Project Report on Nestle

TABLE OF CONTENTS 1 HISTORY OF THE NESTLE...............................................................................................................2 2 BUSINESS OF THE NESTLE..............................................................................................................8 2.1 INDUSTRY/SECTOR...................................................................................................................................9 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................................................................9 2.2 SCOPE OF TRADE (NATIONAL/INTERNATIONAL).........................................................................................11 2.3 LATEST DEVELOPMENTS REGARDING BUSINESS OF THE ORGANIZATION.........................................................12 3 MANAGEMENT PROCEDURES......................................................................................................13 3.1 ORGANIZATION STRUCTURE OF THE ORGANIZATION....................................................................................15 4 PRODUCT & SERVICES OFFERED BY THE ORGANIZATION..............................................16 4.1 PRODUCT LINE OF THE ORGANIZATION.....................................................................................................16 4.2 BRAND NAME OF EACH PRODUCT & SERVICE OFFERED ............................................................................30 4.3 BRAND AMBASSADORS OF ORGANIZATION/PRODUCTS ................................................................................32 5 HUMAN RESOURCE DEVELOPMENT POLICIES.....................................................................33 5.1 RECRUITMENT & SELECTION PROCEDURES................................................................................................34 5.2 TRAINING & DEVELOPMENT PROCEDURES ...............................................................................................34 6 MARKETING STRATEGY................................................................................................................35 6.1 INTEGRATED MARKETING COMMUNICATION (IMC)...................................................................................38 6.2 MARKET SHARE....................................................................................................................................39 7 FINANCIAL PROCEDURES.............................................................................................................41 7.1 METHODS FOR RAISING FUNDS...............................................................................................................41 7.2 INVESTMENT OPPORTUNITIES ..................................................................................................................43 8 MAJOR COMPETITORS IN THE MARKET.................................................................................46 9 SWOT ANALYSIS...............................................................................................................................47 10 CONCLUSION...................................................................................................................................53 11 REFERENCES......................................................................................................................................1

1 History of the Nestle

Nestlé headquarters in Vevey. The company dates to 1867, when two separate Swiss enterprises were founded that would later form the core of Nestlé. In August of that year, Charles A. and George Page, brothers from Lee County, IL in the United States, established the Anglo-Swiss Condensed Milk Company in Cham. In September, in Vevey, Henri Nestlé developed a milk-based baby food and soon began marketing it. In the succeeding decades both enterprises aggressively expanded their businesses throughout Europe and the United States. (Henri Nestlé retired in 1875, but the company, under new ownership, retained his name as Farine Lactée Henri Nestlé.) In 1877 Anglo-Swiss added milk-based baby foods to its products, and in the following year the Nestlé company added condensed milk, so that the firms became direct and fierce rivals. Henri Nestlé. In 1905, however, the companies merged to become the Nestlé and Anglo-Swiss Condensed Milk Company, retaining that name until 1947, when the name Nestlé Alimentana SA was taken as a result of the acquisition of Fabrique de Produits Maggi SA (founded 1884) and its holding company, Alimentana SA of Kempttal, Switzerland. Maggi was a major manufacturer of soup mixes and related foodstuffs. The company’s current name was adopted in 1977. By the early 1900s, the company

was operating factories in the United States, United Kingdom, Germany and Spain. World War I created new demand for dairy products in the form of government contracts; by the end of the war, Nestlé's production had more than doubled. After the war, government contracts dried up and consumers switched back to fresh milk. However, Nestlé's management responded quickly, streamlining operations and reducing debt. The 1920s saw Nestlé's first expansion into new products, with chocolate the company's second most important activity.

Nestlé's logo used until 1970s. Nestlé felt the effects of World War II immediately. Profits dropped from US$20 million in 1938 to US$6 million in 1939. Factories were established in developing countries, particularly Latin America. Ironically, the war helped with the introduction of the company's newest product, Nescafé, which was a staple drink of the US military. Nestlé's production and sales rose in the wartime economy. The end of World War II was the beginning of a dynamic phase for Nestlé. Growth accelerated and companies were acquired. In 1947 came the merger with Maggi seasonings and soups. Crosse & Blackwell followed in 1950, as did Findus (1963), Libby's (1971) and Stouffer's (1973). Diversification came with a shareholding in L'Oréal in 1974. In 1977, Nestlé made its second venture outside the food industry by acquiring Alcon Laboratories Inc. In 1984, Nestlé's improved bottom line allowed the company to launch a new round of acquisitions, notably American food giant Carnation and the British confectionery company Rowntree Mackintosh in 1988, which brought the Willy Wonka Brand to Nestlé.

The Brazilian president, Lula da Silva, inaugurates a factory in Feira de Santana (Bahia), February, 2007. The first half of the 1990s proved to be favorable for Nestlé: trade barriers crumbled and world markets developed into more or less integrated trading areas. Since 1996 there have been acquisitions including San Pellegrino (1997), Spillers Petfoods (1998), and Ralston Purina (2002). There were two major acquisitions in North America, both in 2002: in June, Nestlé merged its U.S. ice cream business into Dreyer's, and in August a US$2.6 billion acquisition was announced of Chef America, the creator of Hot Pockets. In the same time frame, Nestlé came close to purchasing the iconic American company Hershey's, though the deal fell through. Another recent purchase includes the Jenny Craig weight loss program for US$600 million. In December 2005 Nestlé bought the Greek company Delta Ice Cream for €240 million. In January 2006 it took full ownership of Dreyer's, thus becoming the world's biggest ice cream maker with a 17.5% market share. In November 2006, Nestlé purchased the Medical Nutrition division of Novartis Pharmaceutical for $2.5B, also acquiring in 2007 the milk flavoring product known

as Ovaltine. In April 2007 Nestlé bought baby food manufacturer Gerber for $5.5 billion. In December 2007 Nestlé entered in a strategic partnership with a Belgian chocolate maker Pierre Marcolini. Nestlé agreed to sell its controlling stake in Alcon to Novartis on 4 January 2010. The sale forms part of a broader US $39.3 billion offer by Novartis to fully acquire the world’s largest eye-care company. •

Our story begins in 1867, when Henry Nestle developed a baby formula that saved child’s life and marked the beginning of Nestle.

