CHAPTER 1

1. EXECUITVE SUMMARY
Nestl has been a leading food manufacturer and major purchaser of agricultural raw
materials for over 130 years. Food and agriculture are an integral part of the social
cultural, economic and political context of every community. Today, Nestl is the
worlds largest and most diversified food company, with nearly 500 factories in 77
countries, producing healthy, enjoyable food products for every stage of life. The
present study has been carried out with the objective of studying Nestle, their brand
exercises, the use of celebrity endorsement as a tool of brand building by firms and
the consumers perception about the brand image of Nestle The research was carried
out with the help of primary as well as secondary sources of data Primary Data has
been collected through consumer survey, among the existing and potential
consumers of Nestle Products. However secondary dats has been collected through
Books, Periodicals and Journals in the field of marketing, branding and Newspapers
and the Internet. The only limitation in this survey was that I could not conduct a
survey on a big scale, due to the time constraint. After all the literature and market
research, and analysis I wish to conclude that the philosophy behind the branding
strategy of Nestle has been to develop the brand so as to attract and retain the
consumers. The branding strategies adopted have resulted in building a sustainable
and differential advantage over its competitors.

2. ABOUT NESTLE

2.1 Profile of the company

Nestl with headquarters in Vevey, Switzerland was founded in 1866 by Henri Nestl
and is today the world's biggest food and beverage company. Sales at the end of
2004 were CHF 87 bn, with a net profit of CHF 6.7 bn. We employ around 247,000
people and have factories or operations in almost every country in the world.

The Company's strategy is guided by several fundamental principles. Nestl's

existing products grow through innovation and renovation while maintaining a
balance in geographic activities and product lines. Long-term potential is never
sacrificed for short-term performance. The Company's priority is to bring the best and
most relevant products to people, wherever they are, whatever their needs,
throughout their lives.

2.2 Background
Nestle was promoted by Nestle Alimentana, Switzerland, a wholly owned subsidiary
of Nestle Holdings Ltd., Nassau, Bahama Islands. Nestle is one of the oldest food
MNC operating in India, with a presence of over a century. For a long time, Nestle
Indias operations were restricted to importing and trading of condensed milk and
infant food. Over the years, the Company expanded its product range with new
products in instant coffee, noodles, sauces, pickles, culinary aids, chocolates and
confectionery, dairy products and mineral water.
Nestle was incorporated as a limited company in 1959. In 1978, the Company issued
shares to the Indian public to reduce its foreign holdings to 40%. Its name was
changed from Foods Specialties Ltd. to the current name in 1981.The parent held
51% stake in the company as at 2000 end. It has FIPB approval to hike stake by
10% and has been gradually acquiring shares from the open market. Parent stake in
the company as at 2001 end stood at 53.8%. The parent plans to continue hiking
stake through open market purchases.
Nestle India Ltd, 51% subsidiary of Nestle SA, is among the leading branded food
player in the country. It has a broad based presence in the foods sector with leading
market shares in instant coffee, infant foods, milk products and noodles. It has also
strengthened its presence in chocolates, confectioneries and other semi processed
food products during the last few years.
The company has launched Dairy Products like UHT Milk, Butter and Curd and also
ventured into the mineral water segment in 2001. Nestles leading brands include
Cerelac, Nestum, Nescafe, Maggie, Kitkat, Munch and Pure Life.
2.3 Company Mission
At Nestle, we believe that research can help us to make better food, so that people
live a better life. Good food is the primary source of good health, so we are trying to
make good food. To provide fresh and pure products to the customers, we
introduced (SHE) Safety, Health and environment policy to protect health of our
employs and keep clean our surrounding environment

2.4 Company Vision

Vision of Nestle Milkpak Company is to expand business according to the

increasing demand of market.

As per our company vision in 2020 production capacity of all plants working in
Pakistan is being increased. So extension of Kabirwala Plant is the example of our
company vision.

2.5 Plant locations

Nestle started its manufacturing operations with Milkmaid in 1962 at Moga factory.
Manufacturing of Nescafe started in 1964 at the same factory. The company set up
another factory at Cherambadi in Tamil Nadu, for manufacture of infant foods, coffee
etc. For almost two decades there were no new additions of manufacturing facilities
due to restrictive policy environment. The company set up its Nanjangad (Karnataka)
factory in 1989 and the Samlakha (Haryana) factory in 1992. The Ponda (Goa)
factory started operations in 1995. The Company set up its sixth manufacturing unit
in 1997 at Bicholim in Goa
2.6 Business of the Nestle
Nestle is the largest food company in the world. It is present in all five continents,
has an annual turnover of 74.7 billion Swiss Frances. There are 509 factories are
running in 83 countries, having 231,000 employs

3. HISTORY OF NESTLE

Nestl was the result of a series of mergers of many small companies. In the mid1860s, Henri Nestle, merchant, chemist and innovator, experimented with various
combinations of cows milk, wheat flour and sugar. The resulting product was meant
to be a source of nutrition for infants, who could not be breast-fed by their mothers.
In 1867, his formula saved the life of a prematurely born infant. Later that year,
production of the formula, named Farine Lactee Nestl, began in Vevey and the
Nestle Company was formed.
Henri Nestle wanted to develop his own brands and decided to avoid the easier
route of becoming a private label. Henri also wanted to make his company global.
Within a few months of the launch, Henri began to sell his products in many
European countries. In the companys initial years, Henri took various steps to
facilitate research, improve product quality and develop new products.
Meanwhile in 1866, two Americans, Charles and George Page had founded the
Anglo-Swiss Condensed Milk Company. The company launched a milk based infant
food, which competed with Nestls products. In 1875, Daniel Peter, a friend and
neighbor of Henri developed milk chocolate. Peter became the worlds leading
chocolate maker, and later merged his company with Nestl. The rivalry between
Nestl and the Anglo-Swiss Condensed Milk Company intensified but ended in 1905,
when the two companies merged under the Nestl banner.
World War I created a new demand for dairy products. Nestle grew mainly by
executing government contracts. The end of the war created a crisis for the company
as people started using fresh milk again, instead of condensed and powdered milk.
In 1921, Nestl recorded its first loss, which was partly due to the worldwide postwar
economic slowdown. Louis Dapples, a Swiss banking expert restructured the
company, streamling its operations and reducing the debt burden.
In 1930, the Brazilian Coffee Institute approached Dapples, seeking new products.
After eight years of research Nestl developed a soluble powder that revolutionized
coffee drinking around the world. The product was launched under the brand name
Nescafe and became an instant success. The onset of World War II speeded up the
introduction of Nescafe. The beverage also became a popular drink among American
servicemen in Europe and Asia. The end of World War II triggered off a new phase of

growth for Nestl. Many new products were added as the company grew through
acquisitions.
After 1974, Nestls financial position deteriorated. Oil prices rose and growth in
industrialized nations slowed down. The Swiss franc appreciated and the price of
coffee beans and cocoa shot up. This situation was partially offset by Nestls rapid
growth in emerging markets.
In 1981, Helmut Maucher took over as CEO. His policies had a significant impact on
Nestls style of functioning. Maucher pursued a two-pronged strategy to improve the
companys financial situation: First he embarked on internal restructuring and
divestments; second he decided to continue with strategic acquisitions. Between
1980 and 1984, he divested a number of non-strategic or unprofitable businesses,
amounting to nearly SFr8 bn. The divestments included certain food products that
were not consistent with Nestls emphasis on high value added segments. To
improve the companys financial situation, he embarked on a cost-cutting exercise.
While the employee strength was reduced significantly, the inventory and
outstanding debt were brought down.
In 1990, Nestl formed a joint venture with General Mills called Cereal Partners
Worldwide to promote Nestl breakfast cereals. It covered 70 countries accounting
for about 75 per cent of the breakfast cereal consumption outside the US and
Canada. Nestl also formed a joint venture with Coca-Cola, called the Coca-Cola
Nestl Refreshment Company, to market tea and coffee-based ready-to-drink
beverages under the Nestea and Nescafe brands.
In 1996, Nestl decided to end its 50-50 Clinic Nutrition joint venture with Baxter
Healthcare and established Nestl Clinical Nutrition to provide orally consumed
nutrition products to hospitals and nursing homes.
Nestl opened the 20th century by merging with the Anglo-Swiss Condensed Milk
Company to broaden its product range and widen its geographical scope. In the new
millennium, Nestl is the undisputed leader in the food industry, with more than 470
factories around the world. Nestl launched a Group-wide initiative called GLOBE
(Global Business Excellence), aimed at harmonizing and simplifying business

