STARTEGIC FINAL .Docx Final - Docx Final

Arab Academy for Science and Technology & Maritime Transport
College of Management & Technology –

Coventry University Program
Department: MIB
Course /Code: Strategic management
Start Time:
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Lecturer name: Dr. Dina El Salmy Student Name:
Name : Hana El deeb
Reg no : 19100140
Data for lecturer only

Question Marks
Actual Available
1. Module 1 10
2. Module 2 10
3. Module 3 10
4. Module 4 6
5. Module 5 4
6. Presentation 10
7.
8.
Total 50
Lecturer Name : Dr. Dina El Salmy

Date: 16/6 Sign:
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Department: MIB
Start Time:
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Name : Hana Fahmy
Reg no : 19100277

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1. Module 1 10
2. Module 2 10
3. Module 3 10
4. Module 4 6
5. Module 5 4
6. Presentation 10
7.
8.
Total 50

Date: 16/6 Sign:
Department: MIB
Start Time:
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Name : shahd Mohamed
Reg no : 19100424

Question Marks
Actual Available
1. Module 1 10
2. Module 2 10
3. Module 3 10
4. Module 4 6
5. Module 5 4
6. Presentation 10
7.
8.
Total 50

Date: 16/6 Sign:

Department: MIB
Start Time:
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Name : Mohamed El Gebeily
Reg no : 19100150

Question Marks
Actual Available
1. Module 1 10
2. Module 2 10
3. Module 3 10
4. Module 4 6
5. Module 5 4
6. Presentation 10
7.
8.
Total 50

Date: 16/6 Sign:

Department: MIB
Start Time:
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Name : Yassin el hossieny
Reg no : 19102979

Question Marks
Actual Available
1. Module 1 10
2. Module 2 10
3. Module 3 10
4. Module 4 6
5. Module 5 4
6. Presentation 10
7.
8.
Total 50

Date: 16/6 Sign:
Department: MIB
Start Time:
Exam Time:
Name : Ahmed el sayed
Reg no : 19100862

Question Marks
Actual Available
1. Module 1 10
2. Module 2 10
3. Module 3 10
4. Module 4 6
5. Module 5 4
6. Presentation 10
7.
8.
Total 50

Date: 16/6 Sign:

EDQMS 2/5
Module (1): Current Situation Analysis
Introduction:
Nescafé is a popular brand of instant coffee in Egypt. It is owned by Nestlé, a multinational food
and beverage company. The brand is well-known for its quality coffee products, which are
widely available in grocery stores and supermarkets throughout the country. Nescafé is also
popular among coffee enthusiasts who prefer the convenience and speed of instant coffee. The
brand offers a variety of flavors and blends, including Nescafé Classic, Nescafé Gold, and
Nescafé Dolce Gusto, among others. In Egypt, Nescafé has a strong presence in the coffee
market and is a popular choice for many coffee drinkers.
Company performance
In recent years, Nescafé Egypt has been focusing on expanding its product portfolio and
investing in marketing campaigns to stay competitive. The company has introduced new flavors
and formats, such as instant coffee sachets and capsules. Nescafé Egypt has also been active on
social media, engaging with customers and promoting its products. The current market share of
Nescafe in Egypt is 42% of overall market share in the industry and Nescafe’s revenue compared
to the world’s revenue is 63.4%
However, like many other companies, Nescafé Egypt has faced challenges due to the COVID-19
pandemic and the economic slowdown in the country. Despite these challenges, the company has
continued to innovate and adapt to changing consumer preferences, which is reflected in its
sustained market share in the country.
Company mission
NESCAFÉ is dedicated to making great tasting coffees for you to enjoy every day by creating a
delicious cup of coffee simply by adding water.
Company vision:
Based on Nescafe's global vision statement, which is "To be the leading coffee brand, providing
moments of pure pleasure in a fast-moving world," Nescafe Egypt's vision statement is similar,
focusing on being a leading coffee brand in Egypt and providing consumers with a high-quality
coffee experience that adds value to their lives.
Company objectives:
1. To increase market share and revenue in the global coffee industry
2. To innovate and offer new product variations to attract different consumer segments
3. To expand the brand's presence in emerging markets and maintain a strong foothold in
established markets
4. To promote sustainable sourcing and ethical business practices in the coffee supply chain
5. To invest in marketing and promotional activities to raise brand awareness and drive sales.
Strategic managers (BOD ,Top managers)
Nescafe is a brand owned by Nestlé Singapore (Pte) Ltd, which is a subsidiary of Nestlé SA. The
headquarters of Nestlé Singapore (Pte) Ltd is located in Vevey, Switzerland.
The strategic managers of Nescafe Egypt may include individuals with experience and expertise
in areas such as marketing, operations, finance, and supply chain management. These individuals
may work closely with the board of directors to develop and execute strategies that drive growth
and profitability for the company.
Nestle top managers and bord of directors:

Mark Schneider
Chief Executive Officer
Laurent Freixe
Executive Vice President
Chief Executive Officer Zone Latin America
Marco Settembri
Chief Executive Officer Zone Europe
François-Xavier Roger
Chief Financial Officer
Magdi Batato
Head of Operations
Stefan Palzer
Chief Technology Officer
Béatrice Guillaume-Grabisch
Global Head Human Resources & Business Services
Leanne Geale
General Counsel, Corporate Governance and Compliance
Bernard Meunier
Head of Strategic Business Units and Marketing and Sales
Steven Wood Presley

Chief Executive Officer Zone North America
Remy Ejel
Chief Executive Officer Zone Asia, Oceania and Africa
David Xiqiang Zhang

Chief Executive Officer Zone Greater China
Greg Behar
Deputy Executive Vice President
Chief Executive Officer Nestlé Health Science
Sanjay Bahadur
Head of Group Strategy and Business Development
David Rennie
Head of Nestlé Coffee Brands
Lisa Gibby
Chief Communications Officer
Module (2): Environmental Scanning

1.Remote environmental analysis
Remote analysis
Remote environmental
analysis
1. Political and Legal

analysis With a presence in over 180 countries, Nescafe has the
largest worldwide coffee footprint. Policy changes in any of
these countries will have an influence on the brand. The
Egyptian government's cut of corporation tax from 30% to
22%, for example, will be a Christmas miracle for Nescafe.
Tax savings will result in extra cash on hand, which might be
used to boost demand by offering larger discounts to
clients. Nescafe also will take advantage of the new policies,
facilities and advantages that the Egyptian government
newly provides to the exporters
The corporation recently filed a complaint in the Egyptian

High Court against a number of third parties for allegedly
illegally manufacturing, distributing, and selling counterfeit
Nescafe instant coffee. The brand's reputation and the
public's health were jeopardized as a result of these
counterfeit products. The situation is under the jurisdiction
of the Food the consumer protection and Standards
Authority of Egypt and the Ministry of Health and Family
Welfare. A scam involving Nescafe offering free coffee
machines to testers has been brewing. The Egyptian
Communications and Multimedia Commission has received
a report from the brand.
2. Technological In Egypt , Nescafe has a one-of-a-kind research and

development Centre. It has collaborations with agricultural
universities in order to boost the coffee business. The
company has created the first of its type E by Nescafe - a
smart coffee maker that is distributed in many countries
around the world including Egypt but the unstable
economic conditions prevented it and the smart cups from
entering with large amount in Egypt and the smart coffee
can prepare both hot and cold coffee. It must be Bluetooth-
paired with the Nescafe E linked cup app. Various social
media initiatives, such as 'Good Morning World,' were
carried out, in which people were urged to share a video of
themselves with their morning coffee mug on digital
channels. The campaign reached 15 million individuals, with
Facebook being the most engaging medium. E-commerce is
also developing for the company. Almost all products are
available on numerous E-commerce websites such as Talbat
, Amazon, and Marsool , making it easier for individuals to
shop.
3. Environmental
The Nescafe Plan is the brand's primary sustainability
initiative. They are the largest consumers of green coffee
sourced ethically. They are teaching farmers how to grow
coffee in a sustainable way that uses as little water as
possible. Energy-saving techniques in manufacturing are
being used in Egypt to roast more coffee with less energy.
Using more powerful filters in the factories to reduce the
emissions as much as possible also Farmers are learning
how to avoid chemicals while still preventing disease. The
Nescafe brand is also aiming to protect old coffee trees and
improve coffee field use. By 2020, they hope to have
achieved 70% more sustainably sourced coffee, 35%
reduced water withdrawal, and zero garbage disposal.
4. Economical The production of coffee in Egypt is expected to increase

thus leading the increase in supply but the same is not
forecasted. Coffee prices are predicted to climb because
producers will supply only a limited amount at the current
market low price and store the remainder while waiting for
prices to rise. Also, one of the important reasons is the
unstable economic conditions that had played a major role
in this increase in prices This would have an effect on the
brand because the price would rise. Despite this, the
demand for coffee is increasing in Egypt, which is mostly a
has seen a 40% spike in coffee demand in the last decade,
with instant coffee being the most popular among
millennials. Nescafe has a 53% market dominance in Egypt,
Other Nescafe competitors, such as bonjorno and Ali cafe,
are constantly lowering their prices in order to compete.
But also, Nescafe is facing some problems due to the
current unstable economic conditions such as it is hard now
for the company to transfer its profit from Egypt to the
mother company also there are major problem in some
feasibility studies to new projects as the currency is
changing constantly and the calculation of the profit is
difficult due to the change in dollar value inside Egypt and
the continues and unexpected depreciation of the Egyptian
currency
5. Social Nescafe introduced the same branding in all countries

