Assignment Task

 Select any Multinational corporation  Study the organization from the following aspects : 1. Identify mission statement 2. Values 3. Key objectives (short term and long term)  Stakeholders  Responsibilities of that organization.
 What are their resources [physical resources, financial resources ,human

resources]  How they are allocating their resources.  Culture of the organization.  Their recruitment and selection.
 How they are measuring their performance.

 Their demand and supply.  Use of technology.  Advertisement and social responsibility.


The following assignment is a joint corporation by…. The assignment was a useful experience for us in knowing deeply about some of the business environment situations about Nestlé. During our assignment we consulted members of Nestle in Peshawar. Internet and financial reports were also used for the research work about the organization. The assignment shows the current business environment position of Nestlé. It was an excellent experience. We thank Sir Abdul Qudus for his excellent teaching, if it wouldn’t have been that, we would have been facing a lot of problems.



The assignment which we summarized is related to Nestle food and beverages company, Nestlé is the largest food selling brand of the world, with products sold in above 100 countries and over 65000 workers employed and many factories and plants. Our assignment starts with a brief introduction about nestle and a history of all the important events that took place during the passage of time since its beginning. In our assignment we talked about few of the major aspects and information related to nestle, Our first outcome was to identify the mission statement of Nestlé. In order to explain our point more deeply, we explained it deeply and also evaluated it. Next was to explain the values of the firm,to explain our work deeply we also identified the perspective of the values of Nestle and evaluated it. Our next job was to identify the key long term and short term objectives of Nestlé, these included main objectives such as quality and availability of their products. These are important key principles of nestle. Next was the stakeholders, Nestlé being a large company has stakeholders al around the world, millions of suppliers,costumers,shareholders etc. Every firm has certain responsibilities, so is the case with Nestlé. Nestlé considers its self responsible for various number of things, including safety of environment and health and care of workforce. We examined the ke responsibilities and also added a few more key responsibilities to our conclusion. Our most difficult task was finding information related to Physical, financial and Human resources of Nestlé, a very difficult task, for which we studied deeply and then came out with some information. Nestlé being a major brand around the world has billions of money invested in different aspects of business, the money is invested by shareholders and bank loans, this money is then used to buy the physical resources, which include machinery, food ingredients etc.While the workforce used to conduct all the supply and manufacturing of these products come in the HRM section. We covered this outcome successfully giving our conclusion to it too. Every firm has a special unique culture, which specifies the nature of the firm. It helps in explaining the nature of the brand. So is the case with Nestlé, few of the key objectives of the firm were mentioned in the assignment by us, including honesty,integrity,teamwork and loyalty.


Staff recruitment comes next, in this question we explained the process through which nestle recruits new workers, we didn’t find the process good due to certain reasons, therefore we gave our evaluation at the end of the question talking about the things nestle should fix. Performance measurement techniques used by nestle was our next task, during this we found out information about the evaluation team which evaluates the workers and employees on the bases of their performance, and explained certain motivators for giving good performance Demand of nestle included all the details about sales of the business and the sales made in each segment of the company products. We did this part in detail while the supply part was abit short since the supply chain is too vast,the nature of the business is that way, every product has a separate supply chain strategy, so we just identified of one of the most important product of Nestlé. Nestlé pure life water. The second last part of our assignment is related to finding the technological equipments used by Nestlé, according to us the most interesting question .Nestle has an excellent technological system provided to them by IBM and the storage facility is among the biggest in the world. Billions of money invested in the technological equipments of nestle. The last part of the assignment is related to advertisements, a brief description about what is advertising and different forms of advertising was done and than we explained the different forms of advertising mediums used by Nestlé, ending up the assignment with all the promotional activities used by nestle in order to promote nestle pure life water, in order to explain this question.



Nestlé history began in Switzerland in the year 1867 when a pharmacist Henri Nestlé launched his product which was a nutritious gruel for children. Henri used his surname to Name his company, which means little nest, in both the company name and the logo. The nest symbolizes family, security and nourishment, this symbolization still plays a central role in Nestlé’s profile. Since it began over 130 years ago, Nestlé’s has been a success full company since the beginning, keeping complete focus on consumer satisfaction and focus, as a result that company has turned into the largest food Company in the world. the variety of product that nestle produces includes fresh quality chocolates, soups, a vast variety of coffee, cereals, frozen products such as nuggets, fresh yoghurts, mineral water like pure life and other vast number of food products. Since the beginning years in the 1970s nestle continued to expand its product portfolio including pet food product, pharmaceutical and cosmetic products. As a result now in this new ea of twenty first century Nestlé markets a great number of products with all products having one thing in common, high quality, and this is why nestle became popular through out the world. Nestlé owns over 500 factories in 86 countries operating in 5 different regions : 1. 2. 3. 4. 5. Africa America Asia Europe Oceania

