and
Milkmaid, confectionery. To strengthen its presence, it has been the company's
endeavour to launch new products at a brisk pace and has been quite successful in its
launches.
1.1 Strengths:
Parent support - Nestle India has a strong support from its parent company, which is the
world’s largest processed food and beverage company, with a presence in almost every
country. The company has access to the parent’s hugely successful global folio of
products and brands.
Brand strength - In India, Nestle has some very strong brands like Nescafe, Maggi and
Cerelac. These brands are almost generic to their product categories.
Product innovation - The Company has been continuously introducing new products for
its Indian patrons on a frequent basis, thus expanding its product offerings.
1.2 Weakness:
Exports – The company’s exports stood at Rs 2,571 m at the end of 2003 (11% of
revenues) and continue to grow at a decent pace. But a major portion of this comprises of
Coffee (around 67% of the exports were that of Nescafe instant to Russia). This
constitutes a big chunk of the total exports to a single location. Historically, Russia has
been a very volatile market for Nestle, and its overall performance takes a hit often due to
this factor.
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Supply chain - The Company has a complex supply chain management and the main
issue for Nestle India is traceability. The food industry requires high standards of
hygiene, quality of edible inputs and personnel. The fragmented nature of the Indian
market place complicates things more.
1.3 Oppurtunities:
Expansion - The Company has the potential to expand to smaller towns and other
geographies. Existing markets are not fully tapped and the company can increase
presence by penetrating further. With India's demographic profile changing in favour of
the consuming class, the per capita consumption of most FMCG products is likely to
grow. Nestle will have the inherent advantage of this trend.
Product offerings - The Company has the option to expand its product folio by
introducing more brands which its parents are famed for like breakfast cereals, Smarties
Chocolates, Carnation, etc.
Global hub - Since manufacturing of some products is cheaper in India than in other
South East Asian countries, Nestle India could become an export hub for the parent in
certain product categories.
1.4 Threat:
Competition - The Company faces immense competition from the organised as well as
the unorganised sectors. Off late, to liberalise its trade and investment policies to enable
the country to better function in the globalised economy, the Indian Government has
reduced the import duty of food segments thus intensifying the battle.
Changing consumer trends - Trend of increased consumer spends on consumer durables

resulting in lower spending on FMCG products. In the past 2-3 years, the performance of
the FMCG sector has been lacklustre, despite the economy growing at a decent pace.
Although, off late the situation has been improving, the dependence on monsoon is very
high.
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Sectoral woes - Rising prices of raw materials and fuels, and inturn, increasing packaging
and manufacturing costs. But the companies’ may not be able to pass on the full burden
of these onto the customers.
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2. PEST ANALYSIS
2.1 Political or legal forces

Taxation Law
If government imposes heavy taxes on the industry then it badly effects the industry
growth. The taxes impose is from government side and it varies from industry to industry.
Juices have no tax except sales tax. But nestle’s some product has like butter and cream
which has more taxes
Labor Laws
Labor is being privileged here having all the laws. Nestle company also follow these law
like government announce minimum salaries of a employ Rs 6000.
Laws on hiring & promotions

Hiring & promotion is followed by law. People with better capabilities are privileged
because they deserve it, for the betterment of the organization. As well as a well educated
& skilled experienced person is a precious asset for the company suit should be hired on
better term & conditions and be promoted on the basis of it capabilities.
Environmental protection Laws

They do concern for environment and contribute more and more for the betterment of
environment.
Foreign trade Regulations

Foreign trade regulation does not effect the over all policy and the working of the “Nestle
juices” because they operate nationally not internationally.
Attitudes towards foreign companies