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It is originally consisted of two companies and two products, Henry Nestle and His baby food in Vevey, and the Anglo Swiss Condensed Milk company and its condensed Milk in Cham, both in Switzerland.

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His first factory was located in Vevey.

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In 1875, He sold His Company and retired.

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In 1880 second factory was built in bercher.

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In 1883, first time Nestle built a factory abroad, in Edlitz Grimmenstein.

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In 1890, Vevey factory produced 28 billion cans of Milk food and 2.2 million cans of condensed Milk.

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In 1912, Nestle begins it long relationship with South Asia when Nestle condensed Milk company start.

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In 1979, Milkpak Ltd. Is founded by Syed Baber Ali. It manufactures UHT Milk, Cream and Butter as well as fruit Juices.

Nestle In Pakistan •

Nestle have been serving Pakistani consumers since 1988, when our parent company Switzerland based on Nestle first acquired share in Milkpak.

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Nestle acquires 40% share in Milkpak.

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In 1990, sheikhupura factory starts the production of Nido Milk Powder cereals; a plant is acquired at Kabirwala.

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1n 1992, Nestle takes over the running of company and begins to develop its Milk collection network.

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In 1996 Milkpak is renamed to Nestle Milkpak Ltd.

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In 1997, the Kabirwala plant becomes a fully owned unit of Nestle Pakistan.

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1n 1998, Nestle Milk collection system in Punjab matures and company is able to buy all its Milk from Formers instead of relying on contractors.

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In 2005, Nestle Milkpak Ltd. Is renamed again Nestle Pakistan.

Nestle Quality Policy •

Quality is the foundation of our food, nutrition, Health and Wellness Company.

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A Nestle brand name on product is a promise to the customers that :

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It is safe to consume.

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It complies with all relevant laws and regulation.

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Quality is to win consumers trust and preference.

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We are committed to offering products and services to all customers that meat their needs.

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Quality is every body’s commitment.

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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.

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Quality is to strive for Zero defect and no waste.

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We focus on facts and results and we strive for Zero defect and excellence in every thing we do.

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We adopt “No waste” and we constantly look for competitiveness and opportunities for continuous improvement of the quality standards delivered to our customers.

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Quality is to Guarantee, food safety and full compliance.

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We enforce food safety, regulatory and quality requirements in every step of our value chain.

2 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 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, Health and environment policy to protect health of our employs and keep clean our surrounding environment Company Vision •

Vision of Nestle Milkpak Company is to expand business according to the increasing demand of market.

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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. .

2.1

Industry/Sector  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 markets. •

Our products are manufactured in five facilities scattered around the country, from Islamabad in the north, to Karachi in the south.

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Two state-of-the-art multipurpose factories are located in the agricultural heartland of the Punjab, and the remaining three are dedicated to producing our trusted brands of bottled water.

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As citizens of Pakistan, we consider it our duty to make sure that our manufacturing processes are clean, hygienic and safe.

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We are constantly working to reduce emissions at our factories, reducing and treating wastewater, and making our packaging environmentally friendly. Regular audits have confirmed that our factories' environmental management meets the Nestlé international standard.

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As is the Nestlé policy around the world, we care for our people. We uphold the principles of the UN Global Compact and encourage women to participate.

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In 1990, Nestlé Milkpak acquired the Kabirwala factory, located in Khanewal district of the Punjab, as a subsidiary. By 1997 it was a fully owned unit of Nestlé Pakistan Ltd.

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Soon after it was acquired, we began upgrading its capacity. In 1992 we added a MAGGI® Noodles plant was added and 1996 saw an additional of a milk powder.

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Over the years, the Kabirwala factory was constantly enhanced. NESTLÉ® EVERYDAY® tea whitening powder was introduced in 2002 and revolutionised tea and coffee drinking in homes and offices around the country.

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In 2005, the factory continued to make notable achievements.

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2006 has seen the commencement of Kabirwala Extension Project that would be completed in April 2007 at a cost of about Rs. 4.0 billion. The project has seen expansion of milk processing capacity to triple its current size, both for powder and liquid.

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In 2001 we acquired the AVA® water factory in Islamabad. It became a fully owned unit in 2003, and we immediately instituted a programme of major improvement to bring the facility on par with international standards.

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Over the years, better and more efficient machinery has been introduced. This has helped us speed up production, and provide our consumers with their favourite brands of bottled water in convenient package sizes.

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We are proud that the Islamabad factory has made efforts to bring Pakistani women into the workforce, by providing a comfortable and enabling work environment.

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Indeed, we were amongst the first to employ female operators working alongside men in our production department.

