Procurement WorkingWITH the Business

FOR the Business

PROCUREMENT ACCELERATION 2.0

Nestlé is changing the way it manages procurement. A specialist “Nestrade – Procurement Division” will be created to provide procurement expertise to all Nestlé businesses. This division will sit within a reformed Nestrade structure, with existing activities continuing to be delivered by a newly created “Nestrade- Global Trading Division”.

It is the journey toward the Nestlé Standardized Procurement Model.

What is Procurement Acceleration 2.0?

The Nestlé Standardized Procurement Model defines how we consistently manage procurement across all Nestlé Markets and Businesses to deliver the Procurement Vision 2020.

Supported by functional enablers: Responsible Sourcing, Supplier Relationship Management, and End-to-End Source to Pay.World Class Business Services are provided by NGBS Services to Procurement.

What is the Nestlé Standardized Procurement Model?

Send CategoryManagement

Above-Market(Group: Organized by Spend

Category - Raw, Pack and S&IM)

At-Market(NiM: Organized by Spend

Category - Raw, Pack and S&IM)

At-Market

Responsible Sourcing

Functional & E2E S2P Excellence

Supplier Relationship Management (SRM)

(BUs, GMBs, Functions)

ProcurementBusiness Partnering

Above-Market(Zones, SBUs, GMBs, Functions)

PROCUREMENT ACCELERATION 2.0

Procurement Acceleration 2.0 is a cross-functional initiative creating “Fuel for Growth”

Procurement Acceleration 2.0 is Spend Category Optimization and Source to Pay Excellence

The key activities to deliver the model are: Spend Category Management and Procurement Business Partnering.

Procurement Acceleration 2.0

PROCUREMENT ACCELERATION 2.0Key Benefits

Source to PayExcellence

Spend CategoryOptimization

Nestlé Business Excellence Procurement

Time and E�ectiveness

Speed and Agility

Quality and Compliance

Cost E�ciency

Capability Building

E�cient Organization

Improved Employee Satisfaction

85% Stakeholder satisfaction Single Entry Point Vendor Portal

One S2P Flow (85% Standardized)

30% S&IM Spend via e_Catalogues

Improved process e�ciency

70%+ Paperless Processing

Increased activities above-Market

>90% Invoices paid on time

CHF 1 Bio Incremental CostImprovement

All LATAM Heads of Procurement and LATAM Procurement Managers gathered in an integration and alignment event in Panama City on February 15th, 2016. The purpose of the Summit was to set priorities for 2016 and to be aligned with Procurement Acceleration 2.0.

LATAM Procurement Summit 2016

PROCUREMENT ACCELERATION 2.0

LATAM

The journey to improve the ways of working to buy Services and Indirect materials, Easybuy continues for LATAM. Ecuador and Colombia started the preparation to introduce the new definitions and processes with the great support of NBS who is partnering Procurement for the introduction, configuration and training on the supporting tool, Ariba.

The plan for the next markets (See Roadmap) has been also defined for the rest of the year. Among other important contributions, the expected benefits that will come out of the definitions in which the respective Strategic Buyers are working on are: The full visibility of the Preferred suppliers for the di�erent spend categories, a catalogue of items that can be bought from those suppliers (wherever possible), ensure that a real bidding process has taken place according to the Procurement policy before the purchase order Is sent to the selected supplier as well as an improved authorization process for approvers that brings more visibility and speed to the end to end flow.

If you want to know more about this topic, please visit this intranet site.

Easybuy, bringing value to the business

LATAM S&IM Operations

Hygienic Air Handling Units (AHU´s)

Last year, as an initiative from LATAM Procurement Team, we started an aggregation process in order to get better purchasing conditions for these equipments. During 2015 LATAM markets purchased 10 equipments, which is an average of USD 1.000.000. With teamwork between the Technical and the Market procurement teams, we managed to aggregate more than 70% of the requirements with one validated supplier, the other 30% with the alternate validated supplier. This strategy gave us a additional cost improvement of +10%. ¡That´s the average cost of a single AHU!

Aggregation Approach 2015

We currently have a standardized way of working for the purchase of these equipments, which you can found at Link. This process allow us to quote and aggregate more e�ciently, thus making the process faster and delivering lower costs for the projects. We encourage the Technical and Project teams to use the tool on the CO-ENG site and allowing us to add value to your process and taking advantage of Nestlé´s global approach with suppliers.