process architecture; enabling Nestl to realize the advantages of a global leader

while minimizing the drawbacks of size.
The Companys strategy will continue to be guided by several fundamental
principles. Nestls existing products will grow through innovation and renovation
while maintaining a balance in geographic activities and product lines. Long-term
potential will never be sacrificed for short-term performance. The Companys priority
will be to bring the best and most relevant products to people, wherever they are,
whatever their needs, throughout their lives.

4. BUSINESS PRINCIPLES

Since Henri Nestl developed the first milk food for infants in 1867, and saved the
life of a neighbors child, the Nestl Company has aimed to build a business based
on sound human values and principles.

While our Nestl Corporate Business Principles will continue to evolve and adapt to
a changing world, our basic foundation is unchanged from the time of the origins of
the Company, and reflects the basic ideas of fairness, honesty, and a general
concern for people.
People first
Employees, people and products are more important at Nestl than systems.
Systems and methods, while necessary and valuable in running a complex
organization, should remain managerial and operational aids but should not become
ends in themselves. It is a question of priorities. A strong orientation toward human
beings, employees and executives is a decisive, if not the decisive, component of
long-term success.
Quality products
Our focus is on products. The ultimate justification for a company is its ability to offer
products that are appealing because of their quality, convenience, variety and price
-- products that can stand their ground even in the face of fierce competition.
Long-term view
Nestl makes clear a distinction between strategy and tactics. It gives priority to the
long-range view. Long-term thinking defuses many of the conflicts and contentions
among groups this applies to employment conditions and relations with employees
as well as to the conflicts and opposing interests of the trade and the industry. Of
course, our ability to focus on long-term considerations is only possible if the

company is successful in the struggle for short-term survival. This is why Nestl
strives to maintain a satisfactory level of profits every year.
Decentralization
Switzerland is home to Nestl's Swiss subsidiary, its international headquarters and
the registered office of Nestl's holding company, but Nestl does not regard its
Swiss headquarters as the center of the universe. Decentralization is a basic
principle of Nestl. Our policy is to adapt as much as possible to regional
circumstances,

mentalities

and

situations.

By

decentralizing

operational

responsibility, we create strength and flexibility and are able to make decisions that
are better attuned to specific situations in a given country. Policies and decisions
concerning personnel, marketing and products are largely determined locally. This
policy creates stronger motivation for Nestl's executives and employees and a
greater sense of identification with Nestl's business. It is not Nestl's policy to
generate most of its sales in Switzerland, supplemented by a few satellite
subsidiaries abroad. Nestl strives to be an "insider" in every country in which it
operates, not an "outsider."
Uniformity
A very important concern at Nestl has to do with uniformity: how consistent Nestl's
principles, policies, rules of conduct and strategies should be, and to what extent
they should differ depending on the country, subsidiary, region, branch or group of
products. In general, Nestl tries to limit the uniformity of its policy to a requisite
minimum. This minimum is then systematically enforced, unless there are compelling
reasons in a given market that justify deviation from policy.
Diversification
Nestl does not want to become either a conglomerate or a portfolio manager.
Nestl wants to operate only those businesses about which it has some special
knowledge and expertise. Nestl is a global company, not a conglomerate
hodgepodge. We regard acquisitions and efforts at diversification as logical ways to
supplement our business, but only in the context of a carefully considered corporate
marketing policy. Nestl is committed to the following Business Principles in all
countries, taking into account local legislation, cultural and religious practices:

Nestl's business objective is to manufacture and market the Company's

products in such a way as to create value that can be sustained over the long term
for shareholders, employees, consumers, and business partners.

Nestl does not favour short-term profit at the expense of successful long-term
business development.

Nestl recognizes that its consumers have a sincere and legitimate interest in the
behaviour, beliefs and actions of the Company behind brands in which they place
their trust and that without its consumers the Company would not exist.

Nestl believes that, as a general rule, legislation is the most effective safeguard
of responsible conduct, although in certain areas, additional guidance to staff in the
form of voluntary business principles is beneficial in order to ensure that the highest
standards are met throughout the organization.

Nestl is conscious of the fact that the success of a corporation is a reflection of

the professionalism, conduct and the responsible attitude of its management and
employees. Therefore recruitment of the right people and ongoing training and
development are crucial.

Nestl continues to maintain its commitment to follow and respect all applicable
local laws in each of its
Research and development
The Nestl research and development centers have two main tasks: to create new
products and manufacturing processes and to improve those that already exist.
These centers play a key role in product safety and quality and also have their role in
conserving resources and protecting the environment. Environmental concerns are
an integral part of any development process to ensure that our future commercial
operations meet the desired criteria. The Nestl Research Center provides the
scientific support needed to prevent and solve environmental problems arising in the
development groups as well as manufacturing. In addition, studies are carried out to
find new ways of using industrial residues to create value added byproducts. This will
reduce total emissions and effluents. The Nestl development centers prepare

environmental impact studies for new products and manufacturing processes. These
cover all aspects, from raw materials, through processing, to the final packed
product. These analyses provide additional elements for use in deciding whether to
commercialize a new product, or to introduce a new or modified process.
Foresight
At present, the world faces daunting questions about its ability to provide enough
wholesome food for everyone. Malnutrition and poor eating habits are still serious
problems in many developing countries. By 2100, the world's population will double.
Will it be possible to feed a world with so many inhabitants? At Nestl, the big picture
is all about feeding the world and providing food and nutrition for an ever-growing
population. Our response to this situation is to intensify research, strive for
innovations and improve quality.
Flexibility and simplicity
The public's sense of the power and size of a corporation is often inaccurate, for a
company's power is limited by a host of factors including legislation, competition,
regulatory bodies and publicity. From a business point of view, it is desirable for a
firm to achieve the size best suited to a specific industry or mode of production. To
be competitive internationally and make significant investments in research and
technology, a larger company has an advantage. From a strictly organizational point
of view, flexible, simple structures work best and excessively large units should be
avoided whenever possible. In both respects Nestl has a natural advantage:
Although it is a big company, it is spread out over many countries and each of
Nestl's factories has its own management and responsibility.
Handling of raw materials
The Nestl Group is in principle not directly involved in primary production of raw
materials and other food ingredients. In general we use locally available raw
materials and purchase them either directly from producers or through existing trade
channels. Raw materials have to meet clearly established quality criteria and are
checked for possible contaminants including environmental contaminants. Our
purchasing specifications comply not only with legal requirements but go further to
ensure highest safety and wholesomeness of our products. Whenever possible we
give preference to those goods for which environmental aspects have been taken

into consideration. In those cases where the required agricultural raw materials are
not available locally, but the natural production conditions exist, we encourage local
production and provide assistance for cultivation and dairy farm management. We
support plant growing and livestock husbandry methods which:

preserve and improve natural soil productivity and economize and protect
water resources

allow the lowest, most appropriate and safe use of agro-chemicals

use the least energy.