where it advertised for the first time in 75 years. The new
company tagline is "It all starts with a Nescafe." The slogan
was coined with the new generation of consumers in mind.
In a more globalized and social environment, the
corporation decided that a more coherent and powerful
umbrella for the brand was required, one that could express
the brand's unique identity in multiple countries. It
rejuvenated and modernized the brand. With commercials
like "make every moment matter" and #badlolifekiraftar, it
extends beyond coffee. It provides young people with an
uplifting outlook on life. It has a vast variety of products to
satisfy everyone's tastes. It sells anything from pure soluble
coffees to 3 in 1 blends and ready-to-drink coffee. Nescafe
celebrates International Coffee Day every year by
conducting public social events.
2. Industry analysis
Porter’s 5 forces
1-Entry barriers
Entering the market of instant coffee in Egypt is high and would not be easy for
new companies to enter the market . Nescafe Egypt, a subsidiary of Nestle , is one of
the market leaders in the instant coffee market in Egypt. In order to maintain its profits
and position in the market using Porter’s 5 forces , which includes the following
components :
Economies of scale :
Economies of scale refer to low costs achieved by a firm due to its large scale of production
Any new company in the market would need to match the prices of instant coffee in the
Egyptian market which are relatively low with the exception of two companies
(Starbucks , Davidov ) that provide higher quality but are often perceived by the
consumers as overpriced as they have a very close taste and quality to Nescafé . So
most of the companies entering the market would need to achieve economies of scale
in order to be able to decrease their cost as much as possible because there isn’t much
choice in the price range if they aim to match or be close to most of the prices in the
market .
- Product differentiation :
The second barrier to entry in this market is the product differentiation , in this market
mainly one company has an extremely large variety of products which is Nescafé ,
Nescafe offers about 40 products of instant coffee that provides a great variety in flavors
, sizes , and ingredients ; making it difficult but doable for any company to top this . New
entrants may face difficulty in differentiating their products in such a way that can capture
customers' attention and loyalty, giving Nescafe a competitive edge.
- Capital Requirements:
Coffee production in Egypt can require a significant amount of capital, depending on the
scale of production and the specific methods used. Coffee production involves various
costs, such as land, labor, equipment, and processing facilities. Additionally, coffee
plants require a significant investment of time and resources before they can produce a
harvest.
However, the cost of coffee production in Egypt can vary widely depending on the
farming practices used. For example, traditional farming methods may require less
capital but may also result in lower yields and lower-quality coffee. On the other hand,
modern farming methods that incorporate advanced equipment and technology may
require more capital but can lead to higher yields and better-quality coffee.
It's worth noting that Egypt is not a major coffee-producing country and is not known
for its coffee exports. As such, the coffee industry in Egypt may be less developed and
may require more investment to establish a successful operation compared to other
countries that have a more established coffee industry.
- Cost Disadvantages Independent of Size:

There may be cost disadvantages that are independent of a firm's size, like unfavorable
economic and political regulations or environmental impacts. For example, Lipton Egypt may
face higher costs due to changes in the import-export laws, high exchange rate , interest rates in
banks for debt financing .
- Access to distribution channels :
Access to distribution channels in the coffee market in Egypt can be both easy and hard,
depending on various factors such as the size of the company, the location of the distribution
channels, and the type of coffee being sold.
Generally, there are several distribution channels available in Egypt's coffee market, including
supermarkets, hypermarkets, specialty stores, online platforms, and cafes. Large coffee
companies with established brands and networks may find it relatively easier to access these
distribution channels, especially those located in major cities.
However, smaller coffee companies and new entrants to the market may face more challenges
in accessing distribution channels. This could be due to limited resources and brand recognition,
as well as the dominance of established players in the market. Additionally, the coffee market in
Egypt is highly fragmented, with different regions and demographic groups having varying
preferences. This can make it challenging for companies to identify and target the most
appropriate distribution channels for their products.Overall, while access to distribution
channels in the coffee market in Egypt can be challenging for some companies, there are still
opportunities for new entrants to establish themselves by focusing on niche markets and
leveraging emerging distribution channels such as online platforms.
- Government policies:
government policies , any company entering the food and beverage industry in Egypt is
require undergoing tests of quality and health to acquire a certificate of safety according
to the ministry of health( moh , 2019) .Without this certificate this company cannot
operate in the market .Also during operations there are control teams from the ministry
of health that do regular quality checks on the company .
2- Bargaining power of suppliers:

According to Porter's Five Forces framework, the bargaining power of suppliers is one of the key factors
that can affect a company's competitive position in the market. The bargaining power of suppliers refers
to the degree of control that suppliers have over the prices, quality, and availability of the inputs or
resources that are necessary for a company to produce its goods or services
Supply dominated by a few companies:

Supplier power is an important aspect of the instant coffee market in Egypt. The supplier group
in this market is dominated by a few companies, such as Nestle and Jacobs Douwe Egberts,
which have significant market share and control over the supply of raw materials.
Switching costs :
Nescafe's ability to negotiate favorable prices and quality with suppliers may be hindered if the
costs associated with changing suppliers are significant. Consequently, Nescafe may be
compelled to maintain contracts with certain suppliers, despite their inability to offer the most
competitive prices or quality, leading to reduced bargaining power and increased reliance on
these suppliers.
Forward integration :
However, the suppliers do pose a threat of integrating forward into the retail market, which
could potentially increase the bargaining power of suppliers . This threat is particularly relevant
in the case of Nestle, which owns several popular instant coffee brands such as Nescafe and
Taster's Choice.
Importance to supplier :
Despite this, the instant coffee industry is not necessarily an important customer to the supplier
group, as these companies also supply ingredients to other industries, such as the food and
beverage industry. This means that the suppliers may not be as dependent on the instant coffee
market and may have less incentive to exercise their bargaining power.
Contend with other products :
Instant coffee suppliers in Egypt are not necessarily obliged to contend with other products for
sale to the industry, as they may also supply ingredients to other industries such as the food
and beverage industry. However, the competition within the instant coffee market can still be
intense, as suppliers compete to offer the best quality and price for their products.Overall,
while instant coffee suppliers in Egypt may not be obliged to contend with other products for
sale to the industry, they still face competition from various sources, both within and outside
the industry. As a result, suppliers need to be strategic in their pricing, product development,
and marketing efforts in order to remain competitive in the market.
How to decrease the bargaining power of suppliers :
- Diversify suppliers
- Build strategic relationships with important suppliers
3- Bargaining power of buyers:
Buyers' bargaining power is a measure of their capacity to extract advantageous terms,

including better quality, lower prices, or other benefits from a company. It indicates the level of
sway that customers hold over a company's pricing and product decisions. In instances where
buyers possess substantial bargaining power, they can demand concessions or switch to
alternative products, thereby decreasing the company's profits.
Buyer concentration:
The instant coffee market in Egypt is highly influenced by the buyer power due to several
factors. Firstly, if the purchases are concentrated in large volumes, it gives the buyer a
significant bargaining power as the supplier would want to retain such a large customer.
Additionally, the availability of other suppliers also gives the buyer more options to choose
from, thereby increasing their bargaining power.
products purchased are standard:

Secondly, if the products purchased are standard, it further increases the buyer power as the
suppliers would have to compete on price and quality. In this case, the buyer can easily switch
to another product if they are not satisfied with the current one.
Switching costs:
Nescafe's bargaining power may be reduced if the switching costs for buyers are low, meaning
that they can easily switch to another product or brand. This could occur if a competitor
provides a comparable coffee at a lower cost, as buyers may be more inclined to make the
switch.
Unimportant to the quality of the buyer's products :
Fifthly, if the industry's product is unimportant to the quality of the buyer's products or
services, it reduces the buyer's dependence on the supplier, thereby reducing the supplier's
bargaining power.
Price sensitivity :
Nescafe may need to lower its prices to remain competitive if its buyers are highly sensitive to
price changes, as these buyers would have more bargaining power. If buyers are able to easily
compare prices and are willing to switch to a less expensive alternative, Nescafe may need to
adjust its pricing strategy to meet the demands of the market.
Product does not save the buyer money:

Sixthly, if the industry's product does not save the buyer money, it reduces the buyer's
incentive to continue purchasing from the supplier, thereby increasing the buyer's bargaining
power.
Buyers may possess greater bargaining power if there are numerous substitutes accessible to
Nescafe's coffee offerings. For instance, if there are other brands on the market that are
comparable in taste and quality to Nescafe, buyers may be more inclined to switch to one of
these substitutes if Lipton increases its prices.
Buyers pose a credible threat of integrating backwards:

Lastly, if the buyers pose a credible threat of integrating backwards, it further increases their
bargaining power as the supplier would want to retain the buyer as a customer. However, it is
very hard for the buyers to integrate backwards as the process to getting raw coffee grains ,
roasting , and grinding is very hectic , expensive and time consuming .
.
4-Threat of substitutes:
As per Porter's Five Forces framework, the prospect of substitutes is among the quintet of
forces that may have an impact on a firm's profitability and competitiveness. This refers to the
possibility of alternative products or services being easily accessible that can fulfill the same
customer needs or desires as the company's own offerings.
In the market generally the substitutes for instant coffee is tea brands . There are several tea
brands in Egypt, each with its own unique market position. Here are some of the most popular
tea brands in Egypt and their market position:
1. Lipton: Lipton is a well-known brand of tea that is widely available in Egypt. It is owned by
Unilever and is positioned as a premium brand. Lipton offers a wide range of tea products,
including black tea, green tea, and herbal tea.
2. El Arosa : El Arosa is a popular Egyptian brand of tea that has been around since 1890. It is
positioned as a high-quality brand and is known for its traditional blends of black tea.
3. Ahmed Tea: Ahmed Tea is a British brand of tea that is popular in Egypt. It is positioned as a
premium brand and offers a wide range of tea products, including black tea, green tea, and
herbal tea.
4. Twinnings: Twinnings Tea is an English brand of tea that is widely available in Egypt. It is
positioned as a premium brand and offers a wide range of tea products, including black tea,
green tea, and herbal tea.
5. Basilur Tea: Basilur Tea is a Sri Lankan brand of tea that is gaining popularity in Egypt. It is
positioned as a premium brand and offers a wide range of tea products, including black tea,
green tea, and herbal tea.
It is important to note that the market position of these tea brands may vary over time and
across different regions in Egypt. Additionally, personal taste preferences and price sensitivity
may also play a role in determining which tea brand is the best for each individual.
5 – Competitive rivalry
In the instant coffee market , there is a decent amount of competitors sometimes the same
company offers a more affordable options for their own product (targeting diff sectors ), an
example for this company is Nescafe as they offer Nescafé gold and Nescafé classic , which are
basically the same product or serve the same purpose but with higher quality and higher price
(gold) . Also , there are different companies that target different sectors like Starbucks that
targets the upper high class . Companies in the industry generally are aware of the trends on
prices and in the market and tend to follow them which makes them powerful substitutes .
Competitors in this market are not numerous but they are large companies that dominate the
industry and are trusted from the consumers . Industry growth is relatively high and there is a
room for innovation and expansion . Concerning this market , there is room for innovation and
there are chances for new innovations and different product varieties . Finally, the fixed costs
for this product are not extremely high .
3. Operating analysis
Creditors
Opportunities for creditors of Nescafe Egypt includes several things.
Firstly, high brand recognition: Nescafe is a well-known global brand, which could increase the
likelihood of the company's success and, consequently, the ability to repay creditors.
Secondly, strong market position: Nescafe Egypt may have a strong market position in the
coffee industry in Egypt, which could lead to a stable customer base and steady revenue
streams.
Thirdly, diversified product portfolio: Nescafe Egypt may have a diverse product portfolio,
including various types of coffee and coffee-related products, which could reduce the
company's dependence on a single product and increase overall revenue.
The previous points are opportunities to the company as they show that Nescafe Egypt is a
good credit risk, which are good indicators of the company’s ability to repay its outstanding
debts.
Threats for creditors of Nescafe Egypt include,

Firstly, Economic instability: Political and economic instability in Egypt could negatively impact
the company's financial performance and ability to repay creditors.
Secondly, Intense competition: The coffee industry in Egypt is highly competitive, and Nescafe
Egypt may face intense competition from both domestic and international coffee brands, which
may decrease the company’s overall revenue as people may choose to buy the cheaper
substitute, and therefore the company may struggle in repaying its debt.
Thirdly, fluctuating commodity prices: The cost of coffee beans can be volatile and subject to
fluctuations because of the devaluation of the Egyptian pound, which could impact the
company's profitability and ability to pay off debts.
Finally, regulatory changes: Changes in laws and regulations in Egypt could impact the
company's operations and financial performance, which could negatively impact its ability to
repay creditors.
Customers
Opportunities for customers of Nescafe Egypt includes a lot of things.
Firstly, expanding specialty coffee offerings: There is an increasing demand for specialty coffee
and distinctive flavors as consumer preferences change. Nescafé may benefit from this trend by
releasing more specialized and premium coffee products, marketing to a larger market, and
stealing market share from rivals.
Secondly, Packaging that is sustainable and environmentally friendly: As consumers' awareness

of environmental issues grows, Nescafé may decide to invest in more environmentally friendly
packaging materials for its goods, such as compostable or biodegradable materials. This would
improve the brand's reputation and appeal to customers who care about the environment.
Finally, creating healthier coffee alternatives: With the increased emphasis on health and
wellbeing, Nescafé can innovate and provide healthier coffee options, such as low-calorie,
reduced sugar, or fortified products, to appeal to consumers who are concerned about their
health and diversify its product line.
Threats for customers of Nescafe Egypt includes several things:

Firstly, Intense competition could lead to price wars, low quality products, and reduced
customer loyalty.
Secondly, Economic instability and fluctuations could impact affordability and availability of
products. Moreover, the price of commodities, especially coffee beans, can fluctuate, which can
affect the coffee industry. As a major player in the market, Nescafé is subject to these changes,
which may have an impact on its profitability and manufacturing costs.
Thirdly, Nescafé's product portfolio mainly concentrates on coffee goods, with limited product
offerings outside the coffee segment. This can make it more difficult for the Nescafe to diversify
its revenue streams and reduce the risks brought on by shifting consumer preferences or
market trends.
Competitors
Opportunities for the competitors of Nescafe Egypt
Firstly, strong competition could drive innovation and improve quality in the coffee industry in
Egypt.
Threats for the competitors of Nescafe Egypt

Firstly, Competition from international and local coffee brands, including Starbucks, Costa,
Bruxies, Douwe Egberts, among others, is fierce for Nescafé. The market share, pricing power,
and profit margins of Nescafé may be impacted by this competition.
Secondly, Secondly, Intense competition, due to the heavy competition in the Egyptian coffee
market from both local and foreign coffee brands, Nescafe Egypt may see a decline in overall
sales as customers opt for the less expensive alternative.
Moreover, this intense competition could lead to price wars and reduced profitability for all
companies involved.
Suppliers
opportunities for the suppliers of Nescafe Egypt
Firstly, growing demand: The coffee industry in Egypt is growing rapidly, and the demand for
coffee products, especially instant coffee like Nescafe, is on the rise. This presents an
opportunity for suppliers to increase their sales and market share.
Secondly, Nescafe's brand reputation: Nescafe is a well-established and trusted brand in Egypt,
and suppliers who can provide high-quality products that meet Nescafe's standards may benefit
from the brand's positive reputation.
Lastly, increasing coffee culture: with the growing popularity of coffee shops and cafes in Egypt,
there is an increasing interest in coffee culture and a desire for high-quality coffee products.
Suppliers who can provide premium coffee products may be able to tap into this market.
Threats for the suppliers of Nescafe Egypt

Firstly, Fluctuations in commodity prices due to the currency devaluation could impact
profitability for both Nescafe Egypt and suppliers.
Secondly, Competition: The instant coffee market in Egypt is highly competitive, and suppliers
may face intense competition from other brands. This may make it difficult for suppliers to
differentiate themselves and gain market share.
Thirdly, Price sensitivity: Egyptian consumers are price-sensitive, and may be hesitant to pay a
premium for high-quality coffee products. Suppliers who are unable to offer competitive pricing
may struggle to compete in the market.
Finally, Political instability: Egypt has experienced political instability in recent years, which may
impact the country's economy and consumer purchasing power. This may result in a decline in
demand for coffee products, which would negatively impact suppliers.
Employees
Opportunities for employees of Nescafe Egypt may include:
First, Professional growth: Nescafe is a large and well-established company with a strong brand
reputation. Employees who work for the company may have the opportunity to develop their
skills and experience through training and development programs and may also have the
opportunity to work on new and exciting projects.
Second, Competitive compensation and benefits: Nescafe is known for offering competitive
compensation and benefits packages to its employees, which may include health insurance,
retirement benefits, and performance-based bonuses. This can help attract and retain top
talent in the industry.
Third, Career advancement: Nescafe Egypt may offer opportunities for career advancement
within the company, either through promotions or by moving to different departments or
functions. This can provide employees with a sense of job security and long-term career growth
prospects.
Threats for employees of Nescafe Egypt may include:

First, Economic instability: The Egyptian economy has experienced periods of instability in
recent years, which may impact the financial stability of Nescafe Egypt and its ability to offer
competitive compensation and benefits packages to employees.
Second, Market competition: Nescafe Egypt operates in a highly competitive industry, which
may result in pressure to maintain high levels of productivity and performance. This may lead to
work-related stress and burnout for employees.
Third, Technological disruption: The coffee industry is constantly evolving, and new
technologies may be developed that disrupt traditional production methods or render certain
job functions obsolete. This may impact the job security of some employees, particularly those
in more traditional roles.
Internal Environment Analysis

1.SWOT
Strengths Weaknesses
1. Strong brand recognition and 1. Dependence on a limited

reputation number of products
2. Wide distribution network 2. High competition in the coffee