Since the company began in 1860s uptil now, the company has made hugh changes to its product line, also inventing new products based on cosumers,just when Henri developed his first success in 1866,which was a formula to make a special sort of dry milk for babies who are not able to breastfeed. He got his success when he tried it on a premature infent who could not resist his mother milk and any other sort of substitutes. This product 5

was a Hugh success in Europe. Nestlé second big step was merging with the Anglo swiss condensed milk factory in U.S.A in 1905.Since the demand for dairy product was high because of world war so nestle increased its production and as a result achieved Hugh sale margin. After the government contract for world war 1 dried up nestle faced a fall in sales, eventually the firm took a step to stabilize its sales margin by expanding the company with the launch of chocolate in the late 1920s,the company’s second most important product. World war two effected nestle badly dropping the profit from 20 million to 6 million dollars in 1938.Again nestle took a well appreciated step in order o recover their loss, when nestle established factories in other countries since war effected Europe badly, mainly the established their firms in Latin America and launched Nescafe staple drink of the US military. Production rose again in the war time. End of world war was a dynamic phase for Nestlé. Between 1944 to 1975 nestle merged with a number of companies who were indulged in creating quality products, these included magi seasoning soup in 1947,Blackwell in 1950,Findus in 1963,Libby,s in 1971 and Stouffers in 1973.Between 1980 to 1984 nestle divested a number of businesses with new firm objectives. In the first half of the 1990s the company crumbled due to trade barriers and when the world market was created into a fewer integrated trade areas. But since 1996 there has been success since the company have had few acquisitions including San Pellegrino in 1997 , spillers pet food in 98 and ralson Purina in 2002.And in 2002 there were two more acquisitions in North America, with Ice cream business with Dryers in August of the same year with Chef America inc.

At Nestle, we believe that research can help us make better food so that people live a better life. Good Food is the primary source of Good Health throughout life. We strive to bring consumers foods that are safe, of high quality and provide optimal nutrition to meet physiological needs. In addition to nutrition, health and wellness, Nestlé products bring consumers the vital ingredients of taste and pleasure. As consumers continue to make choices regarding foods and beverages they consume, Nestlé helps provide selections for all individual taste and lifestyle preferences. Research is a key part of our heritage at Nestlé and an essential element our future. We know there is still much to discover about health, wellness and the role of food in our lives, and we continue to search for answers to bring consumers Good Food for Good Life. 6

The mission statement of nestle emphasizes on the fact that the products of nestle are available in nearly every part of the world, where ever one may live, Nestlé helps them in providing the safest and reliable range of products and beverages in order to meet consumer needs. The mission statement of nestle mainly reflects on the main trademark of Nestlé, that is quality,the company never compromises on quality and this is our personal experience. Nestlé is always known for providing fresh and excellent quality products. Nestlé also has the advantage that it provides veriety of products and ingredients to various fast food chains, restaurants etc.People around the world show trust in nestle when they purchase their product only because of the quality, so as it is again and again emphasized in the mission statement that quality is the main aspect of Nestlé. In order to achieve their means research has been an important aspect, company fulfill the needs of costumers by identifying the vacant segments in the market and then make products according to the needs. The launch of pure mineral water i.e : nestle pure life is a good example of nestle,s research and development when nestle examined that people in Pakistan are facing difficulty in finding pure water,especially in hilly areas when they go on vacations or trips. Nestlé identified the need and fulfilled it with quality product. This is what nestle stands for, and we also agree that nestle provides quality products based on consumer needs.

No business can long survive in a failed society, and no Society can long survive without a strong economy. Business is the sole creator of wealth, and the origin of all income and tax revenues, as well as charitable contributions. In a sound economy, people can afford both the necessities and the pleasures of life.At the same time, businesses depend on healthy and educated employees, a stable and transparent government and access to sustainable natural resources. These social and environmental dynamics form the context in which businesses derive their financial success and competitive advantage. This interdependence between business and society is the logical starting place to construct a framework for corporate responsibility. Businesses create social and environmental impacts – both positive and negative – through the daily operations of their value chain. In addition, they have the opportunity to use their resources outside the ordinary course of business through social investments that strengthen the context in which they operate. These two dimensions, value chain impacts and contextual investments, are the fundamental tools of corporate responsibility. The more tightly they are linked to the core business strategy of a company, the more value can be created for both the business and


society. Developing a model for corporate responsibility, therefore, depends on studying a company’s value chain to understand the social and environmental consequences of its activities and the external resources required to perform those activities well. THE PERSPECTIVE OF VALUES APPLIED ON NESTLE

