TERM PAPER REPORT SUBMITTED TOWARDS THE PARTIAL

FULFILLMENT OF UNDER GRADUATE DEGREE IN BUSINESS

ADMINISTRATION

PROJECT
ON
STP IN NESTLE
SUBMITTED BY -

MANIT WALIA
BBA (Gen.)
ROLL NO. 53

SECTION G

FACULTY GUIDE -

AMITY SCHOOL OF BUSINESS , NOIDA

Page | 1

AMITY UNIVERSITY UTTAR PRADESH

ACKNOWLEGEMENT

I here will take the opportunity to express my profound sense of

gratitude and reverence to all those who have helped and
encouraged me towards the successful completion of the project.
Its been a great experience working on STP IN NESTLE. It gave
me complete insight about how an organisation not only survives in
cutthroat competition , but also maintain a killer instinct in the
competitive world. I would like to thank my project guider Ms.
Mitushi Singh for her immense guidance. A valuable help and
provided me the opportunity to complete the project under her
guidance.

MANIT WALIA

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CERTIFICATE OF ORIGIN
This is to certify that, I Manit Walia , a student of Under Graduate
Degree in BBA 2014-17 , Amity School of Business , Noida has
worked under the able guidance and supervision of Ms. Mitushi
Singh.
This term paper report has the requisite standard for the partial
fulfillment the under graduate degree in Business Administration. To
the best of our knowledge no part of this report has been
reproduced from any other report and the contents are based on
original research.
I am aware that in case of non compliance , Amity School of
Business is entitle to cancel the report.

MANIT WALIA
ENROLLMENT NO. A3906414492

Signature of Project Coordinator

Signature
( Faculty Guide )

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INDEX
1. Executive Summary
2. Introduction
3. Objective
4. Research Methodology
5. Marketing Mix
6. Marketing strategies
7. Products
8. SWOT analysis
9. Factors for success
10. Initiatives
11. Conclusion
12. Bibliography

Executive Summary
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Nestle is global company of milk products and nutrition, chocolates,

beverage,catering and many type of confectionary goods. It has its
millions of customers worldwide. Today Nestl India Limited is on
good

positioned

to

grow

through

its

business

policy

of constant innovation and renovation, concentrating on its core

competencies and commitment to better and high quality, with the
aim of availability to the best quality food to the people of India. In
the report we have brought a discussion about the marketing
segmentation of Nestle, their target market and positioning strategy
in India. The way Nestle chooses its different core customers
different needs with a better way and how it fulfilled satisfaction its
consumers by making greater facilities by the aggregate of different
products or marketing mixes is shown in market segmentation of
Nestl. In the area of market viewing we have talking how Nestle
have made many segments and decided to expand their whole
business in whole India. In the end of this we have talking how
Nestle available to the customers point more efficiently and
effectively comparing with their other manufacture competitors in
the highly challenging food & beverage market of India by
making differentiation of target users and customers.
Nestle is the biggest nutrition and foods company in the globe,
established his headquarter in Vevey, Switzerland. The journey of
Nestle begins with Henri Nestl developed the first milk food for
early in 1867, and saved the life of a neighbor's child. This man
makes a food for the needy babies who are not able to take
mothers feed can use food as an alternative food. Henri Nestle left
his job in 1875 but the Nestle was going on a top speed. In the
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coming year the Nestl company introduced condensed milk, so

that the company became direct and strong rivals. After that the
company was joined in 1905 with a firm named Anglo-Swiss Milk
company

which

was

established

by

two

brothers

named George Page and Charles Page.

The firm reenter significantly during the First World War though it
fall in debt, a banker provide facility and help it to less its debt. After
the 2nd World War , the company eventually increased its providing
beyond its first condensed milk and infant formula products. The
1920s saw Nestl's first enter into new products, with chocolate
the Nestl's second big important activity. Nestl felt the effects of
World War II immediately. Profits decreased from US$200 lakhs
1938 to US$60 lakhs in 1939. But after the World War II was the
starting of a dynamic phase for Nestl. Growth speeder and
companies were taken. At this time the company operates in 86
countries around the world and hired manpower around 283,000.