Strengths Weaknesses
across Egypt market
3. High quality coffee products 3. Dependence on imported

coffee beans
4. Strong marketing and 4. Limited penetration into rural

advertising campaigns areas
5. Strong partnerships with 5. Limited product diversification

local retailers and cafes
Opportunities Threats
1. Growing demand for coffee 1. Fluctuations in coffee bean

in Egypt prices
2. Increasing popularity of 2. Increasing competition from

instant coffee local and international brands
3. Expanding into new markets 3. Changing consumer

in the Middle East and preferences and tastes
Africa
4. Developing new coffee 4.Increasingly stringent regulations on

products to meet changing coffee production and distribution
consumer preferences
5. Developing online sales

channels
Strengths:
• Strong brand awareness and reputation: Nescafe is a recognized name in Egypt and enjoys a
good reputation for making coffee goods of the highest quality.
• Wide distribution network in Egypt: Nescafe is well-represented in a number of Egyptian

cities and areas, which helps to raise brand awareness and expand the consumer base.
• High-quality coffee products: Nescafe is renowned for making favored by customers high-
quality coffee products.
• Effective marketing and advertising efforts: To promote its brand and goods in Egypt,
Nescafe invests in marketing and advertising initiatives.
• Strong ties with neighborhood shops and cafes: Nescafe has built strong relationships with
neighborhood shops and cafes, which helps to raise brand recognition and product
accessibility.
Weaknesses:
• Dependence on a small number of products: Because Nescafe only sells coffee products in
Egypt, the company is more susceptible to shifts in consumer tastes and market trends.
• Strong rivalry in the coffee business: Both domestic and foreign brands are competing for
market share in Egypt's highly competitive coffee market.
• Dependence on imported coffee beans: Because Nescafe depends on imported coffee beans
to generate its goods, the company is susceptible to changes in the price of coffee around the
world and disruptions in the supply chain.
• Limited reach into rural areas: Because Nescafe's distribution network is mostly
concentrated in urban and suburban areas, it has a limited presence there. Rural areas may
have a lower demand for coffee goods.
Opportunities:
• Growing demand for coffee in Egypt: Changing consumer preferences and rising
disposable income are both contributing to this country's rising coffee demand.
• Growing instant coffee popularity: Nescafe has the chance to diversify its product line
thanks to the rising popularity of instant coffee in Egypt.
• Growing into new markets in the Middle East and Africa: To boost its market share and
revenue, Nescafe can grow its business into new markets in the Middle East and Africa.
• Creating new coffee products to cater to shifting consumer tastes: Nescafe can create new
coffee products to cater to shifting consumer tastes and maintain its position as a market
leader.
• Creating online sales channels: To expand its client base and accessibility, Nescafe can
create online sales channels.
Threats:
• Variations in the price of coffee beans: Nescafe is susceptible to variations in the price of
coffee beans around the world, which can raise manufacturing costs and have an impact on
profitability.
• Growing competition from domestic and foreign brands: The Egyptian coffee industry is
extremely competitive, with numerous domestic and foreign brands vying for market share,
which may have an impact on Nescafe's sales and position in the market.
• Changing customer preferences and tastes: Nescafe's sales and market share may be
impacted by changing consumer preferences and tastes.
• Stricter rules on coffee distribution and production: Egypt's increasingly strict laws on
coffee distribution and production may raise costs and have an impact on profitability.
2.Value Chain
Primary Inbound logistics Operation Outbound Marketing & After sales

Activitie logistics sales service
s
● Sourcing of Coffee ● Operations: ● Outbound ● Marketing and ● Marketing
Beans: Nescafe sources This includes logistics: This sales: This and sales:
high-quality coffee beans activities includes includes This includes
from different coffee- related to activities activities activities
growing regions converting raw related to related to related to ● P
worldwide. The materials into storing and promoting and promoting
company has finished distributing selling Nescafe and selling
r
sophisticated sourcing products, such finished products to Nescafe o
systems to ensure that as roasting, products to consumers, products to f
only the best beans are blending, and customers, such as consumers,
selected. packaging such as advertising, such as i
● Warehousing and
coffee. The transporting brand advertising, t
departments coffee to retail management, brand
Storage: Nescafe has responsible for stores and and sales management
m
several warehousing operations are cafes. The promotions. , and sales a
facilities worldwide the departments The promotions.
r
where the coffee beans manufacturing responsible for departments The
are stored. The company and outbound responsible for departments g
ensures that the beans production logistics are the marketing are responsible i
are stored in the right departments. distribution the marketing for marketing
conditions to maintain and supply and sales
n
their freshness. chain department
● Coffee ● Customer
management
● Raw Material Handling: production: support:
departments. ● Advertising:
Nescafe has advanced Nescafe Nescafe may
systems for handling the sources high- Nescafe uses provide a
quality coffee ● Transportation: various dedicated
raw materials, mainly
coffee beans, during the beans from all Nescafe has a advertising customer
manufacturing process. over the world reliable strategies to support team
The company has and uses a transportation promote its that can
systems that ensure that unique system that coffee respond to
the beans are roasted, roasting helps to deliver products, queries,
grinded, and blended process to its products to which include issues, and
effectively. produce its the customers television complaints
coffee in a timely commercials, related to
products. manner. The print ads, Nescafe
● Inventory Management:
company has a social media products and
Nescafe keeps track of fleet of vehicles advertising, services.
● Product
the inventory of coffee that are used and influencer
beans and other raw development:
for the marketing. ● Feedback
materials in their The brand
transportation
warehouses. The invests heavily and
of its products, ● Product
inventory management in research improvement
which ensures
and Placement: : Nescafe
system ensures that the development that the Nescafe uses may seek
company has enough to create products are product feedback
raw materials to meet innovative delivered safely placement in from its
the production coffee blends and efficiently. movies and TV customers to
demands. and flavors shows to improve its
that appeal to ● Distribution: showcase its products and
● the departments that its customers. products in services and
Nescafe has a
subtle and ensure
are responsible for the in well-structured
non-intrusive customer
bound logistics are the distribution
ways to satisfaction
procurement and the system that
increase brand
supply chain ensures that its
awareness.
management products reach
all its
customers in ● Sponsorship
the required and
quantities. The Collaboration:
company has Nescafe
established sponsors
partnerships sports
with other tournaments
businesses that and other
help it to reach events to
more promote its
customers in brand image
different and reach new
regions. customers. It
also
collaborates
with other
brands and
influencers to
create unique
marketing
campaigns.
● Price
Discounts:
Nescafe uses
price discounts
and
promotions to
incentivize
customers to
purchase its
products and
increase sales
● Multipack and
Bundle Offers:
Nescafe offers
bundle deals
and multipacks
to encourage
customers to
purchase more
products in a
single
transaction.
Support Firm infrastructure

Activitie
s Firm infrastructure refers to the activities and processes within an organization that are necessary
to run the business efficiently and effectively. In the case of Nescafe, the following are the firm
infrastructure support activities:
● Information Technology: Nescafe relies heavily on technology to support its business