They have no any agreement with any foreign company but if any company will offer the
business to them related / unrelated they would think about it according to terms and
conditions.
TY BMS | 2010 – 11 43
Political instability
The government stability also plays a great role for any industry. In Pakistan government
face lot of difficulty from the side of terrorism and also its activity that badly effect
environment of the country which is totally very upset. Recently in Punjab instability of
government creates lot of problem for the industry like shortage of electricity that badly
affects the industry operational process. Nestle juices have not much affect this condition
but in future it may be face some difficulty for operating.
2.2 Economic forces
Inflation Rate
Now in Pakistan inflation rate is almost 22.3% so if increase in inflation rate then
ncrease in prices of Nestle JUICES but if in Pakistan economy.
Economic growth rate

Economy growth rate accelerate is 7+
2.3 Social factor

Health consciousness
Today people are more health conscious so Nestle juices by identifying this need of the
people they are also producing health conscious juices with more vitamins.
Demographic trend
In Pakistan the population growth rate is 1.828% in 2008 and total population is
167,762,040 (July 2008 est)
Age structure
• 0-14 years: 40% (male 33,293,428; female 31,434,314)

• 15-64 years: 56.9% (male 48,214,298; female 46,062,933)
• 65 years and over 4.1% (male 3,256,065; female 3,542,522)
Key Indicators
• Population: 164,741,942 (July 2007 est.)
TY BMS | 2010 – 11 44
• Growth rate: 1.828% (2007 est.)

• Birth rate: 27.74 births/1,000 population (2007 est.)
• Death rate: 8 deaths/1,000 population (2007 est.)
Environmental concerns:
About the environmental concerns of Nestle juices is good health.
Work life quality:

Quality of work life is very safer & environment friendly
Lifestyle changes:
They consider quality life changes and take advantages of accordingly so that customer
can convinced as well as it plays a vital role to attain & retain the customer. Consumer
adopts the trend of changing environment because of modern facility as well as
globalization they are aware about each and every thing happening all around them.
2.4 Technological forces

New Products
Nestle juices focusing concentric and conglomerate diversification because in present era
it is not possible for any organization to exist in market for long run by providing just one
product. So Nestle juices are diversifying according to changing demand of customers
and trends.
Product innovation
Product innovation is becoming more necessary for the organization because of
globalization people are becoming aware about the changes being taken place around
them so in order tactical the situation nestle juices is focusing on product innovation by
introducing new flavor of juices with the passage of time NESTLE JUICES use new tetra
packing like easy open cork of pack.
Productivity improvement through automation
TY BMS | 2010 – 11 45
Automation don’t matter a lot but to some extent it contribute towards productivity and
improvement. Imported pulp is filled in machines for processing after the final form of
juice it is packed in 250 and 1 liter packing.
Total spending on R&D

Spending on R&D is long term investment for any organization. Nestle has R&D
department and head of R&D department is Mr Arshad Bhati. Nestle total spending on
R&D 70 millions.
New communication technology

All the modern as well as traditional ways of communication are being adopted by
Nestle juices including own emails, letters, faxes and monthly visit in different offices of
Nestle juices for better communication among supplier, distributor and customers. Nestle
juices has also established own web site which can be visited any one for most recent
news innovation and activities being taken in the organization.
TY BMS | 2010 – 11 46
CHAPTER 4
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1. RESEARCH METHODOLOGY
I have carried out a research which is both qualitative and quantitative in its support. The
qualitative approach applies to both, descriptive and inductive forms of research. While
as in case of quantitative approach, an extensive use has been made of the literature
available to carry out a detail research on the nature of the problem. I have chosen Nestle
as the target company for my research study.
1.1 Method of data collection & analysis

The data, after collection, has to be processed and analyzed in accordance with the
outline laid down for the purpose at the time of developing the research plan. This is
essential for a scientific study and for ensuring that we have all relevant data for making
contemplated comparisons and analysis. I have conducted a graphical analysis based on
the responses received from the persons questioned and interviewed. Once the interview
was over, the responses received were be grouped together, and a graphical presentation
and analysis has been made for every set of questions.
1.2 Nature of data

I have made use of both, the primary sources and the secondary sources of data in
eliciting information.
1.3 Primary data:

