Value chain nestle analysis

VALUE CHAIN AND COMPETITIVE ADVANTAGE OF NESTLE
Company Profile
The Nestlé Corporate Business Principles are at the basis of our company’s culture, developed over 140
years, which reflects the ideas of fairness, honesty and long-term thinking.
Nestlé can trace its origins back to 1866, when the first European condensed milk factory was opened in
Cham, Switzerland, by the Anglo-Swiss Condensed Milk Company. One year later, Henri Nestlé, a
trained pharmacist, launched one of the world’s first prepared infant cereals ‘Farine lactée’ in Vevey,
Switzerland.
The two companies merged in 1905 to become the Nestlé you know today, with headquarters still based
in the Swiss town of Vevey. We employ around 330 000 people in over 150 countries and have 461
factories or operations in 83 countries. Nestlé sales for 2011 were almost CHF 83.7 bn.
Read more about our 140 year history of nutrition, health and wellness.
Nestlé's Corporate Business Principles
The Nestlé Corporate Business Principles are at the basis of our company’s culture, which has developed
over the span of 140 years.
Download the fully revised new version of the Nestlé Corporate Business Principles, Also available in
more than 50 languages.
Since Henri Nestlé first developed his successful infant cereal “Farine Lactée”, we have built our business
on the conviction that to have long-term success for our shareholders, we not only have to comply with all
applicable legal requirements and ensure that all our activities are sustainable, but additionally we have to
create significant value for society.
At Nestlé we call this Creating Shared Value.
The latest version of our Corporate Business Principles, updated in June 2010, has been handed over to
our employees around the world and accompanied by basic learning and training tools.
Since 2011, a systematic and comprehensive modular training programme is being rolled out on the
various components of the Corporate Business Principles. The depth and focus of the trainings is
established in accordance with the materiality for the different functions within the company. For example,
in 2011 the first step of the training on the human rights components focused on managers and
employees in countries of higher human rights risks as a priority. In 2012, major efforts will be on training
programs related to Management and Leadership, Conditions of Work and Employment and Compliance.
Our Corporate Business Principles will continue to evolve and adapt to a changing world, our basic
foundation is unchanged from the time of the origins of our Company, and reflects the basic ideas of

fairness, honesty, and a general concern for people. Nestlé is committed to the following Business
Principles in all countries, taking into account local legislation, cultural and religious practices:
• 1. Nutrition, Health and Wellness
Our core aim is to enhance the quality of consumers lives every day, everywhere by offering tastier and
healthier food and beverage choices and encouraging a healthy lifestyle. We express this via our
corporate proposition 'Good Food, Good Life'. Nestlé Nutritional Profiling System
• 2. Quality Assurance and product safety
Everywhere in the world, the Nestlé name represents a promise to the consumer that the product is safe
and of high standard. Nestlé Quality Policy
• 3. Consumer Communication
We are committed to responsible, reliable consumer communication that empowers consumers to
exercise their right to informed choice and promotes healthier diets. We respect consumer privacy. Nestlé
Consumer Communications Principles Nestlé Policy and Instructions for Implementation of the WHO
International Code of Marketing of Breast-milk Substitutes
• 4. Human rights in our business activities
We fully support the United Nations Global Compact’s (UNGC) guiding principles on human rights and
labour and aim to provide an example of good human rights’ and labour practices throughout our
business activities. International Labour Organisation
• 5. Leadership and personal responsibility
Our success is based on our people. We treat each other with respect and dignity and expect everyone to
promote a sense of personal responsibility. We recruit competent and motivated people who respect our
values, provide equal opportunities for their development and advancement, protect their privacy and do
not tolerate any form of harassment or discrimination. Nestlé Management and Leadership Principles
(pdf, 2 Mb) and Nestlé Code of Business Conduct
• 6. Safety and health at work
We are committed to preventing accidents, injuries and illness related to work, and to protect employees,
contractors and others involved along the value chain. Nestlé Policy on Health and Safety at Work (pdf, 2
Mb)

