Nestle Analysis SWOT, Five Forces and Core Competencies

Nestle Analysis SWOT, Five Forces and Core Competencies Milkpak will position Nestlà © product as a high quality product consumer focused. Messages like They knows your taste better than us, Nestle Milkpak now at your door step; Add additional flavours to your life will help to portray Nestlà © picture clearly and distinctly. Milkpak will position Nestlà © product against the competitors and gain competitive advantage through the efficient promotional methods, using innovations, and by reaching closer to the target market through the arrangement of events like Basant, Valentine day and etc. In short consumers will view Nestlà © as a product providing highly quality, in terms of taste, customer focused and, at the same time reasonably priced as compared to others. 3.0 Core Competency of Nestlà © To pose Nestlà © product against the competitors, the company will be using differentiation strategy which will not only differentiate their own from others but also give an edge over others. Nestlà © core products will be very beneficial especially in terms of quality, health, and hygiene and most important consumer satisfaction. Nestlà © augmented products will include consumer satisfaction, warranty to retailers in terms of expire, delivery and after sales services. The companies all over the world get some competitive edge based on some features which other companies dont have. For example, as the Dell has the competitive edge over other computer manufacturer companies, because they use built-to-order Strategy while no other company in computer industry use this strategy. Similarly in Pakistan nestle has their competitive edge based on the strategies like product differentiation and customer oriented. Nestlà © is using the product differentiation strategy by providing the superior quality products. Their main focus is to keep the customers loyal. They bought shelve space in different departmental stores to attract the customers. They tried to reach each group of people in which they have succeeded. Besides, customer satisfaction is the focal point for the company. They provide hygienic products to their customers. Products are also verified by health and safety measures and international quality standards. Porter Five Forces 3.1.1 Threat of New Entrants: There is big number of food companies in the world; meanwhile the competitive between food companies are happened. Some companies have carved out role in which they support to dairy supply. These food companies are fearful of being squeezed out by the big players. Another threat for many food companies is other food services companies entering the market.15 Competing in a new industry requires resources to invest. Production of packed products requires huge investment of financial, human, technical, and marketing resources. Bargaining Power of Suppliers: The suppliers of food might not pose a big threat, because of the number of suppliers. Raw milk is standard commodity and is available in the open market from a large number of milkmen. If anyone refuses to sell its product then company can buy it from others who are already willing to sell to company. On the other hand, the importance of volume to supplier also considered as a threat. Suppliers also have less leverage to bargain over price because the company is purchasing the large volume of their milk and suppliers dont have much option to sell milk to others. Bargaining Power of Buyers The buyers will not post much of a threat to the food industry. Large clients have their own bargaining power with food companies. Large corporate clients like airlines and retailers pay millions of dollars a year. There are large numbers of distributors, who are buying and distributing the product, so their bargaining power is low and company have leverage to dictate implement its terms and conditions to distributors. Availability of Substitute There are few of substitutes in the food industry. Most of the food companies have similar suites of services. Companies focusing on their role usually have a competitive advantage, but this advantage depends on whether there are any barriers that preventing other firms from entering.15 Competitive Rivalry The food industry is highly competitive in nowadays. As a result, food industry has become more like a commodity, an area in which the food company with the low cost structure, greater efficiency and better customer service will beat out competitors. In long run, larger companies prefer to take over or merge with other companies rather than spend the money to market and advertise to people.15 Source of Cost Efficiency 3.2.1 Economy of scale Economy of scale determines cost efficiency based on time, and processing of the operations and labour cost. Nestlà © used new high-technology system machines to process all the products, like high-speed bottling system, packaging machine for increasing the output of the products so, it could save time of the operation in process, and save labour cost. The company do not need to hire more labour to operate the process, which is one of the key to save cost. 3.2.2 Experience Nestlà © has been serving Pakistani consumers since 1988, when parent company, the Switzerland-based Nestlà © SA, first acquired a share in Milkpak Ltd. Today Nestlà © is fully integrated in Pakistani life, and is recognized as the producer of safe, nutritious and tasty food, and leaders in developing and uplifting the communities in which they operate. Nestlà © Pakistan ensures