History of Nestle
Nestlé’s origins date back to 1866, when two separate Swiss enterprises were founded that would later form the core of Nestlé. In the succeeding decades, the two competing enterprises aggressively expanded their businesses throughout Europe and the United States.In August 1867 Charles (US consul in Switzerland) and George Page, two brothers from Lee County, Illinois, USA, established the Anglo-Swiss Condensed Milk Company in Cham, Switzerland. Their first British operation was opened at Chippenham, Wiltshire, in 1873.In September 1866 in Vevey, Henri Nestlé developed milk-based baby food, and soon began marketing it. The following year saw Daniel Peter begin seven years of work perfecting his invention, the milk chocolate manufacturing process. Nestlé was the crucial co-operation that Peter needed to solve the problem of removing all the water from the milk added to his chocolate and thus preventing the product from developing mildew. Henri Nestlé retired in 1875 but the company, under new ownership, retained his name as Société Farine Lactée Henri Nestlé.
In 1877 Anglo-Swiss added milk-based baby foods to their products; in the following year, the Nestlé Company added condensed milk to their portfolio, which made the firms direct and fierce rivals.In 1879 Nestle merged with milk chocolate inventor Daniel Peter.In 1904 François-Louis Cailler, Charles Amédée Kohler, Daniel Peter and Henri Nestlé participated in the creation and development of Swiss chocolate, marketing the first chocolate – milk Nestlé.
In 1905 the companies merged to become the Nestlé and Anglo-Swiss Condensed Milk Company, retaining that name until 1947, when the name ‘Nestlé Alimentana SA’ was taken as a result of the acquisition of Fabrique de Produits Maggi SA (founded 1884) and its holding company, Alimentana SA, of Kempttal, Switzerland. Maggi was a major manufacturer of soup mixes and related foodstuffs. The company’s current name was adopted in 1977. By the early 1900s, the company was operating factories in the United States, the United Kingdom, Germany, and Spain. The First World War created demand for dairy products in the form of government contracts, and, by the end of the war, Nestlé’s production had more than doubled.
Nestlé felt the effects of the Second World War immediately. Profits dropped from US$20 million in 1938, to US$6 million in 1939. Factories were established in developing countries, particularly in Latin America. Ironically, the war helped with the introduction of the company’s newest product, Nescafé (“Nestlé’s Coffee”), which became a staple drink of the US military. Nestlé’s production and sales rose in the wartime economy.
In February 2014, Nestlé sold its PowerBar sports nutrition business to Post Holdings, Inc.Later, in November 2014, Nestlé announced that it was exploring strategic options for its frozen food subsidiary, Davigel.
In recent years, Nestlé Health Science has made several acquisitions. It acquired Vitaflo, which makes clinical nutritional products for people with genetic disorders; CM&D Pharma Ltd., a company that specialises in the development of products for patients with chronic conditions like kidney disease; and Prometheus Laboratories, a firm specializing in treatments for gastrointestinal diseases and cancer. It also holds a minority stake in Vital Foods, a New Zealand-based company that develops kiwifruit-based solutions for gastrointestinal conditions.
In December 2014, Nestlé announced that it was opening 10 skin care research centres worldwide, deepening its investment in a faster-growing market for healthcare products. That year, Nestlé spend about $350 million on dermatology research and development. The first of the research hubs, Nestlé Skin Health Investigation, Education and Longevity Development (SHIELD) centres, will open mid 2015 in New York, followed by Hong Kong and São Paulo, and later others in North America, Asia and Europe. The initiative is being launched in partnership with the Global Coalition on Aging (GCOA), a consortium that includes companies such as Intel and Bank of America.
Product
Nestlé has over 8,000 brands with a wide range of products across a number of markets, including coffee, bottled water, milkshakes and other beverages, breakfast cereals, infant foods, performance and healthcare nutrition,seasonings, soups and sauces, frozen and refrigerated foods, and pet food.