2.2

Scope of Trade (National/International)

Pakistan is an agricultural country. According to Ministry of Food, Agriculture and livestock, agriculture accounts for 20.9 percent of the GDP. Dairy industry contributes 49% to the agriculture value and 11% to the GDP. Annual production of milk is 35.25 Billion liters in the country; But the Processed milk is only 4% of the total production. Like other countries Dairy is not a dedicated profession of the people, farmers is associated with dairy and agriculture at the same time, Profitability for the farmers is very less. Infrastructure is not developed, cooling tanks and other facilities are not available, and the large part of milk production is wasted. There is a multi-hierarchal distribution system of the milk; the farmers are not getting reward of their work. All these factors are making this industry unattractive for the farmers and the industry is no developing up to mark. Only 4% of the total milk production is processed and used in urban areas of the country. Nestle Milkpak have a great share in the different multinational companies. It is statistically calculated that Nestle Milkpak have 50% share in the Nestle company and now Nestle become the leader of all multinational companies in food products and beverages. Nestle is operating in all big cities in Pakistan and try best to provide its Products to other small cities and towns. According to Pakistan Dairy Development Authority • Only 0.52 Billion liters UHT and 0.5 Billion liters pasteurized milk is available in the country. • In urban areas 4.7 Billion liters milk is provide by Gawalas.

• 1.27 Billion liters processed milk is sold by the milk shops. • There is a potential of about 5 billion liters of milk sold in the urban areas. • In urban areas people are more health and quality conscious, the income level of urban population is also good so this segment has potential for UHT and Pasteurized milk. Nestle is the world largest food company and nestle Milkpak is Nestlé’s famous UHT milk brand. Nestle Milkpak has south Asia’s biggest Plant at Kabirwala. It is targeting upper and middle class. It is differentiating its brand by adding Iron and Vitamin

“C”.

The Nestle Milkpak is following growth strategy. The immense competition is going in the market; it is recommended that Nestle Milkpak should invest more in milk business and other value added milk products. In this way Nestle Milkpak can fulfill the local demand by locally processed milk and milk products instead of the imported milk products. Nestle has brand recognition throughout the world and they can export milk powder and other value added products in future.

2.3

Latest Developments Regarding Business of the Organization

—(April 6, 2009)—Nestlé Juicy Juice is premiering two products designed to benefit children during different stages of their growth and development. Juicy Juice Brain Development and Juicy Juice Immunity are fruit juice beverages made with natural ingredients, fortified with important nutrients and blended with filtered water to naturally lower the sugar and calorie content.

For Nestlé USA, training is more than just a transfer of knowledge and skills. It is fundamental to our culture of learning and development and to the fostering of our corporate principles and values. Nestlé University teaches employees how to cultivate their capabilities and how to realize their full potential. Nestlé University offers over 30 courses in five key curriculum areas: Innovation, People, Execution, Functional Capabilities and Working at Nestlé. Web-based and instructor-led classes, plus online access to books and media, are just some of the ways you can learn.

3

Management Procedures

The executive board, a distinct entity from the board of directors, includes: •

Paul Bulcke, Nestlé CEO

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John J. Harris, EVP, Chairman, and CEO of Nestlé Waters

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Frits van Dijk, EVP of Asia, Oceania, Africa, Middle East divisions

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Petraea Heynike, EVP of Strategic Business Units and Marketing

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Francisco Castañer, EVP of Pharmaceutical and Cosmetic Products, Liaison with L'Oréal, Human Resources

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Michael Powell, EVP of United Kingdoms Division

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James Singh, EVP of Finance, Control, Legal, Tax, Purchasing, Export

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Luis Cantarell, EVP of Europe divisions

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Richard T. Laube, Deputy EVP of Nutrition Strategic Business units

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Werner J. Bauer, EVP of Research and Development, Technical, Production, Environment.

Current members of the board of directors of Nestlé are: Peter Brabeck-Letmathe (chairman), Paul Bulcke, Andreas Koopmann, Rolf Hänggi, Jean-René Fourtou, Daniel Borel, Jean-Pierre Meyers, André Kudelski, Carolina Müller-Möhl, Steven Hoch, Naïna Lal Kidwai and Beat Hess. The Secretary to the Board is David Frick. Joint ventures Nestlé holds 26.4% of the shares of L'Oréal, the world's largest company in cosmetics and beauty. The Laboratoires Inneov is a joint venture in nutritional cosmetics between Nestlé and L'Oréal, and Galderma a joint venture in dermatology with L'Oréal. Others include Cereal Partners Worldwide with General Mills, Beverage Partners Worldwide with Coca-Cola, and Dairy Partners Americas with Fonterra.

3.1

Organization Structure of the Organization

National sales manager

Regional Sales Manager

Consumer Service manager Or Consumer Service Officer

Area Manager

Territory in charge

System Suport

Event

System support manager

Sales Associates Officer

DS

Leader

Event Manager

4 Product & Services offered by the Organization Nestle Pakistan has being at the forefront of development of dairy sector in Pakistan as major industrial stake holder for a while .internal efforts and some initiatives with government have being going on since long in order to maximize the development of the sector .still, a need for sector wise coordination and combine efforts was there to ensure utilization of all available resources to move forward in the direction. Through the agric-services department nestle has being involved with various infrastructure and support related initiatives such as development of model farms, setup of milk chiller and import of Australian cow to boost milk production .nestle is also working towards setting up mega dairy farms to exemplify best farm practices and ways to boost mike production

4.1

Product Line of the Organization

Nestle Good Start Gentle Plus Powder Formula, 50 Cans $459.99

Nestle Hot Cocoa Mix, Rich Chocolate, No Sugar Added, 8-Count Envelopes (Pack of 12) $33.26

Coffee-Mate French Vanilla Non-Dairy Creamer, Shelf Stable, 16-Ounce Bottles (Pack of 12) $29.91

Visit Store NESTLE NES70821 Coffee $9.95 CSN Office

Visit Store Baby Ruth 24 X 2.1 Oz Baby Ruth 24 X 2.1 Oz $21.88

Visit Store Bit-o-Honey, 1.7 oz 36 ct Bit-o-Honey, 1.7 oz 36 ct $37.85

Visit Store 6 Pack-32 Oz. Cans/ Nestle Good Start... 6 Pack-32 Oz. Cans/ Nestle Good Start Baby Formula/mix $39.99

Visit Store Nestle Milk Chocolate Bar 24ct Nestle Milk Chocolate Bar 24ct $25.00

Visit Store Nestle Cerelac Trigo con Leche Nestle Cerelac Trigo con Leche $14.95

Visit Store Nestle GOOD START Supreme Infant... Nestle GOOD START Supreme Infant Formula With Iron Powder 188oz.