that their products are made available to consumers wherever in the country they might be. Convenience is at the heart of the Nestlà © philosophy, and there aim is to bring products to peoples doorsteps. Resources 3.3.1 Tangible resources Nestlà © Milkpak produces in over 81 countries and achieves 98% of its turnover outside Europe. Nestlà © Milkpak is the worlds largest milk company, which does 98% of its business. It has an annual turnover of 70 billion Swiss francs, 522 new factories in 81 countries, 200 operating companies, 1 basic research outer and 20 technological development groups, has more than 231,000 employees and more than 8000 products around the globe. There are three companies co-ordinate the activities of some 200 operating companies around the globe. Intangible resources There are three different functions, Nestlà © Milkpak, holds the financial shares in the allied companies. It also checks the profitability of these companies and to ensure the profitability of the group as whole. Second, Nestlà © Milkpak, has two areas of activities that are research and technological development, and technical assistance. Beside this, it provides know-how in engineering, marketing, production, organization, management and personnel training on a continuous basis. The third company is Nestlà © World Trade Corporation that oversees the import and export of merchandise worldwide. 3.4 BCG Matrix Relative Market Growth Low High STAR (Growth) QUESTION MARKS (Introduction) CASH COWS (Maturity) DOGS (Decline) 3.4.1 Stars The stars are the high relative market share and high market growth. Nestlà © beverages are the stars in their business, because with the high quality and new designs which comes every now and then makes them more popular among the customers, because customer with upper class wants the quality and nestle offers the best quality food items. Besides, Nestlà © major products such as Nestlà © milk pack and Nestlà © water will lies in the category of star products, due to the needs of human in their life. 3.4.2 Question Marks The product which have high anticipated growth rate but low market share would be considered as question marks. The product which the company launch first time in Pakistan is Nestlà © Ice-cream would come under the question marks due to the unknown result whether successful or failed in the growth of business in future. 3.4.3 Cash Cows The cash cows are Nestlà © cereal and other baby food products. There is less competitive brand on these specific of products and Nestle was considered as a branded and reliable brand, so most of the consumers prefer to buy from Nestle. 3.4.4 Dogs The pharmaceutical products are Nestlà © Dog; because it has low-share business with low growth market especially when talk about Pakistani market. The company has to think on what it can do by improving the low share and growth market. 3.5 Product Life Cycle The product life cycle has been used to analyse the products development refer by the BCG matrix. Product life cycle has 4 stages consist of introduction, growth, maturity and decline. Nestlà © Ice-cream has been stated on the introduction stage because it is launched the first time in Pakistan. Next, the growth stage would be the food items like milk pack, water and etc, due to human need as Nestlà © has provided. On the other hand, Nestlà © cereal and baby food were stated in the maturity stage, due to less competitors. Lastly, Nestlà © pharmaceutical product is on the decline stage, because of the low share in business and low demand. In the product life cycle, it shows that Nestlà © Milkpak industry is now on the maturity stage, the company has been recognized by consumers. 3.6 SWOT Analysis (TOW Matrix) Strengths Worldwide fame of Nestlà ©. Efficient milk collection system. Keeping high quality standards. Integrated distribution and warehousing facilities. Large market share of innovative. Having Good reputation in the market by strong brand name i.e. Nestlà ©. Strong RD. Weaknesses Unable to compete in price sensitive segment of UHT milk market. Under-utilization of the capacity. Unable to fulfil the demand of local powder milk market. Opportunities Improving Economy. Population growth rate. High urbanization rate. High literacy rate. Flexible government policies for food industry. Have significant growth opportunities. May merge with other global businesses to eliminate competitors. Having Capable of expanding into other markets of the world. SO Increase production of quality milk to cater the unsatisfied demand. They should go in the product line of powdered milk. They should increase their exports. They should cater the wide range of unsatisfied demand by improving their distribution networks. WO As per the increase demand of the milk they should fulfill the demand as Nestlà © have the ability to expand. They should make a strong distribution system to cater to avail the full benefit of the growing market. They should adopt affective marketing strategies for the promotion of their product. Threats High inflation rate. Low purchasing power. Decrease in GDP growth rate. Increasing interest rates. Recessionary period in business cycle. Competition with the new entrants. ST Invest more on the dairy product line as there is still a large chunk of the market which require modernization. Introduce new technology for quality assurance and better productivity. WT The co-ordination between different departments should be improved it will lessen the bureaucratic cost and increase the efficiency of the company.