Main brand
Maggi Noodles
In May 2015, Food Safety Regulators from the Uttar Pradesh, India found that samples of Nestlé’s leading noodles Maggi had up to 17 times beyond permissible safe limits of lead in addition to monosodium glutamate.
On 3 June 2015, New Delhi Government banned the sale of Maggi in New Delhi stores for 15 days because it found lead and monosodium glutamate in the eatable beyond permissible limit.The Gujarat FDA on 4 June 2015 banned the noodles for 30 days after 27 out of 39 samples were detected with objectionable levels of metallic lead, among other things. Some of India’s biggest retailers like Future Group, Big Bazaar, Easyday and Nilgiris have imposed a nationwide ban on Maggi. Thereafter multiple state authorities in India found unacceptable amount of lead and it has been banned in more than 5 other states in India.
Milk products and baby food
Main article: 2008 Chinese milk scandal
In late September 2008, the Hong Kong government found melamine in a Chinese-made Nestlé milk product. Six infants died from kidney damage, and a further 860 babies were hospitalised. The Dairy Farm milk was made by Nestlé’s division in the Chinese coastal city Qingdao. Nestlé affirmed that all its products were safe and were not made from milk adulterated with melamine. On 2 October 2008, the Taiwan Health ministry announced that six types of milk powders produced in China by Nestlé contained low-level traces of melamine, and were “removed from the shelves”.
In another incident weevils and fungus were found in Cerelac baby food.
Nestlé has implemented initiatives to prevent contamination and utilizes what it calls a “factory and farmers” model that eliminates the middleman. Farmers bring milk directly to a network of Nestlé-owned collection centers, where a computerized system samples, tests, and tags each batch of milk. To reduce further the risk of contamination at the source, the company provides farmers with continuous training and assistance in cow selection, feed quality, storage, and other areas.
Cookie dough
In June 2009, an outbreak of E. coli was linked to Nestlé’s refrigerated cookie dough originating in a plant in Danville, Virginia. In the US, it caused sickness in more than 50 people in 30 states, half of whom required hospitalisation. Following the outbreak, Nestlé voluntarily recalled 30,000 cases of the cookie dough. The cause was determined to be contaminated flour obtained from a raw material supplier. When operations resumed, the flour used was heat-treated to kill bacteria.
Bottled water
At the second World Water Forum, Nestlé and other corporations persuaded the World Water Council to change its statement so as to reduce access to drinking water from a “right” to a “need.” Nestlé chairman and former CEO Peter Brabeck-Letmathe stated that “access to water should not be a public right.” Nestlé continues to take control of aquifersand bottle their water for profit. Peter Brabeck-Letmathe has later changed his statement.
The Nescafé Plan In 2010, Nestlé launched the Nescafé Plan, an initiative to increase sustainable coffee production and make sustainable coffee farming more accessible to farmers. The plan aims to increase the company’s supply of coffee beans without clearing rainforests, as well as using less water and fewer agrochemicals. According to Nestlé, Nescafé will invest 350 million Swiss francs (about $336 million) over the next ten years to expand the company’s agricultural research and training capacity to help benefit many of the 25 million people who make their living growing and trading coffee. The Rainforest Alliance and the other NGOs in the Sustainable Agriculture Network will support Nestlé in meeting the objectives of the plan.
Other main brand
- Ambient Dairy.
- Chilled Dairy.
- Bottled Water.
- Baby Food.
- Breakfast Cereals.
Conclusion
Nestlé is one of the world’s leading food companies and intends to remain so. Its commitment to high quality market research ensures that it remains fully aware of changes in consumer behaviour and consumer tastes. Its excellent product research and development network ensures that it is well placed to meet the challenge of changes in consumer expectations. The company’s Wellness strategy is carefully geared to delivering to customers what they now clearly want in relation to the foods they eat; a high nutritional value and a positive contribution to their general Wellness.
Also Study:
Nestle Operations Management Project