INTRODUCTION
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NESTLE INDIA
Nestl's relationship with India dates back to 1912, when it began
trading as The Nestl Anglo-Swiss Condensed Milk Company
(Export) Limited, importing and selling finished products in the
Indian market.
After India's independence in 1947, the economic policies of the
Indian Government emphasized the need for local production.
Nestl responded to India's aspirations by forming a company in
India and set up its first factory in 1961 at Moga, Punjab, where the
Government wanted Nestl to develop the milk economy. Progress
in Moga required the introduction of Nestl's Agricultural Services to
educate, advise and help the farmer in a variety of aspects. From
increasing the milk yield of their cows through improved dairy
farming methods, to irrigation, scientific crop management practices
and helping with the procurement of bank loans.
Nestl set up milk collection centers that would not only ensure
prompt collection and pay fair prices, but also instill amongst the
community, a confidence in the dairy business. Progress involved
the creation of prosperity on an on-going and sustainable basis that
has resulted in not just the transformation of Moga into a
prosperous and vibrant milk district today, but a thriving hub of
industrial activity, as well.
Nestl has been a partner in India's growth for over nine decades
now and has built a very special relationship of trust and
commitment with the people of India. The Company's activities in
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India have facilitated direct and indirect employment and provides

livelihood to about one million people including farmers, suppliers of
packaging materials, services and other goods.
The Company continuously focuses its efforts to better understand
the changing lifestyles of India and anticipate consumer needs in
order to provide Taste, Nutrition, Health and Wellness through its
product offerings. The culture of innovation and renovation within
the Company and access to the Nestl Group's proprietary
technology/Brands

expertise

and

the

extensive

centralized

Research and Development facilities gives it a distinct advantage in

these efforts. It helps the Company to create value that can be
sustained over the long term by offering consumers a wide variety
of high quality, safe food products at affordable prices.
Nestl India manufactures products of truly international quality
under internationally famous brand names such as NESCAF,
MAGGI, MILKYBAR, KIT KAT, BAR-ONE, MILKMAID and NESTEA
and in recent years the Company has also introduced products of
daily consumption and use such as NESTL Milk, NESTL SLIM
Milk, NESTL Dahi and NESTL Jeera Raita.
Nestl India is a responsible organization and facilitates initiatives
that help to improve the quality of life in the communities where it
operates.

SPIRIT OF NESTLE

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organizational excellence is never achieved through a one time

effort. It is always a process of continuous improvement across a
number of areas of operation
A key factor for nestles success has been its quest for continues
improvement through ushering in greater productivity and more
efficiency in everyday operations. Despite the infrastructure
impediments in India, nestle has set itself high standards of
business performance. This is reflected through the essence of the
company its mission statement.

NESTLES MISSION
To be in every way the evading company in the Indian food
industry and a good corporate citizen by providing our customers
with superior quality products, our shareholders with rapid growth
and fair returns to our employees with a challenging and satisfying
working environment.
To translate this spirit into a planned and measurable process,
nestle has set up key objectives across all divisions.
Following are the key objectives of nestle:

PRODUCTION
To optimize production costs while enhancing the product
quality so as to make nestle products even more competitive
in the market place.

SALES AND MARKETING

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 To reach a sales turnover of 3ooo Cr. by the year 2ooo.

To double the turnover every year.

PEOPLE
To help employees to retain a long term perspective and
integrate them fully with the companys business goals.
To retain a broad perspective while addressing individual
needs.
To view growth as continuous process.
To concentrate on attitudinal changes

by

developing

leadership skills, an appreciation of interdependence between

units and the enhancement of a sense of belonging to nestle.

FINANCE
To maintain profit levels above the average for the food
industry in India.

OBJECTIVE
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1. To identify the services and products offered by NESTLE.

