Micro and Macro Environment of Nestle [PDF]

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Micro & Macro Environment of Nestle SM MICRO ENVIRONMENT OF NESTLE Suppliers Suppliers provide the raw material resources, unfinished goods and labors to the company in order to produce goods and services. The effectiveness of suppliers determines the efficiency of the company in terms of producing the goods. In addition to that the quality of the finished product has a strong with the suppliers of the firm especially in case of food products. As the presence of the company is in more than hundred companies, it is a challenge for the company to maintain its standard all over the world and provide the consistency to its customers in the taste and quality of the product. Further we can divide the supplier of Nestle into two parts: Labor suppliers and material suppliers. Labor suppliers deal with the quantity of labor is required at the optimum level in order to prevent the loss of labor force and prevent the company from the shortage of labor which again can lead building of inventory as a cost for the company. The skills of labor is again maintained by the labor suppliers, wherein the labors of different skills are managed in such a way that the operation of the firm can run smoothly. Labor strikes and labor relations are other factors which we cannot ignore in the current scenario as the efficiency of the business depends largely on the factors like attrition and employee satisfaction. Material supplies handle all the material required by the firm in order to manufacture the finished product for sale. Nestle is in the food and quality markets and the quality of such item plays a major role in its success in the market. Nestle has maintained a high quality efficiency in handling the quality and quantity of the two different supplies i.e. labor supplies and material supplies and hence the company has been able to run its business smoothly for more than 100 years in spite of the different business trends in the world market.

Marketing Intermediaries The market intermediaries of the company help to advertize, sell and distribute its product to the end customers. The physical distribution network of the company decides the medium by which the finished product is delivered to the end customer on time and with safety. This department also ensures the proper storage of the firm that prevents the product from getting any king of damage. The marketing service department of the firm helps in the promotion of the product and acts as a communication channel between the company and customers. It not only communicates the features of the product to its customers but also get the feedback with the help of survey, which helps the research and development department to develop a product according to the need of the customers. The other intermediaries of the company like banks help to provide the funds to the companies and play an important role in the continuity of the business. Insurance companies insure the property and the goods of the company against the risk involved in various operations, buying and selling of the product. Nestle has the differential advantage of working in a smooth coordination with all its marketing intermediaries which helps in providing the best and pure food products to its valuable customers in the different parts of the world.

Customers The immediate customers of Nestle are retail and grocery stores which provide the products of the company to the end customers at a reasonable price and a reasonable profit. The end customers of Nestle are the consumers who consume its wide range of product. The company has a bright brand image in its big pool of end customers.

Waheed Ahmed [BM-25546]

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Micro & Macro Environment of Nestle SM Competitors Although Nestle is leader in packaged food industry of Malaysia but the other competitors who are giving tough competition to Nestle are •

Petra Foods Limited

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Yeo Hiap Seng Limited

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Maeil Dairy Industry Co., Ltd

MACRO ENVIRONMENT Macro environment include following environment of the country

Political Environment The company is into food and nutrition business they have to just adhere to the laws of food and nutrition policies of government and constantly provide good quality which is the vision and mission of the company thus Nestle never faces any problems on political front.

Cultural Environment Culture is no doubt of having light food at constant intervals and young crowd likes to have good nutritional food thus Nestle has great scope there.

Economical Environment The disposable income of country and the high living standard always give better bigger business opportunities for Nestle.

Technological Environment Technologically rich country both in terms of availability of technology and also the technological work force the highly skilled and educated manpower is abundant. In case of Nestle and the product offered by the company these factors do not create much impact in general scenario. However as we have seen the major events like World War had created a positive impact on the sale of confectionary products of the company. The culture has some impact in this company as whether the country has most people as vegetarian or non vegetarian the consumption of milk products is always there. However the countries where the people are more dependent on milk products are profitable market for Nestle.

Waheed Ahmed [BM-25546]

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