Fin 486 Final Exam

Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) The primary emphasis of the financial manager is the use of A) cash flow. B) profit incentives. C) organization charts. D) accrued earnings. 1) _______ 2) All of the following are key strengths of a corporation EXCEPT A) low organization costs. B) readily transferable ownership. C) limited liability. D) access to capital markets. 2) _______ 3) The ________ is a measure of liquidity which excludes ________, generally the least liquid asset. A) quick ratio; accounts receivable B) current ratio; accounts receivable C) current ratio; inventory D) quick ratio; inventory 3) _______ 4) FASB Standard No. 52 mandates that U.S. based companies must translate their foreign-currency-denominated assets and liabilities into dollars using the A) average rate. B) historical rate. C) current rate. D) none of the above. 4) _______ Table 3.5 A financial manager at General Talc Mines has gathered the financial data essential to prepare a pro forma balance sheet for cash and profit planning purposes for the coming year ended December 31, 2004. Using the percent-of-sales method and the following financial data, prepare the pro forma balance sheet in order to answer the following multiple choice questions. (a) The firm estimates sales of $1,000,000. (b) The firm maintains a cash balance of $25,000. (c) Accounts receivable represents 15 percent of sales. (d) Inventory represents 35 percent of sales. (e) A new piece of mining equipment costing $150,000 will be purchased in 2004. Total depreciation for 2004 will be $75,000. (f) Accounts payable represents 10 percent of sales. (g) There will be no change in notes payable, accruals, and common stock. (h) The firm plans to retire a long term note of $100,000. (i) Dividends of $45,000 will be paid in 2004. (j) The firm predicts a 4 percent net profit margin. Balance Sheet General Talc Mines December 31, 2003 5) The pro forma total liabilities amount is (See Table 3.5) A) $650,000. B) $700,000. C) $500,000. 5) _______ D) $550,000. 6) If a United States Savings bond can be purchased for $29.50 and has a maturity value at the end of 25 years of $100, what is the annual rate of return on the bond? A) 6 percent B) 5 percent C) 7 percent D) 8 percent 6) _______ 7) If a person's required return decreases for an increase in risk, that person is said to be A) risk-indifferent. B) risk-seeking. C) risk-averse. D) risk-aware. 7) _______ Table 8.5 Cuda Marine Engines, Inc. must develop the relevant cash flows for a replacement capital investment proposal. The proposed asset costs $50,000 and has installation costs of $3,000. The asset will be depreciated using a five-year recovery schedule. The existing equipment, which originally cost $25,000 and will be sold for $10,000, has been depreciated using an MACRS five-year recovery schedule and three years of depreciation has already been taken. The new equipment is expected to result in incremental before-tax net profits of $15,000 per year. The firm has a 40 percent tax rate. 8) The initial outlay equals ________. (See Table 8.5) A) $44,100 B) $41,100 8) _______ C) $38,800 D) $38,960 Table 9.6 Nuff Folding Box Company, Inc. is considering purchasing a new gluing machine. The gluing machine costs $50,000 and requires installation costs of $2,500. This outlay would be partially offset by the sale of an existing gluer. The existing gluer originally cost $10,000 and is four years old. It is being depreciated under MACRS using a five-year recovery schedule and can currently be sold for $15,000. The existing gluer has a remaining useful life of five years. If held until year 5, the existing machine's market value would be zero. Over its five-year life, the new machine should reduce operating costs (excluding depreciation) by $17,000 per year. Training costs of employees who will operate the new machine will be a one-time cost of $5,000 which should be included in the initial outlay. The new machine will be depreciated under MACRS using a five-year recovery period. The firm has a 12 percent cost of capital and a 40 percent tax on ordinary income and capital gains. 9) The payback period for the project is (See Table 9.6) A) between 4 and 5 years. B) 2 years. C) 3 years. D) between 3 and 4 years. 9) _______ Table 10.1 A corporation is assessing the risk of two capital budgeting proposals. The financial analysts have developed pessimistic, most likely, and optimistic estimates of the annual cash inflows which are given in the following table. The firm's cost of capital is 10 percent. 10) If the projects have five-year lives, the range of the net present value for Project B is approximately ________. (See Table 10.1.) A) $201,000. B) $255,410. C) $303,280. D) $80,560. 10) ______ 11) The ________ is the firm's desired optimal mix of debt and equity financing. A) target capital structure B) book value C) cost of capital D) market value 11) ______ Table 14.5 Caren's Canoes is considering relaxing its credit standards to encourage more sales. As a result, sales are expected to increase 15 percent from 300 canoes per year to 345 canoes per year. The average collection period is expected to increase to 40 days from 30 days and bad debts are expected to double the current 1 percent level. The price per canoe is $850, the variable cost per canoe is $650 and the average cost per unit at the 300 unit level is $700. The firm's required return on investment is 20 percent. 12) What is the cost of marginal bad debts under the proposed plan? (See Table 14.5) A) $765 B) $5,100 C) $383 D) $3,315 12) ______ 13) Much of the commercial paper is issued by A) venture capitalists. C) small businesses. 13) ______ B) commercial finance companies. D) small manufacturing firms. 14) The part of finance concerned with design and delivery of advice and financial products to individuals, business, and government is called A) Financial Manager. B) Financial Services. C) Managerial Finance. D) none of the above. Table 2.1 14) ______ Information (2005 values) 1. Sales totaled $110,000 2. The gross profit margin was 25 percent. 3. Inventory turnover was 3.0. 4. There are 360 days in the year. 5. The average collection period was 65 days. 6. The current ratio was 2.40. 7. The total asset turnover was 1.13. 8. The debt ratio was 53.8 percent. 15) Inventory for CEE in 2005 was ________. (See Table 2.1) A) $32,448 B) $ 9,167 C) $36,667