Nestle is a complex global corporation that every day sells millions of products under thousands of brands worldwide.It is one of the world’s largest purchasers of basic foodstuffs such as coffee, cocoa and milk. Yet the value chain of this vast enterprise can be simplified to three basic steps:

• • •

Agriculture and sourcing Manufacturing and distribution Products and consumers

Nestlé’s activities at each step of the value chain have the potential to produce social benefits. Through its purchasing practices, Nestle helps improve the economic level of hundreds of thousands of small farmers around the world. Through its operations, the company raises standards for food safety and employment practices. Through the research and development of its products, it helps consumers meet their nutritional needs, contributing in enjoyable ways to their health and wellbeing. Every step in the value chain also has the potential for harmful consequences. Without sustainable growing practices, farms can deplete natural resources, and farmers can be marginalized. Operations can cause pollution, and consumer products can create health risks such as obesity. To fulfill its corporate responsibilities nestle must not only produce social benefits. It must work assiduously to eliminate any possible harmful social or environmental impacts from its value chain. Our study concludes that Nestle has invested heavily in improving the economic and competitive context beyond its ordinary production activities in the regions where it operates. For example, in the Caqueta region in Colombia nestle helped dairy farmers increase their milk production through nutritional supplements for their cows, while simultaneously improving the quality of their milk. This helped them earn above market prices. Better agricultural practices strengthen nestle’s core businesses.They also help farmers earn a better living by producing higher food outputs using fewer natural resources. This is a critical outcome for society at a time when global caloric consumption is set to double in the coming 25 years.



Well what we recommend for nestle for the future is that nestle must build on its legacy of value creation,moving beyond individual initiatives to encompass its entire global value chain of activities. The first step, we believe, is to set goals and to measure progress against them on a global basis in the areas of agricultural development, manufacturing impacts, and consumer benefit and education in order to tighten the link between Nestlé’s strategy and its social responsibility. The company has already developed best practices in different regions and at different points along its value chain. Until more success


stories are replicated across all of Nestlé’s markets, it will not be clear whether they are merely excellent initiatives or if they truly represent a mode of operation that is embedded in corporate strategy. Nestlé recognizes that it cannot work alone, and is building partnerships to address specific social problems that arise in its value chain. For example, the company helped build an open platform – the Sustainable Agriculture Initiative – that now includes 20 food-related companies working to promote sustainable agriculture. This very promising development should be applied in other areas, such as consumer nutrition, where nestle is only one of many companies that affect the issue. Finally, nestle should become more explicit and affirmative with respect to its desired social impacts. Publicly committing to deliver measurable results on key social issues can bring great credibility to a company and, at the same time, help focus internal resources on effective execution. Nestlé has already done a great deal to create values for the business and society at large, but there are many other opportunities to increase its focus and achieve even greater benefits for all of its stakeholders.

Nestle has some key objectives and its is commited to in all countries,also they take in acount the local legislations,religious and cultural perspectives : • The objective to nestle business is that they aim to manufactur the product and then market it in such a way so that it create value in the mind of costumers,employees,business partners etc.They aim to sustain this for a long period of a time. Nestle has never compromised on quality,so it never goes for a short term profit,because it can indiretly effect them in the long term,this shows the honesty of the company to their costumers. Nestle has recognized the importance of their costumers and they really are trying their best to make them create more interest in the behavior , belief and actions of the company and also the brands in which costumers put their trust in.They think without consumers the company would not exist. Nestle is always concerned about assitional guidance to staff so that it can benefit their company by ensuring that the highest standards are met throught all of the organzation. Nestle is strict about the recruitment of their employees,as they believe in the fact that the success of a corporation is the reflection of professionalism.They work hard to recrite the right people for the right job and also give them additional trainings.


Nestle has the key objective of providing consumers with a safe product with high quality,in order to reassure the consumers nestle name on every product is quality for their consumers, its mentioned on every product. As far as the safety environment is concerned the products are made in a safe environment, safety policies of the company are really strict. During the quality phase a continual process is monitored in each phase of production, about 200 controls. Packing policies are also honestly obeyed by the firm, safe packaging implies fresh products. Another key objective is to provide costumers with a healthy product. No artificial ingredients, they believe in providing a balanced fresh and healthy product. Nestle has also made distribution of their products a prime objective, they want their product as convenient as possible, they want it available in all shops and restaurants, everyone should know about the availability.