Visit Store Nestle Good Start Protect Plus Formula... Nestle Good Start Protect Plus Formula - 12 oz Can $23.95

Visit Store Nestle Good Start Protect Plus Formula... Nestle Good Start Protect Plus Formula - 12 oz Can - - cs 6 $141.00

Visit Store NESTLE ... NESTLE NES24300 $24.99 CSN Office

Visit Store NESTLE ... NESTLE NES94100 Wonka $12.99 CSN Office

Visit Store Nestle Hot Cocoa Mix, Rich Chocolate,... Nestle Hot Cocoa Mix, Rich Chocolate, No Sugar Added, 8-Count $38.33

Visit Store Nestle Nips Candy Coffee 4 oz Nestle Nips Candy Coffee 4 oz $1.99

Visit Store Nerd's Rope .92 oz Nerd's Rope .92 oz $23.79

Visit Store Nestle Aero Dark 24 X 42g Bars Nestle Aero Dark 24 X 42g Bars $34.56

Visit Store Nestle Dark Raisinets Chocolate... Nestle Dark Raisinets Chocolate Covering California Raisins $20.35

Visit Store Nestle 31831: Carnation ® Coffee-mate ®... Nestle 31831: Carnation ® Coffee-mate ® Pump Dispenser $19.89

Visit Store Nestle Carnation Instant Breakfast... Nestle Carnation Instant Breakfast Essentials, Rich Milk Chocolate $31.20

Visit Store Nestle GOOD START Supreme Soy DHA & ARA... Nestle GOOD START Supreme Soy DHA & ARA Infant Formula with Iron $15.99

Visit Store Nestle Glucose Control BOOST Strawberry... Nestle Glucose Control BOOST Strawberry 8 oz - Case of 24 $41.99

Visit Store Nestle Boost Nutritional Chocolate... Nestle Boost Nutritional Chocolate Pudding - 24/8 ounce cups $81.97

Visit Store

Nestle Good Start Gentle Plus Powder 12... Nestle Good Start Gentle Plus Powder 12 oz Can $17.95

Visit Store Nestle Good Start Gentle Plus Powder 12... Nestle Good Start Gentle Plus Powder 12 oz Can - - cs 6 $122.08

Visit Store Boost High Protein Nutritional Energy... Boost High Protein Nutritional Energy Drink, Vanilla, 8 Ounce Bottle $39.49

Visit Store Nestle GOOD START Supreme NATURAL... Nestle GOOD START Supreme NATURAL CULTURES BL Infant Formula Powder $24.99

Visit Store Nestle Coffee Crisp Dark 70% Cocoa 4 X... Nestle Coffee Crisp Dark 70% Cocoa 4 X 24 X 42g Bars $120.00

Visit Store Nestle Good Start Supreme Soy, DHA &... Nestle Good Start Supreme Soy, DHA & ARA Infant Formula with Iron $73.45

Visit Store 6 Cans - Nestle Good Start Gentle Plus... 6 Cans - Nestle Good Start Gentle Plus Infant Formula $59.99

Visit Store Nestle BOOST Plus Vanilla 8 oz Bottle -... Nestle BOOST Plus Vanilla 8 oz Bottle - Case of 24 $26.99

Visit Store Nestle Coffee Crisp Dark 70% Cocoa 24... Nestle Coffee Crisp Dark 70% Cocoa 24 X 42g Bars $34.56

Visit Store 8 Cans Nestle Good Start Gentle Plus... 8 Cans Nestle Good Start Gentle Plus Formula 12 Oz $95.00

Visit Store

Carnation Famous Fudge Kit, 1.97-Pound... Carnation Famous Fudge Kit, 1.97-Pound Kits (Pack of 2) $27.99

4.2

Brand Name of Each Product & Service Offered

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Nestle Juices

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Nestle Nesvita

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Nestle yogurt

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Bottled Water

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Chocolate

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Baby Food

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Maggi noodles

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Nescafe

At Nestlé, our chief commitment is to our consumers, and we make every effort to make sure that their voices are heard. When Henri Nestlé prepared his first boxes of infant formula for sale, he put his address on the packages. Today, our Consumer Relationship Panel exhorts people to "Talk to Nestlé", expressing the same belief in openness and accessibility. Our consumer services department is staffed by experts in every area related to our products and wellness, and is poised to provide prompt and relevant service to our consumers. We believe that consumer services requires us to talk to consumers and also, above all, to listen to them. Only by listening to what people say can we understand what they want and need. Only by understanding their needs can we serve our consumers to the fullest.

Transaction Details •

Frequency,

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amount and timing of purchases,

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items bought,

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prices paid,

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Use of cash or credit.

Acquisitions Details •

Marketing channel,

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Promotion type, and

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Address/city.

