CHAPTER 1

1. EXECUITVE SUMMARY

Nestl has been a leading food manufacturer and major purchaser of agricultural raw materials for over 130 years. Food and agriculture are an integral part of the social cultural, economic and political context of every community. Today, Nestl is the worlds largest and most diversified food company, with nearly 500 factories in 77 countries, producing healthy, enjoyable food products for every stage of life. The present study has been carried out with the objective of studying Nestle, their brand exercises, the use of celebrity endorsement as a tool of brand building by firms and the consumers perception about the brand image of Nestle The research was carried out with the help of primary as well as secondary sources of data Primary Data has been collected through consumer survey, among the existing and potential consumers of Nestle Products. However secondary dats has been collected through Books, Periodicals and Journals in the field of marketing, branding and Newspapers and the Internet. The only limitation in this survey was that I could not conduct a survey on a big scale, due to the time constraint. After all the literature and market research, and analysis I wish to conclude that the philosophy behind the branding strategy of Nestle has been to develop the brand so as to attract and retain the consumers. The branding strategies adopted have resulted in building a sustainable and differential advantage over its competitors.

2. ABOUT NESTLE

2.1 Profile of the companyNestl with headquarters in Vevey, Switzerland was founded in 1866 by Henri Nestl and is today the world's biggest food and beverage company. Sales at the end of 2004 were CHF 87 bn, with a net profit of CHF 6.7 bn. We employ around 247,000 people and have factories or operations in almost every country in the world.

The Company's strategy is guided by several fundamental principles. Nestl's existing products grow through innovation and renovation while maintaining a balance in geographic activities and product lines. Long-term potential is never sacrificed for short-term performance. The Company's priority is to bring the best and most relevant products to people, wherever they are, whatever their needs, throughout their lives.

2.2 BackgroundNestle was promoted by Nestle Alimentana, Switzerland, a wholly owned subsidiary of Nestle Holdings Ltd., Nassau, Bahama Islands. Nestle is one of the oldest food MNC operating in India, with a presence of over a century. For a long time, Nestle Indias operations were restricted to importing and trading of condensed milk and infant food. Over the years, the Company expanded its product range with new products in instant coffee, noodles, sauces, pickles, culinary aids, chocolates and confectionery, dairy products and mineral water.Nestle was incorporated as a limited company in 1959. In 1978, the Company issued shares to the Indian public to reduce its foreign holdings to 40%. Its name was changed from Foods Specialties Ltd. to the current name in 1981.The parent held 51% stake in the company as at 2000 end. It has FIPB approval to hike stake by 10% and has been gradually acquiring shares from the open market. Parent stake in the company as at 2001 end stood at 53.8%. The parent plans to continue hiking stake through open market purchases.Nestle India Ltd, 51% subsidiary of Nestle SA, is among the leading branded food player in the country. It has a broad based presence in the foods sector with leading market shares in instant coffee, infant foods, milk products and noodles. It has also strengthened its presence in chocolates, confectioneries and other semi processed food products during the last few years. The company has launched Dairy Products like UHT Milk, Butter and Curd and also ventured into the mineral water segment in 2001. Nestles leading brands include Cerelac, Nestum, Nescafe, Maggie, Kitkat, Munch and Pure Life.2.3 Company MissionAt Nestle, we believe that research can help us to make better food, so that people live a better life. Good food is the primary source of good health, so we are trying to make good food. To provide fresh and pure products to the customers, we introduced (SHE) Safety, Health and environment policy to protect health of our employs and keep clean our surrounding environment

2.4 Company Vision Vision of Nestle Milkpak Company is to expand business according to the increasing demand of market. As per our company vision in 2020 production capacity of all plants working in Pakistan is being increased. So extension of Kabirwala Plant is the example of our company vision. 2.5 Plant locationsNestle started its manufacturing operations with Milkmaid in 1962 at Moga factory. Manufacturing of Nescafe started in 1964 at the same factory. The company set up another factory at Cherambadi in Tamil Nadu, for manufacture of infant foods, coffee etc. For almost two decades there were no new additions of manufacturing facilities due to restrictive policy environment. The company set up its Nanjangad (Karnataka) factory in 1989 and the Samlakha (Haryana) factory in 1992. The Ponda (Goa) factory started operations in 1995. The Company set up its sixth manufacturing unit in 1997 at Bicholim in Goa2.6 Business of the Nestle

Nestle is the largest food company in the world. It is present in all five continents, has an annual turnover of 74.7 billion Swiss Frances. There are 509 factories are running in 83 countries, having 231,000 employs

3. HISTORY OF NESTLENestl was the result of a series of mergers of many small companies. In the mid-1860s, Henri Nestle, merchant, chemist and innovator, experimented with various combinations of cows milk, wheat flour and sugar. The resulting product was meant to be a source of nutrition for infants, who could not be breast-fed by their mothers. In 1867, his formula saved the life of a prematurely born infant. Later that year, production of the formula, named Farine Lactee Nestl, began in Vevey and the Nestle Company was formed.Henri Nestle wanted to develop his own brands and decided to avoid the easier route of becoming a private label. Henri also wanted to make his company global. Within a few months of the launch, Henri began to sell his products in many European countries. In the companys initial years, Henri took various steps to facilitate research, improve product quality and develop new products.Meanwhile in 1866, two Americans, Charles and George Page had founded the Anglo-Swiss Condensed Milk Company. The company launched a milk based infant food, which competed with Nestls products. In 1875, Daniel Peter, a friend and neighbor of Henri developed milk chocolate. Peter became the worlds leading chocolate maker, and later merged his company with Nestl. The rivalry between Nestl and the Anglo-Swiss Condensed Milk Company intensified but ended in 1905, when the two companies merged under the Nestl banner.World War I created a new demand for dairy products. Nestle grew mainly by executing government contracts. The end of the war created a crisis for the company as people started using fresh milk again, instead of condensed and powdered milk. In 1921, Nestl recorded its first loss, which was partly due to the worldwide postwar economic slowdown. Louis Dapples, a Swiss banking expert restructured the company, streamling its operations and reducing the debt burden.In 1930, the Brazilian Coffee Institute approached Dapples, seeking new products. After eight years of research Nestl developed a soluble powder that revolutionized coffee drinking around the world. The product was launched under the brand name Nescafe and became an instant success. The onset of World War II speeded up the introduction of Nescafe. The beverage also became a popular drink among American servicemen in Europe and Asia. The end of World War II triggered off a new phase of growth for Nestl. Many new products were added as the company grew through acquisitions. After 1974, Nestls financial position deteriorated. Oil prices rose and growth in industrialized nations slowed down. The Swiss franc appreciated and the price of coffee beans and cocoa shot up. This situation was partially offset by Nestls rapid growth in emerging markets.In 1981, Helmut Maucher took over as CEO. His policies had a significant impact on Nestls style of functioning. Maucher pursued a two-pronged strategy to improve the companys financial situation: First he embarked on internal restructuring and divestments; second he decided to continue with strategic acquisitions. Between 1980 and 1984, he divested a number of non-strategic or unprofitable businesses, amounting to nearly SFr8 bn. The divestments included certain food products that were not consistent with Nestls emphasis on high value added segments. To improve the companys financial situation, he embarked on a cost-cutting exercise. While the employee strength was reduced significantly, the inventory and outstanding debt were brought down.In 1990, Nestl formed a joint venture with General Mills called Cereal Partners Worldwide to promote Nestl breakfast cereals. It covered 70 countries accounting for about 75 per cent of the breakfast cereal consumption outside the US and Canada. Nestl also formed a joint venture with Coca-Cola, called the Coca-Cola Nestl Refreshment Company, to market tea and coffee-based ready-to-drink beverages under the Nestea and Nescafe brands. In 1996, Nestl decided to end its 50-50 Clinic Nutrition joint venture with Baxter Healthcare and established Nestl Clinical Nutrition to provide orally consumed nutrition products to hospitals and nursing homes.Nestl opened the 20th century by merging with the Anglo-Swiss Condensed Milk Company to broaden its product range and widen its geographical scope. In the new millennium, Nestl is the undisputed leader in the food industry, with more than 470 factories around the world. Nestl launched a Group-wide initiative called GLOBE (Global Business Excellence), aimed at harmonizing and simplifying business process architecture; enabling Nestl to realize the advantages of a global leader while minimizing the drawbacks of size.The Companys strategy will continue to be guided by several fundamental principles. Nestls existing products will grow through innovation and renovation while maintaining a balance in geographic activities and product lines. Long-term potential will never be sacrificed for short-term performance. The Companys priority will be to bring the best and most relevant products to people, wherever they are, whatever their needs, throughout their lives.