Packaging
Manufacturing comprises all unit operations necessary to transform perishable raw
materials into finished products, with the aim to make them safe and convenient for
the consumers. The manufacturing activities of the Nestl Group:

respect natural resources by efficient use of raw materials and energy

minimize waste generation and emissions

ensure environmentally safe disposal of all waste which cannot be recycled.

Regular assessments of processing practices are carried out. These assessments
include:

evaluation of individual plant performance with regard to operations which have

an impact on the environment

definition of targets for improvement

review of plant compliance with local government regulations, company

environmental standards, as well as results achieved in comparison with targets for
improvement

full investigation of incidents which may affect the environment.

Information on developments in environmental protection technology and practices is

disseminated as required to ensure that all plants are using the most effective
environmental practices for their type of processing. This applies also for co packers.
Marketing and distribution
Marketing is based on the principle of satisfying consumer needs. This is the
foundation also for the environmental marketing approach of Nestl. Environmental
product claims in advertising, promotional material and on packaging are in
accordance with legal requirements, based on solid scientific evidence and used in a
serious and reasonable manner. Our aim is to minimize wastage in communication,
publicity and promotional material, in particular through more precise targeting of
marketing activities. Consumer promotions and merchandising material such as
consumer offers, in store promotions, display material, leaflets, printed matter, etc.
take environmental aspects into account.
This means due consideration of environmental impact in selecting both materials
and printing methods. In distribution, energy efficient and pollution controlled
methods are encouraged wherever possible.
Information, communication and education
Nestl's policy is designed to provide correct and coherent information on the
activities of the Group. Activities related to the environment benefit from the same
treatment and their communication is secured through all currently available means
inside and outside the Group. It is furthermore Nestl's duty to create awareness, to
train and motivate employees on their personal responsibility with regard to the
protection of the environment.
Legislation and Regulations
It is the policy of the Nestl Group to strictly comply with all laws and regulations
relevant to our activities. We participate in discussions on food legislation and
regulations between international organizations, government representatives,
industry, the scientific world and consumer associations. We also apply this policy to
environment related matters. In doing so, we cooperate with legislators through local
industry associations in order to promote laws and regulations in the field of
environment which are reasonable, rational, realistic, applicable and enforceable.

We oppose unjustified bans and any other discriminatory measures. We favor the
harmonization of food regulations in order to remove existing trade barriers and to
avoid the creation of new ones. This applies also to environmental issues. We favor
the exchange of information, of experience and of knowledge between the various
interested parties. Thanks to all these synergies, we can contribute to valuable
discussions and be recognized as an active partner in helping authorities to
formulate comprehensive strategies in the field of the environment.

5. NESTLE QUALITY POLICY

Everyday, millions of people all over the world show their confidence in us by
choosing Nestl products. This confidence is based on our quality image and a
reputation for high standards that has been built up over many years.

5.1 Quality is the cornerstone of our success

Every product on the shelf, every service and every customer contact helps to shape
this image. A Nestl brand name on a product is a promise to the customer that it is
safe to consume, that it complies with all regulations and that it meets high standards
of quality. Customers expect us to keep this promise every time. Under no
circumstances will we compromise on the safety of a product and every effort must
be made to avoid hazards to health. Likewise, compliance with all relevant laws and
regulations is a must and is not negotiable. People, equipment and instruments are
made available to ensure safety and conformity of Nestl products at all times. The
effort is worth it. Companies with huge quality standards make fewer mistakes,
waste less time and money and are more productive. They also make higher profits.
Quality is their most successful product. It is the key to their success, today and
tomorrow.
5.2 The customer comes first
Nestle want to win and keep customers: distributors, supermarkets, hotels,
shopkeepers and the final consumers. They have very different requirements. Trade
customers expect excellent service, correct information and timely delivery.
Consumers consider taste, appearance and price when they make their choice. Its
task is to understand what customers want and respond to their expectations rapidly
and effectively. We serve various groups of consumers and there is demand for
products at different levels of perceived quality and price. All customers, however,
expect value for their money good quality at a reasonable price.

When offering quality to customers we also mean environmental quality. Nestl

shares societys concern for the environment and is committed to environmentally
sound business practices throughout the world. Customers are central to their
business and they always respect their needs and preferences.
5.3 Competition
Baby food and Instant coffee are categories where brand loyalties are very strong
and Nestle is the market leader. HLL is a significant competitor to Nestle in instant
coffee; while Heinz is the main competitor in the baby foods market. The market for
culinary products, semi-processed foods such as noodles, ready mixes for Indian
ethnic breakfast and sweets, is largely an urban market. HLL and Indo Nissin Foods
are the main competitors in these product segments. Nestle has also achieved a
significant 25% share in the chocolate/confectionery market. The company has
recently expanded its dairy products portfolio to include, milk, curd and butter. The
company also forayed into the bottled water segment with the launch of its Perrier
brand in the premium mineral segment and Pure Life in the purified water segment.
5.4 Quality is a competitive advantage
We live in a competitive world and must never forget that their customers have a
choice. If they are not satisfied with a Nestl product, they will switch to another
brand. Their goal, therefore, is to provide superior value in every product category
and market sector in which we compete. The pursuit of highest quality at any price is
no guarantee for success, nor is a single-minded cost-cutting approach. Lasting

competitive advantage is gained from a balanced search for optimal value to

customers, by simultaneous improvement of quality and reduction cost. Success can
never be taken for granted. We must watch and learn from our competitors. If they
do something better, we must improve our own performance. We can achieve
competitive advantage through Quality.
5.5 Quality is a joint effort
Operating companies are fully responsible for maintaining agreed quality standards.
Not only Production units, but also Marketing, Purchasing, Distribution and Sales
have a vital role to play in providing quality to customers. This implies a thorough
knowledge of the products and services we offer. Quality units at different levels of
the organization provide specific support, promote quality awareness, assume
guardianship and audit the system. Quality departments monitor operations against
agreed standards and must intervene in case of non-conformity. Quality policy and
principles, the mandatory standards and the recommended tools for implementation
are laid down in the Nestl Quality System which is applicable throughout the group.
Further directions are given through instructions, norms and guidelines, often
specific to a product. Our business products, such as raw material producers,
packaging suppliers, contract manufacturers and distributors are expected to share
our concern for Quality. They too must set up an adequate quality system, so as to
meet our requirements consistently. The quality efforts must be shared by every
function and department in the company as well as our business partners.
5.6 Quality is made by people
Adequate equipment, procedures and systems are needed to make Quality; so are
involved and dedicated people. Each and every Nestl employee must do his best to
provide quality products and services. Training and teamwork are crucial to the
successful implementation of high quality standards. Continuous training ensures
that everyone understands his tasks and has the necessary skills to carry them out.
Teamwork allows us to achieve results that are greater than the sum of individual
efforts. We motivate employees by demonstrating management commitment to
Quality, by setting challenging goals and by giving them responsibility and
recognition. It is through employee involvement that goals and targets can be

achieved in the shortest time. Quality must be a way of life for everyone in the
company.
5.7 Quality is action
Quality is the result of deliberate action. It is the responsibility of senior managers to
communicate the quality objectives and to provide the resources necessary for their
implementation. It is then up to all employees to make Quality happen throughout the
company. Progress is followed by listening to our customers and by measuring our
performance. Shortcomings and mistakes must be analyzed and corrected.
Problems must be anticipated and prevented before they occur. We also must
identify and take advantage of opportunities. To stand still is to fall behind. So we
must strive for continuous improvement in every area. It is through many small
improvements as well as through major breakthroughs that we will achieve
excellence. At Nestl, Quality is our first priority. Let us practice it every day.
5.8 As said by Nestle:

Quality is the foundation of our food, nutrition, Health and Wellness Company.

