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Business Plan Analysis of Nestle

University: REGENT COLLEGE

  • Unit No: 5
  • Level: Undergraduate/College
  • Pages: 12 / Words 2904
  • Paper Type: Assignment
  • Course Code: LSBM306
  • Downloads: 14
Question :

This assessment will cover certain questions which are like - 

  1. What are the internal and the external analysis in Nestle.
  2. Evaluate and identify all the sustainable competitive advantages in Nestle.
  3. What are the strategic recommendations which help in implementing issues and solving problems Nestle.
Answer :

INTRODUCTION

Global expansion of enterprise is not easy task, there is necessity of absolute or peculiar substance regarding of conducting operations and changes that occurs in outside the marketplace. Moreover, demand of strategic planning of activities, through which functional effectiveness can be accomplished. In context of, change and make policies as per requirement of consumers, flexibility in business operations is not require (Thompson, Strickland and Gamble, 2015). With change in operations, there is requirement of making alterations in activities. This report is supported on Nestle which is a well known and reputed organisation in confectionery sphere. Along with this, different varieties of products offered by Nestle such as chocolates, biscuit, baby food, etc. This association is dealing with supply issues, hence this report provides information about internal and external analysis with determining competitiveness. Lastly, there was discussion about recommendations and implementing new policies to deal with it.

MAIN BODY

Brief Background to Case Study Organisation

Nestle is the association which is one of the most leading organisation in confectionery sector. There is requirement of alteration in functional unit, so it is essential as well as  specific for multitude to ascertain and understand evaluation properly. As per view of top level management of nestle it is analysed that supply chain of the organisation is facing issue, hence it is crucial and relevant for personnel to interpret and appraise it. This association is dealing in different countries, so it is integral for group to realize and evaluate modification in a correct manner. As per the case study, it is analysed that Nestle is facing issue in supply chain because of change in climatic surrounding (Nestlé executive: ‘We are all facing risks of having supply challenges, 2016). They are facing issue because of change in climates and raw material of agriculture does not get within specified time. In order to keep positive brand value within market, the role of  members plays a significant impact in regard of analysing and evaluating the emerging trend of industry in an trenchant mode.

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Internal and External Analysis

In order to make business operations in improved and effectual demeanour,  requirement of performing activities as per external market because target of Nestle is to expand business at international level, market components have to be considered (Johnson, 2016). There are many changes such as environment change, difference in demand of consumers, legal laws and regulations changes, etc. are considered for successfully operating at global level. Therefore,  managers make an effort to determine internal and external components and its impact on performance of Nestle.

In order to study external market, PESTLE analysis  is required. In this study, there is study of external market factors and its impact on organisational. There is study of external market factors through which operations of Nestle will be studied and impact on its sustainability.

While in order to study internal factors of the association, a clear and reliable sources because some strategies and resources are required for successfully completion of task. SWOT analysis is used to determine internal positive as well as negative factors affecting operations of Nestle while operating at international market (Uhl and Gollenia, 2016).

SWOT Analysis

Strength

  •  The best and foremost strength with Nestle is proper research and development department which assist in knowing what can be done through which operations can be managed and operated properly.
  • Brand image if Nestle is good because of variety in their product range with reasonable pricing strategy (SWOT analysis of Nestle, 2019).
  • This association is present in every geographic region due to which people are acknowledged with it and they have good sources of income through wide sales.

Weakness

  • this association is over using water due to which respective are not capable to complete or understand plan of action accurately. It is important and signifiant for manpower to evaluate and identify competition in an amended way.
  • They have children working in their organisation due to which legal cases are occurring against them. This gives negative impact on their brand image.
  • This association has name in list of contaminated food items, so it is not possible to complete the task properly with understanding and evaluating changes properly (Peng, 2016).
  • They have less number of suppliers, hence in case of any natural calamity, products are not so frequently available as competitors.

Opportunities

  • This organisation must expand their business in different sector such as shakes, milk, etc.
  • there is requirement of showing ingredients which they are using, so possibilities of negative image can be nullify (Noe and et. al., 2017).
  • They can open their own outlets, where ice- creams, tea, coffee, etc. are available for consumers.