4. BUSINESS PRINCIPLESSince Henri Nestl developed the first milk food for infants in 1867, and saved the life ofa neighbors child, the Nestl Company has aimed to build a business based on sound human values and principles.

While our Nestl Corporate Business Principles will continue to evolve and adapt to a changing world, our basic foundation is unchanged from the time of the origins of the Company, and reflects the basic ideas of fairness, honesty, and a general concern for people.People firstEmployees, people and products are more important at Nestl than systems. Systems and methods, while necessary and valuable in running a complex organization, should remain managerial and operational aids but should not become ends in themselves. It is a question of priorities. A strong orientation toward human beings, employees and executives is a decisive, if not the decisive, component of long-term success.Quality productsOur focus is on products. The ultimate justification for a company is its ability to offer products that are appealing because of their quality, convenience, variety and price -- products that can stand their ground even in the face of fierce competition.Long-term viewNestl makes clear a distinction between strategy and tactics. It gives priority to the long-range view. Long-term thinking defuses many of the conflicts and contentions among groups this applies to employment conditions and relations with employees as well as to the conflicts and opposing interests of the trade and the industry. Of course, our ability to focus on long-term considerations is only possible if the company is successful in the struggle for short-term survival. This is why Nestl strives to maintain a satisfactory level of profits every year.DecentralizationSwitzerland is home to Nestl's Swiss subsidiary, its international headquarters and the registered office of Nestl's holding company, but Nestl does not regard its Swiss headquarters as the center of the universe. Decentralization is a basic principle of Nestl. Our policy is to adapt as much as possible to regional circumstances, mentalities and situations. By decentralizing operational responsibility, we create strength and flexibility and are able to make decisions that are better attuned to specific situations in a given country. Policies and decisions concerning personnel, marketing and products are largely determined locally. This policy creates stronger motivation for Nestl's executives and employees and a greater sense of identification with Nestl's business. It is not Nestl's policy to generate most of its sales in Switzerland, supplemented by a few satellite subsidiaries abroad. Nestl strives to be an "insider" in every country in which it operates, not an "outsider."UniformityA very important concern at Nestl has to do with uniformity: how consistent Nestl's principles, policies, rules of conduct and strategies should be, and to what extent they should differ depending on the country, subsidiary, region, branch or group of products. In general, Nestl tries to limit the uniformity of its policy to a requisite minimum. This minimum is then systematically enforced, unless there are compelling reasons in a given market that justify deviation from policy.DiversificationNestl does not want to become either a conglomerate or a portfolio manager. Nestl wants to operate only those businesses about which it has some special knowledge and expertise. Nestl is a global company, not a conglomerate hodgepodge. We regard acquisitions and efforts at diversification as logical ways to supplement our business, but only in the context of a carefully considered corporate marketing policy. Nestl is committed to the following Business Principles in all countries, taking into account local legislation, cultural and religious practices: Nestl's business objective is to manufacture and market the Company's products in such a way as to create value that can be sustained over the long term for shareholders, employees, consumers,and business partners. Nestl does not favour short-term profit at the expense of successful long-term business development. Nestl recognizes that its consumers have a sincere and legitimate interest in the behaviour, beliefs and actions of the Company behind brands in which they place their trust and that without its consumers the Company would not exist. Nestl believes that, as a general rule, legislation is the most effective safeguard of responsible conduct, although in certain areas, additional guidance to staff in the form of voluntary business principles is beneficial in order to ensure that the highest standards are met throughout the organization. Nestl is conscious of the fact that the success of a corporation is a reflection of the professionalism, conduct and the responsible attitude of its management and employees. Therefore recruitment of the right people and ongoing training and development are crucial. Nestl continues to maintain its commitment to follow and respect all applicable local laws in each of its Research and developmentThe Nestl research and development centers have two main tasks: to create new products and manufacturing processes and to improve those that already exist. These centers play a key role in product safety and quality and also have their role in conserving resources and protecting the environment. Environmental concerns are an integral part of any development process to ensure that our future commercial operations meet the desired criteria. The Nestl Research Center provides the scientific support needed to prevent and solve environmental problems arising in the development groups as well as manufacturing. In addition, studies are carried out to find new ways of using industrial residues to create value added byproducts. This will reduce total emissions and effluents. The Nestl development centers prepare environmental impact studies for new products and manufacturing processes. These cover all aspects, from raw materials, through processing, to the final packed product. These analyses provide additional elements for use in deciding whether to commercialize a new product, or to introduce a new or modified process.ForesightAt present, the world faces daunting questions about its ability to provide enough wholesome food for everyone. Malnutrition and poor eating habits are still serious problems in many developing countries. By 2100, the world's population will double. Will it be possible to feed a world with so many inhabitants? At Nestl, the big picture is all about feeding the world and providing food and nutrition for an ever-growing population. Our response to this situation is to intensify research, strive for innovations and improve quality. Flexibility and simplicityThe public's sense of the power and size of a corporation is often inaccurate, for a company's power is limited by a host of factors including legislation, competition, regulatory bodies and publicity. From a business point of view, it is desirable for a firm to achieve the size best suited to a specific industry or mode of production. To be competitive internationally and make significant investments in research and technology, a larger company has an advantage. From a strictly organizational point of view, flexible, simple structures work best and excessively large units should be avoided whenever possible. In both respects Nestl has a natural advantage: Although it is a big company, it is spread out over many countries and each of Nestl's factories has its own management and responsibility.Handling of raw materialsThe Nestl Group is in principle not directly involved in primary production of raw materials and other food ingredients. In general we use locally available raw materials and purchase them either directly from producers or through existing trade channels. Raw materials have to meet clearly established quality criteria and are checked for possible contaminants including environmental contaminants. Our purchasing specifications comply not only with legal requirements but go further to ensure highest safety and wholesomeness of our products. Whenever possible we give preference to those goods for which environmental aspects have been taken into consideration. In those cases where the required agricultural raw materials are not available locally, but the natural production conditions exist, we encourage local production and provide assistance for cultivation and dairy farm management. We support plant growing and livestock husbandry methods which: preserve and improve natural soil productivity and economize and protect water resources allow the lowest, most appropriate and safe use of agro-chemicals use the least energy. PackagingManufacturing comprises all unit operations necessary to transform perishable raw materials into finished products, with the aim to make them safe and convenient for the consumers. The manufacturing activities of the Nestl Group: respect natural resources by efficient use of raw materials and energy minimize waste generation and emissions ensure environmentally safe disposal of all waste which cannot be recycled. Regular assessments of processing practices are carried out. These assessments include: evaluation of individual plant performance with regard to operations which have an impact on the environment definition of targets for improvement review of plant compliance with local government regulations, company environmental standards, as well as results achieved in comparison with targets for improvement full investigation of incidents which may affect the environment. Information on developments in environmental protection technology and practices is disseminated as required to ensure that all plants are using the most effective environmental practices for their type of processing. This applies also for co packers. Marketing and distributionMarketing is based on the principle of satisfying consumer needs. This is the foundation also for the environmental marketing approach of Nestl. Environmental product claims in advertising, promotional material and on packaging are in accordance with legal requirements, based on solid scientific evidence and used in a serious and reasonable manner. Our aim is to minimize wastage in communication, publicity and promotional material, in particular through more precise targeting of marketing activities. Consumer promotions and merchandising material such as consumer offers, in store promotions, display material, leaflets, printed matter, etc. take environmental aspects into account. This means due consideration of environmental impact in selecting both materials and printing methods. In distribution, energy efficient and pollution controlled methods are encouraged wherever possible. Information, communication and educationNestl's policy is designed to provide correct and coherent information on the activities of the Group. Activities related to the environment benefit from the same treatment and their communication is secured through all currently available means inside and outside the Group. It is furthermore Nestl's duty to create awareness, to train and motivate employees on their personal responsibility with regard to the protection of the environment.Legislation and RegulationsIt is the policy of the Nestl Group to strictly comply with all laws and regulations relevant to our activities. We participate in discussions on food legislation and regulations between international organizations, government representatives, industry, the scientific world and consumer associations. We also apply this policy to environment related matters. In doing so, we cooperate with legislators through local industry associations in order to promote laws and regulations in the field of environment which are reasonable, rational, realistic, applicable and enforceable. We oppose unjustified bans and any other discriminatory measures. We favor the harmonization of food regulations in order to remove existing trade barriers and to avoid the creation of new ones. This applies also to environmental issues. We favor the exchange of information, of experience and of knowledge between the various interested parties. Thanks to all these synergies, we can contribute to valuable discussions and be recognized as an active partner in helping authorities to formulate comprehensive strategies in the field of the environment.