2. To study and analyze the customer perception and
preferences about NESTLE.
3. To know about the marketing strategies and techniques of
such big and successful companies.
4. Finally to draw the various conclusions and recommendations
on the basis of study conducted.

RESEARCH METHODOLOGY

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Managers need information in order to introduce products and

services that create value in the mind of the customer. But the
perception of value is subjective one, and what customers value
this year may be different from what they will value the next year. As
such, the attributes that create value cannot be simply deduced
from common knowledge. Rather, information must be collected
and analyzed. The goal of marketing research is to provide the facts
and direction that managers need to make their important marketing
decisions. The analysis includes the following steps:

Define the problem.

Determine research design.
Identify data type and sources.
Determine sample plan and size.
Collect the data.
Analyze and interpret the data.
Prepare the research report.

For the purpose of study, data from the inter house survey
conducted by the marketing department (secondary data) has been
used and also for coming out with the recommendation.

MARKETING MIX OF NESTLE

PRODUCT

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 Being the worlds largest food and nutrition company almost

six thousand products are being hosted under the brand
named nestle.
Its products are very wide spread in range counting almost all
daily use products as well as occasionally used products. The
products includes coffee, bottled water, cereals,
pharmaceutical products like lens care solutions, infant food,
beverages, chocolates, candies, ice creams, refrigerated food,
yogurt, milk cream, a very unusual product i.e. pet food and
the largest selling milkman. All these categories are
subdivided to the diverse choices of customers including
different sizes and flavors.
Products that are introduced in the markets are first screened
through high profile research and development sector
including food processing, micro analytical research and
proper delivery of functionalities in the food products thus
promising the healthy goods for consumers.
Main raw material for its milk products are UHT treated and
packed in tetra packaging, moreover the packaging is long
lasting as well as tempting.
As hygiene is a basic ethical question for edible products, so
nestle has a full concern and focus on this parameter.
nestle provides the product compliance to the customers
including all legal supports.
Nutrition quality is preferably determined and is provided on
the packing if the product to facilitate consumers to check their
preferences along with the expiry dates.

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 Complaints if any are timely responded and suggestions are

always welcomed.
PRODUCT RANGE OF NESTL
Its activities include manufacturing and marketing of: Condensed milk
Powdered milk
Ice creams
Other dairy products
Infant foods
Chocolates & Confectionery items
Tea
Coffee
Culinary products
Frozen products
Fruit juices
Mineral water
Pet foods

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PRICE
Flexible prices are the key factor of success of nestle in global
markets fir example Milk pack being the largest selling brand
is being sold out at same price as that of other low quality
products while maintaining its quality.
Their marketing strategy includes a wide range of pricing
strategies, and by doing this they can maintain their product
rates at a sustainable position.
Prices are affordable to almost all types of consumers as they
have wide range of single products a sin case of beverages,
fruit juices are affordable to low economy class and expensive
tin packed beverages are also doing business in the market.

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 Bulk purchase discount is also provided at the whole sale

markets as well as the market stores.
Seasonal price variations are also seen, especially in the case
of chocolate products, either by upsizing at the same price or
reducing the sale price.

OPERATIONS IN INDIA
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Nestl set up its operations in India, as a trading

company in 1912 and began manufacturing at the Moga
factory in 1962. The production started with the manufacture of
Milkmaid and other product were gradually brought into
the fold.
Nestl India Limited was formally incorporated in 1978 prior to
which the manufacturing license was issued in the name of the
Food Specialties Limited .The corporate office is located at
Gurgaon and the registered office at M-5A, Cannaught Circus, and
New Delhi. At present Nestl has 6 manufacturing units countrywide
which are successfully engaged in meeting the domestic as well
as the exports demand. In addition there are several co
packing units. The Moga factory is the largest and the oldest
producing the widest range of food products.
The other factories are located at: Choladi (Tamilnadu)

Instant Tea Export 1969

Nanjangud (Karnatka) -

Coffee & Milo 1989

Samalkha (Haryana) -

Cereals, Milkmaid Deserts 1992

Ponda (Goa)

