SWOT Analysis of Nestle

Strength: BRAND IMAGE Marketing strategies established by the company are innovative and lure customers. Financial, marketing and sales strategies are formulated by gauging the Periodic research carried out to judge market trends. It is a large scale organization, with abundant funds and has the capability of acquiring weaker firms by throwing them out of competition. example for this strength of the company. Multinational. Growing Sales and profits. Major shareholder in the food industry of Pakistan. Aggressive Marketing. Efficient Distribution networks through out the country. Quality Products. Environment Friendly. Skilled labor. Educated staff. Large number of offerings. Pre purchase virtual display. Good background of the company. Easy to approach outlets. Solid Financial position Strong supply chain network Focus on research and development Estimations of UHT Milk Production

Weaknesses : 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 : There are substantial growth opportunities considering the average yield of Pakistani animals at only 1,100 liters/annum as compared to 6,000 liters/annum for animals in Europe and USA. There are nearly 20 million milk producing animals in the country, mostly in Punjab (80%). The overall milk market in Pakistan is 20 billion liters, out of which processed milk contributes only 3 million liters. Nestl MilkPak along with other processed milk businesses contribute only 2% to this large market. Nestl MilkPak has expanded its product range by entering the cold dairy market recently by launching Nestl plain yogurt and now fruit yogurt is also added to it. To expand the cold dairy products range, Nestl fruit yogurt is the latest addition to this group. The cold dairy market offers many opportunities for the company which can capitalize these products by banking on its superior quality milk. The coffee brand also offers many opportunities for the company to expand by tuning the taste of the masses towards coffee. Credit policy can be adopted to increase sales

Threats : Price fluctuations due to rupee devaluation as raw material are imported. The uncertainty of economic conditions poses a great threat as the major funds invested in the country come from outside Pakistan. The present economic crisis in the world, led to the withdrawal of foreign management from the company and the investment has come to a halt. Competition with Nestls owns smuggled brands. Effect of Seasonalitys upon sales. Imported raw material, in some of the companys products. 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. Current market situation

Conclusions
Nestl should consider decreasing costs that are incurred due to intensive distribution that it takes up for the most of its products. For example, Nestl Pure Life is found even in outlets such as the local khokhas in Pakistan. Placing it here is not quite beneficial as the poor localities can hardly afford to buy it. Therefore, the firm is incurring cost without the sales being increased at this certain distribution channel.