The primary source of data involves oral interviews and questionnaires. These sources
are inadvertently expected to yield more qualitative data and results.
SAMPLE SIZE: 100
SURVEY AREA: Mumbai
1.4 Primary data collection methods

Interviews:
I have conducted oral interviews with retailers of Nestle. In considering an oral interview
of such a nature, a follow up and step by step approach was adopted in getting through
TY BMS | 2010 – 11 48
the interviewees. The oral interview involved a set of well thought out questions that
were asked and the responses there on noted as a basis for analysis. Subsequently a
graphical analysis has been made based on the responses received from the persons
questioned and interviewed.
Secondary data collection method

The secondary source of data includes relevant literature including periodicals and
journal articles in the areas of Marketing, customer satisfaction.
1.5 Objective of the study

Primary Objective:
• To find out sales volume of Nestle Confectionary vis-à-vis competitor
• To find out the major Nestle competitors
• Suggestion for the company from retailers
Secondary Objective:
• To increase their market share by approaching to retailers who prescribe competitor’s

product.
• To have a good image in the eyes of retailers.
1.6 Limitations
The only limitation in this survey was that I could not conduct a survey on a big scale,
due to the time constraint.
TY BMS | 2010 – 11 49
1.7 Data analysis and interpretations:
Q.1 Name the confectionery brands you stock at your outlet?
Nestle Cadbury Parle Dabur Perfetti Others

60 55 40 20 70 15
Bran
d
Availability in Retailers out of 100

• Retailers have number of brands in their store.
• Perfetti is on the top most preferred brand among the Retailers.
• Nestle is also on the handsome position but Perfetti is more famous among the
Retailers.
• The Main competitors over the market are Perfetti & Cadbury.
TY BMS | 2010 – 11 50
Q.2 Name and rank the top five brands you stock at your outlet?
Nestle Cadbury Parle Dabur Perfetti Others

55 50 30 15 65 10
These brands are taken on the basis of top five brands stock at the outlets.
• Supported by this chart Perfetti is on the top most position by 65 out of 100 Retail
stores.
• Other players are also on the strong position as Nestle is on the 2nd position covered
area by 55 out of 100.
• To cater this market Nestle have to provide some value added service to his retailers.
TY BMS | 2010 – 11 51
Q.3 Please tick the Nestle Brands you stock at your outlet? (Tick Please)
Éclairs 50p V.A. Éclairs POLO

75 85 60
Availability of Nestle confectionery Item in the retail stores

• According to this chart V.A éclairs is on top most position 85 out of 100 retail stores.
• Éclairs 50p is also having a good market but due to the same taste of V.A éclairs the
most retailers prefer that.
• Polo has also good market share but due to the limited preference by customer
retailers prefer less in competition of others.
TY BMS | 2010 – 11 52
Q.4 Please rank the Nestle Brands according to their sales?
Éclairs .50 V.A. Éclairs POLO

40 65 55
Rank of the Nestle Brands according to their sales

• As written on the previous chart V.A.Eclairs is the top most preferred brand among
the retailers.
• 65 retailers out of 100 are shown their preferences to the V.A.Eclairs .
• Polo is also 2nd position among the retailers with 55 out of 100.
• Eclairs.50 has also the beautiful market in this confectionary segment with 40 out of
100 retailers.
Q.5 What percent of stock at your outlet is Nestle?
TY BMS | 2010 – 11 53
Nestle Others
20% 80%
Percentage of Nestle and other competitor brand

• The availability of Nestle in confectionary item is only 20% but number of players is
very high so that we have the result that in this confectionary segment Nestle has very
powerful market.
• Others players are Cadbury, Dabur, Perfetti, Parle, ITC. They together covered other
75% market.
• There are also some small players which covered other 5% of market.
• To cater more market company have to provide some value added service as well as
have to give some schemes among the retailers.
Q.6 What percent of total sales is Nestle at your counter?
TY BMS | 2010 – 11 54
Nestle Cadbury Parle Perfetti

Percentage sales
of confectionery 31% 21% 14% 34%
Percent of total sales at counters