These objectives have a deep connection with a mission statement of the business, both of them have deep focus on quality, availability and meeting consumer needs. However nestle does not have the objective to not go against the perspective of any religion, for an example we can take in account the aids they provide to forces in Israel against Muslims in Gaza, as a result nestle product was banned in many Muslim countries, Nestlé always relies about consumer care, but then on the other hand they provide money for wars against Muslim, I think the company should look upon these objectives again and reconsider.

Intelligent businesses in the new era are aware of the fact that their responsibilities should not be conducted only towards the directors and shareholders, they believe in the fact that consumers , environment , suppliers etc ,all need a proper attention, for nestle this is nothing new. As with passage of time they create values for their different stakeholders as they recognize their importance The major stakeholders in Nestle are :
• •

Shareholders : This include both preference and ordinary shareholders, demanding profit from their dividend. Employees: They demand for job security and training in development facilities in order to enhance their career with nestle.


• •

Consumers : consumers who demand for product that are appropriate to meet their needs and wants and also demand for the availability in every shop at the appropriate price. Business partners : they are essential to run the business and they deand for long term trusted relationship. Local and national economies : The governments also expect the company paying its taxes and duties.

The suppliers of the company provide them wih sources like labor and material in order to produce goods and services. This adds to costumer value delivery system.The Labour supplies include handling of quantity of labour,the quality of labour,labour strikes and labor relation.While material supplies deal with quantity of material, the quality of the material, the price of the material, stability of material inputs and delivery delays. Nestle is efficient at handling all the quantity, quality, stability and price of both labour and material supplies. The labour strikes cause major problems for nestle, causing them supply shortage and also badly effects sales, so this means there is a lack in the care of employees, nestle needs to take employers needs into consideration to avoid further damage.

Nestle manufacturers are good at taking care of their shareholders. They are given equal representation at annual general meeting and are given a chance to add to the agenda. One of the interesting point about nestle strategy about shareholders is that they give more importance to ordinary shareholders. If a shareholder is having 6% shares of total share capital can only use half of their shares. This provides small share holders with a bigger voice.

Nestle is being ranked fifth among he top ten assessed corporations of the world, The company is ranked fifth because it does not have a broader applicable policy in order to handle complaints from both external and internal shareholders on non-compliance issues.



After identifying all the major policies about the stake holders of Nestlé, What we evaluate is that there is a lack of care about employees, if company cannot meet the needs of their employees, this will result in meeting consumer needs and the rage of employees can lead to making poor quality products. This means that all the basic objectives of the company such like quality,packaging,avalibility of product everywhere anytime,all depends on the hard work of the employees, so I think nestle should be really patient with their work force and employees.

RESPONSIBILITIES OF NESTLE PROTECTING THE ENVIRONMENT : This is one of the major responsibility of nestle,Nestle makes products from ingredients which fresh and new,most of them are raw ingredients, that's why it makes good business sense for us to protect and nurture the land from which our products come. Company aims to use all their expertise and experience in manufacturing to create a sustainable future locally, nationally and globally. SOURCING THE BEST INGREDIENTS : One thing is never compromised in the quality and safety of Nestle’s products.Nestle uses the best ingredients for their products which meet the global standards around the world. RESPONSIBLE ADVERTISING : nestle knows that advertisement is one of their main aspect to let their consumers know about the products, it is therefore their responsibility to provide appropriate advertising. Nestlé advertising focuses on the following aspects : 1. Insure that the advertisements are not misleading about the benefits of using their products. 2. Does not undermine the authority of parents. 3. Encourages healthy eating and nutrition choices. 4. To show active lifestyles as a key point of health and wellness. 5. Abide by all laws, regulations and standards.

LABELLING THAT’S HELPFUL : Nestle is responsible for providing easily accessible information about their products. So they provide information on the front of the packs of all their products, this helps costumer to make quick and informed choices about product which best meet their needs.The labeling shows


information such as the amount of calories, sugars, fat, saturates and salt etc. It also shows the percentage of your daily amount of the key nutrients contained in the particular product. Nestlé's product packaging is designed to empower the costumers so they can make more informed purchasing decisions.There are three main guiding principles that form the basis for all Nutrition Communication of nestle :
1. Simplicity : The infrmation about the ingredients/Nutrition must be presented

using words, symbols and concepts that can be easily understood by consumers.
2. Transparency : The information should be appropriate and must give the

consumer a clear image of what the product is about.
3. Clarity : Labelling should present information in a way that it clearly identifies

and separates the different types of information provided. BEING PART OF THE COMMUNITY : One of the important responsibility of nestle if to contribute to local communities where they have their particular offices, such as supporting charities and community projects etc. This will also help them gain consumer attention.