Approach 2016

Implementing PSL for EasyBuy Mexico - Laboratory supplies andCleaning chemicals

LATAM S&IM Operations

Only 17% of our LATAM Air Compressors have a Preventive Maintenance Contract in place. An eventual failure of this Equipment may generate Opportunities losses of Millions of USD per day due to Factory Production stoppage.During 2016 – 2017 we are promoting a “cultural” change of mindset in order to move from Corrective to Preventive maintainance. Cluster 1 has been defined with Brazil, Colombia, Ecuador, Chile and Mexico. With Compressed Air Diagnostics expected to be completed by 2017 we can identify Potential Opportunities in Operational e�ciency optimization by ~ 50%.

What we achieved

During 2016 we started moving forward with Catalogues for Colombia and a detailed PSL for NQAC, Antigua Guatemala.

Air Compressors are critical piece of Equipment in our Factories, hence it is important to maintain and optimize them.

Propagating further

Preventive Maintainance culture – Air Compressors

83%

17%

Equipment with PreventiveMaintenance Contracts (%)

Detailed price catalogs developed for the top chemicals and consumables used (50% of Laboratory consumables and 100% of formulated cleaning chemicals) with 13 preferred suppliers. Also developed PSL for services and spare parts with 42 supplier are available. This eliminated waste in the purchase process aligned with 7SS for the category. After starting in September 2015, we moved forward with a controlled start and by April 2016, 12 Factories are using it. We initiated a weekly forum is open to all end users and the buyer to work together on our approach of “Working with the Business, for the Business”.

LATAM S&IM Operations

E�ective communication between areas and have clarity of business expectations has been key to successful development of the Project.The project involves buying 2 main equipment’s: Filler Machine & Case packer Machine; ensuring at all times be aligned with the timing of the Project and commitment to the business cover.

Among the important points to consider are:

Using technical standards to acquire machinery – URS in both equipment’sTechnical Benchmarking with other markets to anticipate problems and provide the best solution - Visit Colombian MarketQuick response and support at all times by Selected Suppliers – Filler Machine MESPACK & Case packer Machine TAVILReduce import time once the equipment is in the custom – No more than 3 daysInnovation / new technologies has also resulted in the equipment purchased (not only on the product)

In each purchases always have in mind the Opportunity Cost; the release date of a new product can be a trigger for its success or failure (Daniel Mendoza)

General Overview:

Who?

Key Point (for you Strategic Buyer)

Engineering Packing Procurement Nestrade Foreign Trade

Early Involvement with Engineering Working as ONE Team – “Proyecto Morraller – La Lechera - Mexico”

LATAM S&IM Generals

The execution of IT CAPEX is a key activity managed by the GTS LATAM Services team. Based on the lessons learned captured during 2015 we aim to implement further improvements for 2016. To that, during 3 days in January, Procurement joined forces with GLOBE to understand objectives, set priorities and eliminate waste in the purchase process during the participation in the “GTS LATAM CAPEX WORKSHOP”.

A roadmap of procurement negotiations and CAPEX execution plan were discussed and are now revised on a weekly basis. The first portion delivered has met the expectation of simplification and delivered a cost improvement of around US$1 Mio. There are still more to come and we are confident that by working together we will exceed expectations and simplify our ways of working.

Early engagement with GLOBE to SIMPLIFY the Sourcingprocess

Did you know that?

80% of the IS/IT Purchases in

LATAM are mainly based on spot

orders

8’000 Purchase

Orders were created with more

than 500

Suppliers

On average, we

requested 20,000

times a quotation

before a Purchase Order is created

LATAM Ingredients

VITAMINS WORKSHOP IN BRAZIL

Participant’s feedbacks were very good and measured via survey after the event. As a result, 36 project proposals were generated and shared with Nestlé Brazil.

As a next step, the stakeholders at Nestlé Brazil will receive the presentation pack via Procurement Business Partner to evaluate the proposals. If you are interested in knowing more about the Workshop and the proposals generated, please contact Vanessa Fontanelli. We believe this initiative can be replicated in your market and will add value to your Business.

We would like to share with you what happen in Brazil on March 1st and 2nd, Vanessa Fontanelli organized a Vitamins Workshop with the support of the Global Buyer Michael Boyard.