Chocolates & Confectionery 1995

Bicholim (Goa)

Noodles and Cold Sauces 1997

Today, the company is manufacturing and Marketing the

brands in the following product categories: Milk and Dietetics
Culinary
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 Cereals
Instant Drinks
Chocolates and Confectionery

PLACE :
Nestle products have their main business area in Europe from
where they get 9o% of the sales and revenues.
Nestle is running globally, its setup being run in 86%
countries. So, the sales are also done globally and are
impulsive ones.
The products are not directly thrown into the market, rather a
full procedure is followed including all essentials from
manufacturer, distributor, wholesaler, retailer and finally to
consumer.
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 Nestle products are available in all its variety at the maximum

outlets, as the company is always looking forward to expand
its outlets.

PROMOTIONS
Promotion strategies of the company are very well planned
and they always pay multiples of the expected amounts.
Advertising on electronic and print media along with sign
boards having tempting figurations of the brands always
proves good for the brand.
Sometimes limited economy offers boost up the popularity of
brand especially in the case when new induction to the market
is made.

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Summarizing the above mentioned strategies:

1. Gunning the market with new products and brand extensions.
2. Expansion of the distribution network to small towns for
extensive availability.
3. Reduce prices and introduce smaller packages for products to
make them more affordable ( a tool to enter price sensitive
markets).
4. Focus on employ training and develop a positive attitude
through enhanced manpower development.
5. By year 2oo3 it expects chocolate and confectionary to
account for one in every third rupee in sale.

In late 1996 fear of breading complacency by not having a

continuous improvement, gave birth to an international sales and
marketing improvement teams (SMIT).

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SMIT maps the latest in helping towards the target of the year 2oo3.
The SMIT exercise is a major global initiative of nestle to enhance
sales and marketing productivity. Linked with the already existing
BECA project, which in turn emphasizes on excellence by improving
the distribution set up, this gave rise to the following growth
objectives for the year 2oo3
Ensure direct coverage of all urban towns in India.
Expand distribution to reach 1 million retail outlets on a
regular basis.
Work in partnership with the distributor for achievement of
these objectives.
Provide sustainable solutions to optimize our secondary from
distributor to retailer.

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MARKETING STRATEGIS OF NESTLE

The product include features that contain the combination of both
health and hygiene keeping in mind the individuals requirements in
terms of taste. However the marketing will be done considering the
concept of mass percentage.
Products will be tailored to individual needs but promotion will
attract all of them collectively. Furthermore nestle will be following
pull strategy and approach its end users itself with the help of
various promotional activities. For the distribution if products, no
intermediary is involved.

NESTLE-----------------direct channel---------------->RETAILORS

Target market:
Knowing the fact that nestle cannot be everything for everyone, it
will be targeting only those segments that can provide best possible
returns so that it may reach its goals effectively and efficiently.
The target market collectively consists of male sand females in
Lahore and Karachi of age group less than 18-3o belonging to
middle class, not finding any other provider on terms if quality,
hygiene and taste.

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MARKET SEGMENTATION:Nestle has divided its market into geographic, demographic,

psychographic and behavioral segments. These segments will help
to understand the market better and in implementation of marketing
strategies.

GEOGRAPHICAL SEGMANTAION:It is based on the weather conditions as enjoying ice cream is

popular in summers but keeping in mind the market conditions and
secondly to reduce the initial expenses( not to overload the
business)

DEMOGRAPHIC SEGMENTATION:Nestle has it for its products that comprises of following variables:
Age: below18, 18-3o, 3o+
Gender: Male, Female

PSYCHOGRAPHIC SEGMENTAION:
It is based on the classes such as lower, middle and upper class.

BEHAVIORAL SEGMENTATION: Firstly, the segment includes people who are interested
and like enjoying nestle products.

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 Secondly, it includes people who are willing to buy but

not finding any other in the region up to the level they
desire with respect to quality, hygiene and taste.
Thirdly, there are people who are not interested in the
concept at all.