• 7. Supplier and customer relations
We require our suppliers, agents, subcontractors and their employees to demonstrate honesty, integrity
and fairness, and to adhere to our non-negotiable standards. In the same way, we are committed towards
our own customers. Nestlé Supplier Code (pdf, 1 Mb)
• 8. Agriculture and rural development
We contribute to improvements in agricultural production, the social and economic status of farmers, rural
communities and in production systems to make them more environmentally sustainable. Nestlé Policy on
Environmental Sustainability (pdf, 349 Kb)
• 9. Environmental sustainability
We commit ourselves to environmentally sustainable business practices. At all stages of the product life
cycle we strive to use natural resources efficiently, favour the use of sustainably-managed renewable
resources, and target zero waste. Nestlé Policy on Environmental Sustainability (pdf, 349 Kb)
• 10. Water
We are committed to the sustainable use of water and continuous improvement in water management.
We recognise that the world faces a growing water challenge and that responsible management of the
world’s resources by all water users is an absolute necessity. Nestlé Water report (pdf, 3 Mb)
Nestlé continues to maintain its commitment to follow and respect all applicable local laws in each of its
markets.
Nestlé has a Board of Directors, led by our Chairman Peter Brabeck-Letmathe, who was the former
Nestlé CEO. There are 15 members of the Board of Directors. Full details of each member and the
committees that they operate within can be found in our Board of Directors section.
The day to day management of the Nestlé business is taken care of by our Executive Board members.
The 13 designated Board Members manage diverse parts of the global business and a full curriculum
vitea of each member can be found in the Executive Boardsection. You can also download
theOrganisational Chart (Updated April 2012) (pdf, 15 Kb)

The Nestlé Group is managed by geographies (Zones Europe, Americas and Asia/Oceania/Africa) for
most of the food and beverage business, with the exceptions of Nestlé Waters, Nestlé Nutrition, Nestlé
Purina Petcare, Nespresso, Nestlé Professional and Nestlé Health Science which are managed on a
global basis - these we call the Globally Managed Businesses. We also have joint ventures such as
Cereal Partners Worldwide and Beverage Partners Worldwide

History Company
1866 Our history begins back in 1866, when the first European condensed milk factory was opened in
Cham, Switzerland, by the Anglo-Swiss Condensed Milk Company.
1867In Vevey, Switzerland, our founder Henri Nestlé, a German pharmacist, launched his Farine
lactée, a combination of cow’s milk, wheat flour and sugar, saving the life of a neighbour’s child. Nutrition
has been the cornerstone of our company ever since.
“Henri Nestlé, himself an immigrant from Germany, was instrumental in turning his Company towards
international expansion from the very start. We owe more than our name, our logo and our first infant-
food product to our founder. Henri Nestlé embodied many of the key attitudes and values that form part
and parcel of our corporate culture: pragmatism, flexibility, the willingness to learn, an open mind and
respect for other people and cultures.” Peter Brabeck-Letmathe, Nestlé Chairman
1905 The Anglo-Swiss Condensed Milk Company, founded by Americans Charles and George Page,
merged with Nestlé after a couple of decades as fierce competitors to form the Nestlé and Anglo-Swiss
Milk Company.
1914 The onset of World War I brought severe disruption to us along with the rest of the world.
Acquiring raw materials and distributing products became increasingly difficult. Shortages of fresh milk
throughout Europe forced factories to sell almost all their supplies to meet the needs of local towns.
1918 Nevertheless, the war created new demand for dairy products, largely in the form of government
contracts. To keep up, Nestlé purchased several existing factories in the United States and, by war's end,
we had 40 factories worldwide.

1925 The 1920s were a time of deep economic hardship, and Nestlé suffered severe difficulties along
with much of the world. Operations were partially streamlined, but the company was able to continue, and
with the acquisition of Peter, Cailler, Kohler Swiss Chocolate Company, chocolate became an integral
part of our business. This sparked further variety in the products we offered – including malted milk and a
powdered drink called Milo.
1938 Nescafé coffee was launched.
1940 Nescafé became an instant success and was followed in the early 1940s by Nestea.