4.3

Brand Ambassadors of Organization/Products

June 18, 2008 (Sawf News) - Nestle has dropped Bollywood star Rani Mukerji as brand ambassador for its chocolate brand, Nestle Munch, because she has ceased to be a youth icon. Rani had endorsed the product for the last four years, and featured in many Television commercials promoting the brand. A few months earlier, Rani was dropped from Fanta commercials, and replaced by rising South star Asin, Aamir Khan's Ghajini co-star. A top PR official of Nestle India, based in Gurgaon, talked to us on condition of anonymity. "Our contract with Rani Mukherjee was due to get over and we were in the midst of planning new marketing strategies for our brand. It is then that we decided that we won't be renewing our contract with her," the official told us. "Our new strategies include targeting the youth and Rani ceases to be any kind of a youth icon anymore. Her films haven't really worked out at the box office and we are looking out for someone who is very popular in this category. We are working out on a few options and a final announcement shall be made very soon." A source close to Rani confirmed the development, telling us, "Rani is extremely disappointed by Nestle's unprofessionalism. They knew well that once the contract came up for renewal, Rani would increase her price. They wanted to go in for someone cheaper perhaps. They should be thankful that Rani has got their product noticed in last four years." Nestle's action seems to reflect the film industry's perception that Rani is no more the box office draw that she once was.

Rani's stock in the industry has dropped following the poor box office response to her recent films like Saawariya (2007), Laaga Chunari Mein Daag (2007), Ta Ra Rum Pum (2007), and Babul (2006). She is also perceived to be too closely aligned to the Yash Raj Films banner by other filmmakers. Even her 'friends' in the industry are not ready to bet on her anymore. When Kajol vacillated over signing up for My Name is Khan, the film's producer and director, Karan Johar, a close friend of Rani, surprised industry watchers by announcing that he would go with Kareena instead, even though Rani comes through as a more natural Kajol replacement. Till recently, every Karan Johar film featured Rani, often in cameo or relatively insignificant roles, like in Kal Ho Naa Ho (2003), Kabhi Khushi Kabhie Ghum (2001), and Kuch Kuch Hota Hai (1998). Rani must find it hard to digest the manner in which her standing in the industry has started to unravel. Not so long ago she counted amongst the top Bollywood actresses.

5 Human Resource Development Policies HR is dedicated to our employees, and ensures that we have all the right people with the right skills, in the right places at the right time. Understanding that our people are the bedrock of all our business strategies, it is our mandate to enhance their skills with cutting-edge training and provide them with world-standard facilities. We select flexible, innovative people who are ready to confront new challenges and make a difference. Our groundbreaking Management Trainee Programme aims to

develop talented young men and women and help them achieve their potential in a dynamic and enabling environment. Over a hundred people travel out of the country every year to take advantage of our international training and development events

5.1

Recruitment & Selection Procedures

Employees, people and products are more important at Nestl 頴 han 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. 5.2

Training & Development Procedures

There are a number of ways you can join us. We like to recruit people into real jobs, and when a position becomes available, we will select the best person for it. Our recruitment and selection practices and procedures are transparent, fair, and comply with legal requirements. Making use of selection panels that are utilised for all vacancies ensures transparency. The persons involved in the selection panels fairly represent a diverse group. Management Trainee ProgrammeIf you're young, bright and hard working, the Management Trainee Programme may be the place for you.We hire fresh graduates as potential managers to develop new competencies and skills through on-the-job development.You'll be hired in one of various departments at inductee level on a 12-month training programme. Once you've completed the programme, you will be assigned independent responsibilities supporting the company's business needs. We begin sourcing Management Trainees in January.

Preliminary interviews and screening is organised according to the graduation schedules of Pakistani and foreign universities, and are followed by interviews with senior management.If you have any queries about the Management Trainee Programme, and drop us an email!InternshipsInternships are a great way to apply the knowledge and skills you are developing at university and get experience in a leading corporation. We offer project-based internship positions in various departments at Nestlé Pakistan.You may be hired as an intern at various points during your academic career: during undergraduate study or graduate school. Most internship assignments are offered during the summer months and generally run for 6 to 8 weeks. At the end of the internship you will be required to submit a project or programme report to the company on the topic assigned to you at the beginning of the internship programme. If you impress us with your talent & hard work, you may be considered for employment opportunities after you have completed your studies.Please contact us if you have any queries about our internship programme.

6

Marketing Strategy

Our mission is to:

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Optimise and consolidate resources and processes for a low-cost but efficient

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Develop and manage simplified and effective supply network to achieve a high

level of service ·

Create a continuous improvement culture driven by performance measures and

reward Today, Nestlé Milkpak produces in over 81 countries and achieves 98% of its turnover outside Europe. Nestlé milkpak is the world’s largest milk company, which does 98% of its business. It has an annual turnover of 70 billion Swiss francs, 522 new factories in 81 countries, 200 operating companies, 1 basic research outer and 20 technological development groups, has more than 231,000 employees and more than 8000 products around the globe. There are three companies co-ordinate the activities of some 200 operating companies around the globe. Their functions and details are as follows: The first, Nestlé milkpak, holds the financial shares in the allied companies. It also checks the profitability of these companies and to ensure the profitability of the group as whole.

The second, Nestlé milkpak, has two areas of activities that are as follows: •

Research and technological development,

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Technical assistance Beside this, it provides know-how in engineering, marketing, production, organization, management and personnel training on a continuous basis. The third company is Nestlé World Trade Corporation that oversees the import and export of merchandise worldwide.