CORE DISTINCTIVE COMPETENCY OF THE COMPANY

To pose our product against the competitors nestle will be using
differentiation strategy which will not only differentiate it from others
but also given an edge over others. Companys core products will
be very beneficial especially in terms of quality, health, hygiene and
most importantly consumer satisfaction. The segmented products of
nestle will include consumers satisfaction as warranty to retailers in
terms of expire, delivery and after sale services.
Product Market Expansion Grid:
Nestle will be following the same strategy for its expansion:
Low cost operators: nestle will be cost operator in terms of
using minimum initial investment to not to overload the
business with expensive assets. Assets will be utilized in such
a way that ensure full use of existing assets at a regional level
before acquiring additional ones. Selection of ingredients is
done which will give desired consumer perception at lower
cost.

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 Innovation/Renovation: using strong innovation system

which will be able to provide each year a new product range in
a timely manner, while making best use of existing assets.
Product Availability: (WITH IN REACH ARMS) nestle strives
to provide maximum availability at the right cost at all
channels.
Communication: by making nestle products the most visible
brands in the streets, placing a priority on visibility and will
also be ensuring that the company has reinforce the
availability and attractiveness of its brands in locations of high
traffic flow.

TARGET MARKET OF NESTLE

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 Milk, dairy and chilled dairy: wide variety of dairy products is

available to cater almost every segment of customer. Liquid
milk especially Nesvita is produces for the females as it
contains high content of iron, beneficial for them.
Beverages: it includes Nescafe, Milo, Nesquik, NestleFruita
Vitals. Their main target market includes people of all ages.
Bottled water: business, students, for the people who dont
have access to clean drinking water.
Baby food: target market of baby food is all the parents.
Food: it includes Maggie noodles which mostly caters children
and teenagers.
Breakfast cereals: children, teens and adults benefit from it.
Chocolates and confectionary: people of all ages.
Sports nutrition: it specifically targets sports persons for
nutritive protein diet.

SWOT ANALYSIS
STRENGTHS:
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 Companys name Nestle specifies the quality image high

standard and quality product.
Loyalty from customers is also the major strength for the
company.
Employees are also loyal due to the decentralized culture of
the company.
People trust on products due to proper health and safety
measures.
The strength of Nestle confectionary is its imported
chocolates and candies, which strengthens its image.
Being a multinational company it has the capability to attract
more customers than the local companies.
Company has the ability to compete in a dynamic
environment.
Company always adapt the new technology.

WEAKNESSES:
There is not much margins for retailers to prefer its sales.
They need to improve the facilities like chillers.
The distribution cost is high as compared to competition in the
local market.
Company mostly advertises its milk products, advertisement
of confectionary products is not that good.

OPPORTUNITIES:
They have an opportunity to expand or capture the market by
adding its product line.
They have the opportunity to offer snacks.
They can also capture the market of home appliances.
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 Company can open separate stores to eliminate retailers.

Recently, they have created an opportunity for themselves by
introducing chillers in the market.
Company is trying to open stores in universities.
They can provide incentives to retailers to increase sales
volume.
Company can enter in ice cream products.

THREATS:
Existing companies are increasing their product lines that can
prove to be a threat in the coming years.
Company like Cadbury is giving more discounts to retailers as
compared to distributors due to which retailers prefer its
products for sale.
As compared to the local competitors, our distributor cost is
very high. As Nestle confectionary products has to maintain
and obey the Nestle standards.
Some companies are competing on the basis of cost.