Arthur Conan Doyle’s stories Essay

Arthur Conan Doyle was a well known writer during the Victorian Era and still is today. He was famous for his stories. One of his books had a fictional character that caught people’s attention. This character is a spectacular detective, Sherlock Holmes. People loved Sherlock Holmes so much because he always solves the case and always defeat evil. In fact, in one of Arthur’s short story, ‘The Speckled Band’, Sherlock Holmes was described as â€Å"the Scotland Yard Jack-in-office† and â€Å"the busybody!† This period of time is called the Victorian Era because the ruler during this time was Queen Victoria. There were a lot of crimes committed at this time. Common ones were murder and drug abuse, which were feared greatly by people. The life style of people in the Victorian Era was different to everyday life. In the Victorian Times, there were three different groups of people. These were the upper class – rich and powerful people who don’t need to work, middle class – have to work to support but not physical work, and lower/working class – poor people with no money and works physically. ‘The Speckled Band’ and ‘The Man with the Twisted Lip’ are one of Arthur Conan Doyle’s stories. This piece of writing is to show how these two stories give the readers an idea of how people lived and behaved in the Victorian Era and what people expected of certain people because of either their gender, their ethnicity or their class.  In Victorian Times, women were treated differently to men. Women within this time were considered to be very emotional. We know this because in ‘The Man with the Twisted Lip’ when Mrs St Clair saw the blood on a window, she â€Å"fainted at the sight of blood.† The quotation tells us that women were hysterical and they are not strong enough to receive bad news because they’d sometimes break down. Another situation that proves this is when Sherlock was being assured by Mrs St Clair that if he answers her question, he should â€Å"not trouble about my feelings. I am not hysterical, nor given to fainting.† Also informing the readers that, women knew their weaknesses and their strengths. However, men in the Victorian Times always thought things through. We know this because Sherlock said, â€Å"†¦ the impression of a woman may be more valuable than the conclusion of an analytical reasoner.† This let the reader know that men looks at the fact and take time to analyse and observe things and they don’t just jump to conclusions. They thought they could handle situations for themselves and don’t need women’s help at all. The readers detect this when Mrs St Clair â€Å"†¦was escorted home†¦as her presence was no help†¦Ã¢â‚¬  We know that Neville’s wife saw everything and the police knew that she saw her husband but still said she couldn’t help their investigation. Men had everything and they were in control financially. Women couldn’t have control over their money until they were settled with their own husbands. This happened to Helen Stoner, from the story of ‘The Speckled Band’. She wanted Sherlock Holmes to investigate something for her but she didn’t have the money on her then however she guaranteed Holmes that â€Å"†¦in a month or six weeks I shall be married, with control of my income†¦Ã¢â‚¬  Men had authority over a lot of things. People that were not British were disliked by a lot of the Victorians. They are thought to be a danger in the society and are unwanted. There were different ethnic people in the Victorian Era. These people were not White British. They had different lifestyle to Victorian people. Some of this people were the Malays. Malays was what they called Malaysian people. In the story of ‘The Man with the Twisted Lip’ the Malays were mentioned just once. This was when Dr Watson, Sherlock Holmes’ assistant and loyal friend, entered an opium den, â€Å"†¦a swallow Malay attendant had hurried up with a pipe†¦Ã¢â‚¬  Opium den is like a drug den which was run and supplied by the Malaysians. In the same story, we are made known to a different ethnic individual, â€Å"lascar.† A lascar is an East Indian sailor.

How the Rich Benefit from the Poor Essay - 5323 Words

How the Rich Benefit from the Poor this paper has problems with formatting The United States is the most developed capitalist economy in the world. The markets within the economy provide profit-motivated companies endless potential in the pursuance of pecuniary accumulation. Throughout the twentieth-century competitive companies have implemented modernized managerial procedures designed to raise profits by reducing unnecessary costs. These cost-saving procedures have had a substantial effect on society and particularly members of the working class. Managers and owners of these competitive and self-motivated companies have consistently worked throughout this century to exploit the most controllable component of the production process:†¦show more content†¦It is the synergist effect of these numerous strategies that have lead to the widening income gap in America, persistent attempts of contraction in worker’s rights and increased corporate political influence. 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