Assignment 02

Course Title: Bangladesh in International Business

Course ID: INB 304
Section: 02

Submitted to
Dr. Raisul Awal Mahmood
Professor
Department of International Business

Submitted by
Name: Hasibul Hasan
ID: 2021025

Date of submission: 09/04/2023

 Table of contents

1. Introduction
2. Name
3. Country of origin
4. Functioning in Bangladesh
5. Type of Goods and Services Produced
6. Contributions to Bangladesh Economy
7. Prospects of Future Growth
8. Concerns felt of Nestle in Bangladesh
9. Conclusion & Recommendations

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 Introduction

This report focuses on the multinational company Nestle, which is one of the largest food and
beverage companies in the world. Nestle has a presence in almost every country, including
Bangladesh, where it has been functioning for more than 25 years. This report aims to provide a
comprehensive overview of Nestle, including its background, activities, contributions to the
Bangladesh economy, prospects of future growth, concerns felt, and recommendations.

Name

Nestle is a Swiss multinational company that was founded in 1866 by Henri Nestle. The
company is headquartered in Vevey, Switzerland, and is one of the largest food and beverage
companies in the world. Nestle's products range from baby food, bottled water, coffee, and tea to
pet food, snacks, and ice cream.

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 Country of Origin

Nestlé is a Swiss multinational food and beverage company, headquartered in Vevey,

Switzerland. It was founded in 1866 by Henri Nestlé, who established the company to produce
and sell infant food. Today, Nestlé is the largest food company in the world, with more than
2000 brands and operations in 191 countries.

Nestlé's origins can be traced back to the 1860s, when Henri Nestlé, a pharmacist, developed a
nutritious, milk-based baby food that could be easily digested by infants. The product was a
success and Nestlé went on to develop other food products, including condensed milk and
chocolate. The company's early growth was driven by its expansion into new markets, including
the United States, Europe, and Asia. Today, Nestlé has a presence in almost every country in the
world, with operations in a wide range of food and beverage categories, including coffee, bottled
water, pet food, and confectionery. While Nestlé is a Swiss company, it has a decentralized
structure, with many of its operations and brands managed locally. The company has a strong
commitment to sustainability and has implemented a range of initiatives to reduce its
environmental impact and promote social responsibility. As mentioned earlier, nestle is a Swiss
multinational company. Switzerland is a country located in Central Europe and is famous for its
picturesque landscapes, high quality of life, and stable economy. The Swiss economy is
primarily driven by its service sector, which contributes more than 70% to its GDP. The country
has a strong reputation for quality, precision, and innovation, which reflects in the products
manufactured by Swiss companies, including Nestle.

Functioning in Bangladesh

Nestle is a multinational food and beverage company that operates in several countries around
the world, including Bangladesh. In Bangladesh, nestle has been operating since 1994 and has
established itself as a leading player in the country's food and beverage industry.

Nestle Bangladesh Limited (NBL) is a subsidiary of Nestle SA, the parent company based in
Switzerland. NBL produces and distributes a wide range of products in Bangladesh, including

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powdered milk, baby food, cereals, coffee, tea, confectionery, and bottled water. Some of
Nestle's popular brands in Bangladesh include Nescafe, Maggi, Milo, KitKat, and Nestle Pure
Life.

Nestle's operations in Bangladesh are aimed at meeting the needs of consumers and providing
them with high-quality products that meet international standards. The company has a strong
distribution network and works closely with local suppliers to ensure the availability of raw
materials and ingredients.

Nestle also places great emphasis on corporate social responsibility and is involved in various
initiatives aimed at promoting social and environmental sustainability in Bangladesh. These
initiatives include supporting small farmers, promoting sustainable agriculture, and providing
access to safe drinking water in communities.