Threat

  • Competition s one of the major issue which is major threat for this organisation.
  • There is requirement of change in supply change process because this is time consuming and due to any natural calamity, operations might get halted adversely.

 

PESTLE Analysis

Political: This includes factors related to government rules and regulations which has impact on business and its operations (Tallman, Luo and Buckley, 2018) . Changing rules of food standards and promotional actions has lead to changes in policies of Nestle as well over period of time. State stability in UK has positive impact on operations as there is consistency in regulations in environment of business. There are changes in global regulations which has emphasis company to standardised its products to adapt the political changes in different country.

Economic: This includes factors like inflation, growth rate and income level of individuals which has direct and indirect impact on Nestle. There is rise in raw materials of goods which has also lead to rise in production cost and decrease in profits margins. Consumer spending is decreasing which is leading to reduce demands for personal and health care products of Nestle.

Social: This is related to consumer behaviour and attitude which has direct impact on decision making of buying process. Changes of consumer to healthy products has lead company to introduce healthier products range in line to meet customer expectations (Mudambi and Puck, 2016). These days families are more into family time and cooking at home so that relations can be maintained. There are cultural differences that need to be adapted by Nestle in order to meet specification of consumers.

Technological: Rise of social media platforms and technological developments in recent years has promoted company to use different channels for advertisement campaigns. There are number of E – commerce sites that has lead to increase in demand for products and other innovations has positive impact on Nestle.

Legal: All factors related to legal rules and regulations that company needs to align their operations so that they adhere and avoid any fines and penalties. There are number of rules that Nestle need to follow being a global brand and operating at international level  (Bereznoi, 2015). This is important because it has direct impact on expanding its business for future growth as well.

Environmental: It includes all factors related to environment and natural resources and companies need to adhere in order to fulfil its corporate social responsibilities. In recent years there are number of activities that are concerned with environmental issues. Thus it is important that Nestle also align its operations in such a way that it does not harm environment and natural resources(SWOT and PESTEL analysis of Nestle, 2019).

From preceding discussion, it is clear that the role of Swot and PESTLE is crucial and important to determine and plan activities with which managers can understand ways to evaluate occurrence in an efficacious mode. Furthermore, understanding and examination of internal factors, it is trenchant  for administrator to analyse what strategies must be make to improve their supply chain and execute action in proper and effectual demeanor.

Identification of Company’s Sustainable Competitive Advantage

In confectionery aspect, there are numerous establishment employed in business such as change in policies and making operations as per working in improved and effective manner. There is alteration inside business activities as well because employees are not working in appropriate manner. Mars, Hershey's, CADBURY, etc. so it is essential and signifiant for personnel to understand and evaluate industrial competition in an amended mode. Additionally, transparency in communication with workers enable organisation to cope with all sort of challenges in an efficient manner. This assist in making operations as per requirement and able to outshine at international level (Madsen and Walker, 2015).

It is important for Nestle to deal with changes taking place in external market because there are many people who are working in the same sector. As managers of Nestle facing issue bin supply chain of food material because they are not properly using natural resources, so the ecological cycle of the nature gets affected in negative.

In order to grow and sustain in industry, there is requirement of proper market analysis and policies of competitors, so managers can make fast and forward policies associated with it. There will completion of task in appropriate manner, hence business activities will be communicated in relevant and specific manner.

Marketing strategies must be new and innovative as per targeted consumers, so it will be easy for people to attracts consumers and maintain good environment in the society. AS per the changes in operational activities of company, it is important for firm to evaluated and asceratin changes properly. For sustaining and make reliable activities in the association (Hamel and Prahalad, 2017).

Competition is very high in confectionery sector, hence it is important for Nestle to determine and change their operations through which they can understand and evaluate changes properly. There are many changes which are specific and relevant for people to determined. In order to make policies as per external market, there must be regular market analysis and determine what has to be done.

Competitive advantage can be gained with entering in new market or making innovation in their product and services. With change in operating activities, reason and impact on performance of employees must be communicated. Moreover, for placing the brand image of Nestle in an aggressive position, an adoption of innovation or advancement of technology is essential as it help them to handle challenges in an effective style. These days, people want best product out of their changes in better manner. With change and estimating policies, manager have to determine activities in required format. There is importance of achieving competitive advantage in the organisation because it is not possible to compete if association does not strategies through which natural resources can be utilised properly and get positive impact on maintaining sustainability in industry (Rugman and Verbeke, 2017).