5. NESTLE QUALITY POLICYEveryday, millions of people all over the world show their confidence in us by choosing Nestl products. This confidence is based on our quality image and a reputation for high standards that has been built up over many years.5.1 Quality is the cornerstone of our successEvery product on the shelf, every service and every customer contact helps to shape this image. A Nestl brand name on a product is a promise to the customer that it is safe to consume, that it complies with all regulations and that it meets high standards of quality. Customers expect us to keep this promise every time. Under no circumstances will we compromise on the safety of a product and every effort must be made to avoid hazards to health. Likewise, compliance with all relevant laws and regulations is a must and is not negotiable. People, equipment and instruments are made available to ensure safety and conformity of Nestl products at all times. The effort is worth it. Companies with huge quality standards make fewer mistakes, waste less time and money and are more productive. They also make higher profits. Quality is their most successful product. It is the key to their success, today and tomorrow. 5.2 The customer comes firstNestle want to win and keep customers: distributors, supermarkets, hotels, shopkeepers and the final consumers. They have very different requirements. Trade customers expect excellent service, correct information and timely delivery. Consumers consider taste, appearance and price when they make their choice. Its task is to understand what customers want and respond to their expectations rapidly and effectively. We serve various groups of consumers and there is demand for products at different levels of perceived quality and price. All customers, however, expect value for their money good quality at a reasonable price.

When offering quality to customers we also mean environmental quality. Nestl shares societys concern for the environment and is committed to environmentally sound business practices throughout the world. Customers are central to their business and they always respect their needs and preferences. 5.3 CompetitionBaby food and Instant coffee are categories where brand loyalties are very strong and Nestle is the market leader. HLL is a significant competitor to Nestle in instant coffee; while Heinz is the main competitor in the baby foods market. The market for culinary products, semi-processed foods such as noodles, ready mixes for Indian ethnic breakfast and sweets, is largely an urban market. HLL and Indo Nissin Foods are the main competitors in these product segments. Nestle has also achieved a significant 25% share in the chocolate/confectionery market. The company has recently expanded its dairy products portfolio to include, milk, curd and butter. The company also forayed into the bottled water segment with the launch of its Perrier brand in the premium mineral segment and Pure Life in the purified water segment.5.4 Quality is a competitive advantageWe live in a competitive world and must never forget that their customers have a choice. If they are not satisfied with a Nestl product, they will switch to another brand. Their goal, therefore, is to provide superior value in every product category and market sector in which we compete. The pursuit of highest quality at any price is no guarantee for success, nor is a single-minded cost-cutting approach. Lasting competitive advantage is gained from a balanced search for optimal value to customers, by simultaneous improvement of quality and reduction cost. Success can never be taken for granted. We must watch and learn from our competitors. If they do something better, we must improve our own performance. We can achieve competitive advantage through Quality. 5.5 Quality is a joint effortOperating companies are fully responsible for maintaining agreed quality standards. Not only Production units, but also Marketing, Purchasing, Distribution and Sales have a vital role to play in providing quality to customers. This implies a thorough knowledge of the products and services we offer. Quality units at different levels of the organization provide specific support, promote quality awareness, assume guardianship and audit the system. Quality departments monitor operations against agreed standards and must intervene in case of non-conformity. Quality policy and principles, the mandatory standards and the recommended tools for implementation are laid down in the Nestl Quality System which is applicable throughout the group. Further directions are given through instructions, norms and guidelines, often specific to a product. Our business products, such as raw material producers, packaging suppliers, contract manufacturers and distributors are expected to share our concern for Quality. They too must set up an adequate quality system, so as to meet our requirements consistently. The quality efforts must be shared by every function and department in the company as well as our business partners. 5.6 Quality is made by peopleAdequate equipment, procedures and systems are needed to make Quality; so are involved and dedicated people. Each and every Nestl employee must do his best to provide quality products and services. Training and teamwork are crucial to the successful implementation of high quality standards. Continuous training ensures that everyone understands his tasks and has the necessary skills to carry them out. Teamwork allows us to achieve results that are greater than the sum of individual efforts. We motivate employees by demonstrating management commitment to Quality, by setting challenging goals and by giving them responsibility and recognition. It is through employee involvement that goals and targets can be achieved in the shortest time. Quality must be a way of life for everyone in the company. 5.7 Quality is actionQuality is the result of deliberate action. It is the responsibility of senior managers to communicate the quality objectives and to provide the resources necessary for their implementation. It is then up to all employees to make Quality happen throughout the company. Progress is followed by listening to our customers and by measuring our performance. Shortcomings and mistakes must be analyzed and corrected. Problems must be anticipated and prevented before they occur. We also must identify and take advantage of opportunities. To stand still is to fall behind. So we must strive for continuous improvement in every area. It is through many small improvements as well as through major breakthroughs that we will achieve excellence. At Nestl, Quality is our first priority. Let us practice it every day. 5.8 As said by Nestle: Quality is thefoundation of our food, nutrition, Health and Wellness Company. A Nestle brand name on product is a promise to the customers that : It is safe to consume. It complies with all relevant laws and regulation. Quality is to win consumers trust and preference. We are committed to offering products and services to all customers that meat their needs. Quality is every bodys commitment. Our management takes the lead, sets the objectives and demonstrates its commitment towards quality. All Nestle functions across our value chain are fully responsible to follow mandatory norms. Quality is to strive for Zero defect and no waste. We focus on facts and results and we strive for Zero defect and excellence in every thing we do. We adopt No waste and we constantly look for competitiveness and opportunities for continuous improvement of the quality standards delivered to our customers. Quality is to Guarantee, food safety and full compliance. We enforce food safety, regulatory and quality requirements in every step of our value chain.