operations. The company invests in state-of-the-art IT systems that support everything
from supply chain management to customer management. The technology helps Nescafe
to track its inventory, monitor the effectiveness of marketing campaigns, and get insights
into consumer preferences.
● Human Resources: Nescafe values its employees as key resources. The human resource
department is responsible for managing the workforce, including hiring, training,
performance appraisals, compensation, and benefits. Nescafe fosters a culture of diversity
and inclusion to ensure that all employees feel valued and supported.
● Legal and Compliance: Nescafe operates in a highly regulated industry. The company must
comply with strict regulations related to food safety, environmental protection, and labor
laws. Nescafe's legal and compliance team ensures the company meets all regulatory and
legal obligations.
● Finance and Accounting: Nescafe's finance and accounting department is responsible for
managing finances, including budgeting, forecasting, financial analysis, and reporting. The
department also ensures that the company maintains strong financial controls to mitigate
risk.
● Research and Development: Nescafe invests heavily in research and development to stay
ahead of the competition. The company works on developing innovative products to meet
the changing needs of customers.
These firm infrastructure support activities ensure that Nescafe manages its operations
efficiently, while staying compliant with regulations and fostering innovation.
HR
● Recruitment and selection: Nescafe relies on its human resource department to identify
and attract qualified and talented individuals to join its workforce. The department is
responsible for conducting job analysis, posting job vacancies, reviewing applications, and
shortlisting candidates for interviews. The recruitment and selection process is essential in
ensuring that Nescafe hires personnel who align with the company's values and mission.
● Employee engagement: Nescafe believes that engaged employees are critical to its
success. The human resource department is responsible for creating programs that foster
a positive work environment, encourage open communication, and promote employee
participation. Such efforts help to improve employee morale, reduce turnover, and
increase productivity.
● Compensation and benefits: To attract and retain top talent, Nescafe offers competitive
compensation and benefits packages. The human resource department works with
management to establish market-based salaries, bonuses, and other incentives that
reward employees for their contributions. Additionally, the department ensures that
employees are aware of their benefits and support them in accessing these benefits when
needed.
● Training and development: As a leader in the coffee industry, Nescafe invests in providing
continuous learning and development opportunities to its employees. The human
resource department is responsible for developing training programs that enhance
employees' skills, knowledge, and competencies. The training programs focus on areas
such as coffee tasting, customer service, and sales techniques, among others.
Procurement
● In general, procurement refers to the process of acquiring goods and services from external
sources. This can involve activities such as identifying suppliers, negotiating contracts,
managing relationships with suppliers, and ensuring that purchased goods and services meet
the organization's quality and cost requirements.
● In the case of Nescafe Egypt, their procurement processes involves sourcing the raw
materials and packaging materials needed to produce their coffee products, as well as
procuring equipment and services needed for their operations. They have specific
requirements for their suppliers, such as adherence to quality and safety standards, timely
delivery, and competitive pricing.
● Nescafe Egypt has a procurement department or team responsible for managing these
activities, and they use various procurement tools and technologies to streamline their
processes and ensure efficiency. Ultimately, the goal of procurement is to ensure that an
organization has the necessary resources to operate effectively and meet its business
objectives.
R&D
● Sustainable sourcing: Nescafe could invest in research and development to identify new and innovative ways
to source coffee sustainably. This could involve exploring new farming techniques, developing new
partnerships with local growers, or finding ways to reduce waste in the supply chain.
● Quality assurance: Nescafe could invest in R&D to improve their quality control processes and ensure
consistent taste and quality across their products. This could involve the use of advanced testing
technologies and data analytics tools to monitor production processes, identify potential issues, and
optimize product quality.
● Product customization: Nescafe could invest in research and development to personalize their coffee
offerings further, leveraging data and emerging technologies like AI and machine learning. This would enable
them to tailor their products to the needs and preferences of their customers and build stronger brand
loyalty.
● Packaging innovation: Nescafe could invest in product packaging research and development to reduce waste
and improve recyclability of their coffee sachets, pods, cups, and bags. This could involve exploring
sustainable materials, developing new packaging designs, or partnering with waste management companies
to develop better solutions.
1. Three circle
Company Customer
offerings A)POD needs
B)POP
C)POD
Competitor’s
offerings
Company offerings:
Nescafe is a well-known brand of coffee products manufactured by Nestle, a Swiss
multinational food and beverage company. In Egypt, Nescafe offers a variety of coffee
products, including instant coffee, ground coffee, and coffee capsules. Some of the most
popular Nescafe products in Egypt include:
1. Nescafe Classic: This is the original Nescafe instant coffee product, made from a blend
of Robusta and Arabica coffee beans.
2. Nescafe 3-in-1: This is a convenient instant coffee mix that includes coffee, creamer,
and sugar. It is available in a range of flavors, including Original, Caramel, and Hazelnut.
3. Nescafe Gold: This is a premium instant coffee product that uses 100% Arabica coffee
beans and is known for its rich, smooth taste.
4. Nescafe Dolce Gusto: This is a range of coffee capsules that can be used with
Nescafe's Dolce Gusto coffee machines. The capsules come in a variety of flavors,
including Espresso, Cappuccino, and Latte Macchiato.
5. Nescafe Ice: This is a range of instant coffee products that are specifically designed to
be served cold. They come in a range of flavors, including Lemon and Peach.
Competitors offerings:
Nescafe faces competition from several other coffee brands in Egypt, including both local
and international brands. Here are some of the main competitors and their offerings:
1. Lavazza: Lavazza is an Italian coffee brand that offers a range of premium coffee
products, including ground coffee, coffee beans, and capsules. Their offerings in Egypt
include Lavazza Qualita Rossa, Lavazza Espresso, and Lavazza Crema e Gusto.
2. Bonjorno: Bonjorno is an Egyptian coffee brand that offers a range of coffee products,
including instant coffee, ground coffee, and coffee beans. Their offerings include
Bonjorno Classic, Bonjorno Gold, and Bonjorno Espresso.
3. Davidoff: Davidoff is a Swiss luxury brand that offers a range of premium coffee
products, including ground coffee, coffee beans, and capsules. Their offerings in Egypt
include Davidoff Fine Aroma, Davidoff Espresso 57, and Davidoff Rich Aroma.
4. Nespresso: Nespresso is a subsidiary of Nestle that offers a range of coffee capsules that
are designed to be used with their coffee machines. Their offerings in Egypt include
Nespresso Original, Nespresso Vertuo, and Nespresso Professional.
Customer needs:
The customer needs for a coffee brand can include high quality coffee beans, a variety of
flavors, affordable pricing, convenient packaging, sustainable sourcing and production
practices, easy availability at local stores, and a positive brand image.
1. Convenience: Nescafé customers may want a quick and easy way to prepare coffee,
without the need for expensive machines or barista skills.
2. Quality: Customers may appreciate a consistent and high-quality taste from their coffee,
with a range of flavors and intensities to choose from.
3. Variety: Nescafé may aim to cater to different consumer preferences, such as decaf,
flavored, or strong coffee options.
4. Affordability: Customers may appreciate a coffee brand that offers value for their
money, particularly in comparison to expensive coffee shops.
5. Accessibility: Nescafé customers may want to be able to purchase their coffee products
easily, either in-store or online.
Overall, Nescafé may aim to provide a coffee experience that is convenient, high-quality,
and affordable, with a range of flavors to cater to different preferences.
A) POD
Nescafé's point of difference lies in their commitment to providing consistent quality,
convenience, a wide range of options, their trusted brand reputation, and their
commitment to sustainability. The point of difference means what I provide that my
competitors do not, in other words, what is my competitive advantage that allows me to
stand out.
Nescafe's point of difference that Nescafe has been around for over 80 years, giving it a
strong brand recognition and a reputation for delivering quality coffee products
consistently, due to the strong brand recognition all instant coffee is positioned in
people’s mind as “Nescafe”.
Nescafe offers hot instant coffee as well as cold instant coffee. Additionally, Nescafe
offers a wide range of products, such as instant coffee, ground coffee, and coffee pods,
catering to the diverse needs of its customers.
B) POP
Point of parity is the similarities in Nescafe’s offerings, the competitors’ offerings and customer
needs. All Nescafe’s products and its competitors are convenient, easy, and quick to prepare,
they all offer quality ingredients, easily available in all supermarkets.
C) POD
The point of difference means what my competitors provide that I don’t, in other words,
what is my competitors competitive advantage that allows them to stand out.
Some customers perceive competitors like Bonjorno as being more affordable and
people now adays may switch to Nescafe’s substitutes due to the economic problems
that people are facing nowadays. Also, some customers may prefer Davidoff as it offers
premium coffee products.
4. Product life cycle

Nescafé Classic is currently in the maturity stage. During the introduction stage, Nescafé
Classic was first introduced to the market. Nestlé likely invested in extensive marketing
and promotional efforts to raise awareness and build a customer base. They would have
focused on establishing the product's unique features, benefits, and positioning in the
coffee market. This stage is often associated with slow sales growth and high marketing
costs.
Growth: In the growth stage, Nescafé Classic would have experienced an increase in
sales as consumer awareness and demand grew. This stage is characterized by
expanding distribution, increasing market share, and rising profits. The product becomes
more widely available, and competitors may enter the market.
Maturity: The maturity stage is characterized by stable sales and market saturation. By
this point, Nescafé Classic would have achieved widespread recognition and captured a
significant market share. Competition within the coffee industry would likely be intense,
with various brands and alternatives available to consumers. Companies may focus on
product differentiation, packaging innovations, pricing strategies, and promotions to
maintain market share and extend the product's life cycle.
Decline: Eventually, a product may enter the decline stage, where sales and profits start
to decline due to changing consumer preferences, market saturation, or the emergence
of newer, more innovative products. Nescafé Classic, being a well-established brand,
may take longer to reach this stage, especially with ongoing efforts to adapt to changing
consumer trends and preferences.
It's important to note that the product life cycle is not always a linear progression and
can vary depending on various factors, including consumer behavior, market dynamics,
and the company's strategies. Nestlé has a history of introducing new flavors, packaging
variations, and marketing campaigns to revitalize and extend the life cycle of their
products. Therefore, the current stage of Nescafé Classic's product life cycle may have
evolved since my last knowledge update.
Module (3): Strategy Formulation
Apply a review of the company’s mission

The Nescafé brand is owned by Nestlé, one of the largest food and beverage companies in the
world.
"Nestlé's purpose is to enhance the quality of life and contribute to a healthier future. We want to
help shape a better and more sustainable world. We also want to inspire people to live healthier
lives. This is how we contribute to society while ensuring the long-term success of our
company."
Company’s mission review
● Customer: Nescafé's mission statement may focus on providing high-quality coffee

products and experiences that meet the needs and preferences of its customers, whether
they are individuals, businesses, or other organizations.
● Product/Service: Nescafé's mission statement may emphasize its commitment to
producing and selling high-quality coffee products that are delicious, convenient, and
affordable, while also being sustainable and ethically sourced.
● Geographic Domain: Nescafé's mission statement may address its global presence and
aim to provide customers around the world with quality coffee products and experiences.
● Technology: Nescafé's mission statement may highlight its use of innovative technology
to develop and produce its coffee products, as well as its commitment to staying up-to-
date with the latest trends and technologies in the coffee industry.
● Concern of Survival: Nescafé's mission statement may express its commitment to long-
term growth and success, while also acknowledging the need to balance profitability with
sustainability and social responsibility.
● Philosophy: Nescafé's mission statement may reflect its core values and beliefs, such as a
commitment to quality, innovation, sustainability, and ethical business practices.
● Self-Concept: Nescafé's mission statement may aim to position itself as a leading brand
in the coffee industry, with a strong reputation for quality, innovation, and customer
satisfaction.
● Concern for Public Image: Nescafé's mission statement may express its commitment to
being a socially responsible and ethical company that contributes to the well-being of its
customers, employees, partners, and the wider community.
Illustration & Review the company’s objectives
1. Satisfying customer needs: Nescafe strives to offer premium

coffee products that satisfy the various needs and preferences of
its customers worldwide.
2. Business expansion: Nescafe wants to expand its market

share and boost sales through the creation of cutting-edge
products, successful marketing plans, and robust distribution
systems.
3. Sustainability: Nescafe is committed to using sustainable

practices across the whole supply chain, which includes
procuring coffee beans ethically, cutting greenhouse gas
emissions, and enhancing farmer livelihoods.
4.Brand loyalty: By continuously delivering high-quality

products, interacting with customers on social media and
through other channels, and giving promotions and reward
programs, Nescafe hopes to foster brand loyalty among
customers.
5. Employee satisfaction: Nescafe strives to offer its staff

members a welcoming and encouraging work environment with
chances for personal and professional development.
S.M.A.R.T Objectives illustration
Objective: Increase Nescafe's sustainable sourcing of coffee

beans by 20% within the next 2 years.
- Specific: The target indicates clearly that it is to

enhance Nescafe's sustainable sourcing of coffee
beans, and it specifies how much (20%) and how
long (2 years) it should increase by.
- Measurable: The goal is quantifiable since it has a

precise target a 20% increase in sustainable sourcing
and a time limit of two years to reach it.
- Achievable: The objective is attainable because

