PRESENTED BY

MD ABRAR MULLA(16MBA086)
MOHAMMED MUZZAFFER(16MBA089)
MOHAMMED NIZAMUDDIN BASHA(16MBA090)
COMPANY PROFILE
 INDUSTRY : Food Processing
 FOUNDED : 1866
 FOUNDER : Henri nestle, Charles Page, George Page
 HEADQUATER : Switzerland
 PRODUCTS : Baby food, Coffee, Dairy Products, Ice
Cream, etc………
 REVENUE : 89.46 Billion(2016)
 NO OF EMPLOYEES: 335000
Porter’s Five Forces Model of FMCG industry
Porter’s Five Forces Model
1. Threat of New Entrants
• If the market is attractive the new entrants would always be a threat for the company but
if the market has been restricted to a limited resource and it has very few areas of
improvement so it becomes difficult for new entrants to get into the market
• Although Nestle has accomplished a strong name in the market but as the food
processing industry is very huge and viable
• a lot of companies who already entered in this market and somehow achieved a place in
the market even though they could not cross Nestle in terms of market share.
• Nestle has been the leader of market for a century almost so now it has become a very big
challenge for the new entrants
 Threat of Substitute Goods
• Substitutes have always been in line whenever we talk about products market, every kind
of product has a substitute present which leads it to the heights of competition when
taken seriously.
• As the product is very common and daily use product so the threat of substitutes is very
high here.
• Like if we take the example of meggi
• So Nestle has to innovate its products tremendously to stay in the market and to work
efficiently for removing the threat of substitutes
 Bargaining Power of Suppliers
• Nestle is known for strong relations with the suppliers around the globe due to its
immense buying power and also because of the fact that in such dairy and agricultural
products quality is always important.
• Additionally, Nestlé also presents helpful guidance to its suppliers on how to work more
proficiently to decrease redundant expenses. And thus it cares of its suppliers which I
return pays them off in the form of quality products.
 Bargaining Power of Customers
• . Customers carry huge quantity of bargaining power concerning their utilization of
different Nestlé products. Although a lot of substitute products and competitors Nestle
customers have very influential choices but still the quality that has been maintained by
Nestle has made it very successful among the users
• Nestle always cares about and that is reflected in Nestle health and wellness programs
that ar being used wile creation of new products as society has in progress of becoming
more health conscious.
 Competitive Rivalry within the Industry
 Competition if healthy would bring huge success but if negative would destroy the whole
industry so it should be critically analyzed for better future of the company
 Nestle has a very strong position in the food processing industry but few major rivals do
exist in the industry like Kraft Foods and GroupeDanone.
 Competition is violent in the food processing industry, and this is a plus point for
consumers. Provided that these companies carry on in competing with each other,
consumers will persistently enjoy improving product qualities.
EFAS(EXTERNAL FACTOR ANALYSIS SUMMARY)
IFAS (INTERNAL FACTOR ANALYSIS SUMMARY)
SFAS(STRATEGIC FACTOR ANALYSIS SUMMARY)
SWOT ANALYSIS OF NESTLE
STRENGTHS
 Unmatched research and development capability
 Strong geographic presence, with one of the best
geographically diversified revenue sources
 Unrivalled product and brand portfolio
 Environmental sustainability efforts
 Ownership of some of the most recognizable brands in
the world
WEAKNESSES
 Criticism over high water usage, selling contaminated
food, anti-unionism, forced child labour and using
other unethical practices
 Contaminated food recalls
OPPORTUNITIES
 Clear and accurate labelling indicating of any harmful
products
 Transparency in material sourcing
 Growing number of small Silicon Valley based food
start-ups
 Growing ready-to-drink (RTD) tea and RTD coffee
markets
THREATS
 Poor quality water and its scarcity
 Increased competition in the beverage and food
industries
 The price of coffee beans could significantly rise due to
major weather disasters
STRATEGIES OF NESTLE
 Strategy
 Nutrition plays a profound role in everyone’s life.
 Our strategy focuses on delivering distinct benefits to people through the food
and beverages, products and services we provide.
 Over 150 years we have built a successful business by understanding and
anticipating the needs of society, and continuously adapting ourselves to seize
the opportunities presented to us.
 The fast-evolving needs and expectations of society today reconfirm the
validity of our Nutrition, Health and Wellness strategy. The world is at an
inflection point. The speed, intensity and the breadth of change is
unprecedented.
 Digital disruption is reshaping our industry, our relationships with our
suppliers and retailers, and with the people who buy our brands.
 Advances in science and technology are opening up new opportunities for us
to play a role in addressing the challenges society faces. In a world where
hundreds of millions of people are under-nourished, malnourished or over-
weight we are well positioned to help contribute solutions.
CONCLUSION
 Nestlé Company is an international company which came
to the stage it is today by gaining superior competitive
advantage over its rivals. The focus product differentiation
strategy has been very successful although it may not work
for other firms. The company is able to create and deliver
value not only by offering distinguished products but also
gaining effectiveness and efficiency by reengineering its
business processes.
 By doing all recommendations and follow all these steps of
strategic management processes, I am sure that Nestlé
Company will do better in the future than their
competitors and might be the new trendsetter in some
criteria and also gain its above-average returns to their
company