• Perfetti is on the top most preferred brand among the Retailers by holding 34% of
overall market.
• Nestle is also on the handsome position with holding 31% of overall market.
• The Main competitors of Nestle over the market are Perfetti & Cadbury.
Q.7 From where do you procure Nestle Confectionery?
Distributor Wholesalers
TY BMS | 2010 – 11 55
96% 4%
• 96% retailers are procuring Nestle Confectionery from Distributor and only 4%
procure Nestle Confectionery from Wholesalers. That’s show the effective Supply
chain management of Nestle.
• Due to effective supply chain management Nestle cater very huge market of retailers.
Q.8 Which are the seasons for maximum sales?
Summer Winter
45% 55%
TY BMS | 2010 – 11 56
Sales of Nestle Product season wise

• Supported by this graph a very interesting finding is occur that 55% retailers are
shown his interest to make us understand that winter is more prefer time to sail nestle
Product. But 45% are also exist there who said that summer is very special to sail
nestle product .But there is no specific reason fine out.
Q.9 (a) Do Customers (Retailers) prefer Nestle Confectionery to other brands?

(Yes/No)
Yes No
70% 30%
TY BMS | 2010 – 11 57
Preference of Nestle Brand compression to others

• As we stated previously that Nestle have good market. Most of retailers stated that
they prefer Nestle Confectionery sail in comparison to other brands. The percentage
of preferred retailers is approximately 70%.and other who don’t prefer Nestle brand is
only 30%.
Q.10 (b) Do Customers (Retailers) prefer Nestle Confectionery to other brands?

(Yes/No) Why?
Price Quality Of Product Schemes Variety

55 20 60 45
TY BMS | 2010 – 11 58
Reason to prefer Nestle Brand

• Main reason to have Nestle Confectionery brand among the retailers is Schemes.
Most of the retailers have this brand due to schemes and price & quality of the
products.
• Very effective price and quality are affected to absorb that Nestle Confectionery
product among the retailers.
Q.11 (a) Do you prefer to sell Nestle Confectionery over other Brands? (If Yes/No
Why)?
Yes No
85% 15%
TY BMS | 2010 – 11 59
• Main reason to have Nestle Confectionery brand among the retailers is Schemes.
Most of the retailers have this brand due to schemes and price & quality of the
products and approximately 85% are prefer to sail nestle product.
• Very few, approximately 15% are not preferred to sail Nestle product.
• Very effective price and quality are affected to absorb that Nestle Confectionery
product among the retailers.
Q11. (b) Do you prefer to sell Nestle Confectionery over other Brands? (If Yes/No
Why)?
Promotional
Margin Schemes Demand Variety
60 45 55 20
TY BMS | 2010 – 11 60
Reason to sell Nestle Confectionery

• Main reason to sell Nestle confectionery over other brands is the schemes provided
by the company over other brands.
• Sometimes the company provides the schemes which are very preferable to the
Retailers.
Q.12 Do you face any problem while selling Nestle Confectionery to customers?
Yes No
15% 85%
TY BMS | 2010 – 11 61
Facing any problem while selling confectionery

• 85% of Retailers are said that they never face any kind of problem while sailing
Nestle product to the consumer, but 20% are also said that they had faced some
problem while sailing Nestle product. That shown the image of Nestle among the
retailers is very effective.
Q.13 Do you face any problem with Nestle India Limited?
Yes No
20% 80%
TY BMS | 2010 – 11 62
Facing any problem with Nestle India ltd.