Nescafe has already taken steps to strengthen its
sustainable sourcing practices and has set a target of
procuring 100% of its coffee sustainably by 2025.
- Relevance: Because sustainability is a company core

value and a significant determinant of many
consumers' buying decisions, the goal is applicable
to Nescafe's overall business strategy.
- Time-bound: The goal has a two-year deadline,

which creates a sense of accountability and urgency.
Conduct a review of the grand and generic strategies

In the highly competitive coffee market, Nescafé is a recognized global brand. To maintain its
position as the market leader and grow its business, Nescafé may combine grand and generic
strategies.
Grand strategy:
1. Diversification: Nescafé can expand its product line to include related commodities like
tea, snacks, and other food and beverage items in addition to coffee. This would enable
the business to explore other markets and revenue streams while reducing its reliance on
coffee sales.
2. Global expansion: In developing countries where there is a rising demand for high-end
goods like coffee, Nescafé can continue to expand its market share. This can include
investing in entirely new production facilities and delivery networks, as well as tailoring
its products to local tastes and preferences.
3. Strategic partnerships and acquisitions: Nescafe might form strategic relationships with
other companies in the food and beverage industry or purchase smaller companies that
complement its present product line. The company would be able to increase its market
share and benefit from the advantages of rival brands by doing this.
Generic strategy:
1. Differentiation: The goal of a differentiation strategy is to set yourself apart from the
competition by developing a distinctive brand and product offering. Nescafé can set itself
apart from the competition by emphasizing quality, innovation, and distinctive flavors
and blends. The business can spend money on R&D to produce new coffee items that
stand out from those offered by rivals. For instance, Nescafé can release coffee blends
created from environmentally friendly coffee beans or develop special edition coffee
flavors that are only offered for a limited time. Nescafé can also concentrate on
packaging design and marketing to develop a distinctive brand image that attracts
customers looking for premium coffee.
TWOS Analysis
Internal \ external Opportunities Threats
1.Growing demand for coffee 1.Fluctuations in coffee bean

in Egypt prices
2.Increasing popularity of 2.Increasing competition
instant coffee from local and international
3.Expanding into new brands
markets in the Middle East 3.Changing consumer
and Africa preferences and tastes
4.Developing new coffee 4.Potential political instability
products to meet changing in Egypt
consumer preferences 5.Increasingly stringent
5.Developing online sales regulations on coffee
channels production and distribution
Strengths OS Strategies TS Strategies
1.Strong brand recognition OS1: Take use of Nescafe's TS1:Use Nescafe's well-
and reputation solid reputation and brand known brand and solid
2.Wide distribution network recognition to enter new reputation to set its goods
across Egypt markets in the Middle East apart from those of rivals in
3.High quality coffee and Africa. Egypt's fiercely competitive
products coffee industry.
4.Strong marketing and OS2: Increase sales of instant
advertising campaigns coffee products, which are TS2: Create alliances with
5.Strong partnerships with becoming more popular in nearby individuals cafés and
local retailers and cafes Egypt, by utilizing Nescafe's coffee shops to boost sales
extensive distribution and brand recognition despite
network. the growing competition.
Weakness OW Strategies TW strategies
1.Dependence on a limited OW1: Create innovative TW1: Create partnerships

number of products coffee products, such as iced with regional coffee growers
2.High competition in the coffee or specialty coffee to lessen Nescafe's reliance
coffee market drinks, to meet shifting on imported coffee beans and
3.Dependence on imported consumer tastes and to lessen the impact of
coffee beans preferences. changes in the price of coffee
4.Limited penetration into around the world.
rural areas OW2: Extend Nescafe's
5.Limited product distribution system to rural TW2: Invest in R&D to
diversification Egypt, where there may be a produce creative coffee items
rise in the demand for coffee that can compete with other
goods. regional and global brands on
the market.
Nescafe is a well-known firm in Egypt that produces high-quality coffee products and has a
substantial distribution network in addition to successful marketing initiatives. The company is
also vulnerable to changes in consumer preferences and market trends because of its limited
product line, reliance on imported coffee beans, and low market penetration in rural areas.
Changes in coffee bean prices, increased domestic and international brand rivalry, evolving
consumer preferences, potential political instability, and expanding limitations are all threats to
the company. Nescafe might evaluate its strengths, weaknesses, opportunities, and threats in the
Egyptian coffee market using the TOWS analysis to develop plans to retain its competitiveness
and grow its business.
Module 4
1) Present and communicate the company’s strategy implementation problems:
the challenges that Nescafe faces while it is applying its strategy
1. Fluctuations in coffee prices: Nescafe's profitability is directly tied to the price of coffee beans, which
can be volatile and subject to sudden fluctuations due to weather patterns, supply and demand, and
political instability. These fluctuations can impact Nescafe's costs and make it difficult for the company
to plan and forecast its finances.
2. Intense competition: Nescafe faces stiff competition from other coffee brands, both established and
emerging, that offer similar products and services. This competition may make it challenging for Nescafe
to differentiate itself in a crowded market and to maintain its market share. Nescafe must continue to
invest in marketing and branding to remain competitive.
3. Changing consumer preferences: Consumer preferences for coffee products are subject to change,
and Nescafe may face challenges in adapting its products to meet these changing preferences. For
example, there may be a shift towards healthier beverages or alternative coffee brewing methods,
which could impact Nescafe's sales. Nescafe must keep up with changing consumer trends and
preferences to stay relevant.
4. Sustainability challenges: Nescafe has made a commitment to sustainability and responsible sourcing,
but there may be challenges in implementing these initiatives. For example, promoting sustainable
farming practices among coffee farmers may be difficult, and ensuring traceability in the supply chain
can be challenging. Nescafe must continue to invest in sustainability initiatives and work with its
partners in the supply chain to ensure that its products are sustainably sourced.
5. Supply chain disruptions: Nescafe's supply chain may be vulnerable to disruptions due to factors such
as climate change, political instability, and other external factors. These disruptions can impact the
availability and quality of the coffee beans used by Nescafe, which can in turn impact its sales and
profitability. Nescafe must work to mitigate risks in its supply chain and ensure that it has contingency
plans in place to address disruptions.
6. Regulatory challenges: Nescafe may face regulatory challenges in different countries where it
operates. For example, some countries may have stricter regulations on food safety, labeling, or
environmental impact, which can impact Nescafe's operations and profitability. Nescafe must comply
with all relevant regulations while still maintaining its operations and profitability.
Overall, Nescafe faces several challenges that it must address to maintain its position as a leading coffee
brand. These challenges include fluctuations in coffee prices, intense competition, changing consumer
preferences, sustainability challenges, supply chain disruptions, and regulatory challenges. Nescafe must
continue to innovate and adapt its strategy to address these challenges and maintain its
competitiveness in the global coffee market.
2) Present and communicate the company’s Structure Compatibility to the Strategy
how Nescafe's structure helps the company achieve its strategic goals:
Nescafe is a brand owned by Nestle, which is a large multinational corporation with a diverse portfolio
of brands and products. As such, Nescafe's structure is likely to be aligned with Nestle's overall
corporate structure.
Nescafe has a decentralized structure, with a focus on empowering its local businesses and allowing
them to make decisions that are best suited to their markets and regions. The company is organized into
three main business units: Zone Europe, Middle East and North Africa (EMENA), Zone Americas, and
Zone Asia, Oceania, and Africa (AOA). Each business unit is responsible for managing its operations and
achieving its financial and strategic objectives.
Within each business unit, Nescafe has a matrix structure, with functional departments such as
marketing, finance, and human resources, working together with business units to deliver results. The
company also has a strong focus on sustainability and responsible business practices, with a dedicated
unit focused on creating shared value for all stakeholders.
Nescafe is likely to have a similar structure, with a focus on empowering its local businesses and
allowing them to make decisions that are best suited to their markets and regions. The brand is likely to
work closely with Nestle's functional departments to deliver results and achieve its strategic objectives.
Nescafe may also have a dedicated team focused on sustainability and responsible business practices, in
line with Nestle's overall focus on creating shared value for all stakeholders.
Nescafe benefits from Nestle's decentralized structure in several ways. Here are some examples:
Localized decision-making: Nestle's decentralized structure allows Nescafe to make decisions that are
best suited to the local markets and regions where it operates. This allows Nescafe to be more
responsive to local consumer needs and preferences, and to adapt its products and marketing strategies
to local conditions. Collaboration and knowledge sharing: Nestle's matrix structure encourage
collaboration and knowledge sharing between functional departments and business units. This allows
Nescafe to leverage the expertise and resources of other Nestle brands and functional departments,
such as marketing, finance, and research and development. Efficiency and cost savings: Nestle's
decentralized structure allows Nescafe to operate more efficiently and achieve cost savings by
leveraging economies of scale and sharing resources with other Nestle brands and business units.
Sustainability and responsible business practices: Nestle's strong focus on sustainability and responsible
business practices benefits Nescafe by providing a framework for ethical and sustainable operations.
Nescafe can leverage Nestle's sustainability initiatives and best practices to ensure that its products and
operations are environmentally and socially responsible.so Nestle's decentralized structure allows
Nescafe to operate more effectively and efficiently, and to leverage the expertise and resources of other
Nestle brands and functional departments. This helps Nescafe to adapt to local market conditions,
achieve cost savings, and promote sustainability and responsible business practices.
Nescafe's structure helps the company achieve its strategic goals by enabling it to optimize its
operations, maintain strong partnerships, foster a culture of innovation, adapt to changes in the market,
and focus on customer needs and preferences. These factors contribute to Nescafe's success in the
coffee industry and help the company maintain its position as a leading coffee brand. Operational
efficiency: Nescafe's structure includes a focus on operational efficiency, which allows the company to
optimize its resources and reduce costs. This helps Nescafe achieve its strategic objective of maintaining
profitability while still offering high-quality products and services. Nescafe's structure enables it to
streamline its processes and operations to increase efficiency and reduce waste. Strong partnerships:
Nescafe's structure includes partnerships with coffee farmers and suppliers, which helps the company
ensure the sustainability and quality of its coffee beans. These partnerships also help Nescafe maintain a
reliable supply chain and achieve its strategic objective of responsible sourcing. Nescafe's structure
enables it to collaborate with partners and stakeholders to achieve shared goals, such as promoting
sustainable farming practices. Innovation culture: Nescafe's structure includes a culture of innovation
that encourages employees to come up with new ideas and solutions. This helps Nescafe achieve its
strategic objective of introducing new products and services that meet changing consumer preferences
and emerging trends in the coffee industry. Nescafe's structure enables it to foster a culture of
creativity, experimentation, and risk-taking, which is essential for innovation. Adaptability: Nescafe's
structure includes a decentralized decision-making process that enables the company to adapt quickly to
changes in the market and customer needs. This helps Nescafe achieve its strategic objective of
remaining competitive and relevant in a rapidly changing industry. Nescafe's structure enables it to
delegate decision-making authority to different levels of the organization, which enables faster decision-
making and greater agility. Customer-centricity: Nescafe's structure includes a focus on customer needs
and preferences, which helps the company create products and services that meet these needs. This
helps Nescafe achieve its strategic objective of building a strong customer base and maintaining
customer satisfaction. Nescafe's structure enables it to conduct market research, analyze customer
feedback, and tailor its products and services to meet customer needs. Nescafe's structure helps the
company achieve its strategic goals by enabling it to optimize its operations, maintain strong
partnerships, foster a culture of innovation, adapt to changes in the market, and focus on customer
needs and preferences. These factors contribute to Nescafe's success in the coffee industry and help the
company maintain its position as a leading coffee brand.
3) Company’s Strategy Compatibility to its life Cycle Stage
the product life cycle of Nescafe:
Maturity: Nescafe has been in the maturity stage for many years, as it is a well-established brand with a
global presence and a loyal customer base. During this stage, Nescafe has focused on maintaining its
market position by introducing new products and innovations, such as Nescafe 3-in-1 and Nescafe Azera.
The brand has also focused on sustainability and responsible sourcing, by developing partnerships with
coffee farmers and suppliers to promote sustainable farming practices.
Nescafe has been in maturity stage and this helped nescafe as a brand to evolve and adapt over time to
meet changing consumer needs and preferences. Nescafe has successfully maintained its market
position by introducing new products, expanding into new markets, and focusing on sustainability and
responsible sourcing. By continuing to innovate and adapt, Nescafe can remain a leading coffee brand
for many years to come.
Nestle and Nescafe company life cycle :
Formalization stage: This stage is characterized by a focus on standardization, efficiency, and control. In
this stage, companies are focused on optimizing their operations and minimizing costs while maintaining
quality and ensuring compliance with regulations. Nestle is likely in this stage, with a focus on
standardizing its processes and procedures to manage its operations. As for Nescafe specifically, it is a
mature brand within Nestle's portfolio and is likely in the formalization stage, with a focus on optimizing
its operations and maintaining its market position. However, Nescafe also has a strong focus on
customer needs and preferences, which may indicate an element of the elaboration stage, as the brand
is constantly introducing new products and services to meet changing consumer needs. Additionally,
Nescafe may be focused on innovation and sustainability, which are key drivers in the elaboration stage
4) the company’s strategy implementation actions plans for three long term objectives.
.
Action plan
Objective: sustainable growth
Actions Due date BY Comment
1. Expanding it product portfolio 2025 Marketing research