A Nestle brand name on product is a promise to the customers that :

It is safe to consume.

It complies with all relevant laws and regulation.

Quality is to win consumers trust and preference.

We are committed to offering products and services to all customers that meat
their needs.

Quality is every bodys commitment.

Our management takes the lead, sets the objectives and demonstrates its
commitment towards quality.

All Nestle functions across our value chain are fully responsible to follow
mandatory norms.

Quality is to strive for Zero defect and no waste.

We focus on facts and results and we strive for Zero defect and excellence in
every thing we do.

We adopt No waste and we constantly look for competitiveness and

opportunities for continuous improvement of the quality standards delivered to our
customers.

Quality is to Guarantee, food safety and full compliance.

We enforce food safety, regulatory and quality requirements in every step of our
value chain.

CHAPTER 2

1. NESTLE PRODUCTS
Quality and nutritional value are the essential ingredients in all of the nestles brands.
Millions of people prefer Nestl products every day, happy with the addition to their
wellness that they bring. If you are looking for a specific brand our product, just use
the alphabetical index below to jump straight to a listing. Or you can explore by
category.

1.1 Baby Foods

Milk based products and baby food contributes to 43% of Nestle's turnover. For
ensuring regular procurement of good quality milk, Nestle has developed a network
around its Moga factory for collection of fresh milk everyday from the farmers. Nestle
has a dominating 87% market share in the baby weaning foods with its Cerelac and
Nestum brands. Infant milk powder is sold under the Lactogen and Nestogen brands.
Brand loyalties are very high in categories such as infant food and weaning cereals,

enabling the company to command a price premium Other milk products include
dairy whiteners (21% market share) sold under the EveryDay and Tea Mate brands,
sweetened condensed milk and ready to cook mixes for traditional Indian sweets
sold under the Milkmaid brand. The company also markets ghee (6% market share)
under the EveryDay brand. Nestle has expanded its milk product portfolio with the
launch of new dairy products such as UHT milk, Curd and Butter. Huge investments
are being made in building a diversified dairy business and the distribution
infrastructure for the same. Milk products sales registered a 10.6% yoy growth .
The production of infant food goes right back to the origins of the Nestl Company.
Henri Nestl's 'Farine Lacte' was the first product to bear the Nestl name.

In 1867 a physician persuaded Henri Nestl to give his product to an infant who was
very ill he had been born prematurely and was refusing his mother's milk and all
other types of nourishment. Nestl's new food worked, and the boy survived. From
the very beginning, Nestl's product was never intended as a competitor for mother's
milk. In 1869, he wrote: "During the first months, the mother's milk will always be the
most natural nutrient, and every mother able to do so should herself suckle her
children."
The factors that made baby foods success in the early days of the Nestl company
quality and superior nutritional value are still as valid today for the wide range
of infant formula, cereals and baby food made by Nestl. The World Health
Organization (WHO) recognizes that there is a legitimate market for infant formula,
when a mother cannot or chooses not to breast feed her child. Nestl markets infant
formula according to the principles and aims of the WHO International Code of
Marketing Breast Milk Substitutes, and seeks dialogue and cooperation with the

international health community and in particular with the WHO and UNICEF, to
identify problems and their solution. Nestl's expertise as the world's leading infant
food manufacturer, gained over more than 125 years, is put at the disposal of health
authorities, the medical profession and mothers and children everywhere.
1.2 Chocolate & Confectionery
Nestle forayed into chocolates & confectionery in 1990 and has cornered a fourth
share of the chocolate market in the country. The category contributes 14% to Nestle
s turnover. It has expanded its products range to all segments of the market The
Kitkat brand is the largest selling chocolate brand in the world. Other brands include
Milky Bar, Marbles, Crunch, Nestle Rich Dark, Bar-One, Munch etc. The sugar
confectionery portfolio consists of Polo, Soothers, Frootos and Milkybar Eclairs. All
sugar confectionery products are sold under the umbrella brand Allen's. Nestle has
also markets some of its imported brands like Quality Street, Lions and After Eight.
New launches such as Nestle Choco Stick and Milky Bar Choo at attractive price
points to woo new consumers. Chocolate confectionery sales registered a strong
21.5% yoy growth in 2001 aided by good volume growth in Munch, Kitkat and
Classic sales. Nestle relaunched Bar-One during the year. The story of chocolate
began in the New World with the Mayans, who drank a dark brew called
cacahuaquchtl. Later, the Aztecs consumed chacahoua and used the cocoa bean for
currency. In 1523, they offered cocoa beans to Cortez, who introduced chocolate to
the Old World, where it swiftly became a favorite food among the rich and noble of
Europe. Nestle forayed into chocolates & confectionery in 1990 and has cornered a
fourth share of the chocolate market in the country.. It has expanded its products
range to all segments of the market The Kitkat brand is the largest selling chocolate
brand in the world. Other brands include Milky Bar, Marbles, Crunch, Nestle Rich
Dark, Bar-One, Munch etc. The sugar confectionery portfolio consists of Polo,
Soothers, Frootos and Milkybar Eclairs. All sugar confectionery products are sold
under the umbrella brand Allen's. Nestle has also markets some of its imported
brands like Quality Street, Lions and After Eight. New launches such as Nestle
Choco Stick and Milky Bar Choo at attractive price points to woo new consumers.
Chocolate confectionery sales registered a strong 21.5% yoy growth in 2001 aided

by good volume growth in Munch, Kitkat and Classic sales. Nestle relaunched BarOne during the year.

From the beginning, turning raw, bitter cocoa beans into what one 17th century writer
called "the only true food of the gods" has been a fine art, a delicate mixture of
alchemy and science.
1.3 Ice Cream
There are many myths and stories as to the invention of ice cream: was it Marco
Polo who brought it back from China (along with pasta)? Probably not, considering
the most likely never visited China.
The story of its popularity is however connected with the invention of technology to
make it on an industrial scale, and to keep it cold once made. Before refrigeration
techniques, food was frozen with the aid of ice, mixed with salt, which was either
stored in ice houses or shipped from cold countries. But then at the end of the 19th
century, both making and freezing it became easier, and together with the invention
of the ice cream cone, made the product boom.
Today, the United States is the absolute leader in terms of volume consumed, but the
highest per head consumers are in New Zealand. Flavours you'd never have thought
of and yet they're commercially available:

Sorbets - Smoked Salmon, Tomato, Cucumber

Ice Creams - Garlic, Avocado, Sweet corn.

The ice cream cone is the most environmentally friendly form of packaging. A Syrian
from Damascus, Ernest E Hamwi is credited with its invention. Apparently, during the
1904 St Louis World's Fair, his waffle booth was next to an ice cream vendor who
ran short of dishes. Hamwi rolled a waffle to contain ice cream and the cone was
born.
1.4 Prepared Foods
Convenience foods packaged soups, frozen meals, prepared sauces and
flavorings date back more than a century. With the Industrial Revolution came
factory jobs for women and less time to prepare meals.
The problem was so widespread that it became the object of intense study in 1882
by the Swiss Public Welfare Society, which offered a series of recommendations,
including an increase in the consumption of vegetables.
The Society commissioned Julius Maggi, a miller with a reputation as an inventive
and capable businessman, to create a vegetable food product that would be quick to
prepare and easy to digest. The results two instant pea soups and an instant
bean soup helped launch one of the best known brands in the history of the food
industry. By the turn of the century, Maggi & Company was producing not only
powdered soups, but bouillon cubes, sauces and flavorings.