GROWTH PROFILE
Nestle has been associated with the country since the
beginning of the country-importing & trading in condensed
milk & infant foods, manufactured in India in 1962 with the
setting up its first factory at Moga, Punjab, since then, five
additional factories have been set up in Choladi, Nanjangud,
Samalkha, Ponda & Bicholim three of them in the past five
years. In its quest to be in every way the leading company in
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the Indian Food Industry, Nestle has been improving

turnover every year. Rapid new product launches is a key
propeller for growth & Nestle India has significantly
expand it is products portfolio in the recent years launching new
products in the last five years than in the previous thirty years.
Year wise turnover in crores:
199
6

199
7

495

716

199
8
100
1

199
9
120
4

200
0
143
5

200
1
161
3

200
2
155
2

200
3
168
9

200
4
193
7

2005
2047.
7

Compound Annual Growth Rate of Nestle India Limited

1 year
Revenue
Net Income
EPS Basic

8.28%
6%
6%

FACTORS FOR SUCCESS

The culture of innovation and renovation, continuous improvement
and the thrust on value for money and affordability have helped the
company to focus on adding value for the consumer. The company
has continuously focused on operational efficiency; improving
product availability and visibility and initiated efforts to make its
Page | 29

products more relevant to the customers. This has been supported

by the distribution of smaller stock keeping units.
There has been continuous focus on seven value drivers, namely:

Sales growth
Profit margin
Working capital intensity
Fixed capital intensity
Income tax rate
Cost of capital
Value growth duration.

TRANSPARENT PRODUCT LABELLING

The Company complies with applicable product standards), Health
& safety and Sustainable packaging and labelling requirements
including declaration of appropriate method of
products for safe and proper

preparation of

consumption. Distribution of

promotional items along with products is preceded by a safety/risk

evaluation by the Safety Committee of the

Company. The risk

evaluation reviews various aspects including correct labelling and

safety of promotional products.
The Company endeavors to help consumers make well-informed,
healthy food choices through clear nutrition labelling on the back of
every pack in the form of the Nestl Nutritional Compass.
The Nestl Nutritional Compass on the product pack provides
transparent and easy to understand nutritional information that
guides the consumer in making the right food choices. It is a
trustworthy guide for consumers on their journey to Nutrition, Health
Page | 30

and Wellness and empowers consumers to make informed choices

about their diet and enjoy a more balanced life.

LIMITATIONS & PROBLEMS

1. Sometimes people dont give appropriate information

2.
3.
4.
5.
6.

and fill the questionnaire just for the sake of fun.

Mostly retailers dont want to give information and act
rudely. Some even refuse to give response.
People dont have time to fill questionnaires in their
busy life.
Number of questions should be more than this, so that
you come to know the accurate result.
Generally people dont respond well for open ended
questions like the suggestion if any.
Instead of three, there should be one product, so that
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proper stress can be given on the research.

NESTLES INITIATIVE
In their quest to embrace diversification, nestle has adopted two
initiatives. The first initiative is an extensive management training
program at their own Swiss training facility. The individuals invited to
this training are high potential managers who are expected to
eventually join Nestls executive management. The month long
training

focuses

heavily

on

the

benefits

of

diversification.

Additionally, nestle partners with the international institute of

management development (IMD) to provide education resources for
their management all stars. Finally, Nestls executive managers
are expected to give back to the company by acting as instructors
and mentors at the training facility.

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Nestle has also adopted a policy of promoting from within. By

promoting individuals who have already gone through a companys
indoctrination process, the are guaranteed to have upper
management that believes in the companys ideals of improved
performance via diversification. The direct contact between upper
management and executive management trainees guarantees a
solid foundation for this process. This promotion from within
initiative

also

lends

itself

to

the

companys

decentralized

management model.

CONCLUSION
From the above analysis and findings, we can conclude that Nestle
enjoys a strong Market Position in case of its products among its
competitors. Its competitors like Top Ramens noodles, Pasta do
not stand in front of Nestles Maggi.Mostly people have come
across its advertisement in TV, Newspapers, Magzines. They find
its taste very good. But survey points out that its price should be
reviewed. People want a reduction in its price. Above all, We can
conclude that Nestles Maggi is KING in its product area.

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BIBLIOGRAPHY
WEBSITES:www.nestle.com
www.thehindubusiness.com
www.etstrategicmarketing.com
www.forum.nestle.pl

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BY-

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