Create the opportunity for Application Groups to interact with current (DSM) and other global / regional suppliers (Glanbia, Lycored, Basf, Merck and M. Cassab).

Exchange technical knowledge between Nestlé and Suppliers.

Provide I&R ideas for Nestle portfolio.

Opportunity to exchange and renew technical knowledge. Each Supplier had two and a half hours to share a pre-aligned presentation and show prototypes to the audience.

The objectives of the workshop were:

LATAM Packaging

Ten Nestlé markets throughout 19 countries in LATAM region used these amenities (paper cups and lids)

New LATAM image for Nescafe Paper Cups

LATAM Professional and LATAM Procurement worked closely to deliver a Sourcing Strategy that would generate cost reduction, cost avoidance and standardization in sizes, image and materials of Nescafe Cups and Lids for the following sizes Alegría (7oz, 9oz, 11oz), Milano (6oz, 11oz), and Nestea (11 oz, 16 oz).

Procurement standardized the specifications in order to reduce complexity, the SKU portafolio was optimized in 14% and also negociated a significant cost reduction and supplier service improvement. We are encouraging sustainable packaging projects, using lighter paperboard eliminating the over-specification that we had before. (Lighter materials = Less Virgin Carton = Less Trees)There was also a storage improvement. In some markets pallet load optimized in 33% (Before 18thcups/pallet, After 27thcups/pallet) homologating the case from 2,000 cups to 1,000 cups/case.This negotiation could be replicable to other countries and Business units if the need adjust to the specifications and if they buy a minimum volume of 50 thousand cups.

* Next markets for implementation

LATAM Packaging

Cost Reduction and Avoidance

CR: $231

CA: $0

CR: $119

CA: $43

CR: $-4

CA: $15

CR: $19

CA: $4

CR: $-27

CA: $0

CR: $12

CA: $0

CR: $-21

CA: $37

CR: $329

CA: $99*N/A *N/A

CR: $7

CA: $0

CR: $7

CA: $1

CR: $2

CA: $0

CR: $0

CA: $4

CR: $16

CA: $5*N/AN/A N/A

N/A N/A N/A N/A

N/A*N/A

CR: $0

CA: $0

CR: $3

CA: $0

CR: $5

CA: $4

CR: $8

CA: $4*N/A *N/A

CR: $238

CA: $0

CR: $129

CA: $44

CR: $-4

CA: $15

CR: $21

CA: $4

CR: $-27

CA: $0

CR: $12

CA: $4

CR: $-16

CA: $41

CR: $353

CA: $108*N/A *N/A

TOTALLATAM

TOTAL

LATAM Purina

New Packaging for Proplan Argentina

Brazilian domestic corn prices have been supported by a very tight supply as Brazil exported a record amount of corn leaving little corn left for livestock producers in Southern Brazil. Livestock producers imported corn from Argentina & Paraguay to keep facilities producing, sample from Mexico will be tested too, as soon we clear it from Customs. NPP prices in Brazil were pressured the two first quarters of 2016 but with Safrinha coming, prices will lower from current USD 208/mt to USD 157/mt (June). The evaluation of Brazilian currency is a�ecting the competitiveness of Brazilian corn (compared to US and Argentina) so pace of exports probably will lower too.

Aluflex new packaging (Proplan Argentina) presented good results in the tests with significant improvement on its resistance. More tests are needed (shipping tests). A sample from Mexico will be tested too, as soon we clear it from customs. Argentinean legislation requires to be tested in heavy metals before use.

Sourcingis our priority

NPP Latam iscovered for

corn & soybeanmeal untilJuly 2016.

LATAM Purina

Achilles program a challengingroad ahead

What is Achilles Program?

This program creates a comprehensive picture of the extended supply chain for each product, right down to the farm level, in order to gain a better understanding of all the suppliers involved. It records relationships between customers and suppliers as well as products sold and products bought. Achilles is a core requirement of the Nestlé Responsible Sourcing Traceability Operations, and a key enabler for the verification of the Responsible Sourcing Guideline requirements at farm level.From 28 corn suppliers invited to join the program just two accepted and other six still didn’t formalize the acceptance. We are closely monitoring/consolidating the reasons why the remaining are not accepting – excuses vary from “costly”, “lack of confidentiality” and “no reason in accepting it”. For each reason, we will provide specific arguments to convince them and get them on board. Large companies such as Ingredion & Cargill are making decisions at corporate levels.