CHAPTER 2

1. NESTLE PRODUCTSQuality and nutritional value are the essential ingredients in all of the nestles brands. Millions of peopleprefer Nestl products every day, happy with the addition to their wellness that they bring. If you are looking for a specific brand our product, just use the alphabetical index below to jump straight to a listing. Or you can explore by category.

1.1 Baby FoodsMilk based products and baby food contributes to 43% of Nestle's turnover. For ensuring regular procurement of good quality milk, Nestle has developed a network around its Moga factory for collection of fresh milk everyday from the farmers. Nestle has a dominating 87% market share in the baby weaning foods with its Cerelac and Nestum brands. Infant milk powder is sold under the Lactogen and Nestogen brands. Brand loyalties are very high in categories such as infant food and weaning cereals, enabling the company to command a price premium Other milk products include dairy whiteners (21% market share) sold under the EveryDay and Tea Mate brands, sweetened condensed milk and ready to cook mixes for traditional Indian sweets sold under the Milkmaid brand. The company also markets ghee (6% market share) under the EveryDay brand. Nestle has expanded its milk product portfolio with the launch of new dairy products such as UHT milk, Curd and Butter. Huge investments are being made in building a diversified dairy business and the distribution infrastructure for the same. Milk products sales registered a 10.6% yoy growth .The production of infant food goes right back to the origins of the Nestl Company. Henri Nestl's 'Farine Lacte' was the first product to bear the Nestl name.

In 1867 a physician persuaded Henri Nestl to give his product to an infant who was very illhe had been born prematurely and was refusing his mother's milk and all other types of nourishment. Nestl's new food worked, and the boy survived. From the very beginning, Nestl's product was never intended as a competitor for mother's milk. In 1869, he wrote: "During the first months, the mother's milk will always be the most natural nutrient, and every mother able to do so should herself suckle her children." The factors that made baby foods success in the early days of the Nestl company quality and superior nutritional value are still as valid today for the wide range of infant formula, cereals and baby food made by Nestl. The World Health Organization (WHO) recognizes that there is a legitimate market for infant formula, when a mother cannot or chooses not to breast feed her child. Nestl markets infant formula according to the principles and aims of the WHO International Code of Marketing Breast Milk Substitutes, and seeks dialogue and cooperation with the international health community and in particular with the WHO and UNICEF, to identify problems and their solution. Nestl's expertise as the world's leading infant food manufacturer, gained over more than 125 years, is put at the disposal of health authorities, the medical profession and mothers and children everywhere. 1.2 Chocolate & ConfectioneryNestle forayed into chocolates & confectionery in 1990 and has cornered a fourth share of the chocolate market in the country. The category contributes 14% to Nestle s turnover. It has expanded its products range to all segments of the market The Kitkat brand is the largest selling chocolate brand in the world. Other brands include Milky Bar, Marbles, Crunch, Nestle Rich Dark, Bar-One, Munch etc. The sugar confectionery portfolio consists of Polo, Soothers, Frootos and Milkybar Eclairs. All sugar confectionery products are sold under the umbrella brand Allen's. Nestle has also markets some of its imported brands like Quality Street, Lions and After Eight. New launches such as Nestle Choco Stick and Milky Bar Choo at attractive price points to woo new consumers. Chocolate confectionery sales registered a strong 21.5% yoy growth in 2001 aided by good volume growth in Munch, Kitkat and Classic sales. Nestle relaunched Bar-One during the year. The story of chocolate began in the New World with the Mayans, who drank a dark brew called cacahuaquchtl. Later, the Aztecs consumed chacahoua and used the cocoa bean for currency. In 1523, they offered cocoa beans to Cortez, who introduced chocolate to the Old World, where it swiftly became a favorite food among the rich and noble of Europe. Nestle forayed into chocolates & confectionery in 1990 and has cornered a fourth share of the chocolate market in the country.. It has expanded its products range to all segments of the market The Kitkat brand is the largest selling chocolate brand in the world. Other brands include Milky Bar, Marbles, Crunch, Nestle Rich Dark, Bar-One, Munch etc. The sugar confectionery portfolio consists of Polo, Soothers, Frootos and Milkybar Eclairs. All sugar confectionery products are sold under the umbrella brand Allen's. Nestle has also markets some of its imported brands like Quality Street, Lions and After Eight. New launches such as Nestle Choco Stick and Milky Bar Choo at attractive price points to woo new consumers. Chocolate confectionery sales registered a strong 21.5% yoy growth in 2001 aided by good volume growth in Munch, Kitkat and Classic sales. Nestle relaunched Bar-One during the year.

From the beginning, turning raw, bitter cocoa beans into what one 17th century writer called "the only true food of the gods" has been a fine art, a delicate mixture of alchemy and science. 1.3 Ice CreamThere are many myths and stories as to the invention of ice cream: was it Marco Polo who brought it back from China (along with pasta)? Probably not, considering the most likely never visited China. The story of its popularity is however connected with the invention of technology to make it on an industrial scale, and to keep it cold once made. Before refrigeration techniques, food was frozen with the aid of ice, mixed with salt, which was either stored in ice houses or shipped from cold countries. But then at the end of the 19th century, both making and freezing it became easier, and together with the invention of the ice cream cone, made the product boom. Today, the United States is the absolute leader in terms of volume consumed, but the highest per head consumers are in New Zealand. Flavours you'd never have thought of and yet they're commercially available: Sorbets - Smoked Salmon, Tomato, Cucumber Ice Creams - Garlic, Avocado, Sweet corn.

The ice cream cone is the most environmentally friendly form of packaging. A Syrian from Damascus, Ernest E Hamwi is credited with its invention. Apparently, during the 1904 St Louis World's Fair, his waffle booth was next to an ice cream vendor who ran short of dishes. Hamwi rolled a waffle to contain ice cream and the cone was born.1.4 Prepared FoodsConvenience foods packaged soups, frozen meals, prepared sauces and flavorings date back more than a century. With the Industrial Revolution came factory jobs for women and less time to prepare meals. The problem was so widespread that it became the object of intense study in 1882 by the Swiss Public Welfare Society, which offered a series of recommendations, including an increase in the consumption of vegetables.The Society commissioned Julius Maggi, a miller with a reputation as an inventive and capable businessman, to create a vegetable food product that would be quick to prepare and easy to digest. The results two instant pea soups and an instant bean soup helped launch one of the best known brands in the history of the food industry. By the turn of the century, Maggi & Company was producing not only powdered soups, but bouillon cubes, sauces and flavorings.