1939During World War II, Members of the Board and General Management were transferred to the
U.S. where they coordinated Nestlé activities in the Western Hemisphere, the British Empire and
overseas.
1943 Ironically, having slowed the initial launch of Nescafé, the war then helped to popularise it; with
the United States entering the war, Nescafé coffee became a staple beverage of American servicemen
serving in Europe and Asia.
1945 The close of World War II marked the beginning of a particularly dynamic phase of our history.
Dozens of new products were added as our growth accelerated and we acquired outside companies.
1947 The Maggi products, from seasoning to soups, become part of the Nestlé family following the
merger with Alimentana S.A.
1948 Nesquik, the instant chocolate drink, was developed in the United States. Its original name
of Quik was a direct allusion to the speed and simplicity of its preparation.

1974 For the first time we diversified outside the food industry when we became a major shareholder
inL'Oréal, one of the world's leading makers of cosmetics.

1977 Rising oil prices and slow growth in industrialised countries meant that we needed to respond to a
radically changed marketplace. In 1977, we made our second venture outside the food industry by
acquiringAlcon Laboratories Inc., a U.S. manufacturer of pharmaceutical and ophthalmic products.
A boycott against Nestlé was initiated by the U.S.-based organisation Infant Formula Action Coalition over
concerns about our promotion of infant formula in developing countries. This led to a consultation process
with the World Health Organization, UNICEF and non-governmental organisations. The U.S. boycott
ended in 1984 with the signing of a Statement of Understanding between Nestlé and the International
Nestlé Boycott Committee.

1981In 1981 the World Health Assembly adopted the International Code for the Marketing of Breast-
milk Substitutes (“WHO Code”) and recommended that its Member States implement it. Nestlé was the
first company to develop policies based on the WHO Code and apply them across our entire operations in
developing countries.
1984 An improved bottom line allowed us to make new acquisitions, including a public offer of USD 3
billion for the American food giant, Carnation. At the time, this was one of the largest acquisitions in the
history of the food industry.
1986 The Nespresso story began in 1986 with a simple idea: enable anyone to create the perfect cup
of espresso coffee, just like a skilled barista.

1988 The Italian brand Buitoni, in Sansepolcro, became part of our portfolio in 1988. Nestled in the hills
of Tuscany, Casa Buitoni is the symbol of the brand’s ongoing commitment to quality, creativity, and
tradition.
The UK-based organisation, Baby Milk Action, launched a boycott against Nestlé. While there are still
boycott activities in the UK today, the following organisations have officially ended their support for it: the
General Synod of the Church of England in July 1994, the Royal College of Midwives in July 1997, the
Methodist Ethical Investment Committee in November 2005 and the United Reformed Churches in
November 2011.
1993 The first half of the 1990s were favourable for Nestlé with the opening up of Central and Eastern
Europe, as well as China – good news for a company with such far-flung and diverse interests.
2001 We merged with the Ralston Purina Company, which had been founded in 1983, in 2001 to form
a new pet food company, Nestlé Purina PetCare Company.
2002 Two major acquisitions were made in North America in 2002: in July, the merger of our U.S. ice
cream business with Dreyer’s; and in August, a USD 2.6 billion acquisition of Chef America Inc., a leading
frozen food product business.
2003 Nestlé acquired Mövenpick Ice Cream, enhancing our position as a market leader in the super
premium category.
2005 Our Chairman Peter Brabeck-Letmathe recognised that the eating habits of the world’s
population were changing and we began our own transformation. We began to move away from being a
processor of agricultural commodities towards becoming a producer of food with added benefits and
ultimately a provider of a wide range of products and services in the areas of nutrition, health and
wellness.