Maggi merged with Nestl in 1947. Buitoni, the authentic Italian brand, which has
been producing pasta and sauces in Italy since 1827, became part of the Nestl
Group in 1988.
1.5 Beverages
Beverages like coffee, tea and health drinks contribute to about 30% of Nestle s
turnover.
Beverage sales registered a 15% yoy growth . While about 14% of sales come from
Beverages domestic market, exports contribute to about 16% of sales. Nestle's
Nescafe dominates the premium instant coffee segment. Nestle s other coffee brand
Sunrise has also been relaunched under the Nescafe franchise to leverage on the
existing equity of the brand. Nestle has focused on expanding the domestic market
through price cuts and product repositioning. However it has been losing share in the
domestic market, where it has a 37% market share. Milo, a brown-malted beverage
was launched in 1996. It has an estimated volume share of about 3% in the malted
food drink segment. Nestle has launched noncarbonated cold beverages such as
Nestea Iced Tea and Nescafe Frappe during 2001. Nestle is one of the larges coffee
exporter in the country. Key export market is Russia, besides Hungary, Poland and
Taiwan.

Nestls Nescafe dominates the premium instant coffee segment. Nestles other
coffee brand Sunrise has also been relaunched under the Nescafe franchise to
leverage on the existing equity of the brand. Nestle has focused on expanding the
domestic market through price cuts and product repositioning. However it has been
losing share in the domestic market, where it has a 37% market share. Milo, a
brown-malted beverage was launched in 1996. It has an estimated volume share of
about 3% in the malted food drink segment. Nestle has launched non-carbonated
cold beverages such as Nestea Iced Tea and Nescafe Frappe during 2001. Nestle is
one of the largest coffee exporter in the country. Key export market is Russia,
besides Hungary, Poland and Taiwan.
1.6 Timelines for launches
1866
1867
1905
1929
1934
1938
1947
1948
1969
1971
1973
1974
1977
1981
1985
1986
1988
1990
1991
1992
1993
1997
1998
2000
2001
2002

Foundation of Anglo-Swiss Condensed Milk Co.

Henry Nestl's Infant cereal developed
Nestl and Anglo Swiss Condensed Milk Co. (new name after
merger)
Merger with Peter, Cailler, Kohler Chocolates Suisses S.A.
Launch of Milo
Launch of Nescaf
Nestl Alimentana S.A. (new name after merger with Maggi)
Launch of Nestea and Nesquik
Vittel (initially equity interest only)
Merger with Ursina-Franck
Stouffer (with Lean Cuisine)
L'Oral (associate)
Nestl S.A. (new company name)
Alcon (2002: partial IPO; 2008: partial sale)
Galderma (joint venture with L'Oral)
Carnation (with Coffee-mate and Friskies)
Creation of Nestl Nespresso S.A.
Buitoni-Perugina, Rowntree (with KitKat)
Cereal Partners Worldwide (joint venture with General Mills)
Beverage Partners Worldwide (joint venture with Coca-Cola)
Perrier (with Poland Spring)
Creation of Nestl Sources Internationals (2002: Nestl Waters)
Creation of Nutrition Strategic Business Division (2006: Nestl
Nutrition)
San Pellegrino and Spillers Petfoods
Launch of Nestl Pure Life
PowerBar
Ralston Purina
Schller and Chef America

2003
2005
2006

2007
2009
2010

Dairy Partners Americas (joint venture with Fonterra)

Laboratoires innov (joint venture with L'Oral)
Mvenpick and Dreyer's
Wagner, Protika and Musashi
Creation of FoodServices Strategic Business Division (2009: Nestl
Professional)
Lactalis Nestl Produits Frais (associate)
Jenny Craig, Uncle Tobys and Delta Ice Cream
Novartis Medical Nutrition, Gerber and Henniez
Vitality Beverage business
Kraft Pizza

2. COMPETITIVE ANALYSIS
Competitive analysis, as the name implies, is an exploration of the companies in a
given industry sector or market niche that are competing with your company s
products or services for market share. The analysis may be an in-depth exploration
of the top five competitors, or a larger number of competitors could be examined
(typically with less depth in the analysis). In most cases, the client will have identified
the target competitors for you. While this project focuses on competitive analysis in
the for-profit arena, it is worth noting that non-profit organizations can benefit equally
from this analysis (which they might term a comparative analysis, if they viewed the
other organizations as working toward a common goal with them).
2.1 Understand the competition
The primary benefits of any competitive analysis are a better understanding of what
your competitors are doing, what they are offering to customers, and how to maintain

your competitive advantage. The findings from this analysis are likely to factor
strongly into your own company s strategic planning. However, this is definitely not
the only take-away from the process of analyzing competitors. The analysis offers
information about content and functionality that they have probably not considered.
This is especially true for newcomers to your industry and should be fairly common;
not everyone will be a subject matter expert. Looking longer-term, this educational
process benefits not only the current project, but also any future project in that same
industry.
Doing this project has really enhanced my performance for the next project ever will
be held in my career. It has given me the practical exposure while working in such
competitive market

3. DISTRIBUTION NETWORK OF NESTLE INDIA LTD

3.1 Description Of Distribution channel

Nestle India Limited is the primary company in India involved in the production of
food products. It is very prestigious company its food products are regarded as
quality food. Nestle India Limited has a wide distribution network operating on a
national basis. The various channels of physical distribution for nestle are Mother
Godown. Clearing and Sales Agents, Cash Distributors and Retailers(outlets) .
3.2 Mother Godowns
This is the first line agent in the distribution network for channels.Stocks are moved
on consignment basis from the main factory to the different regions. These Mother
godowns are the transshipment points. Nestle enters into a contract with the mother
godownns. These agents in the form of mother godowns are given at flat fees by the
principal company i.e. Nestle.
3.3 Clearing and Sales agents ( C & S )
These are the second line agents in the distribution channel. Clearing & Sales
agents generate invoice on the basis of the requirement of the cash distributors.
Once the invoice is generated by C&S agents and communicated to Mother Godown
then stocks are released by mother godown to C&S.
3.4 Distributors
These are the third line agents in the distribution network. They are regarded as
business partners by the company. The distributors send orders to C&S agents on
weekly basis. The C&S Agents generate invoice, get the stock from mother godown
& supply them to the distributors. Nestle never provides goods to cash distributors on
credit. Distributors have to pay directly to the company by demand draft or cheque.
Distributors has to work within the overall guidelines provided by the Company.
3.5 Retailers
This are the fourth final line agents in the distribution network. Categories of the
retailers are the following:1. Wholesellers
2. grocery shop also called (Kirana shop)
3. Medical shop
4. Non-conventional outlets like panwalas

The distributors are responsible for the collection of money from the retailers. The
retailers are not at the direct linkage with the principle company, i.e. Nestle retailers
are link up with distributors.

