Brief Introduction of

Nestle (Kabirwala, Multan)

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Executive summary:

Nestle has been serving this world for over one hundred and thirty years. It has

differentiated itself through its high quality product mix and positioned itself as health and

Nutrition Company while targeting the health conscious people throughout the world. Nestle

started its operations in Pakistan back in1988, by acquiring a diary company MILKPAK

LTD, when people of Pakistan actually needed it.

Since Pakistan is the fifth world’s largest milk producing country therefore Nestle deals

mainly in dairy products. Moreover it also sells juices, chocolates, prepared food like

noodles, baby food, infant formula milk and breakfast cereals in Pakistan.

Nestle is a low cost leader with its efficient operations hence it provides its customers with

high quality products and sells them at a premium price. Therefore it is earning good profits.

Nestle has set its manufacturing plants at in Karachi, Lahore, Islamabad and Kabirwala. The

milk processing plant at Kabirwala district is the Nestlé’s world largest milk processing plant.

When nestle introduced its products in Pakistan people were neither aware nor accustomed to

them. Therefore nestle ran an extensive marketing campaign to educate people and create a

need for its products.

Pakistan is a land where fresh eatables are readily available. Nestle should sell the same

quality of products in Pakistan as it sells abroad. It should also introduce more brands in

Pakistani market which it offers in other markets of the world since consumers in

Pakistan are becoming more demanding day by day.

History:

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In the mid-1860s Nestlé, a trained pharmacist named Henri Nestle began experimenting with

various combinations of cow's milk, wheat flour and sugar in an attempt to develop an

alternative source of infant nutrition for mothers who were unable to breast feed. His ultimate

goal was to help combat the problem of infant mortality due to malnutrition. He called the

new product Farine Lactée Henri Nestlé.

Nestlé's first customer was a premature infant who could not tolerate any of the conventional

substitutes, and had been given up for lost by local physicians. People quickly recognized the

value of the new product, after Nestlé's new formula saved the child's life and within a few

years, Farine Lactée Nestlé was being marketed in much of Europe.

Henri Nestlé also showed early understanding of the power of branding. Nestlé means 'little

nest'. Nestle was created in 1867.

Nestlé is today the world’s leading food company, with a 140-year history and operations in

virtually every country in the world. Their principal assets are not office buildings, factories,

or even brands. Rather, it is the fact that they are a global organization comprised of many

nationalities, religions, and ethnic backgrounds all working together in one single unifying

corporate culture. Their culture unifies people on all continents, with roughly half their

factories and people located in the developing world.

Nestle started it operations in Pakistan in 1988. A qualified workforce, trained by nestles or

emerging from a strong educational and industrial context, strongly influences the company’s

ability to be globally competitive. The fair treatment and development of company staff and

the strengthening of the local workforce are essential long-term investments. They reinforce

the conditions for growth and sustained economic development in the locations where Nestlé

operates. Nestlé’s ability to employ thousands of people each year is an important

contribution the company makes towards future generations, providing income to

families who can enhance their chances at better education, healthcare and standard of living

for entire families and communities.

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Company Information

Ticker:

NESTLÉ

Country:

PAKISTAN

Major Industry:

Food & Beverages

Sub Industry:

Diversified Food

Employees:

2,345 (Pakistan – as of January 2008)

Currency:

Pakistan Rupee

Market Capital:

61,221,938,400

Share Type:

Ordinary

Mission Statement:

"Nestlé is the largest food company in the world. But, more important to them is to be the

world's leading food company”.

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At Nestlé, we believe that research can help us make better food so that people live a better

life. 

Good Food is the primary source of Good Health throughout life. We strive to bring

consumers foods that are safe, of high quality and provide optimal nutrition to meet

physiological needs. In addition to Nutrition, Health and Wellness, Nestlé products bring

consumers the vital ingredients of taste and pleasure.

Vision statement:

“Nestlé aim is to meet the various needs of the consumer every day by marketing and selling

food of a consistently high quality. The confidences that consumers have in our brands is a

result of

our company’s many years of knowledge in marketing, research and development, as well as

continuity – consumers relate to this and feel they can trust our products”.

In particular, we envision to;

• Lead a dynamic, motivated and professional workforce – proud of our heritage and positive

about the future.

• Meet the nutrition needs of consumers of all ages – from infancy to old age, from nutrition

to pleasure, through an innovative portfolio of branded food and beverage products of the

highest quality.

• Deliver shareholder value through profitable long term growth, while continuing to play a

significant and responsible role in the social, economic, and environmental sectors of

Pakistan.