QUALITY AND SAFETY : Quality and food safety are essential responsibilities for success of nestle.All products and services should be responsible to laws and regulations and as well as the stricest company quality and safety which are really important for the success of the business.

PHYSICAL RESOURCES OF NESTLE AND HOW THEY ARE ALLOCATED : Since the beginning when nestle was started by Henri,with the passage of time the copany started to grow,first in Switzerland,then Europe,then North America,and slowly and gradually around the world,now its almost in every country every where.The physical resouces of nestle are un countable,the company employees around 283000 people and have factories more than 600 facories and or operational plants in almost every country in the world.These includes plants for beverages production,for ready made food products,for chocolates,for mineral water and many many more food stuff. Other physical resources which we came to found out about nestle includes the machineries in all the factories,for different aspects.For packing,baking,mixing,blending


and so on.The list goes on,the company has also merged with various populer brands such as L,Oreal and ALCON. For milk products the company owns fresh dairy farms and poultry farms for other products.The company does not compromise in the case of quality so it can be assured that all the dairy farm products used are fresh. Also other Physical resources include different ingredients used for the products that the company makes,there is a hugh list of ingredients used in every product and nestle buys these in bulks in order to meet the costumer needs. It is too hard to find the exact information about the physical resouces in exact terms because the company is really vast now and it is hard to evaluate everything.But all we could find out is the worth of physical resources of nestle which is worth 9.4 billion dollars.

FINANCIAL RESOURCES OF NESTLE AND HOW THEY ARE ALLOCATED : Finance is like the money put up in a business in order to run its daily operations,without proper finance a company cannot be run.So if we talk in the case of nestle,the company is so vast that it has shareholders in every country and every part of the world.Finance is easily provided for the company day to day operations.These include ordinary and preference share holders and a relevent sum of bank loan.financing cost includes the financial expense on borrowings from third parties as well as the financial income earned on funds invested outside the Group. Financial cost also includes other financial income and expense, such as exchange differences on loans and borrowings, results on foreign currency and interest rate hedging instruments that are recognized in the income statement in the annual reports. Unwind of discount on provisions is presented in financing cost. The company is engaged in a large sum of financial processes, such as tax payments in every country and fiscal and monetary policy. However the main source of finance for the business includes shareholders, bank loans and leasing companies.

HUMEN RECOURCES OF NESTLE AND HOW THEY ARE ALLOCATED : Human Resource Management can be defined as the function within an organization that focuses on recruitment, management and providing direction for the people who work in the organization. Human Resource Management can also be performed by line managers.


Human Resource Management is the organizational function that deals with issues related to people such as compensation, performance management, wellness, organization development, hiring, safety, benefits, communication, administration, employee motivation and training. As far as nestle humen resource management is concerned,the company is working hard for the commitment in workplace on safety and health issues.Safety matters are non non negotiable in nestle,the company really takes care about the safety of their workforce.Health and safety management systems are being used in all the factories,this has really helped in reducing the injuries at workplace. PREVENTING ACCEDENTS : Since the beginning nestle has created a strong network of safety health and environmental functions,these functions help them develop and share practices in order to prevent accedents in their factories all around the world. INVOLVING EMPLOYEES : Employees are always reasured about the safety at the workplace in order to stop them from getting demotivated.Also behavior based safety programs are implemented in all factories,operational sites and distribution centres.

TOOLS TO MANAGE SAFETY PERFORMANCE : These include some costum rools which have been put to track workplace safety and performance.Managers have easy access to these reports and they use it to evalute the safety measures and work performance. EMPOWERING HIGH PERFORMANCE TEAMS : As the economies diversify,the growth in competition also increases.Nestle has a proper way of evaluating its performance of their highly trained workers.This is one of the main HRM culture of nestle and its helps in achieving the best performance.An example of their evaluation teams can be mission directed teams,it is a mini business which is focused on the dilivery of high quality products to other internal mission directed teams.

LISTENING AND RESPONDING TO EMPLOYEES VIEWS : One of the really appretiated steps taken by nestle is listening and responding to what employees say,this helps in motivating them,gives them he feeling of the homely environment.This also varifies that the system is not centralized,its decentralized and employees and other forces are consulted too in order to take decisions.