2006 We acquired Jenny Craig and Uncle Toby's
With the help of Harvard’s Michael Porter and Mark Kramer, we articulated for the first time the concept of
Creating Shared Value. Creating Shared Value expresses our conviction that we can only be successful
over the long term if we create value, not just for our shareholders, but also for society.
2007 We acquired Novartis Medical Nutrition, Gerber andHenniez.
2009 We held the first Creating Shared Value Forum in New York, with leading experts in the areas of
nutrition, water and rural development coming together to discuss serious global challenges facing us in
these three areas and the role of business in helping to solve them. The Creating Shared Value Forum
has been held on an annual basis since then, with London in 2010 and Washington, D.C. in 2011.
We celebrated the opening of the Chocolate Centre of Excellence in Broc, Switzerland
January 2010 We sold our remaining Alcon shares to Novartis and also acquired Kraft Foods’
frozen pizza business.
March 2010 We faced a challenge from Greenpeace who wanted to be reassured about our
commitment to sustainable Palm Oil. It was the first time we saw social media being used in a substantial
way to challenge us and ask questions. We didn’t get the handling of our response to the campaign itself
quite right in social media, but on the issue at its heart – palm oil - we took steps to both strengthen our
position and to explain it more clearly.
May 2010 This month Nestlé launched Special.T.
We launched the Nestlé Cocoa Plan which will supply 38 million high quality, disease-resistant plantlets
to farmers helping them rejuvenate their farms and increase productivity. The Nescafé Plan was also
launched – investing CHF 500 million to address responsible farming, sourcing and consumption across
our coffee supply chain.

We also awarded the first Nestlé Prize in Creating Shared Value to IDE Cambodia for its Farm Business
Advisors programme and we announced our partnership with the Forest Trust to work to combat
deforestation.
September 2010
We announced the creation of Nestlé Health Science and the Nestlé Institute of Health Sciences,
innovative ventures aimed at the prevention and eventually treatment of chronic medical conditions with
science-based personalised nutrition solutions.
January 2011 We voluntarily submitted our policies and procedures to the FTSE4Good Policy
Committee for independent review.
March 2011 We became the first infant formula manufacturer to be included in the FTSE4Good
Index. This is the London Stock Exchanges’s responsible investment index and the only index that
evaluates companies on their responsible marketing of breast-milk substitutes, alongside human rights
and supply chain criteria.
April 2011 China was at the forefront, as we announced a partnership in April with Chinese food
company Yinlu, a manufacturer of ready-to-drink peanut milk and canned rice porridge.
July 2011 We announced a partnership with Hsu Fu Chi, a confectionery and snacks manufacturer.
November 2011 We became the first food company to partner with the Fair Labor Association.
This partnership will help us investigate if children are working in cocoa farms that supply our factories
and, where we find problems, to solve them.
nestle is the world's leading nutrition, health and wellness company. "Good Food, Good Life" is the
promise we commit to everyday, everywhere – to enhance lives, throughout life, with good food and
beverages.
We believe that leadership is about behaviour, and we recognise that trust is earned over a long period of
time by consistently delivering on our promises. Nestlé believes that it is only possible to create long-term
sustainable value for our shareholders if our behaviour, strategies and operations also create value for
the communities where we operate, for our business partners and of course, for our consumers. We call
this 'creating shared value'.
The Nestlé Corporate Business Principles (pdf, 1 Mb) are at the basis of our company’s culture,
developed over 140 years, which reflects the ideas of fairness, honesty and long-term thinking.
Nestlé can trace its origins back to 1866, when the first European condensed milk factory was opened in
Cham, Switzerland, by the Anglo-Swiss Condensed Milk Company. One year later, Henri Nestlé, a