We will make an extra effort to have our suppliers mapped and aligned to our Nestle Supplier Code.

Argentina

Argentina results 2015 and Challenges for 2016

During H2 2015 we developed a pitch process in Argentina with two main objectives:

1. E�ciency: Improve global remuneration and media rates, enhance media payment terms condition according to Nestlé’s Global condition and get better transparency on Rebates.

2. Innovation: Develop “out of the box” strategies for each brand, depending on your objectives and Budget. Bring alternative media mixes e�ective for each brand and reinforce the team with a more digital view.

The initiative was a success, we were able to improve the global remuneration target in 3% average, cost e�ciencies in 13% and we stablished a 60 days of payment term condition for open TV.

We are really glad to say that we had a really challenging year but also a successful 2015, we were able to contribute to the Business Units achieving OPEX target, key in our ambition of becoming partner of choice. As examples of this commitment are some key initiatives such as the media pitch (see below) or the optimization for NESPRESSO and dolce gusto and e-commerce distribution.

For this first quarter, our main concern is to protect the BU´s against the inflation process related with the economic situation and the peso depreciation impact.We are working in initiatives related to corrugated cases, flexibles packs, working capital, just to mention some projects.We know, that 2016 will be a huge challenge, but the Procurement team is committed to deliver the results that our region needs to continue in the growing path.

Argentina Media Pitch

Brazil

Financial indicators

A project implemented by the Local Procurement organization in conjunction with an external partner (Accenture) to manage the negotiations for Services and Indirect Materials small purchases under a threshold of R$ 50K (Tail Spend) for all Factories and DCs.

Last projections prices show a reduction at 4% in regards with OPL (- BRL 160 mio), motivated mainly by Foreign Exchange (FX) drop in 10% (USD/BRL year average used in OPL was 4,30 vs. last projection of 3,88), just as strong negotiations with vendors of categories of Cereals and Grains, Dairy Products and Metals (- BRL 21 mio).

Updated forecast

e- CatalogsTail management (BPO)

During 2015, payment conditions has been extended for more than 1.500 suppliers increasing 7 days the Market payment terms and improved over BRL 200 mio in Working Capital. As an additional action, a fixed date payment approach (two times per month) was implemented at the end of 2015 improving our Trade Payables in more than BRL 80 Mio.

Trade Payables improvements

2015 was the first full year after the project implementation. Results were above expectations delivering 5,4% Opex savings (R$ 6.6 Mio) against a 4% target and achieving the agreed 90% SLA. Besides, the new process model gave us better visibility in terms of spend management helping us to leverage negotiations scale, increase catalog usage and agility to the Business. We have moved from 20% in 2014 to 42% in 2015 the number of purchases under a catalog (SAP Contract) that represents 5.500 new materials negotiated with a price list.

The plan for 2016 is to continue increasing the number of materials under catalogue adding 3.500 more materials to the existing base, helping us to achieve our ambition to have 60% of purchases under a catalog, reducing complexity and increasing e�ciency for the Business.

Market relevant events

A project which objective is to optimize and eliminate manual interventions on the Source to Pay E2E flow. With a pilot launched in December last year including 3 Factories and 50 suppliers, the new process is showing excellent results where over 90% of the invoices were processed fully automatically on the system. Based on the pilot good evolution, we plan to rollout the solution by the end of 2016.

The National Agency of Sanitary Surveillance (ANVISA) has published a new regulation regarding allergen labeling specific for the Brazilian Market. This resolution sets forth the mandatory labeling requirements for major foods, which cause food allergies, and is applicable to foods, including beverage, ingredients, food additives and technology aids packed when the consumers are not present, including those solely intended for industrial processing and intended for food services. As from 1st of July 2016 all materials must have the label adapted to comply with the new legislation.

Procurement is working closely with Packaging suppliers inorder to ensure all changes are done prior to July 1st, 2016.

Electronic Invoice

NFe Incoming Project

90%Invoices Porcessed

Automatically on the system.

Brazil

Allergen labelling in Nestle products

Sourcing Strategy

We have recently finalized a major Strategic Sourcing review for the category Events. The review was conducted in close collaboration with the Market Stakeholders resulting in a Preferred Supplier List with 11 agencies fully compliant with Procurement guidelines. Main benefits from the e�ort are new payment terms, fixed price for recurrent items, standard fee and fixed cost for event Planning & Management. Overall the new strategy achieved 25% cost improvement.