Nestlé’s commitment to sound Corporate Governance goes back to its very early days. Today both legislation and international recommendations indicate growing public interest in the issue.These reflects and highlight nestle’s ongoing commitment to ensure the highest level of responsible corporate conduct in all of our Company’s activities: • Building consumers trust through the quality of their products. Nestle is known for its quality, and this is one of their main objectives, consumers trust them because they have fresh natural products.

Respecting the social, political and cultural traditions of all countries in which it operates. I don’t agree with this objective and we think that nestle is supporting Israel against Palestine in war,which is against the Muslims.

Nestle also takes long term approach in order to take strategic decisions. This includes interest of shareholders,consumers,employees,business partners etc.

• • • • •

Maintaining top service levels and share the company’s aspirations and beliefs. Building Customer Loyalty Inspiring Employee Passion and Commitment Consistently Achieving our Key Business Objectives Acting with an Entrepreneurial Company Spirit


• • • • • •

Constantly Improving Our Company and Ourselves. Respect for People, Community and the Environment Honesty and Integrity Teamwork Commitment to a strong work ethic, integrity, honesty and quality. Personal relations based on trust and mutual respect. This implies a sociable attitude towards others, combined with an ability to communicate openly and frankly. A personalized and direct way of dealing with each other. This implies a high level of tolerance for other ideas and opinions, as well as a relentless commitment to co-operate proactively with others. A more pragmatic than dogmatic approach to business. This implies being realistic and basing decisions on facts. One of the main objective of nestle is that they r open and curious for dynamic future trends in technology, changes in consumer habits, new business ideas and opportunities, while maintaining respect for basic human values, attitude and behavior are also one of they key aspects the business follows.

METHOD OF STAFF RECRUTMENT USED BY NESTLE : Over the past 135 years nestle is recruiting millions of people all around the world from each and every nationality. The company has over 265000 workers in over hundred countries. This shows the company provides a vast rate of employment, however getting 18

a job in nestle is not easy because nestle is a company which has complete focus on quality,so for every task they recruit the right people with the right skills at the right place and the right time. This is the recruitment slgen of the nestle company. In order to recruit their workers for the right task, it depends on the qualification and skills of the workers, whether they are from the research category or whether work force or whether management, in order to get a job the company accepts the CV report and the skills which are sent to them through email address. If the skills meet the needs of the company, then nestle recruits the workers. Training is provided to workers time after time through various training programs in order to improve the skills of workers, this also motivates the workers showing them job satisfaction. According to our evaluation what we think is that nestle should not recruit the workers through looking at their CV,z through internet, if they talk personally they can evaluate the workers, because there are many people who are much more experienced than the CV,s show. Nestlé in this point can lose a large number of skilled people.If they take little time and staff for recruiting than this can lead to future progress and vice versa.but on the other hand I appretiate the training campaigns run by the firm.This helps in improving the skills of the workers for future progress.

PERFORMANCE MEASUREMENT METHODS OF NESTLE : As we mentioned before, Nestlé has a Hugh number of workers working all around the world. Evaluating their staff performance is a part of almost every organization, so is done by nestle.For staff evaluation nestle has kept special team and certain rules and regulations which we came to found out about when we met the workers at the local head office.We came to know that since nestle is strict in terms of quality, on which they have no compromise, so is the case with work force performance. Nestle accepts work force who are good at providing quality. The local evaluator evaluates the workers every month. Every staff member and worker is given a specific target, if the targets are not achieved than they are asked to leave the organization. On the other hand nestle also gives grants to workers who give good performance. They have a certain amount of level which they have to meet,if they achieve above the level than they are given bonuses and for staff members they have promotions and fringe benefits. From what we judged about nestle performance management we conclude that nestle should give chance to their workers because there can be a situation where a worker did


not want to do a particular thing but it happens by mistake. So a chance should be given, this way the company can lose large number of skilled people.