Market segmentation and target strategy including consumer profiling

It is really a big market and it is always difficult to segment the big market. There are many uses for segmentation. Needs Based Segmentation Milk Pack has made different sizes of tetra packs which can match the needs of buyers, ranging from 0.25 liters to 1.5 liter. Buyers can buy according to there need between these quantities.

Product Segmentation Manufacturers diversify products within each needs base to appeal to buyers with different tastes and wealth.

6.1

Integrated Marketing Communication (IMC) Company have a complete imc plan in which they that how can the

company will inform their consumer about the new, upcoming product and value added services to the existing product. The sources which can use by the company to inform their consumers are print, electronic as well as through their websites. As a mother you want the best for your child and almost always *worry about his/her health. But are you completely sure if your child is getting sufficient nutrition for his or her good health and development? Many of you may not be so sure. Children between 1 to 3 years of age experience rapid growth and strong height and weight gains making their nutritional requirements unique. That's why we have NESTLÉ NESLA, growing-up milk for children 1-3 years of age. NESTLÉ NESLAC provides the right vitamins and minerals in the right proportions that your little one needs at this particular age. NESTLÉ NESLAC is available in Honey flavour and is enriched with the right balance of Protein, Iron, Calcium and Multivitamins to help give your child a strong and healthy foundation for life! Market Positioning: They will position our product as a high quality product consumer focused. Messages like “They knows your taste better than us”, “Nestle Milkpak now at your door step”; “Add additional flavors’ to your life” will help us portray our picture clearly and

distinctly. Milkpak will position our product against the competitors and gain competitive advantage through our efficient promotional methods, using innovations, and by reaching closer to our target market through the arrangement of events like BASANT, VALENTINE DAY and etc. In short consumers will view us as a product providing highly quality, in terms of taste, customer focused and, at the same time reasonably priced as compared to others.

6.2 Market Share Nestle steps up efforts to grow market share THE difficult operating conditions across the fast-moving consumer goods (FMCG) industry have affected sales performance of some products of Nestle India last fiscal. Though the company says that it has maintained its market share in most of the product categories by taking a few measures, including managing input costs and price points, improving distribution network as well as market penetration and making more effective use of its supply chain, sales of some key products remained below expectations in 2004. Take for example liquid UHT (long shelf-life) milk. The Nestle India Chairman, Mr Martial G. Rolland, said in the latest annual report that the market performance of this product has been below expectations and a full review is being undertaken. And even as Maggi noodles continue to have the highest sales volume in India, among all Nestle companies, Maggi sauces have performed below expectations during 2004 due to aggressive competition, he added.

Milkmaid Sweetened Condensed Milk did not perform as per plan, and Mr Rolland said the company is taking corrective action to improve the performance of Milkmaid Squeezy. Similarly, in confectionery, Nestle Chocostick is being reviewed, even as the company said products such as Nestle Milkybar Eclairs, Nestle Eclairs and Polo lozenges have performed well. In the recent past, Nestle has been reviewing the performance of Milo Chocolate Energy Food Drink and it launched Milo with `Badam Shakti' in select cities of Tamil Nadu during last fiscal. The Chairman said performance of the new variant is being monitored. Among the products that continue to perform well from the Nestle stable are Nestle Munch and Nestle Kitkat chocolates, Nescafe instant coffee and Everyday Dairy Whitener. Mr Rolland said in the annual report that the company is aware of the fact that with changing lifestyles, consumers are seeking food products that provide greater convenience, along with taste and pleasure, and that Nestle is working on several initiatives to provide consumers with products of their choice. Among new products that Nestle launched last year are Nestle Coffee Eclairs, Nestle Chocolate Eclairs, Nestle Sweet Lassi and Nestum 123. The company reiterated its commitment to the `value for money' and affordability planks and retained investments in brands, while refraining from passing on the entire increase in commodity prices to consumers.

7

Financial Procedures

An employee in Finance & Control ensures we make financially sound business decisions to meet our long-term profitability goals. Nestlé is a financial leader in the consumer products industry and one of the few firms around the globe with a AAA credit rating. We're looking for employees with strong analytical and communication skills, a willingness to embrace change and the discipline to meet financial standards. 7.1

Methods for Raising Funds

Ambika Cotton to issue pref shares to UTI venture fund A VENTURE fund promoted by UTI Asset Management Company has forayed into textiles account by choosing to invest in the Coimbatore-based Ambika Cotton Mills Ltd (ACM), a known name in the premium segment cotton yarn production and exports. ACM's board of directors early this week decided to issue 8.75 lakh shares to UTI Investment Advisory Services Ltd, trustees of the UTI's venture fund `Ascent India Fund', through preferential issue route. Ambika Cotton will give the preference shares at a premium of Rs 175 per share (of face value of Rs 10 each) and the company stands to mop up Rs 16.18 crore from the preferential issue to buttress its capital base. To facilitate the preferential share allotment to the UTI, the ACM's board has also decided to raise the company's authorised capital from Rs 5 crore (50 lakh equity shares of Rs 10 each) to Rs 10 crore (one crore equity shares of Rs 10 each). The Managing Director of the ACM, Mr P.V. Chandran, told Business Line that his company had chosen the preferential issue route for its least cost proposition to