Maggi merged with Nestl in 1947. Buitoni, the authentic Italian brand, which has been producing pasta and sauces in Italy since 1827, became part of the Nestl Group in 1988.1.5 BeveragesBeverages like coffee, tea and health drinks contribute to about 30% of Nestle s turnover.Beverage sales registered a 15% yoy growth . While about 14% of sales come from Beverages domestic market, exports contribute to about 16% of sales. Nestle's Nescafe dominates the premium instant coffee segment. Nestle s other coffee brand Sunrise has also been relaunched under the Nescafe franchise to leverage on the existing equity of the brand. Nestle has focused on expanding the domestic market through price cuts and product repositioning. However it has been losing share in the domestic market, where it has a 37% market share. Milo, a brown-malted beverage was launched in 1996. It has an estimated volume share of about 3% in the malted food drink segment. Nestle has launched noncarbonated cold beverages such as Nestea Iced Tea and Nescafe Frappe during 2001. Nestle is one of the larges coffee exporter in the country. Key export market is Russia, besides Hungary, Poland and Taiwan.

Nestls Nescafe dominates the premium instant coffee segment. Nestles other coffee brand Sunrise has also been relaunched under the Nescafe franchise to leverage on the existing equity of the brand. Nestle has focused on expanding the domestic market through price cuts and product repositioning. However it has been losing share in the domestic market, where it has a 37% market share. Milo, a brown-malted beverage was launched in 1996. It has an estimated volume share of about 3% in the malted food drink segment. Nestle has launched non-carbonated cold beverages such as Nestea Iced Tea and Nescafe Frappe during 2001. Nestle is one of the largest coffee exporter in the country. Key export market is Russia, besides Hungary, Poland and Taiwan. 1.6 Timelines for launches

1866Foundation of Anglo-Swiss Condensed Milk Co.

1867Henry Nestl's Infant cereal developed

1905Nestl and Anglo Swiss Condensed Milk Co. (new name after merger)

1929Merger with Peter, Cailler, Kohler Chocolates Suisses S.A.

1934Launch of Milo

1938Launch of Nescaf

1947Nestl Alimentana S.A. (new name after merger with Maggi)

1948Launch of Nestea and Nesquik

1969Vittel (initially equity interest only)

1971Merger with Ursina-Franck

1973Stouffer (with Lean Cuisine)

1974L'Oral (associate)

1977Nestl S.A. (new company name)

Alcon (2002: partial IPO; 2008: partial sale)

1981Galderma (joint venture with L'Oral)

1985Carnation (with Coffee-mate and Friskies)

1986Creation of Nestl Nespresso S.A.

1988Buitoni-Perugina, Rowntree (with KitKat)

1990Cereal Partners Worldwide (joint venture with General Mills)

1991Beverage Partners Worldwide (joint venture with Coca-Cola)

1992Perrier (with Poland Spring)

1993Creation of Nestl Sources Internationals (2002: Nestl Waters)

1997Creation of Nutrition Strategic Business Division (2006: Nestl Nutrition)

1998San Pellegrino and Spillers Petfoods

Launch of Nestl Pure Life

2000PowerBar

2001Ralston Purina

2002Schller and Chef America

Dairy Partners Americas (joint venture with Fonterra)

Laboratoires innov (joint venture with L'Oral)

2003Mvenpick and Dreyer's

2005Wagner, Protika and Musashi

2006Creation of FoodServices Strategic Business Division (2009: Nestl Professional)

Lactalis Nestl Produits Frais (associate)

Jenny Craig, Uncle Tobys and Delta Ice Cream

2007Novartis Medical Nutrition, Gerber and Henniez

2009Vitality Beverage business

2010Kraft Pizza

2. COMPETITIVE ANALYSIS

Competitive analysis, as the name implies, is an exploration of the companies in a given industry sector or market niche that are competing with your company s products or services for market share. The analysis may be an in-depth exploration of the top five competitors, or a larger number of competitors could be examined (typically with less depth in the analysis). In most cases, the client will have identified the target competitors for you. While this project focuses on competitive analysis in the for-profit arena, it is worth noting that non-profit organizations can benefit equally from this analysis (which they might term a comparative analysis, if they viewed the other organizations as working toward a common goal with them).

2.1 Understand the competitionThe primary benefits of any competitive analysis are a better understanding of what your competitors are doing, what they are offering to customers, and how to maintain your competitive advantage. The findings from this analysis are likely to factor strongly into your own company s strategic planning. However, this is definitely not the only take-away from the process of analyzing competitors. The analysis offers information about content and functionality that they have probably not considered. This is especially true for newcomers to your industry and should be fairly common; not everyone will be a subject matter expert. Looking longer-term, this educational process benefits not only the current project, but also any future project in that same industry.

Doing this project has really enhanced my performance for the next project ever will be held in my career. It has given me the practical exposure while working in such competitive market

3. DISTRIBUTION NETWORK OF NESTLE INDIA LTD

3.1 Description Of Distribution channelNestle India Limited is the primary company in India involved in the production of food products. It is very prestigious company its food products are regarded as quality food. Nestle India Limited has a wide distribution network operating on a national basis. The various channels of physical distribution for nestle are Mother Godown. Clearing and Sales Agents, Cash Distributors and Retailers(outlets) .

3.2 Mother GodownsThis is the first line agent in the distribution network for channels.Stocks are moved on consignment basis from the main factory to the different regions. These Mother godowns are the transshipment points. Nestle enters into a contract with the mother godownns. These agents in the form of mother godowns are given at flat fees by the principal company i.e. Nestle.

3.3 Clearing and Sales agents ( C & S )These are the second line agents in the distribution channel. Clearing & Sales agents generate invoice on the basis of the requirement of the cash distributors. Once the invoice is generated by C&S agents and communicated to Mother Godown then stocks are released by mother godown to C&S.

3.4 DistributorsThese are the third line agents in the distribution network. They are regarded as business partners by the company. The distributors send orders to C&S agents on weekly basis. The C&S Agents generate invoice, get the stock from mother godown & supply them to the distributors. Nestle never provides goods to cash distributors on credit. Distributors have to pay directly to the company by demand draft or cheque. Distributors has to work within the overall guidelines provided by the Company.

3.5 RetailersThis are the fourth final line agents in the distribution network. Categories of the retailers are the following:-1. Wholesellers2. grocery shop also called (Kirana shop)3. Medical shop4. Non-conventional outlets like panwalas

The distributors are responsible for the collection of money from the retailers. The retailers are not at the direct linkage with the principle company, i.e. Nestle retailers are link up with distributors.