Events Category

25%

11

$20 mioA new Sourcing Strategy was implemented covering R$ 185,5 mio spend (91% of the total spend). Main improvements compared with the previous strategy includes a robust Business Continuity Plan, a negotiated trigger based on resin price fluctuation and local tax benefits resulting a R$ 20 mio in Cost Improvements.

Rigid Plastic

COST IMPROVEMENT

COST IMPROVEMENT

FULLY COMPLIANT

AGENCIES

Brazil

Mexico

2015 was a very challenging year, with interestingachievements for Mexico

During 2015 Procurement conducted three innovation fairs for the business units in México Headquarters to support their wrought with Glass innovative applications, new point of sale materials and creative auto-exhibit packaging materials & stands.

Procurement, a source for Innovation

Once again a new record was achieved for the market of 57.4 days for Procurement spend and a total market of 39.5 days (14.8% increase vs 2014, reaching the 4th position of best performers in LATAM after Honduras, Brazil and El Salvador).

Payment Terms

Mexico achieved the highest amount of compliant vendors in LATAM with 768 vendors (Raw 241, Pack 104 and S&IM 423) followed by Brazil with 741 vendors.

Responsible Sourcing Compliant Vendors

Mexico became the second best performer (excluding Venezuela) by reducing 23.5% its active supplier base for Services and Indirect Materials (from 3,182 to 2,434).

Procurement S&IM Vendor BaseOptimization

Mexico

Nestlé Mexico was the Zone AMS Pilot market and launched EasyBuy in September 2015. This implementation included not only a new front-end tool for users, but mainly the transition of the PO creation to NBS Ribeirão Preto, Brazil.The implementation involved an intense training activity deployed from August 2015 to April 2016 to +700 users from all locations including Factories, DC’s and Head Quarters.By the end of March 2016, 658 users are live in the platform as Requestors, Approvers and Strategic Buyers.

EasyBuy Implementation

Mexico

Our 2016 must Win Battles are mainly supported by thefollowing initiatives:

Finalize the deployment of EasyBuy implementation to full scope, while stabilizing the solution. By end Q1 17% of S&IM PO’s were created via new EasyBuy solution, and 59% of them were automated (without any intervention from an Operational Buyer). Easy Buy 1 and standard SRM solutions will become inactive by May 1st, 2016.

1.

Enhance Procurement Business Partnering with Business, but mostly with Functions. We have implemented new BP roles for Corporate Communication, Human Resources, Supply Chain, Engineering and Business Excellence, and now we need to foster their interaction and strategic support.

2.

Improve Payment Terms even further, by increasing payment terms on delegated spend categories (not penetrated by Procurement) and improve GR/IR processes.

4.

Successfully implement Procurement Acceleration 2.0 Initiative becoming a lighthouse for Zone AMS.

5.

Increase our Value Added perception from our Stakeholders by:a. Improving our follow through b. Addressing stronger initiatives to improve total delivery costc. Providing stronger sourcing strategies aligned between business needs and market opportunities.

3.

Central America

Culinary successful Negotiation

In order to increase the competiveness within concentrated tomato suppliers in Panama we invited new north and South American suppliers to our bidding process. The process closed with a 21% reduction in cost which is lower than the actual market price. The supplier who won is CB Services (North American) and the shipment will pay 0% custom tari�. We gain a 170K USD of cost improvement.

From now on, we will be focusing on including Asian suppliers for the next bidding process in order to have sourcing suppliers from the principal zones where tomato is sourced.

The implementation of advanced NCE tools in Antigua and Malher Factory Malher have been beneficial for Business as we identified 19 projects or opportunities associated with source saving opportunity of 1.2MM USD for 2016 , which have been working since. Perhaps the most important project is the harmonization of flexible materials between both plants, it has a high potential for achieving a significant saving and also seeks to harmonize the structure of primary packaging, leading to increase our bargaining power by consolidating volumes.

LEAN implementation drives excellent opportunities inCulinary Factories

We have been closing some biddings which are now translated in important savings for our region.

The first bidding that we can mention is the one of Glutamate where we gain a cost improvement of 271K USD between Antigua and Malher factories. The next one was from Onion powder where we are now reporting 83K USD in cost improvement. Then we had the closing of Nucleotides bidding where we achieved 45K USD and last but not least the one for black beans where we gain a 80K USD.