and development 1. Sustainable growth: Nescafe
department aims to achieve sustainable
growth by expanding its product
portfolio, entering new markets,
driving innovation and creativity,
developing new coffee products
and flavors, enhancing
distribution channels, and
improving customer experience.
This involves actions such as
conducting marketing research
and development, empowering
local businesses, improving
sustainability and responsible
business practices, and
enhancing supply chain and
distribution processes.
2. Entering new markets 2026-2028 Supply chain and

operation
3. Driving innovation and creativity 3-4 years Marketing research

development
4. Developing new coffee product, 2-3 years Marketing research
flavors and development

department
5. Enhancing distribution channel 1-3 years Supply chain and
distribution
6. Enhancing customer experience
2-5 years department
Marketing research
and development
department
Action plan
Objective: operational efficiency
1. Optimizing operation 2024 Manufacturing Operational efficiency: Nescafe aims
department to optimize its operations, improve
productivity, reduce costs, increase
automation, and improve marketing
and distribution processes to
increase efficiency. This involves
actions such as optimizing
manufacturing processes, improving
supply chain and logistics processes,
enhancing finance and accounting
processes, and investing in
automation technologies
2. Improving productivity 2024 Manufacturing
department
3. Reducing costs 2025 Finance
department
4. Increase automation 2024 Supply chain,
finance
department,
manufacturing
department
5. Improving the marketing Decemb Marketing

and distribution process to er 2023 department,
increase efficiency supply chain
process
Action plan
Objective: product excellence
1.ensure that coffee products are of 2023-2024 Quality . Product excellence:
highest quality, safety and nutrition assurance Nescafe aims to ensure
value department that its coffee products
are of the highest quality,
safety, and nutritional
value. The company plans
to achieve this by
continuously improving
and innovating its
products, meeting
changing customer needs
and preferences, and
developing new products
that are convenient and
sustainable. This involves
actions such as investing
in research and
development, enhancing
product quality assurance,
and improving marketing
and distribution
processes.
1. Continues improvement and Research and
innovation development
2. Meet changing needs and Research and
preferences of customers development,

marketing
department
3. Developing new products that are 2025-2027 Research and
convenient and sustainable development

department and
quality
assurance
department
Summary
In Module 4, several aspects of Nescafe's strategy implementation and company structure were
discussed. Firstly, the challenges that Nescafe faces while implementing its strategy were
outlined, including fluctuations in coffee prices, intense competition, changing consumer
preferences, sustainability challenges, supply chain disruptions, and regulatory challenges.
Secondly, the structure of Nescafe was discussed, which is likely to be aligned with Nestle's
overall corporate structure, and includes a decentralized structure with a focus on empowering
local businesses, a matrix structure within each business unit, and a strong focus on sustainability
and responsible business practices. Finally, the product life cycle of Nescafe was analyzed, and it
was determined that the brand is currently in the maturity stage, which has allowed it to evolve
and adapt to meet changing consumer needs and preferences. Nestle and Nescafe's life cycle
stages were also discussed, with Nestle likely in the formalization stage and Nescafe possibly in
both the formalization and elaboration stages. Overall, this module provided insight into the
challenges and strategies of a well-established coffee brand, as well as the importance of
structure and life cycle stage in achieving success. The action plan outlines three objectives:
sustainable growth, operational efficiency, and product excellence.
For sustainable growth, the actions include expanding the product portfolio, entering new
markets, driving innovation and creativity, developing new coffee products and flavors,
enhancing distribution channels, and improving customer experience. These actions involve the
marketing research and development department, supply chain and operation, and the
distribution department, with various due dates ranging from 1 to 4 years.
The objective of operational efficiency involves optimizing operations, improving productivity,
reducing costs, increasing automation, and improving marketing and distribution processes.
These actions involve the manufacturing department, finance department, supply chain process,
and marketing department, with a due date of 2023-2025.
For product excellence, the actions include ensuring the highest quality, safety, and nutritional
value of coffee products, continuous improvement and innovation, meeting changing customer
needs and preferences, and developing new products that are convenient and sustainable. These
actions involve the quality assurance department, research and development, and the marketing
department, with due dates ranging from 2023-2027.
module 5
objectives actual corrective actions
1. To increase market share they expanded their market

and revenue in the global share in emerging markets
coffee industry such as China and India
2. To innovate and offer new they innovated and were able

product variations to attract to improve their quality and
different consumer segments they increased customer
satisfaction
3. To expand the brand's increased the number of

presence in emerging markets vending machines and self-
and maintain a strong -- serve coffee stations globally
foothold in established
markets
4. To promote sustainable reduced the environmental
sourcing and ethical business – impacts of their operations
practices in the coffee supply through sustainable sourcing
chain and reducing waste
5. To invest in marketing and they were able to achieve

promotional activities to raise this objective as there was an
brand awareness and drive increase in sales by 5%
sales annually through effective
marketing campaign
Phase 6: Presentation and Teamwork (10marks)(ILO’s 4.1)
Summary:
As previously discussed the objectives, actual achievements, and corrective actions taken by
Nescafe to improve its market position and performance in the global coffee industry. The
objectives outlined include increasing market share and revenue, offering new product
variations, expanding presence in emerging markets, promoting sustainable sourcing and ethical
practices, and investing in marketing and promotion.
Regarding the objective of increasing market share and revenue, Nescafe successfully expanded
its market share in emerging markets like China and India. This contributed to their growth and
revenue generation.
In terms of innovation and product variations, Nescafe focused on improving quality and
increasing customer satisfaction. They introduced new and improved products that catered to
different consumer segments, resulting in a positive response from customers.

