Strategic Management Term Report

Subject: Strategic Management

Term Report on: Nestle Food

Class: MBA (4th)

Submitted by: Sehar Aslam (MBA-18-30)

Qasim Bilal (MBA-18-27)

Kashmala Irshad (MBA-18-08)

Fareeda Kausar (MBA-18-32)

Iqra Nawaz (MBA-18-01)

Submitted to: Dr. Waris Ali

University of Sahiwal Dr. Waris Ali

Strategic Management Term Report

Abstract: In this analysis we use secondary data and the main purpose of this is to
analysis identify the problems and challenges faced by Nestle Food Company. In the
competitive market the marketing strategies of this company has the great importance
and this is the reason we have chosen this company because of its well-known
reputations we have covered all the main aspects of the project . In this analysis we
describe the company Vision, Mission, Internal & External analysis and SWOT
matrix of the company and also evaluate these factors and then we choose a strategy
on the base of internal and external evaluation.

Brief Background of Industry: Food is an essential part of our lives. The food
industry is the basic and important of every nation. It plays crucial role in public health,
food safety, food security, social development and nutrition. Product quality, health and
sanitation issues are major concerns in the food industry.

Food is an essential part of our lives. The

food industry is the basic and important
to every nation. It is one of the seventeen
national critical sectors of US economy.
It plays a crucial role in public
health, food safety, food security,
social
development, and nutrition. Product
quality, health, and sanitation issues are
major concerns in the food industry.
Figure 1 shows the double pyramid
which

University of Sahiwal Dr. Waris Ali

Strategic Management Term Report

suggests a virtuous model to promote

sustainable food choices for health and
the
environment [1].
The food industry covers diverse
activities including food supply,
production,
harvesting, processing, packaging,
transportation, distribution, consumption,
and
disposal. The development of the food
industry began in the early 1900s
Food is an essential part of our lives. The
food industry is the basic and important
to every nation. It is one of the seventeen
national critical sectors of US economy.
It plays a crucial role in public
health, food safety, food security,
social

University of Sahiwal Dr. Waris Ali

Strategic Management Term Report

development, and nutrition. Product

quality, health, and sanitation issues are
major concerns in the food industry.
Figure 1 shows the double pyramid
which
suggests a virtuous model to promote
sustainable food choices for health and
the
environment [1].
The food industry covers diverse
activities including food supply,
production,
harvesting, processing, packaging,
transportation, distribution, consumption,
and
disposal. The development of the food
industry began in the early 1900s.
Food is an essential part of our lives. The
food industry is the basic and important

University of Sahiwal Dr. Waris Ali

Strategic Management Term Report

to every nation. It is one of the seventeen

national critical sectors of US economy.
It plays a crucial role in public
health, food safety, food security,
social
development, and nutrition. Product
quality, health, and sanitation issues are
major concerns in the food industry.
Figure 1 shows the double pyramid
which
suggests a virtuous model to promote
sustainable food choices for health and
the
environment [1].
The food industry covers diverse
activities including food supply,
production,

University of Sahiwal Dr. Waris Ali

Strategic Management Term Report

harvesting, processing, packaging,

transportation, distribution, consumption,
and
disposal. The development of the food
industry began in the early 1900s.
Brief Background of Company: Nestlé Pakistan Ltd. is a subsidiary of Nestlé S.A.,
a company based in Vevey, Switzerland. Today, millions of consumers across Pakistan
mirror our emphasis on nutrition, realizing that food choices impact their health and
quality of life. Our food processing company has been operating in Pakistan since 1988
under a joint venture with Milk Pak Ltd.

Vision: “The Nestle global vision is to be the leading health, wellness, and Nutrition
Company in the world”

Mission: “Good food is the primary source of good health throughout life. We strive to
bring consumer foods that are safe, of high quality and provide optimal nutrition to
meet physiological needs with the use of best technology. In addition to Nutrition,
Health and Wellness, Nestle products bring consumers the vital ingredients of taste
and pleasure” We want to excel as market leader in the world with an ethical culture
and care for its employee.

Mission statement (Evaluation): “Nestle products bring consumers the vital

ingredients of taste and pleasure that is matched by none”. here the mission statement
fulfill the six basic mission components which are market, technology, customers ,
employees , public image and product &services ,self concept is that what is the
taste and competitive advantage of the firm . So the mission statement of nestle food is
good”.