trained pharmacist, launched one of the world’s first prepared infant cereals ‘Farine lactée’ in Vevey,
Switzerland.
The two companies merged in 1905 to become the Nestlé you know today, with headquarters still based
in the Swiss town of Vevey. We employ around 330 000 people in over 150 countries and have 461
factories or operations in 83 countries. Nestlé sales for 2011 were almost CHF 83.7 bn.
Visi Misi
Our Vision
Research and Development is a key competitive advantage for Nestlé. Without our R&D Nestlé could not
have become the food industry leader in nutrition, health and wellness.
With 32 research, development and technologyfacilities worldwide, Nestlé has the largest R&Dnetwork of
any food company. Nestlé’s research, development and technology network, together with local market
application groups, employs over 5,000 people.
Nestlé further strengthens its R&D capability through Innovation Partnerships at each stage of the product
development process – from early stage collaborations with start up and biotech companies to late stage
partnerships with its key suppliers.
By bringing together all of its global R&D resources, Nestlé is able to provide high quality, safe food
solutions for consumers worldwide – whether this is in terms of nutrition, health, wellness, taste, texture or
convenience. Above all, Nestlé brings to consumers products that are of the highest quality. And safety is
non-negotiable.
R&D is also critical in ensuring regulatory compliance of all Nestlé products. Nestlé is able to launch new
products quickly and efficiently, in countries all over the world, by integrating regulatory affairs in all
its R&D activities, from start to finish.
Nestlé scientists also play their part in communicating the health and wellness benefits of products to
consumers. Nestlé nutritionists world-wide work to ensure that all nutrition communication, both on and
off pack, is locally relevant, as well as scientifically sound.
Beyond sound nutrition, the future of foods will increasingly be driven by science. Nestlé scientists are
looking ahead to the foods of the future. Nestlé R&D is translating nutrition and food science in two ways:
• From consumer needs into research priorities
• From emerging science into consumer benefits, and services.
The vision of Nestlé R&D is long term. A glimpse of how Nestlé R&D is helping to shape the future of
foods is provided through these internet pages.

Primary Activities
Inbound Logistics
Implementing the Nestlé Supplier Code
Driving compliance, sustainability and Creating Shared Value
We seek to source raw materials responsibly by helping suppliers to develop sustainable and ethical
practices. This is important in our overall approach to rural development because through our
Responsible Sourcing activity, we want to help develop the agricultural supply chain and safeguard and
enhance farmer incomes, thereby contributing to farms and communities thriving over the long term.
The Nestlé Supplier Code
The Nestlé Supplier Code distils relevant parts of our Corporate Business Principles, outlining for
suppliers the non-negotiable minimum standards that we expect from them: on business integrity, human
rights (including forced and child labour), sustainability, labour, safety and health, environment and use of
natural resources. We ask our suppliers, their employees, agents and sub-contractors to adhere to these
standards at all times, and we monitor implementation through our Responsible Sourcing Audit
Programme. Our Supplier Code is aligned with credible, internationally recognised responsible production
standards and provides fair compensation for suppliers.
• 96% of suppliers, key vendors and quality suppliers are compliant with Nestlé’s sourcing policy [KPI].
• 75.2% of our purchased volume is compliant with the Nestlé Supplier Code [KPI].

For agricultural raw materials and packaging materials that we source through complex trade channels,
we promote compliance with the Nestlé Supplier Code through a two-staged programme:
1. Our Responsible Sourcing Audit Programme for key suppliers.
2. Our Responsible Sourcing Traceability Programme, which is a recent addition to the Responsible
Sourcing Audit Programme, focused on promoting compliance with the Code in extended supply chains,
back to the origin.
Coffee and cocoa
Coffee and cocoa are produced by smallholder farmers who supply Nestlé either directly or via larger
companies. The Nestlé Supplier Code has been communicated to all our direct coffee and cocoa
suppliers and farmers supplying direct suppliers, as well as Nestlé factories and buying stations (a
contractual requirement), again with instructions to pass the Code’s requirements down their own supply
chains.
Compliance and verification is carried out in the manner as detailed above – audits by independent third
parties and on-farm visits of direct suppliers or farmers who are sub-suppliers of direct suppliers. All non-
compliances are categorised as minor, major or critical, and follow-up audits are required in the case of
major or critical issues. Nestlé conducts spot-checks of audits and also follows up with suppliers to ensure
corrective plans are put in place.
Milk
In terms of value of products sold, Nestlé is the world’s largest milk company. We sourced over 13.41
million tonnes of fresh milk equivalent from more than 30 countries in 2010.
The dairy industry is one of the most powerful engines for rural development and the majority of Nestlé’s
rural factories are within our milk districts.