• 80% of Retailers are said that they never face any kind of problem to having Nestle
product in their store, but 20% are also said that they had faced some problem while
sailing Nestle product. That shown the image of Nestle among the retailers is very
effective.
Q.14 Will you recommend Nestle Confectionery to customers?
Yes No
85% 15%
TY BMS | 2010 – 11 63
%age of Retailers who want to recommend Nestle Confectionery among the

customers
• Supported by chart 85% retailers are very much satisfied with the process of Nestle.
they also want to recommend nestle product among the consumer.25% of also there
who don’t want to recommend Nestle product.
Q.16 Please rate the performance of Nestle Confectionery on the basis of following
features? Numbers from 1 to 6 is Very Low to Extremely High.
Promotional Understands
Price Product Quality Scheme Variety Customers
3 5 4 4 5
TY BMS | 2010 – 11 64
Credibility of Promptness in
Nestle Margins Demand Delivery Advertisement
6 3 4 3 3
• These performances are calculated on the basis of ranking from very low to extremely
high.
• In which credibility of Nestle is given the extremely high ranking by 55 retailers out
of hundred.
Q.17 Please rank the following according to your preference what you think is most
important for customers while buying confectionery? Numbers from 1 to 6 is Most
Important to Least Important.
Quality Of Promotional
Price Product Brand Name Scheme Margins
3 1 2 4 3
TY BMS | 2010 – 11 65
• In this case Quality of the Product has given the Rank 1 i.e. Most Important. Whereas
least important is given to no other thing.
2. RESULTS AND FINDINGS

Analysis is done on the basis of:-
 Price of the Product
 Quality of the Product
 Brand Name
 Taste
 Schemes and Margins provided by the company.
TY BMS | 2010 – 11 66
• Perfetti is the market leader in comparison to its competitors and the major
competitors are Cadbury, Nestle, Parle and Dabur.
• These products are mostly sold on the Promotional Schemes provided by the
company. Such as Nestle Éclairs Dino Pack worth Rs.25
• These Promotional Schemes attract many customers which increases the sales of
the product offered by the company.
• Only one part where the company is lacking is the schemes provided to the
retailers. The retailers are not satisfied with the schemes provided by the company as
compared to the competitors.
• Somewhere and somehow in some of the jars the schemes provided by the
company is satisfactory for the retailers.
• On the other hand retailers are happy to sell these products to the customers
because of the demand whereas the taste and different varieties of product offered by
the company.
• Nestle confectionery is provided at different prices such as 50p Éclairs, V.A.

Éclairs, Rs.2 POLO and Rs.5 POLO. So customers can buy any range products.
• The company manufactures the product by understanding the customer needs and
demands.
• Whereas the Credibility of Nestle is extremely high in the eyes of the customers.
• Demand of the product is also high because of the Brand Name, Promotional
Schemes, Variety and taste of the product.
• The quality of the product provided by the company is shown by the high sales of
the goods which we have already done and mentioned.
TY BMS | 2010 – 11 67
3. RECOMENDATIONS
Points where company should pay attention and are reason where
should they overcome: -
• Whole sell market: - Prices of products in the whole sell market is less then
company so kirana stores, medical stores and panwalas buy products from whole sell
according to their need and demand. For ex. MRP of Éclairs is Rs.60 then its Cost
TY BMS | 2010 – 11 68
Price is Rs.47 in whole sell and Rs.50 in company. To overcome this problem it is
necessary the company provides schemes and replacement offer to the shopkeepers.
• Melting Problem: - Chocolates get melt in summers due to high temperature so

shopkeepers who do not have cooling system are not ready to buy chocolates. So it is
necessary to sell more of the confectionery items in summer because it never melts
during summer.
• Jo dikhata hai wahi bikta hai: - Company should provide posters banners etc. by
which shopkeepers make costumers aware that he sell chocolates and confectionery
of Nestle. This problem comes mainly in potentially low markets like Gokalpuri and
Bhajanpura etc.
• Some of the markets need more focus are: - Gokalpuri, Bhajanpura, Zafrabad etc.
These markets are potentially low markets where sell of Branded Confectionery are
very low. And they buy from whole sell if required. It is necessary to provide
incentives to the Sales Man by providing at least 2 jars of confectionery in each shop.
• Salesmen concentrate mainly on confectionary to be sold on kirana, bakeries, and