Type of Goods and Services Produced

Nestle produces a wide range of products in Bangladesh, including powdered milk, instant
coffee, noodles, chocolates, and cereals. Some of its most popular brands in Bangladesh include
Nescafe, Maggi, KitKat, and Nestle Milkpak. The company also produces products under the
brand name of Lactogen and NAN, which are baby food products. Nestle is a multinational
company that produces a wide range of food and beverage products in Bangladesh. Some of the
goods and services produced by Nestle in Bangladesh include.

1. Dairy Products: Nestle produces a variety of dairy products in Bangladesh, including

milk, yogurt, and cream.

2. Baby Food: Nestle produces a range of baby food products such as Cerelac, Nestum, and
NAN for infants and young children.
3. Beverages: Nestle produces a range of beverages in Bangladesh, including Nescafe
instant coffee, Nestea, Milo, and Nesquik.

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 4. Confectionery: Nestle produces confectionery products such as KitKat, Milky bar, and
Smarties in Bangladesh.

5. Culinary Products: Nestle produces culinary products such as Maggi noodles, Maggi
soups, and Maggi sauces in Bangladesh.

6. Pet Food: Nestle also produces pet food products such as Purina in Bangladesh.

Contributions to Bangladesh Economy

Nestle has made significant contributions to the Bangladesh economy over the years. Firstly, the
company has created employment opportunities for thousands of Bangladeshis, both directly and
indirectly. Currently, nestle employs more than 1,500 people in its two factories in Bangladesh,
and an estimated 25,000 people are indirectly employed through the company's supply chain.
Secondly, nestle has been a significant contributor to the Bangladesh exchequer in terms of taxes
paid. The company paid more than BDT 1.9 billion in taxes in 2020, which is a substantial
contribution to the country's economy.

Thirdly, Nestle's operations in Bangladesh have helped the country earn foreign exchange. The
company exports its products to neighboring countries such as India, Nepal, and Bhutan, which
helps Bangladesh earn foreign currency.

Fourthly, nestle has transferred technology to Bangladesh through its operations in the country.
The company's factories in Bangladesh use state-of-the-art technology and equipment, which has
helped improve the country's manufacturing capabilities.

Finally, nestle has also contributed to Bangladesh's economy by promoting innovative ideas. The
company has introduced new products to the Bangladeshi market, such as NESCAFE 3-in-1,
which is a unique product that combines coffee, milk, and sugar in a single sachet.

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 Prospects of Future Growth

Nestle is a multinational food and beverage company that has been in operation for over 150
years. Over the years, Nestle has acquired various companies and brands, expanding its product
portfolio and geographic reach. The company's products range from confectionery and bottled
water to pet food and healthcare products.

In recent years, Nestle has focused on sustainability and digitalization as part of its growth
strategy. The company has set ambitious sustainability goals, such as achieving zero net
greenhouse gas emissions by 2050 and 100% of its packaging being recyclable or reusable by
2025. In terms of digitalization, nestle has invested in e-commerce and digital marketing to reach
consumers in new ways.

Despite the challenges posed by the COVID-19 pandemic, Nestle reported strong financial
results in 2020. The company's organic sales growth was 3.6%, and its net profit increased by
3.2%. Nestle also maintained its dividend payout to shareholders.

Looking ahead, nestle will likely continue to focus on sustainability and digitalization to drive
future growth. The company may also pursue strategic acquisitions to expand its product
portfolio and enter new markets. However, the success of Nestle's growth strategy will depend
on various factors, such as changes in consumer behavior and regulatory requirements.

Nestle has a bright future in Bangladesh due to the country's growing economy and increasing
consumer demand. The food and beverage industry in Bangladesh is expected to grow
significantly in the coming years, driven by a rising population, increasing urbanization, and
changing lifestyles. Nestle is well-positioned to take advantage of this growth as it has a strong
brand reputation.

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 Concerns felt of Nestle in Bangladesh

There have been several concerns raised about Nestle's operations in Bangladesh. Some of the
main concerns are:

1. Water usage: Nestle's operations in Bangladesh require significant amounts of water,

which has raised concerns about the impact on local water resources. There have been
allegations that Nestle is using groundwater at unsustainable rates, which could be
contributing to water scarcity in the area.