CHAPTER 3

1. SWOT ANALYSISNestle India Limited is the Indian arm of Nestle SA, which holds a 51% stake in the company. It is one of the leading branded processed food companies in the country with a large market share in products like instant coffee, weaning foods, instant foods, milk products, etc. It also has a significant share in the chocolates and other semi-processed foods market.Nestl's leading brands include Cerelac, Nestum, Nescafe, Maggie, Kitkat, Munch and Milkmaid, confectionery. To strengthen its presence, it has been the company's endeavour to launch new products at a brisk pace and has been quite successful in its launches.1.1 Strengths:Parent support- Nestle India has a strong support from its parent company, which is the worlds largest processed food and beverage company, with a presence in almost every country. The company has access to the parents hugely successful global folio of products and brands.Brand strength- In India, Nestle has some very strong brands like Nescafe, Maggi and Cerelac. These brands are almost generic to their product categories.Product innovation -The Company has been continuously introducing new products for its Indian patrons on a frequent basis, thus expanding its product offerings.1.2 Weakness:Exports The companys exports stood at Rs 2,571 m at the end of 2003 (11% of revenues) and continue to grow at a decent pace. But a major portion of this comprises of Coffee (around 67% of the exports were that of Nescafe instant to Russia). This constitutes a big chunk of the total exports to a single location. Historically, Russia has been a very volatile market for Nestle, and its overall performance takes a hit often due to this factor.Supply chain- The Company has a complex supply chain management and the main issue for Nestle India is traceability. The food industry requires high standards of hygiene, quality of edible inputs and personnel. The fragmented nature of the Indian market place complicates things more.

1.3 Oppurtunities:Expansion- The Company has the potential to expand to smaller towns and other geographies. Existing markets are not fully tapped and the company can increase presence by penetrating further. With India's demographic profile changing in favour of the consuming class, the per capita consumption of most FMCG products is likely to grow. Nestle will have the inherent advantage of this trend.Product offerings- The Company has the option to expand its product folio by introducing more brands which its parents are famed for like breakfast cereals, Smarties Chocolates, Carnation, etc.Global hub- Since manufacturing of some products is cheaper in India than in other South East Asian countries, Nestle India could become an export hub for the parent in certain product categories.1.4 Threat:Competition- The Company faces immense competition from the organised as well as the unorganised sectors. Off late, to liberalise its trade and investment policies to enable the country to better function in the globalised economy, the Indian Government has reduced the import duty of food segments thus intensifying the battle.Changing consumer trends- Trend of increased consumer spends on consumer durables resulting in lower spending on FMCG products. In the past 2-3 years, the performance of the FMCG sector has been lacklustre, despite the economy growing at a decent pace. Although, off late the situation has been improving, the dependence on monsoon is very high.Sectoral woes- Rising prices of raw materials and fuels, and inturn, increasing packaging and manufacturing costs. But the companies may not be able to pass on the full burden of these onto the customers. 2. PEST ANALYSIS

2.1 Political or legal forcesTaxation LawIf government imposes heavy taxes on the industry then it badly effects the industry growth. The taxes impose is from government side and it varies from industry to industry. Juices have no tax except sales tax. But nestles some product has like butter and cream which has more taxes

Labor LawsLabor is being privileged here having all the laws. Nestle company also follow these law like government announce minimum salaries of a employ Rs 6000.

Laws on hiring & promotionsHiring & promotion is followed by law. People with better capabilities are privileged because they deserve it, for the betterment of the organization. As well as a well educated & skilled experienced person is a precious asset for the company suit should be hired on better term & conditions and be promoted on the basis of it capabilities.

Environmental protection LawsThey do concern for environment and contribute more and more for the betterment of environment.

Foreign trade RegulationsForeign trade regulation does not effect the over all policy and the working of the Nestle juices because they operate nationally not internationally.

Attitudes towards foreign companiesThey have no any agreement with any foreign company but if any company will offer the business to them related / unrelated they would think about it according to terms and conditions.Political instabilityThe government stability also plays a great role for any industry. In Pakistan government face lot of difficulty from the side of terrorism and also its activity that badly effect environment of the country which is totally very upset. Recently in Punjab instability of government creates lot of problem for the industry like shortage of electricity that badly affects the industry operational process. Nestle juices have not much affect this condition but in future it may be face some difficulty for operating. 2.2 Economic forcesInflation RateNow in Pakistan inflation rate is almost 22.3% so if increase in inflation rate then ncrease in prices of Nestle JUICES but if in Pakistan economy.

Economic growth rateEconomy growth rate accelerate is 7+2.3 Social factorHealth consciousnessToday people are more health conscious so Nestle juices by identifying this need of the people they are also producing health conscious juices with more vitamins.

Demographic trendIn Pakistan the population growth rate is 1.828% in 2008 and total population is 167,762,040 (July 2008 est)

Age structure 0-14 years:40% (male 33,293,428; female 31,434,314) 15-64 years: 56.9% (male 48,214,298; female 46,062,933) 65 years and over 4.1% (male 3,256,065; female 3,542,522) Key Indicators Population: 164,741,942 (July 2007 est.) Growth rate: 1.828% (2007 est.) Birth rate: 27.74 births/1,000 population (2007 est.) Death rate: 8 deaths/1,000 population (2007 est.) Environmental concerns: About the environmental concerns of Nestle juices is good health.

Work life quality:Quality of work life is very safer & environment friendly

Lifestyle changes:They consider quality life changes and take advantages of accordingly so that customer can convinced as well as it plays a vital role to attain & retain the customer. Consumer adopts the trend of changing environment because of modern facility as well as globalization they are aware about each and every thing happening all around them.2.4 Technological forcesNew ProductsNestle juices focusing concentric and conglomerate diversification because in present era it is not possible for any organization to exist in market for long run by providing just one product. So Nestle juices are diversifying according to changing demand of customers and trends.

Product innovationProduct innovation is becoming more necessary for the organization because of globalization people are becoming aware about the changes being taken place around them so in order tactical the situation nestle juices is focusing on product innovation by introducing new flavor of juices with the passage of time NESTLE JUICES use new tetra packing like easy open cork of pack.

Productivity improvement through automationAutomation dont matter a lot but to some extent it contribute towards productivity and improvement. Imported pulp is filled in machines for processing after the final form of juice it is packed in 250 and 1 liter packing.

Total spending on R&DSpending on R&D is long term investment for any organization. Nestle has R&D department and head of R&D department is Mr Arshad Bhati. Nestle total spending on R&D 70 millions.

New communication technologyAll the modern as well as traditional ways of communication are being adopted by Nestle juices including own emails, letters, faxes and monthly visit in different offices of Nestle juices for better communication among supplier, distributor and customers. Nestle juices has also established own web site which can be visited any one for most recent news innovation and activities being taken in the organization.

CHAPTER 4

1. RESEARCH METHODOLOGY

I have carried out a research which is both qualitative and quantitative in its support. The qualitative approach applies to both, descriptive and inductive forms of research. While as in case of quantitative approach, an extensive use has been made of the literature available to carry out a detail research on the nature of the problem. I have chosen Nestle as the target company for my research study.

1.1 Method of data collection & analysisThe data, after collection, has to be processed and analyzed in accordance with the outline laid down for the purpose at the time of developing the research plan. This is essential for a scientific study and for ensuring that we have all relevant data for making contemplated comparisons and analysis.I have conducted a graphical analysis based on the responses received from the persons questioned and interviewed. Once the interview was over, the responses received were be grouped together, and a graphical presentation and analysis has been made for every set of questions.

1.2 Nature of dataI have made use of both, the primary sources and the secondary sources of data in eliciting information.