strengthen its capital base, which is required to meet company's expansion project. He said an extra-ordinary general meeting of the members of the company has been called on May 14 to seek the shareholders approval for the preferential allotment. These investments would also result in enhancing the company's turnover from the present Rs 86 crore to Rs 160 crore on completion of the projects. Ambika Cotton is eyeing Europe and the US as emerging markets for its yarn exports. As per the present shareholding pattern of ACM, of the 50 lakh equity shares, the promoters and their close relatives/associates hold 34.51 lakh shares or close to 70 per cent, while the institutions including banks/FIs and the public hold another 14.81 lakh shares or 30 per cent. The post-preferential allotment will consequently see dilution in the promoters holding in the company by 10 per cent. UTI Mutual spreads wings in eastern region SALES figures logged in the eastern region, considered a relatively risk-averse market for long, have sprung a surprise for UTI Mutual Fund, thanks mainly to what is being identified as the region's growing appetite for equity schemes. As much as 75 per cent of the fresh sales recorded by the fund is on account of inflows into various equity products managed by it, figures pertaining to the year ended March 31, 2005, indicate. Considering the previous year's contribution of equity to UTI MF's total sales, this represents a 100 per cent escalation and a significant change for the fund house. An increasing interest displayed by investors based in the region in equity funds, buoyed by the stock markets and driven partly by dividends announced in some of

the better-known schemes, have resulted in the change, said Mr T.K. Maji, head of UTI MF in the East. He was referring particularly to the dividends declared by schemes such as UTI Master Value and UTI Mastershare; the former, incidentally, paid a 100 per cent dividend earlier this year. While this interest has primarily benefited plain-vanilla diversified growth funds, some of the sectoral schemes too have received attention from the investing public, it is pointed out. These include funds dedicated to sectors such as auto and petroleum. The penchant for equity, the MF has conceded, has been witnessed nationally and the eastern market is not really an exception. However, what is also admitted that trend in the region is quite noticeable, especially when it is seen against the backdrop of the past. The MF had an overall asset base of around Rs 21,000 crore at the end of March. UTI MF's latest offering, UTI Dividend Yield Fund, is currently being marketed aggressively in the region, Mr Maji observed, adding that the fund house expects decent inflows from centres such as Kolkata, Bhubaneswar and Guwahati. "Guwahati, if you go by last year's sales, can well turn out to be a good market. Local investors have been responding well to all sorts of products, including liquid and floating rate funds," he said.

7.2

Investment Opportunities

Opportunity to transition into full-time employment or Development Program upon conclusion of Internship. JRG starts online trade in commodity, capital markets JRG, one of the leading brokerage houses, has introduced integrated Internet trading venture in commodity and capital markets. Mr Regi Jacob, Managing Director, JRG Securities Ltd, said that the company has created its own integrated platform known as I-Trade for the purpose. This system would help investors to trade in capital and commodity markets from a single window anywhere in the world, he added. JRG, Mr Jacob said, had also inaugurated its UAE operations by setting up its first overseas branch in Dubai to provide professional services for the investing community among NRIs in the UAE. Discussions are also on to start branches in Abu Dhabi and Muscat, he said. Speaking on the occasion, Mr Giby Mathew, Managing Director of the JRG Wealth Management Ltd, said that the company has tied up with Tirumala Tirupati Devasthanam in Andhra Pradesh by setting up an online commodity trading terminal in the temple complex. Through the terminal, the TTD management could view the commodity prices from NMCE, NCDEX and MCX. The Tirupati Temple is the biggest purchaser of commodities such as sugar, cardamom, cashew in the country, and it is essential to instantly update about the fluctuations in the commodity markets, he said. The company has already extended its commodity operations to Tamil Nadu, Andhra Pradesh, Karnataka, Punjab, Uttar Pradesh and Delhi.

Shareholders seek remedy to 'trading' anomalies while restructuring NATIONAL Investors Foundation (NIF) has drawn the securities regulator's attention to what it feels is an "unfair" market practice - delay in listing of newlyissued shares after corporate restructuring. A note from NIF to SEBI's secondary markets division refers to the gap between the termination of trading in shares of the transferor company and allotment of shares of the transferee company to shareholders of the former. Such delays, which may easily be anywhere between four and ten weeks, occur in the case of most mergers and acquisitions, the foundation has pointed out. As things stand, shareholders of the transferor company receive shares of the transferee company even as trading in the shares of the former is discontinued. NIF has particularly referred to such M&A deals involving Vardhaman Spinning and Mahavir Spinning, Burroughs Welcome and Glaxo, and JVSL and Jindal Iron & Steel. "The process is quite lengthy. In fact, it makes life extremely difficult for the shareholder fraternity. For them, it is a tedious and costly proposition," Mr Sudip Bandyopadhyay, Trustee, NIF, told Business Line. "This practice results in unfair discrimination in favour of the shareholders of the transferee company as they are free to trade in the interim, whereas the shareholders of the transferor company are in no position to take any steps in the absence of the shares of the transferee company, being available with them," the NIF note has pointed out.

A certain mechanism should, therefore, be available to enable the transferor company's shareholders sell their holdings, it has further maintained. Listing agreement updates suggested NIF, which claims to have taken "the legal position, the market realities and the logistics" into consideration, has further underscored the need to add teeth to the relevant clauses of listing agreement. It has urged SEBI to consider the following: Stock exchanges should stop trading in shares of both the transferor and the transferee companies in the event of M&As. Trading should be resumed in the transferee company's shares only after a reasonable period by when all shareholders of the transferor company have received their quotas. Trading in the transferor company's shares, in a manner reflecting the approved swap ratio, should be allowed - in spite of the specific shares of the transferee company not being available.

8

Major Competitors in the Market

INTERNAL COMPETITORS •

Haleeb Milk

•

Olpers milk

•

Good Milk

•

Dairy Queen Milk

EXTERNAL COMPETITORS •

DANONE

•

MILUPA

COMPETITORS ADVANTAGES •

We never compromise on quality and quantity

•

Our extensive milk collection system ensures that the Milk you get is of the finest quality.