medical stores and shows no attention on small shops.
• Sales men’s visit problem: - SM were dealing only those counters which are
potentially efficient, normally regular in payments. They used to open only those new
counters which are potentially efficient and ready to deal 3 to 4 initial dealings in
cash.
• Some of the shops which are small and near to big bakeries and confectionaries do
not sell products due to low sale.
TY BMS | 2010 – 11 69
• Shops which are near to schools and colleges usually keep less of the chocolates and
confectionery when schools and colleges are closed.
TY BMS | 2010 – 11 70
CHAPTER 5
5. CONCLUSION
First of all, I would like to say that it was a real interesting experience because it was the
first time in my schooling that I work on a project which seems to be professional.
However, I met many technical difficulties. Indeed, it was really difficult to be creative at
each time and to find more and more information about the candies. During the project, I
got an enriching experience about selling and how to convince the customer to buy the
product or to win an order. Study on world’s one of the top FMCG company like Nestle
gave me practical experiences about nature of consumers, market and how to deal
TY BMS | 2010 – 11 71
customers in the practical life in a market. It was for the first time when I was in the
market to deal with the customers and company like Nestle gave me great exposure about
the markets, nature of markets, nature of customers and how to deal with the customers.
6. BIBLIOGRAPHY
6.1 Books:
• C.R.Kothari Research Methodology
• Philip Kotler Marketing
• Marketing Management - By - Philip Kotler
• Financial Reports - Nestle India Ltd
6.2 Web Sites:
TY BMS | 2010 – 11 72
• www.iloveindia.com
• www.google.com
• www.nestle.com › Media
• wikipedia.org/wiki/Nestlé
• www.foodanddrinkeurope.com
• www.foodnavigator.com
• www.Google.com
• www.shareinfoline.com
• Ask.com
• sharekhan-firststep.com
7. ANNEXURE
Questionnaire – Retailers
Name of the Retail Outlet :
Location of the Outlet :
Please read the following questions carefully and answer appropriately.
1. Name the Confectionery Brands you stock at your outlet.

_______________________________________________________________
TY BMS | 2010 – 11 73
2. Name and rank the top 5 brands at your outlet.(according to Sales)

_______________
_______________
_______________
_______________
_______________
3. Please tick the Nestle brands you stock at your outlet. (Tick please)
Éclair 50p
V.A. Éclairs
POLO
4. Please rank the Nestle brands according to their sales.

Éclair 50p
V.A. Éclairs
POLO
5. What % of stock at your outlet is Nestle (no of cases)?

______________
6. What % of Total Sales is Nestle in your counter –
7. From where do you procure Nestle Confectionery? (Tick please)

Distributor
Wholesalers
8. Which are the seasons for maximum sale (Tick please).

Summers
Winters
Others: ________________________________________________________
9. What is the expected traffic at your outlet? (No. Of customers per day)
______________
10. Do customers prefer Nestle Confectionery to other brands (If Yes / No, Why)?
(Tick please)
Price
Quality of product
Schemes
Variety
TY BMS | 2010 – 11 74
11. Do you prefer to sell Nestle Confectionery over other brands (If Yes / No, Why)?
(Tick please)
Margins
Promotional Schemes
Demand
Variety
12. Do you face any problem while selling Nestle confectionery to customers?
_______________________________________________________________
13. Do you face any problem with Nestle India Limited?

_______________________________________________________________
_______________________________________________________________
14. Will you recommend Nestle Confectionery to customers? (Tick please).

Yes No
Why ___________________________________________________________
15. Any Recommendations.