Goals of Nestle:

The main goals as described by Nestle are as follows:

“Good Food, Good Life, the key to health, nutrition and wellness. With over 140 years of experience

and expertise, we take great pride in bringing you the best products because happy, healthy consumers

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are important to us. We develop our products keeping your preferences, tastes and needs in mind. We

understand that you, along with millions of other consumers, know that you can trust our products to

deliver purity, quality, convenience and nutrition. Our products are carefully aligned to Pakistani

tastes and needs. We're always trying hard to develop new products and improve existing ones, and

serve our consumers better. That's why through constant renovation and innovation we're always

testing or launching value added products and making them available in sizes that will suit every

requirement. So explore the world of health with Nestlé products, and find out what suits your

family's needs”

Objectives of Nestle:“Marketing objectives are compatible with the overall corporate objectives of nestle.

Company’s objective is to be the world’s largest and best branded food manufacturer while

insuring that nestle name is synonymous with the products of the highest quality”.

Philosophy of Nestle:

Nestlé‘s philosophy is summed up in four words:

Good Food, Good Life.

In their quest to become the world's leading health, nutrition and wellness company, they

do everything they can to help people live more fulfilling lives.

Good Food, Good Life

Henri Nestlé chose his own coat of arms to represent the company's philosophy:

a bird's nest, with a mother feeding her young.

The image represents Nestlé core values: care, family values, nutrition, healthy growth, safety

and comfort. It is a guarantee of quality and a commitment to responsibilities as a food

company and experts in nutrition.

Over the years Nestlé has reaffirmed its commitment to wellness, helping consumers to live

longer, healthier, and more productive lives, no matter their age, gender or socioeconomic

status.

Good Ingredients

Three vital ingredients lie at the heart of Nestlé and come together in their brands:

Their people, their research and development, and their commitment to quality.

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The 250,000 dedicated people who make up the Nestlé family are their source of strength and

energy. Realizing this, Nestlé offer them constant professional development, and feel their

cultural diversity is one of greatest assets.

Products:

Business Lines in Pakistan:

Milked dairy and chilled dairy:

MILKPAK

NESVITA

NIDO

NESLAC

EVERYDAY

NESTLE Dahi

NESTLE Fruit Yogurt

NESTLE Raita

MILKPAK Cream

Beverages:

NESCAFE

NEQUICK

MILO

NESTLE Fruita Vitals

Bottled Water:

NESTLE Pure Life

Baby Food:

CERELAC

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Food:

MAGGI-2 Minute Noodles

Break Fast Cereals:

Corn Flakes

Honey Gold Flakes

KOKO Crunch

Chocolate & Confectionary:

KITKAT

KITKAT Chunky

Polo

Target market of Nestle:

Milk, dairy and Chilled dairy: wide variety of dairy products is available to cater

almost every segment of customer. Liquid Milk especially Nesvita is produced

especially for the females as it contains high content of iron, beneficial for them.

Beverages: it includes Nescafe, Milo, Nesquik, and Nestle Friuta Vitals. Their main

target market includes people of all ages.

Bottled water: businesses, students, for the people who do not have access to clean

drinking water.

Baby food: target market of baby food is all the parents

Food: it includes Maggie noodles which mostly caters children and teenagers.

Breakfast cereals: children, teens and adults benefits from it

Chocolates and confectionary: people of all ages.

Sports nutrition: it specifically targets sports persons for a nutritive protein diet.

Size of the organization:

2010: Nestlé’s first quarter revenues in 2010, increased by 6.5% compared to the previous

year. The company's food and drinks segment revenues increased by 5.1% in Europe and

more than 10% in emerging markets.

In the first half of 2010, Nestlé’s revenues increased 6.1% compared to the first half of 2009;

net profits increased 7.5%

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CHAIRMANP.Barbeck-letmathe

Corporate governanceD.P FRICK

CEOP.Bulcke

Corporate communicationsR.Ramsauer

Pharma & cosmetics HRF.Castaner

Finance & controlJ.Singh

OperationsJ.Lopez

SBU’s marketing &salesW.Bauer

Innovation technology & R&D

W.Bauer

2009: Nestle is the world's largest food and beverage company, with 2009 sales of over 107

billion CHF ($101 billion USD).

2008: With sales of CHF 109.9 billion (Swiss currency) in 2008, Nestlé is the world's leading

nutrition, health and wellness company. The company employs more than 280,000 people

and has 456 factories in 84 countries. Nestlé products are sold in almost every country in the

world.

Only about 1.5 percent of its sales are generated in its home country, and all but 12 of its

factories are situated abroad. Nestlé is a truly public company with over 250,000 shareholders

of which around one third are Swiss. No single shareholder owns more than 3% of the stock.

US investors, who, together, hold over 30% of the capital.

Competitors: Engro Foods Pakistan

Major product lines: Olpers milk, Olwell, Olper Cream, Tarang Tea whitener, Tarkka Ghee

Haleeb Foods

Major product lines: Bread, snacks, desserts and meals.