•

Our products are available in every city and town

9 SWOT Analysis One opportunity that Nestle has is that health-based products are becoming more popular in the world, including in the United States. Consumers are becoming more health conscious, and realize that living longer isn’t only by luck and genetics. LC1 has not been introduced in the United States yet. Nestle also has an opportunity of being even a larger market leader in Germany with LC-1. Within two years of launching the product in Germany, they had captured 60% of the market. This was due to the fact that they differentiated the product, and Germans simply preferred the taste. Another opportunity of LC1 is that, because they are a market leader, they can introduce more health-based products in Germany. A threat to Nestle is the fact that some markets they are entering are already mature. Danone had an established leadership position in the yogurt market in France. Since Danone was the first to arrive in the market, they have always been the market leader

there. Also consumers in France liked the taste of LC-1, but researchers believe they did not repurchase the yogurt because they preferred the taste of Danone products better. Another threat to Nestle is that there is intense competition in the United States yogurt market. General Mills’ Yoplait division is the leader in the yogurt market in the United States. Yoplait has been the leader for years and is constantly innovating new health products. General Mills has been a strong competitor of Nestle and they are not short of experience and strength. One strength that they have is their brand recognition. One of their main goals has been to deliver brands that consumers trust and value and they have succeeded. Another strength they have is their distribution. Yoplait is distributed to more stores in the United States than any other brand of yogurt. This is one of the reasons why they have been the market leader in yogurt for so long. Another strength that General Mills has is the fact that consumers simply know Yoplait is healthy. Yoplait is the only leading brand of yogurt to offer vitamin D and this vitamin is especially important for adult women.(Yoplait.com) It is not just a coincidence that Yoplait has vitamin D, but they have purposely added this vitamin to target female consumers. General Mills also has some weaknesses. They fact that they are the market leader in the United States may be hindering them from innovation. They have been producing Yoplait yogurt for many years, and have offered a series of new products in the past few years in the nutrition department. Most of these products however, are very common, and are widely offered in the United States. The health food industry in the United States has been booming and General Mills does not offer enough products in the smaller niche markets. They have not entered into many unknown areas because of their success in the yogurt market.

An opportunity General Mills has is that its Yoplait division is so successful. Yoplait is the only division of General Mills that is currently earning a profit. They have a large market share over their main competitors in the yogurt market. Another opportunity that they share with Nestle is that the health-based and nutritional food market is booming. They are continually releasing and marketing new products in these markets and they will continue to do so while the market continues to yield profits. The main threat that challenges General Mills is that there is intense competition amongst the top players in the yogurt and related markets. Nutrition and health is becoming more and more important to consumers in the United States, and worldwide. Along with this comes increased competition to gain market share. Simple supply and demand theories are prevalent in these markets. Another threat General Mills has is that smaller companies are producing similar products with the same or added nutritional benefits.

Strengths •

Skilled labor.

•

Educated staff.

•

Large number of offerings.

•

Pre purchase virtual display.

•

Arrangement of events.

•

Good background of the company.

•

Easy to approach outlets.

•

Physical evidence Strong Brand image

•

Quality product

•

Solid Financial position

•

Strong supply chain network

•

Qualified work force

•

Commitment to High Quality Products Focus on research and development Estimations of UHT Milk Production and

•

Consumption up to 2008– 09 Year Annual Production

•

(million liters) Annual Consumption (million liters) 2008-09 => 648.43 353.71 2009-10 => 753.89 372.05 Weaknesses •

Physically impossibility to have target market.

•

There is weak marketing of Milkpak as there is no advertisement of Milkpak

on official website. •

Lack of awareness among the target market.

•

It Dependency on others (govt. & sponsors) for the arrangement of events.

The target market of Nestle Milkpak is upper middle and high class because lower middle and poor class cannot afford to buy UHT milk due to its premium

price. •

It is a main weakness of milkpak that there are different companies of milk

but the name of nestle milkpak is always stand in the last because of low advertising and marketing.

Opportunities •

Increasing interest of people

•

31billion customers are there in Pakistan for milk. Upton now only 4 billion customers are being facilitated.27 billion customer markets is still available to be penetrated.

•

Few and weak competitors

•

Estimations of UHT Milk Production and Consumption up to 2008– 09 Year Annual Production

•

2008-09

=>

648.43 353.71

2009-10

=>

753.89 372.05

The projected values of UHT Milk consumption and production are obtained from the ARIMA model.

•

More people are coming towards processed milk because loose milk is dangerous for health due to a lot of contamination.

•

Growth of processed milk is increasing with 20% annually so Nestle Milkpak has the opportunity to capture a large share of market.

Threats •

Major player may enter target market

•

Legal and ethical issues.

•

Market segment growth could attract new entrants.

•

Economic slow down can reduce demand. Two main competitors Haleeb and Olpers are main threat for Milkpak especially the Olpers is growing very fast.

•

Inflation is getting higher and higher so the purchasing power of the people is decreasing day by day.

•

There is no entry barrier for new entrants as the Olpers has come in the market.

Taste of consumer has already developed which is hard to change

10 Conclusion Problems Faced By Nestle Nestle is facing the problem that is regarding the quality of mill . it is being perceive that infant or child belonging to poor family who use low quantity of milk then required in daily use are getting effected. It is hard to agree the customer to swich to pack milk because of taste which is huredel for further expansion Recommendations Nestle must state in writing that it accepts that the international code and the subsequent relevant World Health Assembly Resolutions are minimum requirements for every country. Nestle must state in writing that it will make required changes to bring its Baby Food Marketing policy and practice into line with International Code and Resolutions.

11 References

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