_______________________________________________________________
_______________________________________________________________
16. Please rate the performance of Nestle Confectionery on the basis of following
features. (Please circle the response number that best describes how NESTLE has
performed on that feature.) For any feature(s) that you feel is (are) not relevant to
your evaluation, please circle (NA)
(6 – Extremely High, 5 – Very High, 4 – High, 3 – Adequate, 2 - Low, 1 – Very Low)
a) Price (NA) Extremely High 6 5 4 3 2 1 Very low

b) Product Quality (NA) Extremely High 6 5 4 3 2 1 Very low
c) Promotional schemes (NA) Truly Satisfied 6 5 4 3 2 1 Totally
Dissatisfied
d) Variety (NA) Extremely High 6 5 4 3 2 1 Very low
e) Understands Customer (NA) R. Understands 6 5 4 3 2 1 No Clue
f) Credibility of Nestle (NA) Extremely High 6 5 4 3 2 1 Very low
g) Margins (NA) Extremely High 6 5 4 3 2 1 Very low
h) Demand (NA) Extremely High 6 5 4 3 2 1 Very low
i) Promptness in Delivery (NA) Extremely Quick 6 5 4 3 2 1 Very Slow
j) Advertisements (NA) Extremely High 6 5 4 3 2 1 Very low
17. Please rank the following according to your preference what you think is most
important for customer while buying confectionery from 1 to 6. (1 – Most important
& 6 – Least important)
TY BMS | 2010 – 11 75
a. Price
b. Quality of Product
c. Company / Brand Name
d. Promotional Schemes
e. Margins
TY BMS | 2010 – 11 76

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NESTLE: GOOD FOOD, GOOD LIFE

“NESTLE: GOOD FOOD GOOD LIFE”

THE BACHELOR OF MANAGEMENT STUDIES

UNDER THE GUIDANCE OF

CHINAI COLLEGE OF COMMERCE AND ECONOMICS

_________, MUMBAI – 4000____

ACADEMIC YEAR 2010 - 2011

I FURTHER DECLARE THAT INFORMATION SUBMITTED BY ME IS TRUE

I FURTHER CERTIFY THAT THE INFORMATION SUBMITTED IS TRUE AND

Name of the guide

I EXPRESS MY SINCERE THANKS TO MISS ______________FOR HER

I WISH TO TAKE THE OPPORTUNITY TO EXPRESS MY DEEP SENCE OF

FINALLY IT IS THE FOREMOST DUTY TO THANK ALL MY RESPONDENTS,

Name of the student

2.1 Profile of the company

The Company's strategy is guided by several fundamental principles. Nestlé's existing

Nestle was promoted by Nestle Alimentana, Switzerland, a wholly owned subsidiary of

2.3 Company Mission

2.4 Company Vision

2.5 Plant locations

2.6 Business of the Nestle

The Company’s strategy will continue to be guided by several fundamental principles.

• Nestlé's business objective is to manufacture and market the Company's products in

Research and development

Flexibility and simplicity

Handling of raw materials

Manufacturing comprises all unit operations necessary to transform perishable raw

• respect natural resources by efficient use of raw materials and energy

• evaluation of individual plant performance with regard to operations which have an

Information on developments in environmental protection technology and practices is

Marketing and distribution

Information, communication and education

Legislation and Regulations

5. NESTLE QUALITY POLICY

5.1 Quality is the cornerstone of our success

5.2 The customer comes first

5.4 Quality is a competitive advantage

5.5 Quality is a joint effort

5.6 Quality is made by people

5.7 Quality is action

Quality is the result of deliberate action. It is the responsibility of senior managers to

5.8 As said by Nestle:

1.1 Baby Foods

1.2 Chocolate & Confectionery

1.3 Ice Cream

• Sorbets - Smoked Salmon, Tomato, Cucumber

1.4 Prepared Foods

1.6 Timelines for launches

1866 Foundation of Anglo-Swiss Condensed Milk Co.

1990 Cereal Partners Worldwide (joint venture with General Mills)

2.1 Understand the competition

3. DISTRIBUTION NETWORK OF NESTLE INDIA LTD

3.1 Description Of Distribution channel

3.2 Mother Godowns

3.3 Clearing and Sales agents ( C & S )

2. grocery shop also called (Kirana shop)

Changing consumer trends - Trend of increased consumer spends on consumer durables

2.1 Political or legal forces

Laws on hiring & promotions

Environmental protection Laws

Foreign trade Regulations

Attitudes towards foreign companies

_____, MUMBAI – 4000