Multinational Corporate Case Study On Nestle Marketing Essay

Multinational Corporate Case Study On nestle Marketing Essay match to Stuart Wall, Sonal Minocha and Bronwen Rees (2010), MNC (Multinational bodily) is a company that has headquarters in one country only when has operations in other country. MNC had defined by Dunning (1993) MNC are engages in FDI (Foreign calculate Investment) and owns or fudges value-adding activities in to a greater extent than one country. Typically the multinational would not just own value-adding activities, but might buy resources and create goods or operate in a variety of countries. Multinational Corporate in 2007 an estimated 79000 multinational corporate, collectively controlled a total of around 800000 foreign affiliates, employed almost 82million great deal worldwide and accounted for sales revenue of over $31 trillion, some 11% of world GDP. . (Stuart WallSonalMinocha and Bronwen Rees. 2010. pg. 31).Research (Global Education, 2009) has shown that globalisation have many meanings and definitions , but loosely known as the greater movement of people, goods, capital and ideas affected by the increments of the economic integration which in turn is propelled by the increasing trades and investments. It is like pathetic towards living in a b launchless world. There has constantly been a sharing of goods, services, knowledge and cultures betwixt people and countries. In recent years, the improvement of technologies and a decline of barriers mean the speed of exchange is much faster. Globalization provides lots of different types of opportunities and challenges (Global Education, 2009).Why snuggle is Multinational Corporate? nestle is a multinational corporate since the headquarter is located in Switzerland but operates businesses in the many other countries over the world such as Europe, United State, China, Malaysia, Hong Kong etc. As we know, snuggle is an infants ware. likewise producing infants, Nestle has besides produces some other productions such as coffee tree, yogurt drink, cornflakes, ice-cream etc which can easily found in supermarkets all over the world.Introduction to NestleIn 1860s, a pharmacist named Henri Nestle had succeeded developed a nutrient for babies whom are unable to breastfeed. And his first-class honours degree success was to be able to feed a premature infant who could not tolerate his mothers milk or any of the usual substitutes. (Nestle, 2010)In 1867, he adopted his own coat of arms as a trademark in 1867. In German Nestle means little nest. The Nestle symbol is universally downstairsstood to carry the meaning of nurturing and caring, security, provender and family bonding. These attributes are still the guiding legacy for the company Henri Nestl founded which fulfills the commitment to Good Food, Good Life.The Nestl Coat-of-ArmsSources Nestle Sdn Bhd 2010In 1905 Nestl work together with the Anglo-Swiss Condensed Milk Company, the year subsequently Nestl added chocolate to its line of foods. The newly formed Nes tl and Anglo-Swiss Milk Company had factories in the Spain, Germany, United States and Britain. Soon, the company had full-scale manufacturing in Australia with warehouses in Hong Kong, Singapore and Bombay. Most deed still took place in Europe. (English Tea Store, 2004-2009)At first, Nestle business was mainly based on milk and dietetic foods for children. Then, Nestl grew and diversified its range of products, done acquisitions and mergers with the already famous brands of that time. For example, the manufacturing of LACTOGEN began in 1921, and in the alike year, a beverage containing wheat flour was marketed under the brand name MILO. In 1938, NESCAF was introduced to the as the first instant coffee. Then, in 1947, Nestl merged with the MAGGI Company.Currently, Nestle is still having their principles, which to provide the best products throughout the world. As the leading Food, Nutrition, Health and Wellness Company, Nestl provides the best food for anytime of twenty-four hou rs and for anytime of your life. Nestl has grown to become the worlds largest food company which offers more than 8500 brands and 10000 products throughout the whole world. With its headquarters in Vevey, Switzerland, Nestl has more than 456 factories in more than 80 countries and having more than 283,000 employers. (Nestle Products Sdn Bhd , 2010)Actual impact of globalization on NestlePESTLE depth psychology which contains of political, economic, social, engine room, legal and environment analysis which consist of external environmental. It is a useful analysis to understanding the situation of a company in an industry.Political analysisThe stability of political in a country impart be under the consideration by draw near to build a formulatet that can operates NESTLEs factories that considering the countrys political stability, good tax incentives as well as its skilled workforce, NESTLE chose Malaysia to be the site of another regional manufacturing centre for NESCAFE (Mr. J os Lopez, Exe attenuatedive Vice President, Nestle S.A. responsible for global operations and GLOBE (Nestls Global seam Excellence Programmer)).Economic AnalysisThe important of economic factors go forth leads to the strength of consumer spending. For example, in recession economy, people might cut of their budget to consume fellowship stuff rather than unnecessary