To expand their brand's presence, Nescafe increased the number of vending machines and self-
serve coffee stations globally. This strategy helped them establish a strong foothold in both
emerging and established markets.
Promoting sustainable sourcing and ethical business practices was another objective for Nescafe.
They took measures to reduce the environmental impacts of their operations through sustainable
sourcing practices and waste reduction initiatives.
Investing in marketing and promotional activities was also a key objective. Nescafe's effective
marketing campaigns led to a 5% annual increase in sales, demonstrating their success in raising
brand awareness and driving sales.
Overall, Nescafe's actions align with their objectives and have positively impacted their market
position, revenue growth, customer satisfaction, and sustainability efforts.
Customer needs are diverse when it comes to coffee brands, and Nescafé aims to meet these
needs effectively. Customers seek high quality coffee beans, a wide variety of flavors, affordable
pricing, convenient packaging, sustainable sourcing and production practices, easy availability at
local stores, and a positive brand image. Nescafé recognizes the importance of convenience for
its customers, offering a quick and easy way to prepare coffee without the need for expensive
machines or barista skills. They also prioritize delivering consistent and high-quality taste,
providing a range of flavors and intensities to cater to different preferences. Variety is another
focus for Nescafé, as they aim to cater to different consumer preferences with options such as
decaf, flavored, or strong coffee. Affordability is valued by customers, especially when
compared to expensive coffee shops. Accessibility is also key, with Nescafé ensuring its coffee
products are easily purchasable both in-store and online. Overall, Nescafé aims to provide a
coffee experience that is convenient, high-quality, and affordable, while offering a diverse range
of flavors to cater to different preferences.
Nescafé's point of difference (POD) lies in its commitment to consistent quality, convenience, a
wide range of options, trusted brand reputation, and sustainability. With over 80 years of
existence, Nescafé has built strong brand recognition and a reputation for delivering quality
coffee products consistently. Instant coffee is often associated with the Nescafé brand due to its
strong recognition among consumers. Nescafé offers not only hot instant coffee but also cold
instant coffee, providing versatility to its customers. Additionally, Nescafé caters to diverse
needs by offering a wide range of products, including instant coffee, ground coffee, and coffee
pods.
On the other hand, the point of parity (POP) refers to the similarities in offerings between
Nescafé and its competitors, as well as meeting customer needs. Nescafé, along with its
competitors, ensures that its products are convenient, easy, and quick to prepare. Quality
ingredients are common across the board, and the products are readily available in supermarkets.
While Nescafé has its unique advantages, it is essential to consider the point of difference (POD)
of its competitors. Some customers perceive competitors like Bonjorno as more affordable, and
economic challenges may lead people to switch to Nescafé's substitutes. Additionally, some
customers may prefer brands like Davidoff for their premium coffee offerings. By
acknowledging these competitive advantages of other brands, Nescafé can continue to refine its
own unique selling points and maintain its market position.
The following is a summary following TOWS analysis
Internal Opportunities:
1. Growing demand for coffee in Egypt.

2. Increasing popularity of instant coffee.
3. Expanding into new markets in the Middle East and Africa.
4. Developing new coffee products to meet changing consumer preferences.
5. Developing online sales channels.
Internal Threats:
1. Dependence on a limited number of products.
2. High competition in the coffee market.
3. Dependence on imported coffee beans.
4. Limited penetration into rural areas.
5. Limited product diversification.
Strengths:
1. Strong brand recognition and reputation.
2. Wide distribution network across Egypt.
3. High-quality coffee products.
4. Strong marketing and advertising campaigns.
5. Strong partnerships with local retailers and cafes.
Opportunities-Strategy (OS):
OS1: Utilize Nescafe's solid reputation and brand recognition to enter new markets in the Middle
East and Africa.

OS2: Increase sales of instant coffee products, which are becoming more popular in Egypt, by
utilizing Nescafe's extensive distribution network.
Threats-Strategy (TS):
TS1: Use Nescafe's well-known brand and solid reputation to differentiate its products from
rivals in Egypt's competitive coffee industry.
TS2: Establish alliances with local cafes and coffee shops to boost sales and brand recognition
despite growing competition.
Weaknesses:
1. Dependence on a limited number of products.
2. High competition in the coffee market.
3. Dependence on imported coffee beans.
4. Limited penetration into rural areas.
5. Limited product diversification.
Opportunities-Weaknesses (OW):
OW1: Create innovative coffee products, such as iced coffee or specialty coffee drinks, to meet
shifting consumer tastes and preferences.
OW2: Expand Nescafe's distribution system to rural Egypt to cater to the potential rise in
demand for coffee products.
Threats-Weaknesses (TW):
TW1: Establish partnerships with regional coffee growers to reduce reliance on imported coffee
beans and mitigate the impact of price fluctuations.
TW2: Invest in research and development to create innovative coffee products that can compete
with other regional and global brands in the market.

Refrences
Discover the Coffee Experience | Nescafe MENA
- https://www.bloomberg.com/news/articles/2022-10-04/nestle-commits-1-billion-to-protect-
coffee-from-climate-threat
https://www.bloomberg.com/news/articles/2016-06-28/nestle-leans-on-nespresso-s-kid-
brother-as-coffee-growth-lags
https://www.bloomberg.com/news/articles/2016-04-14/nestle-revenue-beats-estimates-on-
nescafe-nespresso-coffee
Nestlé SA in Hot Drinks | Market Research Report | Euromonitor
IBISWorld - Industry Market Research, Reports, & Statistics
Nestle plans price hikes after costs eat into profits | Reuters
Nestle pledges $1 billion to coffee sustainability plan | Reuters
National Coffee Association (ncausa.org)
Roast Magazine
Daily Coffee News by Roast Magazine - Business news for specialty coffee professionalsDaily
Coffee News by Roast Magazine
Sprudge
Coffee Review - The World's Leading Coffee Guide
Taste Testing Coffee Capsules from Around the World: Part One - Barista Magazine Online
Coffee Brewing Guides: Start Here For Great Coffee - Craft Coffee Spot
Homeworkers fuel surge in Nestlé coffee sales | Nestlé | The Guardian
Nestlé Nescafé | Schneider Electric Global (se.com)

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Arab Academy for Science and Technology & Maritime Transport

College of Management & Technology –

Name : Hana El deeb

Data for lecturer only

Lecturer Name : Dr. Dina El Salmy

Number of Answer Books returned: ------------------

Name : Hana Fahmy

Data for lecturer only

Lecturer Name : Dr. Dina El Salmy

Name : shahd Mohamed

Data for lecturer only

Lecturer Name : Dr. Dina El Salmy

Number of Answer Books returned: ------------------

Name : Mohamed El Gebeily

Data for lecturer only

Lecturer Name : Dr. Dina El Salmy

Number of Answer Books returned: ------------------

Name : Yassin el hossieny

Data for lecturer only

Lecturer Name : Dr. Dina El Salmy

Name : Ahmed el sayed

Data for lecturer only

Lecturer Name : Dr. Dina El Salmy

Number of Answer Books returned: ------------------

Module (1): Current Situation Analysis

Strategic managers (BOD ,Top managers)

Nestle top managers and bord of directors:

Steven Wood Presley

David Xiqiang Zhang

Module (2): Environmental Scanning

1. Political and Legal

The corporation recently filed a complaint in the Egyptian

2. Technological In Egypt , Nescafe has a one-of-a-kind research and

4. Economical The production of coffee in Egypt is expected to increase

5. Social Nescafe introduced the same branding in all countries

- Cost Disadvantages Independent of Size:

2- Bargaining power of suppliers:

Supply dominated by a few companies:

Buyers' bargaining power is a measure of their capacity to extract advantageous terms,

products purchased are standard:

Product does not save the buyer money:

Buyers pose a credible threat of integrating backwards:

Threats for creditors of Nescafe Egypt include,

Secondly, Packaging that is sustainable and environmentally friendly: As consumers' awareness

Threats for customers of Nescafe Egypt includes several things:

Threats for the competitors of Nescafe Egypt

Threats for the suppliers of Nescafe Egypt

Threats for employees of Nescafe Egypt may include:

Internal Environment Analysis

1. Strong brand recognition and 1. Dependence on a limited

2. Wide distribution network 2. High competition in the coffee

across Egypt market

3. High quality coffee products 3. Dependence on imported

4. Strong marketing and 4. Limited penetration into rural

5. Strong partnerships with 5. Limited product diversification

1. Growing demand for coffee 1. Fluctuations in coffee bean

2. Increasing popularity of 2. Increasing competition from

3. Expanding into new markets 3. Changing consumer

4. Developing new coffee 4.Increasingly stringent regulations on

5. Developing online sales

• Wide distribution network in Egypt: Nescafe is well-represented in a number of Egyptian

Primary Inbound logistics Operation Outbound Marketing & After sales

Support Firm infrastructure