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- This article is about Nestlé S.A., the company. For information about Henri Nestlé, see Henri Nestlé.
Nestlé S.A. or Société des Produits Nestlé S.A., headquartered in Vevey, Switzerland, is the world's biggest food and beverage company. Nestlé's existing products extend from mineral waters to baby food to coffee and dairy products.
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3.1 Baby milk marketing |
History
Nestlé was founded in 1866.
In the 1860s Henri Nestlé, a pharmacist, developed a food for babies who were unable to breastfeed. His first success was a premature infant who could not tolerate his own mother's milk or any of the usual substitutes. People quickly recognized the value of the new product, after Nestlé's new formula saved the child's life, and soon, Farine Lactée Henri Nestlé was being sold in much of Europe.
In 1905 Nestlé merged with the Anglo-Swiss Condensed Milk Company. By the early 1900s, the company was operating factories in the United States, United Kingdom, Germany and Spain. World War I created new demand for dairy products in the form of government contracts. By the end of the war, Nestlé's production had more than doubled.
After the war, government contracts dried up and consumers switched back to fresh milk. However, Nestlé's management responded quickly, streamlining operations and reducing debt. The 1920s saw Nestlé's first expansion into new products, with chocolate the company's second most important activity.
Nestlé felt the effects of World War II immediately. Profits dropped from $20 million in 1938 to $6 million in 1939. Factories were established in developing countries, particularly Latin America. Ironically, the war helped with the introduction of the company's newest product, Nescafé, which was a staple drink of the US military. Nestlé's production and sales rose in the wartime economy.
The end of World War II was the beginning of a dynamic phase for Nestlé. Growth accelerated and companies were acquired. In 1947 came the merger with Maggi seasonings and soups. Crosse & Blackwell followed in 1950, as did Findus (1963), Libby's (1971) and Stouffer's (1973). Diversification came with a shareholding in L'Oréal in 1974. In 1977, Nestlé made its second venture outside the food industry by acquiring Alcon Laboratories Inc.
In 1984, Nestlé's improved bottom line allowed the company to launch a new round of acquisitions, the most important being American food giant Carnation.
The first half of the 1990s proved to be favorable for Nestlé: trade barriers crumbled and world markets developed into more or less integrated trading areas. Since 1996 there have been acquisitions including San Pellegrino (1997), Spillers Petfoods (1998) and Ralston Purina (2002). There were two major acquisitions in North America, both in 2002: in July, Nestlé merged its U.S. ice cream business into Dreyer's, and in August, a $2.6 bn acquisition was announced of Chef America, Inc.
Business
Management
The executive board includes:
- Peter Brabeck-Letmathe, CEO
- Carlo Donati, EVP, Chairman, and CEO of Nestlé Waters
- Frits van Dijk, EVP of Asia, Oceania, Africa, Middle East divisions
- Ed Marra, EVP of Strategic Business units and Marketing
- Francisco Castañer, EVP of Pharmaceutical and Cosmetic Products, Liaison with L'Oréal, Human Resources
- Paul Bulcke, EVP of Americas divisions
- Wolfgang H. Reichenberger, EVP of Finance
- Chris Johnson, Deputy EVP of Information System and Logistics
- Lars Olofsson, EVP of Europe divisions
- Luis Cantarell, Deputy EVP of Nutrition Strategic Business units
- Werner J. Bauer, EVP of Research and Development
Earnings
In 2003, consolidated sales was CHF 87.979 bn and net profit was CHF 6.213 bn. Research and development investment was CHF 1.205 bn.
- Sales by activity breakdown: 27% from drinks, 26% from milk and food products, 18% from ready-prepared dishes and ready-cooked dishes, 12% from chocolate, 11% from pet products, 6% from pharmaceutical products.
- Sales by geographic area breakdown: 32% from Europe, 31% from Americas (26% from US), 16% from Asia, 21% from rest of the world.
Joint Ventures and Minority Interests
Nestlé holds 26.4% of the shares of L'Oréal, the world's leading company in cosmetics and beauty. The Laboratoires Inneov is a joint venture in nutritional cosmetics between Nestlé and L'Oréal . Galderma is another joint veture in dermatology between Nestlé and L'Oréal. Others include Cereal Partners Worldwide, Beverage Partners Worldwide (formerly CCNR), and Dairy Partners Americas.
Criticisms of Nestlé's business practices
Baby milk marketing
See also: Nestlé boycott and International Code of Marketing of Breast-milk Substitutes
Since the late 1970s, Nestle has attracted much criticism for its baby milk marketing policies in developing countries. This has centered on its apparent recommendations for nursing mothers to switch to its infant formula milk products, leading to the alleged deaths of about 1.5 million babies each year as a result of formula being mixed with contaminated water. Nestlé allegedly has violated and regularly continued to violate the widely agreed-upon International Code of Marketing of Breast-milk Substitutes. This has led to a boycott coordinated by the International Nestlé Boycott Committee, informed by monitoring conducted by the International Baby Food Action Network).