The milk district model
Through our successful milk district model, which we first used in the 1870s and continue to use widely,
we work directly with small-scale dairy producers and cooperatives to build a supply chain. The model
has been adopted in many developing countries including Brazil, Chile, China, India, Mexico and
Pakistan.
The essence of our milk district model is that farmers supply our milk factories directly, and Nestlé
provides facilities and support to develop the local supply chain. This includes local collection, storage
and chilling facilities, providing a reliable route to market and product quality assurance.
We also work at farm level: our agronomists and vets provide technical advice and training to farmers,
and we provide access to financial assistance for them to expand their operations.
Cocoa
Cocoa, the most important ingredient of chocolate, provides an income to more than 4.5 million farmers in
remote, rural locations across the world.
To enhance our ability to continue to do business in the future, make better quality chocolate and satisfy
consumer preference, it is vital that we ensure the wellbeing of the cocoa farmers that supply us and the
communities in which they live. We therefore decided to launch a range of initiatives to improve farm
profitability, cocoa quality and traceability in the cocoa supply chain, and in 2009 we brought them
together under one programme – The Nestlé Cocoa Plan.
The Nestlé Cocoa Plan
The Nestlé Cocoa Plan is driving forward the way we source cocoa globally. Through it, we are working
with small-scale farmers to ensure the supply of high-quality, sustainably sourced cocoa, supporting
community development and meeting certified ethical and environmental standards. We are:
• investing CHF 110 million in cocoa plant science and sustainability initiatives from 2010–2019;
• distributing 1 million high-yielding, disease-resistant cocoa plantlets each year from 2012, which helps to
address the issue of declining quality and yields are linked to old and dying cocoa plants;
• training 30 000 cocoa farmers on farming and post-harvest practices;
• supporting other social projects in cocoa-growing areas.
In committing CHF 110 million to The Nestlé Cocoa Plan from 2010–2019, Nestlé’s investment will focus
on plant science and sustainable production in Côte d’Ivoire and Ecuador (the world’s largest sources of
cocoa and fine cocoa respectively). This investment builds on the CHF 60 million already invested in the
preceding 15 years.
Focus areas
To help cocoa farmers to run profitable farms, respect the environment, have a good quality of life and
give their children a better education, The Nestlé Cocoa Plan focuses on four key areas:
• training farmers on agricultural best practice to increase their yields, reduce cocoa disease, adopt better
agricultural farming practices and produce a better quality crop;

• g in plant researchinvestin to propagate disease-resistant plantlets to improve the quality, quantity and
sustainability of cocoa production;
• g the supply chainimprovin by buying from cooperatives and paying a premium for high-quality cocoa;
• g social conditionsimprovin in cocoa-growing areas by working with partners to tackle child labour,
improve
The Cocoa Plan works with leading certification programmes UTZ CERTIFIED and Fairtrade with the aim
ricultural,
• coa purchased for our KitKat, Aero, Coffee Crisp andSmarties brands
roduct lines;
end this percentage to 100% for our Smarties and Clubbrands;
tM 4-
all
erformance
• f our global cocoa supply via The Nestlé Cocoa Plan;
•
six expecting to
rld Cocoa Foundation and the
argets
or 2012 are to:
• oa supply via The Nestlé Cocoa Plan;
•
art a programme to
as adult livelihoods
education opportunities, and to improve water and sanitary conditions.
Certification
of implementing a sustainable cocoa supply chain to benefit both farmers and consumers. Nestlé is a
member of the UTZ CERTIFIED Good Inside Cocoa programme, which is aimed at promoting
sustainability in mainstream cocoa production through independent certification of improved ag
social and environmental practices. Nestlé is committed to buying an increasing amount of certified beans
in the coming years:
Canada: in 2011, 10% of the co
was UTZ CERTIFIED; by 2014, we want to purchase only certified cocoa for these p
• Australia and New Zealand: in 2011, 100% of the cocoa purchased for KitKat was UTZ CERTIFIED; in
2012, we want to ext
• Europe (Excluding Belarus, the Ukraine, Russia and the UK): 10% of purchased cocoa for our KitKa
Finger was UTZ CERTIFIED in 2011; we are working to purchase 100% UTZ CERTIFIED cocoa for
our KitKat products by 2014. In the UK, KitKat 4-Finger is 100% Fairtrade certified.
P
In 2011 we:
sourced 6% o
trained 19 115 cocoa farmers to improve productivity and sustainability;
• distributed 824 000 higher-yielding, disease resistant-plantlets;
• helped 10 of our partner cocoa cooperatives to achieve UTZ certification, with a further
achieve certification in early 2012;
• launched The Nestlé Cocoa Plan in Indonesia;
• began new collaborations with the Fair Labor Association, the Wo
Sustainable Trade Initiative (IDH).
T
Our targets f
source 10% of our global coc
deliver more than one million disease-resistant cocoa plantlets to farmers;
• partner with the World Cocoa Foundation ECHOES programme in West Africa to st
build or refurbish 40 schools over four years, provide complementary activities such
education, and provide 140 family support scholarships for children’s education and women’s
entrepreneurship