DEMAND OF NESTLE : Nestle is the largest food and beverage company of the world, this particular outcome is about finding the demand of nestle,in short form we can say that nestle had sales of over 107 billion in 2008.This can show simply how much nestle is demanded. The company own several major brands,these include Nescafe,kit kat,stouffers,nestle water and many more. Nestlé is a major brand and its competitors include unilever NV (UN),Hershey foods (HSY),Kraft foods(KFT),Catbury (CSG) etc etc.$2 percent of nestle sales come from north America making nestle one of the most geographically diverse and major food and beverage company. Nestle has occupied the top spot in terms of sales but it is still attempting to continue its growth by increasing the nutritional value of its products, most recent was the promotion of health benefits of chocolates. For various research aspects the company has a vast development network with over 5000 scientists and technicians.Demand for various nestle products according to their proper order is listed below :

DEMAND FOR NESTLE BEVERAGES : Beverages comprised of 26% of nestle revenue in the year 2008,these included milk products ice creams and nutritional drinks.nestle also owns several international beverages brands including Nescafe,nestea,nesquick,purelife etc.Famous brands in the beverage section include lipton,evian,nestle juices. MILK PRODUCTS, NUTRITIONAL AND ICE CREAM MILK PRODUCTS :


This was the nestle largest segment in 2008 with 28 percent of the companies total sales. Brands from this division's includes Carnation, Coffee Mate, Dreyers and Edys.Each of these had he sale over 1 billion. Competitors include Dannon yogurt and Store brands.

PREPARED DISHES AND COOKING AIDS : From the forecast of 2008 sales,this particular segment adds 17 percent to the sales of nestle.They make famous products like microwave lasagna,maggi 2 minutes noddles.They are designed to be prepared quick and easily .The company owns famous brands such as stouffers,lean cuisine,Hot pockets and magi.Maggi had the sales of over 1 billion in year 2008.Competitors for this segment include Didiorna,Bertoli and Kraft Macaroni and Cheese.

CONFECTIONARY : This segment of nestle comprises 11 percent of the total revenue generated in 2008.Famous brands include kit Kat and nestle chocolates. Famous products include Baby Ruth and nestle crunch. Nestle chocolates and candies compete with famous brands such as Hershey foods (HSY) and Cadbury (CSG). PET CARE : Nestle also makes product for pets which contributes 11 percent to the sales of 2008.The company also owns several brands of pet care that produced above 1 billion dollars in 2008,these brands included dog chow and Friskies.Major competitors include Iam,z and Store Brand.

PHARMACEUTICAL PRODUCTS : A new division added to nestle is the pharmaceutical products, these comprised of 7 percent of the sales of 2008.These consists of mostly cosmetics such as L’Oreal and ALCON (ACL).

SUPPLY OF NESTLE : Supply is one of the main aspects nestle needs to focus on,so the company chooses its best managerial team to distribute their product through the appropriate medium offer. Nestlé owns over 500 factories around the world.These factories are either supplied wih the products from the manufacturing countries or either by they are made in the same 21

country, since nestle has a long list of products, all having different way of supply method, so it was hard to find about all the products. However the main method includes Manufacturer to wholesaler wholesaler to retailer and retailer to costumer.This is one of the examples of nestle mean of method distribution. This example was about how nestle pure life mineral water is distributed.
Pure Life Water

Whole Seller



TECHNOLOGY USED BY NESTLE : Through out the whole assignment apart from the delicious food,the only other thing which we liked about nestle was their technological systems.There are two sides of this topic,one is the technology used in their offices while the other in the factories. Nestle has signed contract with IBM for the next five years,purchasing their computer for data saving and other important functions.These equipments were worth 500 million U.S dollars.Through these system they can make servers and transfer data to other factories and offices.


For the factory side, Nestlé has always kept focus on a few important policies. Nestlé have the objective that all the equipments and machineries in the plants should be environment friendly, safer for human, products and product line and it should have higher energy efficiency. These systems are used in various different types of Nestlé’s departments such as chemical plants,cold storage and pharmaceuticals. The company owns over 30000 refrigerators for keeping the product for storage and safe.Each 4000 kW,which is equal to 30000 house hold refrigerators .This shows how much money the company is investing on their technological equipments. ADVERTISING Advertising is an important element aspect of the marketing communications.In simple words,advertising directs a message at large numbers of people with a single communication.Advertising has a number of benefits for the advertiser. The advertiser has control over the message. The advert and its message, to an extent, would be designed to the specifications of the advertiser. So the advertiser can focus its message at a huge number of potential consumers in a single hit, at a relatively low cost per head. Advertising is quick relative to other elements of the marketing communications,for example personal selling, where an entire sales force would need to be briefed or even recruited. Therefore an advertiser has the opportunity to communicate with all or many of its target audience simultaneously.There are two key categories of advertising, namely above-the-line and below-the-line. The definitions owe a lot to the historical development of advertising agencies and how they charge for their services.