Legal action against Ethiopian government
In December 2002, international aid agency Oxfam revealed that Nestlé was demanding millions of dollars in compensation from Ethiopia – one of the poorest countries in the world which was then in the midst of an extreme drought that put over 11 million people at risk for starvation. The $6 million demand was issued for shares in an Ethiopian agricultural firm, which was nationalised by the Marxist Mengistu regime in 1975. Nestlé had acquired ELIDCO’s parent company, the Schweisfurth Group, ten years later. Nestlé refused the embattled Ethiopian government’s offer of a settlement worth around $1.5m.
Nestlé Purina in Venezuela
In early 2005, Nestlé Purina sold thousands of tons of poisoned animal food in Venezuela. The local brands included Dog Chow, Cat Chow, Puppy Chow, Fiel, Friskies, Gatsy, K-Nina, Nutriperro, Perrarina and Pajarina. Thousands of dogs, cats, birds and cattle died. It was reported that it was caused by corn that was stored incorrectly, which lead to a proliferation of a fungus with a high quantity of aflatoxin causing hepatic problems in the animals that ate the food.
In March 3rd 2005, the Venezuelan National Assembly stated that the company Nestlé Purina was responsible for the quality standards and compensation must be paid to the owners of the affected animals.
Main Brands
Brands are categorized by their targeted markets.
Coffee
- Nescafé
- Taster’s Choice
- Ricoré
- Ricoffy
- Nespresso
- Bonka
- Zoégas
- Loumidis
Water
- Nestlé Pure Life
- Nestlé Aquarel
- Perrier
- Vittel
- Contrex
- S.Pellegrino
- Acqua Panna
- Levissima
- Nestlé Vera
- Arrowhead
- Poland Spring
- Deer Park
- Al Manhal
- Ozarka
- Hépar
- Ice Mountain
- Zephyrhills
- San Bernardo
- Quézac
- Viladrau
- Naleczowianka
- Acqua Panna
Other Beverages
- Carnation
- Caro
- Libby’s
- Milo
- Nescau
- Nesquik
- Nestea
Shelf Stable
- Nestlé
- Nido
- Nespray
- Ninho
- Carnation
- Milkmaid
- La Lechera
- Moça
- Klim
- Gloria
- Svelty
- Molico
- Nestlé Omega Plus
- Bear Brand
- Coffee-Mate
Chilled
- Nestlé
- Sveltesse
- La Laitière
- La Lechera
- Ski
- Yoco
- Svelty
- Molico
- LC1
- Chiquitin
Ice Cream
- Nestlé
- Frisco
- Motta
- Camy
- Savory
- Peters
- Häagen Dasz
- Mövenpick
- Schöller
- Dreyer's
- Oreo (Canada)
- Valio (Finland)
Infant Foods
- Nestlé
- Nan
- Lactogen
- Beba
- Nestogen
- Cérélac
- Neslac
- Nestum
- Guigoz
- Good Start
- PreNan
- Alfare
- NanSoy
- FM 85
- NAN HA
Performance Nutrition
- PowerBar
- Nesvita
- Neston
Healthcare Nutrition
- Nutren
- Peptamen
- Modulen
- Nutren Junior
- Peptamen UTI
Seasonings
- Maggi
- Buitoni
- Thomy
- Winiary
Frozen Foods
- Maggi
- Buitoni
- Stouffer’s
- Lean Cuisine
- Hot Pockets
Refrigerated Products
- Nestlé
- Buitoni
- Herta
- Toll House
Chocolate, Confectionery and Biscuits
- Nestlé
- Crunch
- Cailler
- Galak/Milkybar
- Kit Kat
- Quality Street
- Smarties
- Baci
- After Eight
- Baby Ruth
- Butterfinger
- Lion
- Aero
- Polo
- Rolo
- Yorkie
- Caramac
- Violet Crumble
- Coffee Crisp (Canada)
- Toll House
Professional Products
- Chef
- Davigel
- Minor's
- Santa Rica
Petcare
- Friskies
- Fancy Feast
- Alpo
- Mighty Dog
- Gourmet
- Mon Petit
- Felix
- Purina
- Dog Chow
- Pro Plan
- ONE
- Beneful
- Tidy Cats
External links
- Official website of Nestlé (http://www.nestle.com)
- Article on ownership structure of Nestlé and L'Oréal (http://www.nytimes.com/2004/02/05/business/worldbusiness/05nestle.html?ex=1391317200&en=9bfbfa3f4307cbb5&ei=5007&partner=USERLAND)
- Pamphlet "The Baby Killer" 1974 (http://www.i-case.com/newdemo/inffeed/docs/018if.pdf#search='the%20baby%20killer')
- Blog dedicated to the Venezuelan Nestlé Purina incident (Spanish) (http://www.victimas-purina.cjb.net)
Data
- Yahoo! - Nestlé SA Company Profile (http://biz.yahoo.com/ic/41/41815.html)
- Nestlé SA - Fact Sheet - Hoover's Online (http://www.hoovers.com/nestl%c3%a9/--ID__41815--/free-co-factsheet.xhtml)ca:Nestlé
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