Successful Biddings

Central America

Working as ONE Team

Strategic buyers from flexible materials make a strategic move by calling to a price revision with flexible suppliers considering the actual oil price reduction. The reduction that buyers obtained in this negotiation was 1.2% which represents 290K USD per year for Central America and 56K USD for the case of Rigid Plastics in the same region.

This negotiation could only be possible in hard currency markets as Ecuador, Perú and Central America.

During 2015, Procurement and Communications area detected big opportunities of improvement on media category in Central America. Both areas, also with the support of LATAM Procurement Team, developed a robust bidding process for our ATL and Digital Media Buying, Community Management and Contact Center.

The collaboration was crucial to achieve great results, we have now a clearer market scope, and a cost improvement (around $700K USD), a clear cost structure that would help future negotiations and with the implementation of new services.

Winning with oil price reduction and cost structures negotiations

Chile

Chile Saving money and energy in CD Quilicura

CD Quilicura will change (330 Lights to LED format , with sensor and e�cient programming) Technical & Production team lead by Strategic Buyer Gonzalo Ortega are changing to New technology in Q2 2016 in order to achieve 40% savings initial projectable to 62% immediately.

The benefits of this implementation is a cost reduction in energy and savings. Also we are fully compliant with engineering guidelines, we will have more e�cient lights at a low cost with a 10 year guarantee.In 2016-2017 we will be trying to implement new LEDs in more sites.

Biomass success negotiation is changing the way of working with suppliers in Cancura Factory. Regional Strategic buyer Christian Alvarez and Technical Manager Cancura Factory, Daniel Vera, are leading the beneficial changes that are now obtaining excellent results.

In the past years, the factory can award the supplier depending of the amount of moisture and could also fine the supplier if the moisture passes the standard.Now, the wood that is used for combustion meets the standard of 35% humidity asked by factory guidelines and at a competitive price. We are not accepting less or more creating more quality in our products. Factory is receiving biomass with new prices less than last year and better humidity in the wood. A Cost Reduction 15.3% (136 K USD) and Cost Avoidance (177 K USD).

Since the implementation of the Biomass boiler in Cancura factory, we have been able to develop suppliers that meet our standards and requirements of the wood. Over time, we have been able to expand the pool of suppliers, leading to improved competitiveness, better product and less moisture exit barriers with suppliers.As the market is moving to renewable energies, company will move to new supplies and new ways of working. This factory could give us an example to understand our environmental alignment.

Cancura factory improves the ways of working with Biomass

Colombia

Colombia, focused on savings, payment terms and VendorEvaluation Scorecard objectives

In Colombia procurement direct Materials we are focus in achieve savings, payment terms and Vendor Evaluation Scorecard objectives. Below you can find the main projects and targets for this year.

Develop and implement the new sourcing for Whole Milk Powder from USA. Due to the dry season for fresh milk.New supplier for Milk Skimmed Powder in USA (Dairy America) for Dairy and Nestlé Nutrition BU.Replace the use of maltodextrin imported by national production (Project Mazorca)Improve wheat base negotiation 2016 for ConfectionaryPurchase of 176 Ton for Cocoa Powder from Nestlé Venezuela to Cocoa Malt Beverages.Change Corn Starch by Yucca Starch in Ambient Culinary BusinessRound Trip Project with the glass supplier OI – Peldar.Develop and implement for Calcium Carbonate sourcing (Omya)New sourcing for Vitamin C from China.Milk Run with the main suppliers for packaging in Culinary and Confectionary Business.

Change the payment terms for Dairy America from 30 to 60 days. It is the main supplier for Colombia.Working with OI-Peldar to increase the Payment Terms. It is the main supplier of packaging materials.Change the payment terms for Beneo Orafti to 90 Days.

SAVINGS (Target 6.300.000 USD)

Payment Terms (48 Days)

Colombia

Vendor Evaluation Scorecard (95%)

Continue improving the performance for our suppliers with action plans to ensure the sourcing of raw and packaging material on time, right quantity and excellent quality. With the final purpose to provide a synchronized Supply Chain according with the market needs. Our focus in this quarter is our supplier for solid board and Microflute Indagraf.