CHAPTER 3

1. SWOT ANALYSIS

Nestle India Limited is the Indian arm of Nestle SA, which holds a 51% stake in the
company. It is one of the leading branded processed food companies in the country
with a large market share in products like instant coffee, weaning foods, instant
foods, milk products, etc. It also has a significant share in the chocolates and other
semi-processed foods market.
Nestl's leading brands include Cerelac, Nestum, Nescafe, Maggie, Kitkat, Munch
and Milkmaid, confectionery. To strengthen its presence, it has been the company's
endeavour to launch new products at a brisk pace and has been quite successful in
its launches.
1.1 Strengths:
Parent support - Nestle India has a strong support from its parent company, which is
the worlds largest processed food and beverage company, with a presence in
almost every country. The company has access to the parents hugely successful
global folio of products and brands.
Brand strength - In India, Nestle has some very strong brands like Nescafe, Maggi
and Cerelac. These brands are almost generic to their product categories.
Product innovation - The Company has been continuously introducing new products
for its Indian patrons on a frequent basis, thus expanding its product offerings.
1.2 Weakness:
Exports The companys exports stood at Rs 2,571 m at the end of 2003 (11% of
revenues) and continue to grow at a decent pace. But a major portion of this
comprises of Coffee (around 67% of the exports were that of Nescafe instant to
Russia). This constitutes a big chunk of the total exports to a single location.
Historically, Russia has been a very volatile market for Nestle, and its overall
performance takes a hit often due to this factor.
Supply chain - The Company has a complex supply chain management and the
main issue for Nestle India is traceability. The food industry requires high standards

of hygiene, quality of edible inputs and personnel. The fragmented nature of the
Indian market place complicates things more.
1.3 Oppurtunities:
Expansion - The Company has the potential to expand to smaller towns and other
geographies. Existing markets are not fully tapped and the company can increase
presence by penetrating further. With India's demographic profile changing in favour
of the consuming class, the per capita consumption of most FMCG products is likely
to grow. Nestle will have the inherent advantage of this trend.
Product offerings - The Company has the option to expand its product folio by
introducing more brands which its parents are famed for like breakfast cereals,
Smarties Chocolates, Carnation, etc.
Global hub - Since manufacturing of some products is cheaper in India than in other
South East Asian countries, Nestle India could become an export hub for the parent
in certain product categories.
1.4 Threat:
Competition - The Company faces immense competition from the organised as well
as the unorganised sectors. Off late, to liberalise its trade and investment policies to
enable the country to better function in the globalised economy, the Indian
Government has reduced the import duty of food segments thus intensifying the
battle.
Changing consumer trends - Trend of increased consumer spends on consumer
durables resulting in lower spending on FMCG products. In the past 2-3 years, the
performance of the FMCG sector has been lacklustre, despite the economy growing
at a decent pace. Although, off late the situation has been improving, the
dependence on monsoon is very high.
Sectoral woes - Rising prices of raw materials and fuels, and inturn, increasing
packaging and manufacturing costs. But the companies may not be able to pass on
the full burden of these onto the customers.

2. PEST ANALYSIS

2.1 Political or legal forces

Taxation Law
If government imposes heavy taxes on the industry then it badly effects the industry
growth. The taxes impose is from government side and it varies from industry to
industry. Juices have no tax except sales tax. But nestles some product has like
butter and cream which has more taxes
Labor Laws
Labor is being privileged here having all the laws. Nestle company also follow these
law like government announce minimum salaries of a employ Rs 6000.
Laws on hiring & promotions
Hiring & promotion is followed by law. People with better capabilities are privileged
because they deserve it, for the betterment of the organization. As well as a well
educated & skilled experienced person is a precious asset for the company suit
should be hired on better term & conditions and be promoted on the basis of it
capabilities.
Environmental protection Laws
They do concern for environment and contribute more and more for the betterment
of environment.
Foreign trade Regulations
Foreign trade regulation does not effect the over all policy and the working of the
Nestle juices because they operate nationally not internationally.
Attitudes towards foreign companies
They have no any agreement with any foreign company but if any company will offer
the business to them related / unrelated they would think about it according to terms
and conditions.

Political instability
The government stability also plays a great role for any industry. In Pakistan
government face lot of difficulty from the side of terrorism and also its activity that
badly effect environment of the country which is totally very upset. Recently in
Punjab instability of government creates lot of problem for the industry like shortage
of electricity that badly affects the industry operational process. Nestle juices have
not much affect this condition but in future it may be face some difficulty for
operating.
2.2 Economic forces
Inflation Rate
Now in Pakistan inflation rate is almost 22.3% so if increase in inflation rate then
ncrease in prices of Nestle JUICES but if in Pakistan economy.
Economic growth rate
Economy growth rate accelerate is 7+
2.3 Social factor
Health consciousness
Today people are more health conscious so Nestle juices by identifying this need of
the people they are also producing health conscious juices with more vitamins.
Demographic trend
In Pakistan the population growth rate is 1.828% in 2008 and total population is
167,762,040 (July 2008 est)
Age structure

0-14 years:

40% (male 33,293,428; female 31,434,314)

15-64 years:

56.9% (male 48,214,298; female 46,062,933)

65 years and over

4.1% (male 3,256,065; female 3,542,522)

Key Indicators

Population:

164,741,942 (July 2007 est.)

Growth rate:

1.828% (2007 est.)

Birth rate:

27.74 births/1,000 population (2007 est.)

Death rate:

8 deaths/1,000 population (2007 est.)

Environmental concerns:
About the environmental concerns of Nestle juices is good health.
Work life quality:
Quality of work life is very safer & environment friendly
Lifestyle changes:
They consider quality life changes and take advantages of accordingly so that
customer can convinced as well as it plays a vital role to attain & retain the customer.
Consumer adopts the trend of changing environment because of modern facility as
well as globalization they are aware about each and every thing happening all
around them.
2.4 Technological forces
New Products
Nestle juices focusing concentric and conglomerate diversification because in
present era it is not possible for any organization to exist in market for long run by
providing just one product. So Nestle juices are diversifying according to changing
demand of customers and trends.
Product innovation
Product innovation is becoming more necessary for the organization because of
globalization people are becoming aware about the changes being taken place
around them so in order tactical the situation nestle juices is focusing on product
innovation by introducing new flavor of juices with the passage of time NESTLE
JUICES use new tetra packing like easy open cork of pack.
Productivity improvement through automation

Automation dont matter a lot but to some extent it contribute towards productivity
and improvement. Imported pulp is filled in machines for processing after the final
form of juice it is packed in 250 and 1 liter packing.
Total spending on R&D
Spending on R&D is long term investment for any organization. Nestle has R&D
department and head of R&D department is Mr Arshad Bhati. Nestle total spending
on R&D 70 millions.
New communication technology
All the modern as well as traditional ways of communication are being adopted by
Nestle juices including own emails, letters, faxes and monthly visit in different offices
of Nestle juices for better communication among supplier, distributor and customers.
Nestle juices has also established own web site which can be visited any one for
most recent news innovation and activities being taken in the organization.

CHAPTER 4

1. RESEARCH METHODOLOGY
I have carried out a research which is both qualitative and quantitative in its support.
The qualitative approach applies to both, descriptive and inductive forms of research.
While as in case of quantitative approach, an extensive use has been made of the
literature available to carry out a detail research on the nature of the problem. I have
chosen Nestle as the target company for my research study.
1.1 Method of data collection & analysis
The data, after collection, has to be processed and analyzed in accordance with the
outline laid down for the purpose at the time of developing the research plan. This is
essential for a scientific study and for ensuring that we have all relevant data for
making contemplated comparisons and analysis. I have conducted a graphical
analysis based on the responses received from the persons questioned and
interviewed. Once the interview was over, the responses received were be grouped
together, and a graphical presentation and analysis has been made for every set of
questions.
1.2 Nature of data
I have made use of both, the primary sources and the secondary sources of data in
eliciting information.
1.3 Primary data:
The primary source of data involves oral interviews and questionnaires. These
sources are inadvertently expected to yield more qualitative data and results.
SAMPLE SIZE: 100
SURVEY AREA: Mumbai
1.4 Primary data collection methods

Interviews:
I have conducted oral interviews with retailers of Nestle. In considering an oral
interview of such a nature, a follow up and step by step approach was adopted in
getting through the interviewees. The oral interview involved a set of well thought out
questions that were asked and the responses there on noted as a basis for analysis.
Subsequently a graphical analysis has been made based on the responses received
from the persons questioned and interviewed.
Secondary data collection method
The secondary source of data includes relevant literature including periodicals and
journal articles in the areas of Marketing, customer satisfaction.
1.5 Objective of the study
Primary Objective:

To find out sales volume of Nestle Confectionary vis--vis competitor

To find out the major Nestle competitors

Suggestion for the company from retailers

Secondary Objective:

To increase their market share by approaching to retailers who prescribe

competitors product.