Strategic Recommendations Based on Analysis, and Discussion of Implementation Issues

There is change in working style of association when operations have to performed at international level because individuals have to identify and realise policies in an accurate style. It is essential and specific for people to understand and evaluate happening on the basis bof market demand. With determination of external market, it is evaluated that environmental changes are taking place frequently which negatively impact over manpower performance towards organisational goal.  As environment is unpredictable, hence in case of any negative impact, managers of Nestle are not able to satisfy demand of consumers. This might impact on consumer loyalty and brand image of Nestle, so there are some strategies with which it can be managers of Nestle can improve their performance in the organisation.

There is modification in business process of Nestle due to which carbon emission gets reduced by 22% with optimal use of resources. As per change in operations of association, it is essential that it must be communicated to workers, so they are ready to work with flexible policies of the Nestle (Nestlé executive: ‘We are all facing risks of having supply challenges, 2016).

Managers of Nestle decided to use renewable sources of energy because this does ot give negative impact on natural resources, hence there will less impact on supply chain of Nestle. They are using coal and other e- sources of energies with which people can perform activities properly and in effective manner (Hitt, Li and Xu, 2016).

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Managers of Nestle are using natural refrigerants through which emission of bad rays will reduced and they can preserve environment properly. There will completion of activities with motivating and training of workers. With installation of new machines, it is important to understand and determine changes properly.

It is essential that manners of Nestle must take resources from different suppliers situated at different geographical region, hence they can satisfy their demand properly and in effective manner. There will less possibilities of less hampering of supply activities because activities will be communicated  in suitable manner.

There must be environmental audit conducted by workers as it is the  foremost means to conduct the activities in better and effective mode. In order to evaluate and understand occurrence within industry, decision maker are able to determine what has to be done through which they can protect the environment and contributes to social development of the society.

From the  above mentioned strategies it has been signified that managers of Nestle can deal with changes which are taking place in external market in a smooth way. In relation to this,  requisite of determining methods through which functional units can be carry out in an improved manner. In order to evaluate and understand policies, regular communication with employees is must. There must be different suppliers and supply chain mist be flexible, so product can be readily available to consumers because if product is not available, then consumer might shift to other brand because there is high competition in this sector (Rothaermel, 2017). 

CONCLUSION

This has been summarised from present report that, to expand business market share, regular market analysis and frame tactics assist  management to perform its desired goal. There is requirement of change in legal policies as per change in rules and regulations to conduct activities. There is issue in supply chain of the organisation, so it is not possible for managers of organisation to make other sources through which they can make regularity in the activities. There is change in operational efficiency of company, when they are considering environment prospects. There must be use of energy which gives less emission of energy and people are unable complete the task properly. Hence it is essential to change or alter working style for maintaining sustainability in the environment.

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REFERENCES

  • Bereznoi, A., 2015. Business model innovation in corporate competitive strategy. Problems of Economic Transition. 57(8). pp.14-33.
  • Hamel, G. and Prahalad, C. K., 2017. Do you really have a global strategy?. In International Business (pp. 285-294). Routledge.
  • Hitt, M. A., Li, D. and Xu, K., 2016. International strategy: From local to global and beyond. Journal of World Business. 51(1). pp.58-73.
  • Johnson, G., 2016. Exploring strategy: text and cases. Pearson Education.
  • Madsen, T. L. and Walker, G., 2015. Modern competitive strategy. McGraw Hill.
  • Noe, R. A. and et. al., 2017. Human resource management: Gaining a competitive advantage. New York, NY: McGraw-Hill Education.
  • Peng, M. W., 2016. Global business. Cengage Learning.
  • Rothaermel, F. T., 2017. Strategic management. New York, NY: McGraw-Hill Education.
  • Tallman, S., Luo, Y. and Buckley, P. J., 2018. Business models in global competition. Global Strategy Journal. 8(4). pp.517-535.
  • Uhl, A. and Gollenia, L. A. eds., 2016. A handbook of business transformation management methodology. Routledge.
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