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... our early assimilation of Nestle product. It is basically come from good quality product as well as consistent advertising and promotional efforts. Once the product is acceptable by the consumers and it is proved to be good, it will automatically become a demanding product in the market.
Customer loyalty will also take place. In addition to that, advertisement about the product is also important because it is use to aware the customers about the new product being introduced in the market. Milo and Nescafe are some of the fine examples of Nestle'e's strongest brand name over the years. Specialist marketing expertise - As the company is growing bigger and bigger more relevant specialist are needed in order to handle the company well. Therefore more and more people with the required specialized skills are hired. With their professional skill and knowledge they have, together they help the company to successfully build its business to the climax.
New, innovative product or services - With the help of the Research and Development department, they will do more research on the consumers needs (what they want from Nestle) and develop the new product according to the consumers taste. Once they capture what the consumers' needs, it is easier to market their products. Reason to do market research is because different country will have different taste for example the product might be very demanding in Malaysia but it is not demanding at all in U. S. When the company always introduced new and innovative products to the consumer, the consumer will always keep an eye on this product.
Launching a good customer service also played an important part. This is because it allows consumer to give feedback and the company can use the feedback to improve the company. Size and capital backing - Nestle Company gain profits over the past years where it allows them to acquire more production factories around the world. With the backing and tariff incentive from the local government, Nestle'e's acquisitions of these factories will receive support from its investors or sponsors. With more acquisitions, it can increase its size and also be able to venture into more diversified areas. Weaknesses Damage reputation -Boycott of the product from the customers will leads to damage reputation.
Other consumer will stop buying the product. Example: boycott Nestle for using artificial material to make baby milk powered. Even if Nestle make clearance on the statement, it is still damage the company reputation. Size - Nestle'e's is looking forward to open more branches all over the business area whereby it potentially might be a problem to the company as they are in danger of becoming too huge to stay nimble and competitive. To overcome this problem from coming true, each new branch to be open should carefully considered ensuring that the acquisition will only benefit them not drown them. Opportunities Mergers or joint ventures - With mergers or joint ventures, the company can gain more profits and become the leader in the market because they produce a lot of varieties of product to the market where no second company able to produce as many products as the leader company.
Nestle is one of the biggest merger company where in the end it become a leading company in Malaysia. Nestle originally is just produce baby food and dietetic food for children but later Nestle merged with Anglo-Swiss Condensed Milk Company to produce condensed milk. Years after that, Peter & Kohler Swiss General Chocolate Company joint venture with Nestle to produce milk chocolate. Later MAGGI Company merged with Nestle.
With mergers or joint ventures, Nestle successfully became the leading market in Malaysia. Advancements in the communications area - Internet is growing fast all around the world, hereby Nestle can use this valuable communications to help the company to growth. Nestle will continue to benefit as they utilize the Internet fully to support their business. The employees can get information from the Internet easily and it is the best way for the consumer to look for more information about the company via Internet and they could send feedback to the company via Internet. Growing affluence of developing countries - Developing countries are currently growing in terms of its affluence. Nestle can now market its product to other countries and Nestle also have the opportunities to collaborate with new partners to develop products suitable for the local market.
Moving into new attractive market segments - Nestle has become the top multinational companies with their top brand name whereby there are a lot of small companies would like to be Nestle'e's dealers. By this way, Nestle has become a supplier besides just selling the product to the market on its own. Now with the help of dealers, the product could be selling in the fastest way and more profit will be gain by Nestle. Threats Price war - As there is many same type of product by different company to compete in the market, some of the consumer will look at the price to determine which one to buy such as restaurant will surely choose for the cheapest product.
Price war will occurs here. All of the company will fight with each other by promoting the cheapest price so that their product will be sold fast. Reluctance of users to purchase new product - Most of the consumers do not like to adopt new product because they are satisfy with the one they are having and reluctance to try others. They do not want to waste time to suite themselves with the new product. So even if Nestle may come out with new ideas the adoption of the new product might be slow. For example: first approach Nescafe and later Nescafe Arabian.
