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Modern globalization and increased level of competition encourages many companies to become multinational to win the world markets and remain at the top positions in sales, spread, customer appreciation, etc. Before getting down to the analysis of the competitiveness and the global spread of Nestle, Bartlett and Ghoshal’s definitions of global, multinational, international and transnational organisations should be considered.
According to Bartlett and Ghoshal’s typology, there are three types of multinational companies, global, multidomestic and transitional.
Global company combines “high integration with low responsibility”, multidomestic one comprises “low integration with high responsibility” and transitional company comprises “high integration with high responsibility” (Harzing, 2000, p. 3). Nestle is a transitional multinational company with the representations in many countries which products are manufactured and sold internationally.
Operation in the Country of Residence and Abroad
Nestle is a multinational company which has manufacturing plants in many countries of the whole world. The company has plants in Europe, Asia, Oceania, and Africa however, most of the manufacturing is concentrated in the USA. Switzerland, Germany, and India have some of the largest manufacturing plants which produce foods and beverages with the company label.
Having conducted SWOT analysis it becomes obvious that the company has many opportunities with its international plants and manufacturing (Company Spotlight, 2006).
Having various products lines, starting with baby nutrition and other products and finishing with cosmetics and pharmaceutical products, Nestle has an opportunity to satisfy the needs of the customers by means of manufacturing specific product types which appear under demand in a particular country.
Presence at Home and International Markets
Operating worldwide, having presentations in various parts of the world and manufacturing plants, Nestle has an opportunity to save and increase its competitiveness among the companies whose world presentation is lower.
Dwelling upon the scope of sold Nestle products worldwide, it is important to divide world market into several niches where Nestle’s products are present, food, beverages, baby nutrition, cosmetics, pharmacy, etc. Nestle is guided by local market and according to customers’ preferences creates worldwide distribution (DATAMONITOR, 2011).
Global spread of Nestle
Looking at the United Nations list of countries and the American intelligence service, it may be concluded that most of these countries have Nestle products at heir markets. Moreover, some of those countries are the leading manufacturers of Nestle products.
Depending on the country’s needs, Nestle tries to provide the clients of this or that country with the particular products, trying to reduce the distribution of the products to the country where they are of no demand (Nestle, 2011).
Considering the major markets of Nestle, it is important to mention the USA and Europe. The competitors at these markets are Nestle, the Coca Cole Company and PepsiCo. However, these companies are Nestle rivals only in beverages segment.
Nestle products are various, “powdered and liquid beverages, water, milk products and ice cream, nutrition, prepared dishes and cooking aids, confectionery, pet care and pharmaceutical products” (‘Soft Drinks Industry Profile, 2011, p. 32). Thus, it has more chances to be recognized at the international market.
Therefore, Nestle is a multinational transitional company with representation in different countries of the world which occupies leading positions in sales. Having many rivals, Nestle remains leading among other competitors due to the variety of products and global manufacturing presentation that helps the company coordinate its business.
Company Spotlight: Nestle, 2006. MarketWatch: Drinks, 5 (6), pp. 21-31.
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Datamonitor: Nestlé SA, 2011. Nestle SA SWOT Analysis, pp. 1-10.
Harzing, A., 2000. An empirical test and extension of the Bartlett and Ghoshal typology of multinational companies. Journal of International Business Studies, 31 (1), pp. 101-120.
Nestle: Good Food, Good Life, 2011. Nestle. [online] Available at: <https://www.nestle.com/> .
Soft Drinks Industry Profile: Global, 2011. Soft Drinks Industry Profile: Global, p. 1.