stuff such as chocolate. Americans likes luxury chocolates, a new premium line of cacao which is called Nestle Treasures God had launched in order to cash in on the recession.Social Analysis as yet though Nestle as a multinational corporate which operates their business in the other country, but do respect to peoples culture and traditional which is a corporate that think global, act local by working hard to fuse itself into the cultures and traditions of the country. For example, Kit-Kats formula is almost different everywhere. A Russian Kit-Kat is smaller than a Bulgarian, but less sweet than Germanys Kit-Kat. Whil e in Japan, the strawberry Kit-Kat is all the rage. engine room AnalysisAs the technology of recently changed rapidly in global, Nestle have attracted people to purchasing their products by using advertising. For example, Kit-Kat have been advertised by attracting youngster or child because it is a sweeten tid-bits. Infants foods advertisement is to attracted housewife to procure it to given their child a healthy life.Recent research on technology analysis (Nestle Policy and Environmental sustainable) (2008) reports shown that during the manufacturing process, Nestle had using efficient technologies to ensure that in that respect is no wasted energy while producing products. In addition, to control the eliminate emission including the greenhouse gases.Legal AnalysisIn 1996, Nestle was the first multinational corporate that voluntary for halal certification for its own food products. Those food products that exported to the other countries were certified as Halal products. As a glo bal food company like Nestle, hygiene is a must. Since Nestle has the Halal certification and hygiene was the procedure which contain in that certificate.Besides that, health and safety were the principle that keeps by Nestle. While provided employees to minimize risks in their personal lives, Nestle had always emphasize each of their employees about to change the employees attitudes towards personal safety.Environmental AnalysisNestle always committed to people to produce the best fictional character to their consumers. Besides that, Nestle also prevented the wasted food by reduced the materials weight and volume, yet supported initiatives of recycle from used packaging. Nestle have also use recycled materials to produce its products.But, Nestle had done a fact that will cause of the lost of the home for orangutan. According to Heidi Marshall (2010), Nestles product-Kit Kat is a product of environmental destruction. This is because of the material that used in the candy bars and f or the other Nestle products as well was comes from a palm oil that get from by destroying Indonesia rainforests.The outline that used by Nestle to actual impact of globalization are includedMarket Penetration StrategyMarket penetration strategy is which to refer to increase market share of the current products. A firm using this method by raises their sale revenue without any changing of their exist products. Nestle may try to use the promotion which is buy 1 free 1 for its products. For example, buy 2 packs of 1kg Milo free a 10 pack of instant Nescafe.A market penetration will also involve the 4ps which is products, price, promotion and place. According to (Stuart Wall SonalMinocha and Bronwen Rees, 2010), the product in international selling is the extent to which a standard and differentiated product should be provided. For example, Nestle is using the differentiated products since it produce its products Kit-Kat in different flavor. A Russian Kit-Kat is smaller than a Bulga rian, but less sweet than Germanys Kit-Kat. While in Japan, the strawberry Kit-Kat is all the rage.The international price is related to the account market different between countries, exchange rates, difficulties of voicing and collecting payment across borders, the effect of tariffs and purchase taxes on competitiveness, governmental regulations of the host country and the long term strategic plan of the company in the different markets in which it operates.For the promotion, it is often expressed to attracted people to consume their products and yet to capture a new consumer to purchasing their products. Nestle is always advertise their products thru media ways. To make sure that people know their products yet to pursuing people to make a purchase on their products. For example, Nestle advertise its products thru the television set advertisement. This can make sure that children will attracted by its advertisement while it advertise.A place or distribution it is difficult to con trol from international the foreign country itself. A company will solve this problem by its own subsidiary. In addition, if the products are being imported, a multinational company will recruit a local agent to ensure that there is safety, cheapest and quickest way is using. For example, Nestle might recruit a people that located outside of overseas of it country to solve the problem such as a warehouses, the selling markets and etc.SWOT Analysis of NestleAs Dr. Jill Novak, (2009) commented thatStrengthNestle is a global food producer since it located in over 100 countries. It is consistently one of the worlds largest producers which with global sales in 2008 topped $ ci billion. In addition, Nestle was named one of Americas Most Admired Food Companies in Fortune