Corporate & Legal

Nestl Pakistan Ltd is a subsidiary of Nestl SA, headquartered in Vevey, Switzerland. We are a standard-bearer of Nestl SA's global performance; registered on the Karachi and Lahore stock exchanges, for the past five years we have been declared one of the top 25 companies on the Karachi Stock Exchange. Headquartered in Lahore, we serve both Pakistan and Afghanistan. Of our five production facilities, two manufacture a wide range of products. The remaining three produce NESTL PURE LIFE.

External & Assessment Pest Analysis

Internal

Pest analysis is a powerful tool to visualize your external surroundings, which enables you to understand the external factors such as Political, Economic, Social and technological affecting your business. So for understanding Nestls position among its competitor Pest analysis is the best technique to understand the external forces.

Political influence
Taxation law
If government imposes heavy taxes on the industry then it badly effects the industry growth. The taxes impose is from government side and it varies from industry. FMGCs have to pay heavy taxation; changes in any taxation system can

badly affect Nestls productivity & sales (profits). Nestls some products have like butter and cream which has more taxes.

Labor Laws
Labor is being privileged here having all the laws. Nestl Company also follows this law like government announces minimum salaries of an employ Rs.6000. But if any labor laws changes it will affect the Nestl management all together because its difficult to get potential labor now a days. Nestls main aim to or key potential factor is to keep their employees happy & contended because as one said happy employees happy management & it leads to prosperity.

Political Instability
The government stability also plays a great role for any industry. In Pakistan government face lot of difficulty from the side of terrorism and also its activity that badly effect the environment of the country which is totally very upset. Recently in Punjab instability of Government creates lot of problem for the industry like shortage of electricity that badly affects this condition but in future it may be face some difficulty for operating.

Nestl Scandal Nestle Accused of Exploiting Water Supplies for Bottled Water
In the small Pakistani community of Bhati Dilwan, a former village councilor says children are being sickened by filthy water. Who's to blame? He says it's bottled water-maker Nestl, which dug a deep well that is depriving locals of potable water. The water is not only very dirty, but the water level sank from 100 to 300 to 400 feet, Dilwan says. The testimony is a key moment in the new documentary film Bottled Life by Swiss filmmaker Urs Schnell and journalist Res Gehriger. The film opens in Swiss theaters on Jan. 26. The village councilor interviewed in the film says Nestl refused the villages request for clean water to be piped in. The notoriously bad drinking water in Pakistan and elsewhere is the reason for the success of the Pure Life brand. A good 10 years ago, the Swiss food company

began adding minerals to ground water and bottling it. Today, Pure Life Purified Water Enhanced with Minerals is the largest water brand in the world a jewel in our portfolio, according to John Harris, head of Nestl Waters. In view of the fact that every day more children die from drinking dirty water than AIDS, war, traffic accidents and malaria put together, Maude Barlow, a former UN chief advisor for water issues, states: When a company like Nestl comes along and says, Pure Life is the answer, were selling you your own ground water while nothing comes out of your faucets anymore or if it does its undrinkable thats more than irresponsible, thats practically a criminal act. In response to questions put to it by Tages Anzeiger, Nestl communicated in writing that it had built two water filtering facilities that were providing over 10,000 people in Pakistans Sheikhupura with clean drinking water. Construction of a further facility was planned for 2012. The company said they had also built two schools in Sheikhupura. Nestl is not the only company to create a huge business with big profit potential by bottling ground water -- DANONE and Coca-Cola do it too. However, the way Nestl goes about it, as depicted in the film, is in stark contrast to the image the company seeks to project. Nestl likesto see itself as a global problem solver out not only for profits but to create shared values. In 2007, when Schnell and Gehriger began working on the movie, then Nestl spokesman Franois-Xavier Perroud called it "the wrong film at the wrong time." Several times between 2007 and 2009 the company denied requests for interviews with company managers. It also refused to allow visits to bottling facilities. The companys present spokesperson, Melanie Kohli, told the Tages Anzeiger that Nestl had reached the conclusion that the project would reflect a one-sided and unfair view of company activity and those who worked for Nestl. Consequently, we declined to work with the filmmakers. Our carefully considered decision was the right one at the time.

Social forces and Cultural

Health Consciousness
Today people are more health conscious so Nestl products by identifying this need of the people they are also producing health conscious products with more elements of pure & quality, which create the market for Nestl & trend of its product in the market. However when launches it Milk in 1988 back then it was not so much popular but now a days people are more health conscious.

Environmental concerns
About the environmental concerns of Nestl products are the symbol of good health & nutrition no matter which product is under consideration. Nestl also consider a lot about the environmental factors because they are very much socially responsible towards nature & humans.

Work Life Quality

Quality of work life is very safer & environment friendly company of the world as every MNC is maintaining the same standards abroad with a slight cultural changes.

Technological Forces
New products
Nestl focusing concentric and conglomerate diversification because in present era it is not possible for any organization to exist in market for long run by providing just one product. So Nestl are diversifying according to changing demand of customers and trends. Nestl wants to diversify its portfolio with the change or need of market needs.

Product Innovation
Product innovation is becoming more necessary for the organization because of globalization people are becoming aware about the changes being taken place

around them so in order tackle the situation nestle is focusing on product innovation by introducing new products with the help of technological factors.

Productivity improvement through automation

Automation doesnt matter a lot but to some extent it contributes towards productivity and improvement. Now by the help of technology Nestl maintain the efficient scale of production which normally called economies of scale.

Total spending on R&D

Spending on R&D is long term investment for any organization. Nestl has R&D department and Nestl total spending on R&D 70 million. Because with true technological changes his research & development cannot takes place. So with the help of technological changes Nestl can enhance its products & diversify its portfolio of products.

New Communication Technology

All the modern as well as traditional ways of communication are being adopted by Nestl including own enables off and texts and monthly visit in different offices of Nestl for better communication among customers. Nestl has also established own website which can be visited any one for most recent news innovation and activities being taken in the organization. With the Technological change option adoption the whole organization can be increased.

Conclusion
Recommendations:
They should increase their product quality as now days they are facing problems of impurity of their products. They have to improve the marketing strategies so that they can capture market and improve their sales. Nestl must start in writing that it accepts that the international code and the subsequent relevant World Health Assembly Resolutions are minimum requirements for every country. Nestl must start in writing that it will make required changes to bring its Baby Food

Marketing policy and practice into line with National Code and Resolutions

Suggestions:
Nestl Milk Pak should concentrate on all age groups (by showing its benefits) instead of concentrating on just child growth They should try to create strong brand loyalty among customers They should keep in mind the competition environment while designing their strategies They should concentrate on customer retention They should try to exploit the loopholes of their competitors products They should try to cater the mind of customers by creating some attractive jingles Inventory should be maintained