There are two type of promotion decisions that a company can take :

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Above-the-line promotion Below-the-line promotion



This is the term used in connection with advertising of a product or business through the media,such as radio,T.V,newspaper.These advertisements are usually directed towards the appropriate target market by selecting certain media.Successful advertising have led to substantial increase in consumer awareness and sales and,and this effect can last for a considerable length of time if brand loyalty can be established.Advertisments are often classified in 2 types,but in practices this distinction is often quiet blurred.

Informative advertising : These are adverts that give information to potential purchasers of a product,rather than just trying to create a brand image.This information includes price,technical specification or main features and places where the product can be purchased.This style of advertising could be perticulerly effective in promoting new products.

Persuasive advertising : This is trying to create a distinct image or brand identity for the product and may not contain any details at all about materials or ingredients used,prices or places to buy it.This form of advertising Is common,especially in those markets where there might be little actual between products and where advertisers are trying to create a perceived difference in the minds of consumers



This is the term used in connection with all forms of promotion, other than advertising, over which the business will have some direct control. Some of the best known examples include :

Money off coupons and other consumer incentives to purchase: These can either be immediate incentives, for example free samples and trail packs or delayed incentives, for example saving up discount points or air miles to be used in the future. These schemes are often designed to encourage consumers to try a product for the first time and to which from a competitors brand

Direct mail shots to people identified by market research to have a potential interest in this type of product: These can contain a great deal of detailed information,for example,saving schemes.

Point of sales display : manufacturers are very keen to obtain the best position for their product in retail shops and will develop eye catching displays to draw consumers attention.

Sponsership of sports and cultural events : This is now a hugh part of total promotion industry.The growth of global television and internet have oncreased the potential market for major sporting and cultural events.Expanditure on this form of promotion can lead to dramatic results.


To increase sales and build an image in the mind of consumer company advertise their product in different ways, as far as Nestle is concerned, the company uses:

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Television Radio News Paper Bill Board Hoarding etc.

Some time company also makes free sampling, held stalls at different programs like food exhibitions etc.

Nestle produces a wide range of products, for every product they use a different mean of advertisement. Nestle is among the top three companies with the highest rate of advertisements. Lets suppose we take nestle pure life water advertisement campaign. Nestle pure life mineral water basically started their origin in Pakistan,In order to let the costumers know about the product,nestle applied various interesting strategies, this included :

Personal Selling: A direct selling activity was carried out during the summer months of June, July, and August and the year 1999 in Lahore. A team of vendors, clad in branded T-shirts, caps and jackets, sold chilled 0.5 liter bottles to travelling customers on all major intersections. The brand got great mileage out of this innovative idea of personal selling in terms of brand awareness, paid trial, image as well as real sales. Publicity: Nestle Pure Life mineral water was launched with a huge amount of enthusiasm and positive response shown by the locals. The successful story of its launch was printed in all the local newspapers the next day. This greatly helped in creating awareness of the brand and gave its introduction a good start.Daily advertisements are shown on local television channels for past 9 years.


Sales Promotion: Specific promotions of Nestle Pure Life is arranged in some of the key outlets. Elaborate shelf space is acquired for product display and specially designed POS material is extensively used to promote sales. On a 12-bottle purchase of 1.5 ml, one 1.5 ml bottle is offered free to consumers. Similarly on a 6-bottle purchase of 1.5 ml, one 0.5 ml bottle is offered free. Regarding trade promotion, the retailer is also given an additional discount of 4 % during this sales promotion. Not only did the sales of Nestle Pure Life grow tremendously during the promotion, it is still continuing to grow more at a higher pace even after it day by days.Sampling and sticker sampling activities were carried out in Murree in summer of 1999. Nestle marketing team has also undertaken a major education campaign on water use and its importance in daily life. Mothers of school children were sent an invitation to attend a Water Show demonstrating the benefits of safe water and were asked to fill out a questionnaire. The questionnaire refined the team's knowledge of consumer perceptions. At the end of the show, visitors received a promotional kit offering a chance to sample Nestle Pure Life and opportunity to enter a photo contest on the theme “Nestle Pure Life and You.” The contest offered 10,000 rupees in prize money. This helped boost the brand's image in the minds of consumers.

Public Relations: As far as the public relations is concerned, The organization releases an annual report which includes the company's financial statements along with the sales of all product categories. The annual report is mainly aimed at the stockholders. However, another very important form of public relations are the newsletters and bi-monthly magazines issued by the organization. A huge amount of information is found in these regarding the products and their promotion. In the same way, Nestle Pure Life is given quiet a bit of importance in the newsletters issued after its launch, which obviously helped in creation of the awareness of this brand.