Essay - Case Study: Nestle Company with Reference to the Nestle Case...


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Case Study: Nestle Company

With reference to the Nestle case study, provide one example, which clearly illustrates a link between topics or concepts dr*****wn from at least two pre-requisite modules.

Nestle's success in ***** food stuffs industry has been due, in large part, to the value adding activities the *****ganization has developed, in the form of a value chain, which is one concept covered in the pre-requisite modules. Not only have they mastered this concept within their own organization, but have also extended it beyond their company ***** include ***** supply chains and distribution networks. China is a perfect ***** ***** this *****ful strategy.

More than a decade of talks found Nestle finally inv*****ed to set up shop in China. Their powdered milk and infant formula plant was opened in 1990. Although the region ***** still relatively poor, Nestle knew that these basic products would be most applicable to the local citizen's needs, and once economic improvement matured, and citizens were found to have more disposable *****come, Nestle would then be able to expand their product line to *****s beyond essential food items. Yet it was dis***** that the infrastructure of the ***** would not support the necessary delivery of milk are the ***** of the final products.

Nestle understood that to capture the value in both the supply cha***** and in the distribution network, and therefore add value ***** the entire enterprise, someth*****g had to be d***** about the ***** of ***** region. As such, they establishe***** what would become kn***** as milk roads, ***** 27 villages, located around the region, ***** collection points for *****. This allowed the farmers to bring *****ir milk more quickly to the ***** centers. ***** convenience, coupled with Nestle's prompt payment to the farmers ***** *****ir product, encouraged the farmers to produce even more milk and allowed Nestle to increase production from 316 tons in 1990 to more than 10,000 tons four years later.

In addition, this newly built infrastructure ***** useful for ***** as well. Finished product could now be delivered to the ***** with greater ease and efficiency than previously. This ***** for reduced distribution costs, *****ks to the new infrastructure. This commitment to adding value throughout ***** *****in has given Nestle a competitive advantage in China, that it otherwise ***** not have.

A second concept covered in the pre-requis*****e ***** that can be illustrated by an example provided in ***** case study is that of market sh*****. Although in some geographic regions, *****d certain ***** segments, Nestle holds a considerable market share presence, in some areas, such as Japan, Nestle has not been able to adapt quickly enough and has lost valu***** market share ***** the process.

***** had become com*****table as the dominant coffee product in Japan, ***** such when the cold canned coffee market opened up, Nestle dismissed ***** idea, secure in its ***** share lead. As *****, they did ***** enter the ***** coffee market. However, Coca-Cola saw the potential and ***** a product named Georgia that

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