Shezan Foods Pakistan

Major product lines: Food Products, Jams Jellies & Marmalades, Tomato Ketchup, Sauces &

Pickles, Fruit Juices Syrups & Squashes

Organization Chart

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Pakistan - key positions occupied by: Trevor Clayton, Managing Director, MD Office (Country Head of Operations)

Syed Yawar Ali, Chairman

Raymond Franke, Head of Finance and Controls, Finance & Control Division

Haseeb Aslam, country business manager water, water division.

Peter Wuetherich, Head of Technical, Technical Division

Salman Nazir, Head of Supply Chain, Supply Chain Division

Uzma Qaiser Butt, Head of Human Resources, Human Resources Division

Zafar Hussain, Head of Sales, Sales Division

Registered and Corporate Offices in Pakistan

308 – Upper Mall, Lahore

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+92042 111.637.853

+92 042 578 9303

+92 042 578 9304

Corporate Office Annex

304 – Upper Mall, Lahore

+92 042 111.637.853

Park Lane Tower

72-Tufail Road, Lahore Cantt

Lahore

+92 042 609 9300

Sheikhupura Factory

29thK.M.Lahore-Sheikhupura Road, Sheikhupura

+92 056 340 6615-25

+92 042 636 8710

Kabirwala Factory

Kabirwala-Kabirwala Road, Kabirwala, District Khanewal

+92 065 111.637.853

+92 065 241 1432

Islamabad Factory (Water)

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Plot no. 32, Street 3; Sector 1 – 10/3, Islamabad

+92 051 444 5991-3

+92 051 444 5997

Karachi Factory (Water)

23-A, North Western Industrial State, Port Qasim Authority, Karachi

+92 021 472 0151-3

+92 021 472 0154

Type of Business:

Nestlé Corporate Business Principles will continue to evolve and adapt to a changing world,

their basic foundation is unchanged from the time of the origins of their Company, and

reflects the basic ideas of fairness, honesty, and a general concern for people. Nestlé is

committed to the following Business Principles in all countries, taking into account local

legislation, cultural and religious practices.

Consumers

1. Nutrition, Health and Wellness

Our core aim is to enhance the quality of consumers’ lives every day, everywhere by offering

tastier and healthier food and beverage choices and encouraging a healthy lifestyle. We

express this via our corporate proposition Good Food, Good Life.

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2. Quality assurance and product safety

Everywhere in the world, the Nestlé name represents a promise to the consumer that the

product is safe and of high standard.

3. Consumer communication

We are committed to responsible, reliable consumer communication that empowers

consumers to exercise their right to informed choice and promotes healthier diets. We respect

consumer privacy.

Human Rights and Labor Practices

4. Human rights in our Business activities

We fully support the United Nations Global Compact’s (UNGC) guiding principles on human

rights and labor and aim to provide an example of good human rights and labor practices

throughout our business activities.

Our People

5. Leadership and personal responsibility

Our success is based on our people. We treat each other with respect and dignity and expect

everyone to promote a sense of personal responsibility. We recruit competent and motivated

people who respect our values, provide equal opportunities for their development and

advancement protect their privacy and do not tolerate any form of harassment or

discrimination.

6. Safety and health at work

We are committed to preventing accidents, injuries and illness related to work, and to protect

employees, contractors and others involved along the value chain.

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Suppliers and customers

7. Supplier and customer relations

We require our suppliers, agents, subcontractors and their employees to demonstrate honesty,

integrity and fairness, and to adhere to our non-negotiable standards. In the same way, we are

committed to our own customers.

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8. Agriculture and rural development

We contribute to improvements in agricultural production, the social and economic status of

farmers, rural communities and in production systems to make them more environmentally

sustainable.

The Environment

9. Environmental sustainability

We commit ourselves to environmentally sustainable business practices. At all stages of the

product life cycle we strive to use natural resources efficiently, favor the use of sustainably-

managed renewable resources, and target zero waste.

10. Water

We are committed to the sustainable use of water and continuous improvement in water

management. We recognize that the world faces a growing water challenge and that responsible

management of the world’s resources by all water users is an absolute necessity.

Customers

Every person, of any age group, gender etc is the target customer of Nestle

Nestle target its customers by knowing customer needs & demands. For this purpose it

made customer profile.

Customer profile based on two criteria:

Qualitative research:-

This involves setting up small focus groups of consumers who express their ideas and

opinions about their needs and views on different products.

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At one level, this might involve asking groups of athletes to talk about their lifestyles,

dietary habits and training regimes.

At another level, it could involve a consumer focus group discussing the quality of the

nutritional labeling on a yogurt drink.

Quantitative research:-

This involves only relatively few people like professional market researchers may

interview thousands of people through postal or telephone interviewing.

Nestlé regularly uses both forms of research to gain a clear idea of consumer opinions

and trends.

Using these customer profile techniques, Nestle developed its different product

strategies to target the customers.

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