To have a good image in the eyes of retailers.

1.6 Limitations
The only limitation in this survey was that I could not conduct a survey on a big
scale, due to the time constraint.

1.7 Data analysis and interpretations:

Q.1 Name the confectionery brands you stock at your outlet?
Nestle
60

Cadbury
55

Parle
40

Dabur
20

Perfetti
70

Others
15

Brand

Availability in Retailers out of 100

Retailers have number of brands in their store.

Perfetti is on the top most preferred brand among the Retailers.

Nestle is also on the handsome position but Perfetti is more famous among the
Retailers.

The Main competitors over the market are Perfetti & Cadbury.

Q.2 Name and rank the top five brands you stock at your outlet?
Nestle
55

Cadbury
50

Parle
30

Dabur
15

Perfetti
65

Others
10

These brands are taken on the basis of top five brands stock at the outlets.

Supported by this chart Perfetti is on the top most position by 65 out of 100 Retail
stores.

Other players are also on the strong position as Nestle is on the 2 nd position
covered area by 55 out of 100.

To cater this market Nestle have to provide some value added service to his
retailers.

Q.3 Please tick the Nestle Brands you stock at your outlet? (Tick Please)
clairs 50p
75

V.A. clairs
85

POLO
60

Availability of Nestle confectionery Item in the retail stores

According to this chart V.A clairs is on top most position 85 out of 100 retail
stores.

clairs 50p is also having a good market but due to the same taste of V.A clairs
the most retailers prefer that.

Polo has also good market share but due to the limited preference by customer
retailers prefer less in competition of others.

Q.4 Please rank the Nestle Brands according to their sales?

clairs .50
40

V.A. clairs
65

POLO
55

Rank of the Nestle Brands according to their sales

As written on the previous chart V.A.Eclairs is the top most preferred brand
among the retailers.

65 retailers out of 100 are shown their preferences to the V.A.Eclairs .

Polo is also 2nd position among the retailers with 55 out of 100.

Eclairs.50 has also the beautiful market in this confectionary segment with 40 out
of 100 retailers.

Q.5 What percent of stock at your outlet is Nestle?

Nestle
20%

Others
80%

Percentage of Nestle and other competitor brand

The availability of Nestle in confectionary item is only 20% but number of players
is very high so that we have the result that in this confectionary segment Nestle has
very powerful market.

Others players are Cadbury, Dabur, Perfetti, Parle, ITC. They together covered
other 75% market.

There are also some small players which covered other 5% of market.

To cater more market company have to provide some value added service as
well as have to give some schemes among the retailers.

Q.6 What percent of total sales is Nestle at your counter?

Nestle

Cadbury

Parle

Perfetti

31%

21%

14%

34%

Percentage
sales

of

confectionery

Percent of total sales at counters

Perfetti is on the top most preferred brand among the Retailers by holding 34% of
overall market.

Nestle is also on the handsome position with holding 31% of overall market.

The Main competitors of Nestle over the market are Perfetti & Cadbury.

Q.7 From where do you procure Nestle Confectionery?

Distributor
96%

Wholesalers
4%

96% retailers are procuring Nestle Confectionery from Distributor and only 4%
procure Nestle Confectionery from Wholesalers. Thats show the effective Supply
chain management of Nestle.

Due to effective supply chain management Nestle cater very huge market of
retailers.

Q.8 Which are the seasons for maximum sales?

Summer
45%

Winter
55%

Sales of Nestle Product season wise

Supported by this graph a very interesting finding is occur that 55% retailers are
shown his interest to make us understand that winter is more prefer time to sail
nestle Product. But 45% are also exist there who said that summer is very special to
sail nestle product .But there is no specific reason fine out.

Q.9 (a) Do Customers (Retailers) prefer Nestle Confectionery to other brands?

(Yes/No)
Yes
70%

No
30%

Preference of Nestle Brand compression to others

As we stated previously that Nestle have good market. Most of retailers stated
that they prefer Nestle Confectionery sail in comparison to other brands. The
percentage of preferred retailers is approximately 70%.and other who dont prefer
Nestle brand is only 30%.

Q.10 (b) Do Customers (Retailers) prefer Nestle Confectionery to other

brands? (Yes/No) Why?
Price
55

Quality Of Product
20

Schemes
60

Variety
45

Reason to prefer Nestle Brand

Main reason to have Nestle Confectionery brand among the retailers is Schemes.
Most of the retailers have this brand due to schemes and price & quality of the
products.
Very effective price and quality are affected to absorb that Nestle Confectionery
product among the retailers.

Q.11 (a) Do you prefer to sell Nestle Confectionery over other Brands? (If
Yes/No Why)?
Yes
85%

No
15%

Main reason to have Nestle Confectionery brand among the retailers is Schemes.
Most of the retailers have this brand due to schemes and price & quality of the
products and approximately 85% are prefer to sail nestle product.
Very few, approximately 15% are not preferred to sail Nestle product.
Very effective price and quality are affected to absorb that Nestle Confectionery
product among the retailers.

Q11. (b) Do you prefer to sell Nestle Confectionery over other Brands? (If
Yes/No Why)?
Promotional
Margin
60

Schemes
45

Demand
55

Variety
20

Reason to sell Nestle Confectionery

Main reason to sell Nestle confectionery over other brands is the schemes
provided by the company over other brands.

Sometimes the company provides the schemes which are very preferable to the
Retailers.

Q.12 Do you face any problem while selling Nestle Confectionery to

customers?
Yes
15%

No
85%

Facing any problem while selling confectionery

85% of Retailers are said that they never face any kind of problem while sailing
Nestle product to the consumer, but 20% are also said that they had faced some
problem while sailing Nestle product. That shown the image of Nestle among the
retailers is very effective.

Q.13 Do you face any problem with Nestle India Limited?

Yes
20%

No
80%

Facing any problem with Nestle India ltd.

80% of Retailers are said that they never face any kind of problem to having
Nestle product in their store, but 20% are also said that they had faced some
problem while sailing Nestle product. That shown the image of Nestle among the
retailers is very effective.

Q.14 Will you recommend Nestle Confectionery to customers?

Yes
85%

No
15%

%age of Retailers who want to recommend Nestle Confectionery among the

customers

Supported by chart 85% retailers are very much satisfied with the process of
Nestle. they also want to recommend nestle product among the consumer.25% of
also there who dont want to recommend Nestle product.

Q.16 Please rate the performance of Nestle Confectionery on the basis of

following features? Numbers from 1 to 6 is Very Low to Extremely High.

Price
3
Credibility
Nestle
6

Product

Promotional

Quality
5

Scheme
4

of

Understands
Variety
4
Promptness

Margins
3

Demand
4

Delivery
3

Customers
5
in
Advertisement
3

These performances are calculated on the basis of ranking from very low to
extremely high.

In which credibility of Nestle is given the extremely high ranking by 55 retailers

out of hundred.