Colombia

Colombia recently launched ”Compras Workflow” for requestors who need to purchase services and indirect materials. The purpose of this new tool is to eliminate e-mails, improve the E2E process, to have a automatic process, measure SLAs and to ensure the proper quality and service in a more standardized way.

Do you need to request quotations for S&IM?

“Compras Workflow” LIVE in Colombia

Colombia will implement Easybuy to provide an easier integrated platform to end users in order to guarantee the strategy development and the compliance across the S2P process for Services and Indirect materials. The expected benefits of this implementation are: having a full visibility of the preferred suppliers for the di�erent spend categories, a catalogue of items, ensure that a real bidding process has taken place according to the Procurement policy.

EASYBUY LIVE Next month

Ecuador

ECUAMAS initiative was o�cially inaugurated on January 29th in Quito, Ecuador by Rodrigo Camacho, CEO of Nestlé Ecuador. It was attended by various Local suppliers, representatives of local industries, local authorities, LATAM Procurement Regional Team and media reporters and editors.

The focus of this program is to develop local suppliers and encourage innovation synergies to ensure we meet our target of Responsible Sourcing. This initiative will bring quality and sustainable materials based on Procurement Best Practices and Creating Shared Value. It contributes to Ecuador productive matrix by strengthening local competitiveness.

CURRENT RESULTS

The Supplier Development Program: contacted and made synergy with 30 local companies.

135 Attendance, 29 free National Media Impacts

In Q1 we delivered savings of $180K since the launch of the initiative.

There are 30 local suppliers and 19 local materials developed in several segments including plastics, spices, fruits and vegetables.

Supply and continuity of operations with quality and responsibility.

Nestle Ecuador successfully launched the ECUAMAS initiativelead by Procurement

Ecuador

GOING FOWARD …

ECUAMAS Initiative

Consolidate training and support to agro. Explore renewable energy

Expand & Develop inclusive business models with local supplier developed

Synergies “ECUAMAS & YOUTH”Develop local talent in the local industry

The Ministry of Production support to ECUAMAS, and adopt the model for other local industries in Ecuador

Technical support for Innovation in Flavor and Meat categories

The new tool to buy services and indirect materials in a fastestand easiest way

We are pleased to announce the upcoming launch of a new tool to buy services and indirect materials in Nestlé Ecuador in May 9, 2016.

EasyBuy comes to simplify and improve your daily experience in the Source-to-Pay process.

EasyBuy (an electronic catalogue) is considered a key enabler to support the optimization of the Source-To-Pay End-to-End Flow for services and indirect Materials (S&IM). Therefore a specific Learning & Training strategy has been defined to ensure the appropriate capability building for all Nestlé employees holding the role of Requestor, Strategic Buyer and Approvers.

Ecuador

Easybuy is coming to Ecuador

Peru

Important contributions from Peru

During the last months we have been working in the full integration of Nestle Bolivia and Fagal’s spend to LATAM Procurement in direct materials and S&IM categories. Therefore, we have appointed a dedicated business partner to ensure a smooth integration, flawless execution and deliver the added value to the business covering the expectations of our stakeholders.

On early March, an IBO exercise was done for the biscuits and wafer business unit, identifying opportunities up to 8 Mio USD across all the areas of the value chain. Procurement will be contributing with key initiatives focused on incrementing the marginal contribution of the business.

The main projects to be delivered for this year are focused on direct materials: Flexibles (change of sourcing to Peru), Corrugated (develop specifications with recycled paper), Cocoa Powder (change of sourcing to Nestle Venezuela) and Fat & Oils (Validate supplier from Ecuador).Also, a main initiative is to increment that payment terms through financial instruments with the banks.

Procurement processes and policy will be revised to generate more e�ciencies focusing the resources in more added value activities and ensuring compliance with our best practices.

Venezuela

Simplification for requesting quotations

Since April 8, requestors in Venezuela can start their purchasing process for services and indirect materials in a more simple and standardized way through the new "Compras Workflow". The new tool seeks continuous improvement within the E2E process to request quotations to suppliers.

During the first 15 days of implementation our requestors have raised more than 180 tickets, 45 are already closed and within the defined SLA and 140 are still in progress with an average time of 4 days.

Among others, it is important to mention the following benefits:

Reduction of emailsAutomation of the processElectronic form which guarantee we include the necessary and proper information Greater visibilityImprove quality and speed in service through the right measurement of response capacity.

180raised tickets

more than 45already closed

140still in progress

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