1.3 Primary data:The primary source of data involves oral interviews and questionnaires. These sources are inadvertently expected to yield more qualitative data and results.SAMPLE SIZE: 100SURVEY AREA: Mumbai

1.4 Primary data collection methodsInterviews:I have conducted oral interviews with retailers of Nestle. In considering an oral interview of such a nature, a follow up and step by step approach was adopted in getting through the interviewees. The oral interview involved a set of well thought out questions that were asked and the responses there on noted as a basis for analysis. Subsequently a graphical analysis has been made based on the responses received from the persons questioned and interviewed.

Secondary data collection methodThe secondary source of data includes relevant literature including periodicals and journal articles in the areas of Marketing, customer satisfaction.

1.5 Objective of the studyPrimary Objective: To find out sales volume of Nestle Confectionary vis--vis competitor To find out the major Nestle competitors Suggestion for the company from retailersSecondary Objective: To increase their market share by approaching to retailers who prescribe competitors product. To have a good image in the eyes of retailers.

1.6 LimitationsThe only limitation in this survey was that I could not conduct a survey on a big scale, due to the time constraint.

1.7 Data analysis and interpretations:

Q.1 Name the confectionery brands you stock at your outlet?

NestleCadburyParleDaburPerfettiOthers

605540207015

Brand Availability in Retailers out of 100 Retailers have number of brands in their store. Perfetti is on the top most preferred brand among the Retailers. Nestle is also on the handsome position but Perfetti is more famous among the Retailers. The Main competitors over the market are Perfetti & Cadbury.

Q.2 Name and rank the top five brands you stock at your outlet?

NestleCadburyParleDaburPerfettiOthers

555030156510

These brands are taken on the basis of top five brands stock at the outlets. Supported by this chart Perfetti is on the top most position by 65 out of 100 Retail stores. Other players are also on the strong position as Nestle is on the 2nd position covered area by 55 out of 100. To cater this market Nestle have to provide some value added service to his retailers.

Q.3 Please tick the Nestle Brands you stock at your outlet? (Tick Please)

clairs 50pV.A. clairsPOLO

758560

Availability of Nestle confectionery Item in the retail stores According to this chart V.A clairs is on top most position 85 out of 100 retail stores. clairs 50p is also having a good market but due to the same taste of V.A clairs the most retailers prefer that. Polo has also good market share but due to the limited preference by customer retailers prefer less in competition of others.

Q.4 Please rank the Nestle Brands according to their sales?

clairs .50V.A. clairsPOLO

406555

Rank of the Nestle Brands according to their sales As written on the previous chart V.A.Eclairs is the top most preferred brand among the retailers. 65 retailers out of 100 are shown their preferences to the V.A.Eclairs . Polo is also 2nd position among the retailers with 55 out of 100. Eclairs.50 has also the beautiful market in this confectionary segment with 40 out of 100 retailers.

Q.5 What percent of stock at your outlet is Nestle?

NestleOthers

20%80%

Percentage of Nestle and other competitor brand The availability of Nestle in confectionary item is only 20% but number of players is very high so that we have the result that in this confectionary segment Nestle has very powerful market. Others players are Cadbury, Dabur, Perfetti, Parle, ITC. They together covered other 75% market. There are also some small players which covered other 5% of market. To cater more market company have to provide some value added service as well as have to give some schemes among the retailers.

Q.6 What percent of total sales is Nestle at your counter?

NestleCadburyParlePerfetti

Percentage sales of confectionery31%21%14%34%

Percent of total sales at counters Perfetti is on the top most preferred brand among the Retailers by holding 34% of overall market. Nestle is also on the handsome position with holding 31% of overall market. The Main competitors of Nestle over the market are Perfetti & Cadbury.

Q.7 From where do you procure Nestle Confectionery?

DistributorWholesalers

96%4%

96% retailers are procuring Nestle Confectionery from Distributor and only 4% procure Nestle Confectionery from Wholesalers. Thats show the effective Supply chain management of Nestle. Due to effective supply chain management Nestle cater very huge market of retailers.

Q.8 Which are the seasons for maximum sales?

SummerWinter

45%55%

Sales of Nestle Product season wise Supported by this graph a very interesting finding is occur that 55% retailers are shown his interest to make us understand that winter is more prefer time to sail nestle Product. But 45% are also exist there who said that summer is very special to sail nestle product .But there is no specific reason fine out.

Q.9 (a) Do Customers (Retailers) prefer Nestle Confectionery to other brands? (Yes/No)

YesNo

70%30%

Preference of Nestle Brand compression to others As we stated previously that Nestle have good market. Most of retailers stated that they prefer Nestle Confectionery sail in comparison to other brands. The percentage of preferred retailers is approximately 70%.and other who dont prefer Nestle brand is only 30%.

Q.10 (b) Do Customers (Retailers) prefer Nestle Confectionery to other brands? (Yes/No) Why?

PriceQuality Of ProductSchemesVariety

55206045

Reason to prefer Nestle Brand Main reason to have Nestle Confectionery brand among the retailers is Schemes. Most of the retailers have this brand due to schemes and price & quality of the products. Very effective price and quality are affected to absorb that Nestle Confectionery product among the retailers.

Q.11 (a) Do you prefer to sell Nestle Confectionery over other Brands? (If Yes/No Why)?

YesNo

85%15%

Main reason to have Nestle Confectionery brand among the retailers is Schemes. Most of the retailers have this brand due to schemes and price & quality of the products and approximately 85% are prefer to sail nestle product. Very few, approximately 15% are not preferred to sail Nestle product. Very effective price and quality are affected to absorb that Nestle Confectionery product among the retailers.

Q11. (b) Do you prefer to sell Nestle Confectionery over other Brands? (If Yes/No Why)?

Margin Promotional SchemesDemandVariety

60455520

Reason to sell Nestle Confectionery Main reason to sell Nestle confectionery over other brands is the schemes provided by the company over other brands. Sometimes the company provides the schemes which are very preferable to the Retailers.

Q.12 Do you face any problem while selling Nestle Confectionery to customers?

YesNo

15%85%

Facing any problem while selling confectionery 85% of Retailers are said that they never face any kind of problem while sailing Nestle product to the consumer, but 20% are also said that they had faced some problem while sailing Nestle product. That shown the image of Nestle among the retailers is very effective.

Q.13 Do you face any problem with Nestle India Limited?

YesNo

20%80%

Facing any problem with Nestle India ltd. 80% of Retailers are said that they never face any kind of problem to having Nestle product in their store, but 20% are also said that they had faced some problem while sailing Nestle product. That shown the image of Nestle among the retailers is very effective.

Q.14 Will you recommend Nestle Confectionery to customers?

YesNo

85%15%

%age of Retailers who want to recommend Nestle Confectionery among the customers Supported by chart 85% retailers are very much satisfied with the process of Nestle. they also want to recommend nestle product among the consumer.25% of also there who dont want to recommend Nestle product.

Q.16 Please rate the performance of Nestle Confectionery on the basis of following features? Numbers from 1 to 6 is Very Low to Extremely High.

PriceProduct QualityPromotional SchemeVarietyUnderstands Customers

35445

Credibility of NestleMarginsDemandPromptness in DeliveryAdvertisement

63433

These performances are calculated on the basis of ranking from very low to extremely high. In which credibility of Nestle is given the extremely high ranking by 55 retailers out of hundred.

