By Geographic Area
In Million of CHF 2006
(%)
Europe 25/706 36.7
North and South America 22/262 31.8 Africa, Asia and Oceania 13/493 19.3 Other Activities 8/537 12.2
69/998
By Main Product Group
Europe 36.7% North and South America 31.8% Africa, Asia and Oceania 19.3% Other Activities 12.2%
In Million of CHF 2001(%)
Beverages 19/142 27.4
Milk Products, Nutrition and Ice Cream
334 27.6
Prepared Dishes and Cooking Aids 17/660 25.2 Chocolate and Confectionery 10/663 15.2 Pharmaceuticals 3/1999 4.6 Beverages 27.4% Milk Products, Nutrition and Ice Cream 27.6% Prepared Dishes and Cooking Aids 25.2% Chocolate and Cofectionary 15.2% Pharm aceutic als 4.6%
Breakdown of 2006 Trading Expenses (in %)
Percentage
Raw Materials 26.2
Packaging 8.8
Salaries and Welfare Expenses 16.6
Depreciation 4.1
Other Trading Expenses 34.5 Total Trading Expenses 90.2
Trading Profit 9.8
Go to Financial Guide for additional facts and figures.
Company Profile
• Chairman of the Board: Helmut O. Maucher Raw Materials 13.8% Packaging 4.6% Salaries and Welfare Expenses 8.7% Other Trading Expenses 18.1% Total Trading Expenses 47.4% Trading Profit 5.2% Depreciation 2.2%
• Chief Executive Officer: Peter Brabeck-Letmathe
• World’s leading food company
• Switzerland’s largest industrial company
• Worldwide operations
• 495 factories
• Group’s total work force: 225, 808 people.
Historical Development
1866 Company’s foundation
1905 Merger between Nestle and Anglo-Swiss Condensed Milk Company
1929 Merger with Peter-Cailler-Kohler Chocolates Suisses. S. A.
1947 Merger with Alimentana S.A. (Maggi) 1971 Merger with Ursina-Franck (Switzerland) 1985 Acquisition of Carnation (USA)
1990 Acquisition of Buitoni-Perugina (Italy) 1992 Acquisition of Rowntree (GB)
1994 Acquisition of Perrier (France) 1998 Acquisition of Spillers (GB)
2002 Divestiture of Findus brand and parts of Nestlé's frozen food business in Europe. Divestiture of Hills Bros, MJB and Chase & Sanborn roast and ground coffee brands (USA).
2006 Acquisition of PowerBar. Factories
Nestle has 6 factories in India. These are
1. Moga (punjab)
The Nestle factory in Moga has the pride of being the first and most comprehensive factory of Nestle India. Set up in 1962, it represents the core competence of Nestle India in the manufacture of milk products (Everyday, Milkmaid), beverages, culinary products
(Maggi sauces, noodles, soups etc.), weaning cereals (Cerelac) and infant milk formulae.
2. Choladi ( Tamil Nadu)
The factory in Choladi started production in 1967. Situated about 60 miles from Calicut, the factory today has 81 employees and produces 1.5% of the total turnover of Nestle India. It is a 100 percent export oriented unit which processes freshly picked tea leaves into soluble instant tea.
3. Nanjagud (Karnataka)
Production in this factory began in 1989 with the manufacture of Nestle instant coffee and Sunrise. Today in addition to instant coffee the factory also manufactures health beverages. The plant to manufacture MILO was also commissioned at this factory. This factory employs 145 people and is cited as a model in terms of environment protection for its
installations to purify waste water as well as for its provisions for recycling coffee wastes.
4.Samalakha (Haryana)
This factory was set up in 1993. Located 70 kilometres from Delhi , it manufactures weaning cereals , culinary products ,health beverages and milk products. Recently the expansion of manufacturing capacity for Milkmaid Dessert Mixes was undertaken at this factory as this new and unique product category is viewed to have great potential in the future.
5.Ponda (Goa)
This Kit-Kat factory was set up in Goa in 1995 at a cost of Rs. 50 crores. It represented a major step by Nestle towards becoming the Number 1 Chocolates and Confectionery Company in India.
The construction work at this new factory is progressing with speed. This factory will soon commence the manufacture of culinary products, which is a key thrust area for the company and will include latest technological improvements relating to this category of products.
As a part of Nestles efforts towards continuous improvement and excellence in Manufacturing operation, a Moga Improvement team (MIT) was put in place at the Moga factory. The team comprised of international experts from Nestle Technical Services (NESTEC) and the local staff. In 1996, it embarked on a program with the single minded objective of optimizing production costs while enhancing the product quality so as to make Nestle products even more competitive in the market place. Drawing upon Nestle’s global experience and manufacturing expertise in 75 countries the team identified the following areas for detailed study -
• Process improvement to ensure the optimal usage of
• Improvement of operational efficiency
• Cost optimization
A series of small but critically important initiatives ranging from redesigning laboratories to palletisation of raw materials and packaging material utilization, manufacturing and filling loses and labour man hours resulting in substantial savings and improved productivity and machine utilization. In addition, several non tangible benefits in the form of systems for sustainable improvement in areas like factory maintenance planning tools , down time recording systems and performance measurement tools were also realized .
This project was highly successful and the company is now implementing its key learning’s of MIT in its other factories.
In a country as vast and diverse as India, supply chain
Through BECA, Nestle has concentrated heavily on streamlining and improving their supply chain management in order to make it more dependable, more cost effective and most importantly, more responsive to market needs.
For better supply chain integration the planning of key operations - purchase, production, distribution and sales are synchronised to ensure that everybody works towards a common business plan. Monthly objectives are broken down into weekly and (wherever necessary) into daily plans and monitored regularly to ensure smooth implementation and quick corrective action when needed . Major benefits accrued thus far include reduction in working capital through lower inventories of finished goods and materials, better stock availability and reduction in obsolescence of materials.
In addition to traditional performance indicators, quantifiable performance measures have been identified and implemented in all functional areas such as sales planning, production output, quality assurance, material
ordering transportation and warehouse management. These measures are monitored regularly to gauge the extent of improvement and identify root problems for taking corrective actions.
Teams have been put in place at all factories and sales offices to ensure the implementation is continuous and self-sustaining. Areas of improvement are regularly identified and timebound action plans established. For this purpose, standard tools such a Total Quality Management(TQM), Kaizen, 5S and Small Group improvement activity (SGIA) are being extensively used.
The efficacy of this hierarchical structure is seen in Nestle’s performance over past few years of various products.
By 1989 the company had achieved a sales figure of approximately Rs. 258 crores. 1989 was the year of launches. Seven new product lines were launched in this year. This was also the year in which the Nanjagud factory was set up. By the year 1992, this sales figure
was touching Rs 500 crores. In the 1990’s the pace of launches quickened and since the construction of the factory at Samalakha, 20 new products have been introduced. By 1996, Nestle had about 76 different products in its portfolio with various new products in the pipeline as well. The sales figure now touched Rs. 1214 crores. Thus sales grew by 450% over a period of one and a half decades.
TODAY NESTLE IS PRESENT IN DIFFERENT