Swot Analysis: The SWOT Analysis Of Nestle

Nestle being a large industry has a plethora of strengths due to its bulky finance and brand name followed with a variety of opportunities it can use for its benefit. However, following these are many threats also that the company must withstand. Along with all that, the company must work on eliminating and tackling their weaknesses. The following diagram is an illustration of the SWOT analysis of Nestle:

Strengths

Variety of products

Diversified markets

Competitive pricing

Global recognition

Environmental sustainability efforts

Unmatched R&D capabilities

Weaknesses

Health and environment degradation

Maggi controversy

Criticism

Opportunities

Healthy breakfast

Strategic alliances

Growing trend of “ready to drink” (RTD) tea and coffee

Threats

Furthermore, even if a product fails to sell in one country, it might suit the preferences of customers in another country.

Competitive pricing: The products of Nestle are priced in a way that it can be bought by most income groups. This gives it a competitive advantage over some of its competitors since Nestle can easily gain consumers with their pricing.

Global recognition: Nestle has been operating since more than 150 years and is well known throughout most of the world. This increases the brand value of Nestle and naturally gives it more loyal consumers than others. Moreover, with the brand being so well known it is easier for Nestle to promote new products in the market.

Environmental sustainability efforts: By the end of 2016, 182 (63%) factories of Nestle have achieved zero waste disposals. Nestle also uses recycled materials and chooses materials from renewable sources whenever possible. Only a few of Nestlé’s competitors have been able to match with Nestlé’s efforts. Environmental sustainability efforts not only reduces costs but also results in a cleaner environment which can in turn satisfy the consumers who are concerned about the

This is an excellent opportunity for Nestle to penetrate the market and grab more customers with its products like Nestle milk and cereals like Cheerios.

Strategic alliances: Nestle already has partnerships with major companies like Coca-Cola and is also one of the main shareholders of L’Oreal. This means that with such major alliances, Nestle has a huge opportunity to expand more in the market.

Growing trend for ‘ready to drink’ tea and coffee: According to beverage Marketing Corporation reports, the demand for RTD coffee and tea is increasing. Since Nestle does not have any significant brands in RTD coffee or tea, this could be an opportunity for them to acquire smaller brands of RTD tea or coffee or grow its own RTD brands to take advantage of the situation.

Threats:

Increased competition: Nestle faces a lot of competition since the food and beverage market is growing rapidly. There are companies who might offer what Nestle does not and others which might provide better products than Nestle and so it will be difficult for Nestle to compete in the