Q.17 Please rank the following according to your preference what you think is most
important for customers while buying confectionery? Numbers from 1 to 6 is Most
Important to Least Important.
Quality
Price
3

Product
1

Of

Promotional
Brand Name
2

Scheme
4

Margins
3

In this case Quality of the Product has given the Rank 1 i.e. Most Important.
Whereas least important is given to no other thing.

2. RESULTS AND FINDINGS

Analysis is done on the basis of: Price of the Product
Quality of the Product
Brand Name
Taste
Schemes and Margins provided by the company.

Perfetti is the market leader in comparison to its competitors and the major
competitors are Cadbury, Nestle, Parle and Dabur.

These products are mostly sold on the Promotional Schemes provided by the
company. Such as Nestle clairs Dino Pack worth Rs.25

These Promotional Schemes attract many customers which increases the sales of
the product offered by the company.

Only one part where the company is lacking is the schemes provided to the retailers.
The retailers are not satisfied with the schemes provided by the company as
compared to the competitors.

Somewhere and somehow in some of the jars the schemes provided by the
company is satisfactory for the retailers.

On the other hand retailers are happy to sell these products to the customers
because of the demand whereas the taste and different varieties of product offered
by the company.

Nestle confectionery is provided at different prices such as 50p clairs, V.A. clairs,
Rs.2 POLO and Rs.5 POLO. So customers can buy any range products.

The company manufactures the product by understanding the customer needs and
demands.

Whereas the Credibility of Nestle is extremely high in the eyes of the customers.

Demand of the product is also high because of the Brand Name, Promotional
Schemes, Variety and taste of the product.

The quality of the product provided by the company is shown by the high sales of the
goods which we have already done and mentioned.

3. RECOMENDATIONS
Points where company should pay attention and are reason where
should they overcome:

Whole sell market: - Prices of products in the whole sell market is less then
company so kirana stores, medical stores and panwalas buy products from whole
sell according to their need and demand. For ex. MRP of clairs is Rs.60 then its
Cost Price is Rs.47 in whole sell and Rs.50 in company. To overcome this problem it
is necessary the company provides schemes and replacement offer to the
shopkeepers.

Melting Problem: - Chocolates get melt in summers due to high temperature so

shopkeepers who do not have cooling system are not ready to buy chocolates. So it
is necessary to sell more of the confectionery items in summer because it never
melts during summer.

Jo dikhata hai wahi bikta hai: - Company should provide posters banners etc.
by which shopkeepers make costumers aware that he sell chocolates and
confectionery of Nestle. This problem comes mainly in potentially low markets like
Gokalpuri and Bhajanpura etc.

Some of the markets need more focus are: - Gokalpuri, Bhajanpura, Zafrabad
etc. These markets are potentially low markets where sell of Branded Confectionery
are very low. And they buy from whole sell if required. It is necessary to provide
incentives to the Sales Man by providing at least 2 jars of confectionery in each
shop.

Salesmen concentrate mainly on confectionary to be sold on kirana, bakeries,

and medical stores and shows no attention on small shops.

Sales mens visit problem: - SM were dealing only those counters which are
potentially efficient, normally regular in payments. They used to open only those new
counters which are potentially efficient and ready to deal 3 to 4 initial dealings in
cash.

Some of the shops which are small and near to big bakeries and confectionaries
do not sell products due to low sale.

Shops which are near to schools and colleges usually keep less of the chocolates
and confectionery when schools and colleges are closed.

CHAPTER 5

5. CONCLUSION
First of all, I would like to say that it was a real interesting experience because it was
the first time in my schooling that I work on a project which seems to be professional.
However, I met many technical difficulties. Indeed, it was really difficult to be creative
at each time and to find more and more information about the candies. During the
project, I got an enriching experience about selling and how to convince the
customer to buy the product or to win an order. Study on worlds one of the top
FMCG company like Nestle gave me practical experiences about nature of
consumers, market and how to deal customers in the practical life in a market. It was
for the first time when I was in the market to deal with the customers and company
like Nestle gave me great exposure about the markets, nature of markets, nature of
customers and how to deal with the customers.

6. BIBLIOGRAPHY
6.1 Books:

C.R.Kothari

Research Methodology

Philip Kotler

Marketing

Marketing Management - By - Philip Kotler

Financial Reports - Nestle India Ltd

6.2 Web Sites:

www.iloveindia.com

www.google.com

www.nestle.com Media

wikipedia.org/wiki/Nestl

www.foodanddrinkeurope.com

www.foodnavigator.com

www.Google.com

www.shareinfoline.com

Ask.com

sharekhan-firststep.com

7. ANNEXURE
Questionnaire Retailers
Name of the Retail Outlet :
Location of the Outlet

Please read the following questions carefully and answer appropriately.

1.

Name the Confectionery Brands you stock at your outlet.

_______________________________________________________________

2.

Name and rank the top 5 brands at your outlet.(according to Sales)

_______________
_______________
_______________
_______________
_______________

3.

Please tick the Nestle brands you stock at your outlet. (Tick please)
clair 50p
V.A. clairs
POLO

4.

Please rank the Nestle brands according to their sales.

clair 50p
V.A. clairs
POLO

5.

What % of stock at your outlet is Nestle (no of cases)?

______________

6.

What % of Total Sales is Nestle in your counter

7.

From where do you procure Nestle Confectionery? (Tick please)

Distributor
Wholesalers

8.

Which are the seasons for maximum sale (Tick please).

Summers
Winters
Others: ________________________________________________________

9.

What is the expected traffic at your outlet? (No. Of customers per day)
______________

10.

Do customers prefer Nestle Confectionery to other brands (If Yes / No, Why)?
(Tick please)
Price
Quality of product
Schemes
Variety

11.

Do you prefer to sell Nestle Confectionery over other brands (If Yes / No,
Why)? (Tick please)
Margins
Promotional Schemes
Demand
Variety

12.

Do you face any problem while selling Nestle confectionery to customers?

_______________________________________________________________

13.

Do you face any problem with Nestle India Limited?

_______________________________________________________________
_______________________________________________________________

14.

Will you recommend Nestle Confectionery to customers? (Tick please).

Yes No
Why ___________________________________________________________

15.

Any Recommendations.
_______________________________________________________________
_______________________________________________________________
16. Please rate the performance of Nestle Confectionery on the basis of following
features. (Please circle the response number that best describes how NESTLE has
performed on that feature.) For any feature(s) that you feel is (are) not relevant to
your evaluation, please circle (NA)
(6 Extremely High, 5 Very High, 4 High, 3 Adequate, 2 - Low, 1 Very Low)

a)
b)
c)

Price
Product Quality
Promotional schemes
Dissatisfied
d)
Variety
e)
Understands Customer
f)
Credibility of Nestle

(NA) Extremely High 6 5 4 3 2 1 Very low

(NA) Extremely High 6 5 4 3 2 1 Very low
(NA) Truly Satisfied
6 5 4 3 2 1 Totally
(NA) Extremely High 6 5 4 3 2 1 Very low
(NA) R. Understands 6 5 4 3 2 1 No Clue
(NA) Extremely High 6 5 4 3 2 1 Very low

g)
h)
i)

Margins
(NA) Extremely High 6 5 4 3 2 1 Very low
Demand
(NA) Extremely High 6 5 4 3 2 1 Very low
Promptness in Delivery
(NA) Extremely Quick 6 5 4 3 2 1 Very
Slow

j)

a.
b.
c.
d.
e.

Advertisements

(NA) Extremely High

6 5 4 3 2 1 Very low

17. Please rank the following according to your preference what you think is most
important for customer while buying confectionery from 1 to 6. (1 Most important &
6 Least important)
Price

Quality of Product

Company / Brand Name

Promotional Schemes

Margins