Q.17 Please rank the following according to your preference what you think is most important for customers while buying confectionery? Numbers from 1 to 6 is Most Important to Least Important.

PriceQuality Of ProductBrand NamePromotional SchemeMargins

31243

In this case Quality of the Product has given the Rank 1 i.e. Most Important. Whereas least important is given to no other thing.

2. RESULTS AND FINDINGSAnalysis is done on the basis of:- Price of the Product Quality of the Product Brand Name Taste Schemes and Margins provided by the company.

Perfetti is the market leader in comparison to its competitors and the major competitors are Cadbury, Nestle, Parle and Dabur. These products are mostly sold on the Promotional Schemes provided by the company. Such as Nestle clairs Dino Pack worth Rs.25 These Promotional Schemes attract many customers which increases the sales of the product offered by the company. Only one part where the company is lacking is the schemes provided to the retailers. The retailers are not satisfied with the schemes provided by the company as compared to the competitors. Somewhere and somehow in some of the jars the schemes provided by the company is satisfactory for the retailers. On the other hand retailers are happy to sell these products to the customers because of the demand whereas the taste and different varieties of product offered by the company. Nestle confectionery is provided at different prices such as 50p clairs, V.A. clairs, Rs.2 POLO and Rs.5 POLO. So customers can buy any range products. The company manufactures the product by understanding the customer needs and demands. Whereas the Credibility of Nestle is extremely high in the eyes of the customers. Demand of the product is also high because of the Brand Name, Promotional Schemes, Variety and taste of the product. The quality of the product provided by the company is shown by the high sales of the goods which we have already done and mentioned.

3. RECOMENDATIONSPoints where company should pay attention and are reason where should they overcome: -

Whole sell market: - Prices of products in the whole sell market is less then company so kirana stores, medical stores and panwalas buy products from whole sell according to their need and demand. For ex. MRP of clairs is Rs.60 then its Cost Price is Rs.47 in whole sell and Rs.50 in company. To overcome this problem it is necessary the company provides schemes and replacement offer to the shopkeepers.

Melting Problem: - Chocolates get melt in summers due to high temperature so shopkeepers who do not have cooling system are not ready to buy chocolates. So it is necessary to sell more of the confectionery items in summer because it never melts during summer.

Jo dikhata hai wahi bikta hai: - Company should provide posters banners etc. by which shopkeepers make costumers aware that he sell chocolates and confectionery of Nestle. This problem comes mainly in potentially low markets like Gokalpuri and Bhajanpura etc.

Some of the markets need more focus are: - Gokalpuri, Bhajanpura, Zafrabad etc. These markets are potentially low markets where sell of Branded Confectionery are very low. And they buy from whole sell if required. It is necessary to provide incentives to the Sales Man by providing at least 2 jars of confectionery in each shop.

Salesmen concentrate mainly on confectionary to be sold on kirana, bakeries, and medical stores and shows no attention on small shops.

Sales mens visit problem: - SM were dealing only those counters which are potentially efficient, normally regular in payments. They used to open only those new counters which are potentially efficient and ready to deal 3 to 4 initial dealings in cash.

Some of the shops which are small and near to big bakeries and confectionaries do not sell products due to low sale.

Shops which are near to schools and colleges usually keep less of the chocolates and confectionery when schools and colleges are closed.

CHAPTER 5

5. CONCLUSION

First of all, I would like to say that it was a real interesting experience because it was the first time in my schooling that I work on a project which seems to be professional. However, I met many technical difficulties. Indeed, it was really difficult to be creative at each time and to find more and more information about the candies. During the project, I got an enriching experience about selling and how to convince the customer to buy the product or to win an order. Study on worlds one of the top FMCG company like Nestle gave me practical experiences about nature of consumers, market and how to deal customers in the practical life in a market. It was for the first time when I was in the market to deal with the customers and company like Nestle gave me great exposure about the markets, nature of markets, nature of customers and how to deal with the customers.

6. BIBLIOGRAPHY

6.1 Books: C.R.Kothari Research Methodology Philip Kotler Marketing Marketing Management - By - Philip Kotler Financial Reports - Nestle India Ltd

6.2 Web Sites: www.iloveindia.com www.google.com www.nestle.com Media wikipedia.org/wiki/Nestl www.foodanddrinkeurope.com www.foodnavigator.com www.Google.com www.shareinfoline.com Ask.com sharekhan-firststep.com

7. ANNEXUREQuestionnaire Retailers

Name of the Retail Outlet:

Location of the Outlet:

Please read the following questions carefully and answer appropriately.

1. Name the Confectionery Brands you stock at your outlet._______________________________________________________________

2. Name and rank the top 5 brands at your outlet.(according to Sales)___________________________________________________________________________

3. Please tick the Nestle brands you stock at your outlet. (Tick please) clair 50p V.A. clairs POLO

4. Please rank the Nestle brands according to their sales. clair 50p V.A. clairs POLO

5. What % of stock at your outlet is Nestle (no of cases)?______________

6. What % of Total Sales is Nestle in your counter

7. From where do you procure Nestle Confectionery? (Tick please) Distributor Wholesalers

8. Which are the seasons for maximum sale (Tick please). Summers WintersOthers: ________________________________________________________

9. What is the expected traffic at your outlet? (No. Of customers per day)______________

10. Do customers prefer Nestle Confectionery to other brands (If Yes / No, Why)? (Tick please) Price Quality of product Schemes Variety

11. Do you prefer to sell Nestle Confectionery over other brands (If Yes / No, Why)? (Tick please) Margins Promotional Schemes Demand Variety

12. Do you face any problem while selling Nestle confectionery to customers?_______________________________________________________________

13. Do you face any problem with Nestle India Limited?______________________________________________________________________________________________________________________________

14. Will you recommend Nestle Confectionery to customers? (Tick please).Yes No Why ___________________________________________________________

15. Any Recommendations.______________________________________________________________________________________________________________________________

16. Please rate the performance of Nestle Confectionery on the basis of following features. (Please circle the response number that best describes how NESTLE has performed on that feature.) For any feature(s) that you feel is (are) not relevant to your evaluation, please circle (NA)(6 Extremely High, 5 Very High, 4 High, 3 Adequate, 2 - Low, 1 Very Low)

a) Price (NA) Extremely High 6 5 4 3 2 1 Very lowb) Product Quality (NA) Extremely High 6 5 4 3 2 1 Very lowc) Promotional schemes (NA) Truly Satisfied 6 5 4 3 2 1 Totally Dissatisfiedd) Variety (NA) Extremely High 6 5 4 3 2 1 Very lowe) Understands Customer (NA) R. Understands 6 5 4 3 2 1 No Cluef) Credibility of Nestle (NA) Extremely High 6 5 4 3 2 1 Very lowg) Margins (NA) Extremely High 6 5 4 3 2 1 Very lowh) Demand (NA) Extremely High 6 5 4 3 2 1 Very lowi) Promptness in Delivery (NA) Extremely Quick 6 5 4 3 2 1 Very Slowj) Advertisements (NA) Extremely High 6 5 4 3 2 1 Very low

17. Please rank the following according to your preference what you think is most important for customer while buying confectionery from 1 to 6. (1 Most important & 6 Least important) a. Priceb. Quality of Productc. Company / Brand Named. Promotional Schemese. Margins