Survey shows consumers prefer the old Nescafe taste. Alliance between major competitors - All types of products rely on customers. Without customers there is no company. Nestle is not an unexceptional case so if its competitors come out with some new and attractive product to attract existing customers, the company could be in trouble from this loss of competitiveness. Alternate Strategies The alternate strategy looks into the ways Nestle maintain its competitiveness.
Nestle aims to re-shape in concentrate on core brands, significant improvements in supply chain and innovation. With the strength identified in the SWOT analysis, Nestle is no doubt capable of maintaining its competitiveness. The objective of the company would be produce and sell world class products of the highest consistent quality, reliability and convenience. To achieve this, Nestle must plan duration to reach to the objective.
Nestle plan to achieve it in 2 years time. Within this time, Nestle needs to do research and develop the product several times until the product is successful and it meets the objective. It will benefit the company as the consumer will be more loyal to the product as the product is trusted by them. Nestle can also cooperate with other local research and development team from other organization together to do research about the upcoming product. Competitive Advantages Competitive advantages encompass those strengths of the Company which are better than its competitors.
The following are those competitive advantages of Nestle: 1. Leader in the milk and food industry & # 61607; Nestle is the world leader when it comes to the field of food research. & # 61607; Nestle marketing over 8, 500 brands and 30, 000 products. It operates nearly 500 factories across 5 continents and employs over 200, 000 employees worldwide. 2. Research and Development & # 61607; Nestle annually spends in the excess RM 2 billion to research new products and processes. & # 61607; The Research and Development help Nestle better understand the processes of food production - from fresh consumables to finishes products. 3. Quality & # 61607; Quality is the cornerstone of Nestle'e's success. & # 61607; Nestle always promise to the customer that it is safe to consume and complies with all regulations as well as meets high standards of quality. & # 61607; Beside food safety, nutrition of the food produced is emphasized. 4. Supply chain management & # 61607; Bernard Telling, assistant vice president of business process integration for Nestle S.
A says supply chain management (SCM) is "both a source of competitive advantage and a lever for profit margins. " (Source: Supply Chain Management, web) & # 61607; Nestle defines SCM as the two-way management of the flow of goods, services and information from suppliers to manufacturers, wholesalers, distributors, stores to the end user. Critical Success Factors (CSF) Critical Success Factors (CSF) is those things that must go right in order to achieve company's objectives. For Nestle, it make sure that all the products manufactured, marketed as well as imported are of their values and fulfill the standard of quality by applying Nestle Quality System (NQS) throughout the Nestle world. The NQS, covering raw material sourcing, manufacturing, quality control, marketing and delivery, guarantees full satisfaction to every consumer.
In addition, the research and development is set in order to conduct research activities cover all aspect of nutrition ranging from the study or raw materials to food technology. This complies Nestle is not only emphasize on the quality but also consumer's daily nutrition. While the consumer services is set to understand what the consumers want and their preferences. Products of Nestle have to satisfy consumers' taste, too. Products of Nestle are always reviewed by the internal research and development for products refining. Besides that, these two components of Nestle also help to survey the market trend for new product innovation and development.
Another factor that helps the Company to meet its goal is increase the supply chain. By increasing the supply chain, the prices of the products would decrease and would be more affordable by the consumer. Nestle'e's enviable position in the milk and food industry is due to strong product identification which is made possible through early assimilation of Nestle'e's products. With the consistent advertising and promotional efforts, the name "Nestle" is now almost stay in every consumers' heart in Malaysia.
Learning from others is an important factor that leads Nestle lead to success, too. Nestle always learn from others competitors no matter their success story or failure, so that they will gain benefit from others success and learn from the competitors failure. Conclusion In the conclusion, we know that Nestle is the successful market leader company which bases on its business strategy according to its mission statement. Nestle mission statement and purpose; together with its core values and principles allowed the company to grow from a small company to a huge company with branches all over the world.
The mergers and joint venture of other company with Nestle is very successful and dare to say almost all of the product sells in the market now are all manufacturers and distributed by Nestle Company. As a market leader, Nestle also move into a new segments whereby besides selling the products by its own, a lot of smaller organization is interested to cooperate with Nestle to help the company to market the product such as Malaysian International Chamber of Commerce and Industry (MICCI) and...
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Research essay sample on Critical Success Factors Supply Chain Management