2. Labor practices: There have been allegations of labor rights violations at Nestle's
factories in Bangladesh, including claims of forced labor, low wages, and poor working
conditions. Some workers have also reported harassment and discrimination.

3. Marketing practices: Nestle has been criticized for its marketing practices in Bangladesh,
particularly in relation to the promotion of infant formula. There have been concerns that
Nestle is using aggressive marketing tactics to promote formula over breastfeeding,
which can have negative impacts on infant health.

4. Environmental impact: There have been concerns about the environmental impact of
Nestle's operations in Bangladesh, particularly in relation to waste management and
pollution. There have been allegations of improper waste disposal and pollution of local
waterways.

There are legitimate concerns about Nestle's operations in Bangladesh, and the company has
faced criticism from both local activists and international organizations. Nestle has
acknowledged some of these concerns and has taken steps to address them, but there is still much
work to be done to ensure that its operations in Bangladesh are socially and environmentally
responsible.

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 Conclusion

Nestle is one of the largest food and beverage companies in the world, with a presence in 191
countries. They operate in various sectors, including pet care, coffee, bottled water, and baby
food. Nestle's products are popular among consumers worldwide, and the company has a
significant market share in many countries.

In recent years, Nestle has focused on improving its sustainability practices and reducing its
environmental impact. The company has set ambitious targets to achieve zero net greenhouse gas
emissions by 2050 and has pledged to make all of its packaging recyclable or reusable by 2025.
Nestle has also made efforts to promote healthier products, reduce sugar, salt, and fat content in
its foods, and increase the availability of nutritious products.

Nestle Bangladesh is a subsidiary of Nestle S.A., a global food and beverage company with a
diverse portfolio of products.
The company operates in Bangladesh's growing consumer goods market, which is expected to
continue to expand due to factors such as population growth and rising income levels.
Nestle Bangladesh has a significant presence in the country's dairy, infant nutrition, and culinary
segments, among others.

The company has faced challenges in the past regarding the safety and quality of its products,
particularly in relation to its Maggi brand noodles.
Nestle Bangladesh has undertaken various initiatives to address these concerns, including
improving its supply chain and quality control processes.

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 Recommendations

Focus on sustainability: Nestle should continue to prioritize sustainability and work towards
achieving its zero net greenhouse gas emissions target by 2050. The company can invest in
renewable energy sources, reduce its water usage, and improve its waste management practices
to achieve this goal. Promote healthy products: Nestle should continue to promote healthier
products and reduce the sugar, salt, and fat content in its foods. The company can also explore
the development of plant-based and vegan products to meet the changing consumer demands.
Expand into new markets: Nestle should explore new markets and expand its product offerings to
diversify its revenue streams. The company can look into emerging markets, such as Asia and
Africa, to tap into the growing demand for food and beverage products. Innovate: Nestle should
invest in innovation and research and development to stay ahead of the competition. The
company can explore new technologies, such as AI and automation, to improve its production
processes and product offerings. Nestle Bangladesh should continue to innovate and diversify its
product portfolio to meet the changing needs and preferences of Bangladeshi consumers. This
can be done by conducting market research, investing in research and development, and
collaborating with local suppliers and partners. The company should focus on building brand
loyalty and trust by ensuring product quality, safety, and transparency. This can be achieved by
implementing rigorous quality control measures, using sustainable and ethical sourcing practices,
and communicating effectively with consumers. Nestle Bangladesh should continue to prioritize
sustainability and social responsibility by reducing its environmental footprint, supporting local
communities, and promoting ethical business practices. This can help enhance the company's
reputation and build trust with consumers and stakeholders. Overall, Nestle Bangladesh has a
strong position in the Bangladeshi market, and with a focus on innovation, quality, sustainability,
and social responsibility, the company can continue to grow and succeed in the future.

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