External Analysis of Nestle Food

Economical Factor:

GDP Un- GDP Growth, Inflation rate,

Inflatio Dolor unemployment rate, dolor
Years Growth employment
n rate rate
rate rate rate,
2014 4.67% 8.62% 5.7% 103
2015 4.73% 4.53% 6.00% 105.20 Nestle company define
2016 5.52% 2.86% 5.7% 104.60 sustainable development as
2017 5.55% 4.15% 5.6% 117
2018 5.87% 3.93% 5.5% 131
University of Sahiwal Dr. Waris Ali
Averag 5.26% 4.82% 5.7% 112.16
e
growth
Strategic Management Term Report

the process of increasing the world’s access to higher quality food, while contributing to
long term social and economic development, and preserving the environment for future
generations.

Competitor Analysis of Nestle food with Unilever:

Critical
successful Nestle Food Unilever Food
Factors
Market shares High Average
Inventory
Good Good
system
Financial
Good Good
position
Product quality Good Average
Consumer
Loyal Loyal
loyalty
Relationship
Good Good
with suppliers
Organization
Excellent Average
structure
Advertising High Good
Efficient cost
Excellent Good
management
EFE External Factor
Evaluation Matrix:

Total Total
Opportunities Weight Response Response
score score
Online shopping 0.3 3 0.6 2 0.6
Market penetration for
0.1 4 0.4 2 0.2
breakfast cereals
Expending ready-to-
drink tea and coffee 0.1 2 0.2 1 0.1
market
Introduce more healthy
based food products to
0.3 4 0.12 2 0.6
attract health-conscious
customers
partnerships 0.2 3 0.6 2 0.4
Total 1.00 1.92 1.9
Threats
Rising competition 0.1 3 0.3 3 0.3
Taste of the consumer
0.2 3 0.6 2 0.4
has already developed

University of Sahiwal Dr. Waris Ali

Strategic Management Term Report

Water scarcity 0.3 4 0.12 3 0.9

Strong advertisement
0.2 3 0.6 3 0.6
by major competitors
Total 1.00 1.62 2.2
Analysis: The analysis of nestle whit their competitor and also analysis of EFE matrix
reveals that the Nestle is the first priority and Unilever is the 2 nd prefer of the customers.

Internal Audit Checklist of Nestle Food

Questions Comments Yes/No Strength & Weaknesses

Management Audit Checklist
Does each member of staff Yes Strength
know their role and
responsibility?
Is proper planning of all Yes Strength
departments?
Marketing Audit Checklist
Does the marketing plan Yes Strength
match up with the overall
goals of the company?
Does the company conduct Normal Average need to improve
competitor analysis?
Finance & Accounting Audit Checklist
Are capital budgeting Yes Strength
procedures effective?
Is the firm’s debt situation Normal Strength
excellent?
Production & Operation Audit Checklist
Does the organization have Average Average need to improve
reliable and reasonably
priced suppliers?
Does the firm have Yes Strength
technological
competencies?
MIS Audit Checklist
Has the company Yes Strength
developed an IT strategy
linked with the long and
medium term plans?
Is there a separate No Weakness
electronic data processing
department within the
company?
Research & Development Audit Checklist
Are R&D resources Yes Strength

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Strategic Management Term Report

allocated effectively?
Are MIS and computer No Weakness
system adequate?
SWOT Matrix:
Strengths: Weaknesses:

Unmatched research and selling Using unethical practices

Development capacity unionism Structure flexible
Strong geographic presence Marketing plans not match with Goals
Opportunities: Threats:
High marketing share Covid-19
Excellent advertising Poor scarcity
Good product quality Price of rise
Suitable strategies for Nestle: SPACE Matrix

Factors Status Remarks +1 to +7 , -1 Average

to -7
1)Liquidity, High, Favorable, +5,+5,+6/3
Cash flow, High, Favorable =5.33
Inventory High Favorable -4+5.33/2
Turnover X-Axis =0.66
2)Market share, High, Favorable , -2,-2/2
Product quality Good Favorable = -4
Growth High Favorable, 5, 5/2
Potential, Low Favorable =5
Resource
Utilization -5.5+5/2
Technological Low Unfavorable, -5,-6/2 Y-Axis= 0.25
Changes, Unfavorable = -5.5
Competitive High
Pressure
X-Axis= 0.66. So Nestle food pursues aggressive strategy Market Penetration.

Conclusion: The Economic condition, Market Share, Product quality and Financial
Position of Nestle is good as compare to other competitors that we evaluate with the
help of external audit. And the other hand with the help of EFE Matrix we know about
our company value as compare to Unilever. Nestle is the 1 st Priority of Customers.
______________________

University of Sahiwal Dr. Waris Ali