magazine. Furthermore, Nestle provides quality brands and products and line extensions that are well-known, top-selling brands including Maggi, Haagen Dazs, Kit Kat, Nescafe, CoffeeMate, prepared cross foods, yogurt, fo ods for infants and many more.WeaknessMost of the products have their own weaknesses. For Nestle, it was not as successful as the other country in France. Nestle could not contend against a strong and established brand which is Dannon that entered into France earlier than Nestle which is top selling of health yogurt. Besides that, since 2004, Nestle has been forced to reduce the amount of kale in their products that may cause of diabetes among American children. In addition, Nestle has been removed the packaging and advertising that false claims of heart healthy and lower cholesterol which is an order from FDA(Food and Drug Administration) and American Medical Association which is the under fire of the breakfast cereal industry.OpportunitiesIn today, everyone hope and needs to have a healthy life, as a producer like Nestle, it has an opportunities to raise their selling profits with producing health-based products. Since Nestle was a well-known branded, for sure, it will be easy t o attract people to purchase their products. Further, they launched a new premium line of cacao called Nestle Treasures Gold, in order to cash in on the recession economy in which consumers cut back on luxury goods, but regularly indulge in candy and chocolate. Americans want luxury chocolates, and high-end chocolate is immune to the recession (so far), because it is an inexpensive indulgence.ThreatsEven though Nestle was a big producer in the world, but it still has its competitor, such as Hersheys, Cadbury-Schweppes (owned by Pepsi), Kelloggs, Starbucks, , Quaker, Kraft Foods, Danone, , Heinz, Unilevel and many more. Furthermore, any taint foods supply especially e.coli which causes the recalled of their brand-Toll House cookie dough. Outbreaks were linked to 28 states and the product had to be recalled globally. Nestl has yet to find out how this happened, and is still investigating (Dr. Jill Novak, (2009).Potential impacts of globalization on NestleNestle corporate have its own potential in globalization since it is a big foods producer in global.TechnologyIn the world of today, technology will be changing rapidly in global. And this will leads a good improvement in all type of products that will be produce around the world. A research and development department will be a part of Nestle from today towards future performance by gaining profits without wasting the raw material in manufacturing process. Besides that, by using a developed technology may reduce the effects that will occurs greenhouse effect. For example, use of plastics packaging in every single of Nestle products improve to recycled paper packaging, used of plastic bottle in modify the Nestle beverage into tin that can recycle use.On the others side, a case that occurs in India, which is Nestle chocolate, will be melted before its eyes. This is because there are lacks of distribution and the heat temperature in India will make the chocolate melted. By using the technology that can solve this problem that is using the technology to change its chocolate ingredients so that can afford India heat temperature.EnvironmentalAs the info below, Nestles Kit Kats was made from a palm oil that came from by destroying the rainforest in Indonesia. This is cause of the pollution in Indonesia. To solve this problem, Nestle corporate should consider using the palm oil from the other countries by not destroying the rainforest of the country. On the other side, there is another solution too. That is, refining the vegetables oil that can out inside the ingredient of qualification chocolate.SocialAs a food producer in global, Nestle may do some different in their products. Such as, a new flavor of the chocolate could be launch. This is because different country has a different taste towards foods. For Malaysia, a durian can be a part of the ingredient in the making of Kit-Kat. For Korea, a Kim chi flavor Kit-Kat can also create. This is a try for Nestle to attract people by producing diff erent flavor but same products around the world.The strategy that might use by Nestle in the potential impacts on globalization isDiversification strategyAccording to Stuart WallSonalMinocha and Bronwen Rees diversification strategy involve the company branching out into both new products and new markets. For example, from the info that I mention below, Nestle might create a different flavor of Kit-Kat to attracted new customer. For Malaysia, Nestle may create a durian flavor Kit-Kat to attracted those customer who are not chocolate lover but is a durian lover to purchase this products.ConclusionOn the day Nestle was introduced, it was only food for infants. As time goes, Nestle has grown to be more famous in brand name and focus in widen its product line. Today, Nestle is one of the most famous and successful foods and drinks producer. Furthermore, Nestle had expands to globalization which consist of factories around the world. Besides that, Nestle will always try counter threats and competitor, such as the current products or new product entrants. Therefore, Nestle still has the potential to grow more and continue to be the one of the leader in the market share.