Recognition for The Nestlé Cocoa Plan
Our achievements through The Nestlé Cocoa Plan were recognised when Nestlé Professional United
Kingdom was named winner of the Sustainable Sourcing category in the Foodservice Footprint Awards in
the UK.
Nestlé action plan on responsible sourcing of cocoa from Côte d’Ivoire
On February 29, 2012, Nestlé became the first company in the food industry to partner with the Fair Labor
Association (FLA), a non-profit multi-stakeholder initiative that works with major companies to improve
working conditions in their supply chains. During the affiliation process we invited the FLA to begin a
project to examine our cocoa supply from the Côte d’Ivoire. In January the FLA sent independent experts
to the West African country to attempt to map our cocoa supply chain. The assessment team visited a
total of seven suppliers, 20 co-ops and two co-op unions and 87 farms. They surveyed the traceable
Nestlé Cocoa Plan supply chains as well as untraceable standard supply chains. The report is published
on the Fair Labor Association website
We support the 11 recommendations the FLA has made to Nestlé and other members of the cocoa
industry. Together with the FLA we have developed an action plan (pdf, 452 Kb) covering immediate
actions in 2012, medium-term actions in 2013 and longer-term actions up to 2016, in response to the
recommendations.
Operations
Quality and Safety
Our commitment to consumers
Quality and Safety for our consumers is Nestlé’s top priority. This applies to our entire portfolio, from
foods and beverages to all our systems and services.
Quality assurance and product safety is one of Nestlé’s 10 Corporate Business Principles (pdf, 1 Mb),
which form the foundation of all we do.

Nestlé Quality Policy
Our actions to ensure quality and food safety are guided by the company’s Quality Policy (pdf, 85
Kb) which describes our commitment to
• Build trust by offering products and services that match consumer expectation and preference
• Comply with all internal and external food safety, regulatory and quality requirements
• Gain a zero-defect, no-waste attitude by everyone in our company
• Make quality a group-wide objective
Nestlé Quality Management System
Our Quality Management System is the platform that we use globally to guarantee food safety,
compliance with quality standards and to create value for consumers. Our internal Quality Management
System is audited and verified by independent certification bodies to prove conformity to internal
standards, ISO norms, laws and regulatory requirements.
From farm to fork
Our Quality Management System starts on farms. We have a long history of working together with
farmers in rural communities to help them improve the quality of their produce and adopt environmentally
sustainable farming practices.
The Quality Management System not only ensures our ongoing access to high quality raw materials. It
also enables farmers to protect or even increase their income. Often the standard of living of entire rural
communities is raised as a result. The system helps address key global environmental and social issues.
Quality by design
Quality is built in during product development according to the requirements of the consumers and
following all food safety and regulatory requirements. Nestlé’s R&D network applies in this “Quality by
design” to all of our products.
Good Manufacturing Practices
We apply internationally recognized Good Manufacturing Practices (GMP) to ensure quality and food
safety. GMP covers all aspects of manufacturing, including standard operating procedures, people
management and training, equipment maintenance, and handling of materials.

Hazard Analysis and Critical Control Points
We apply the internationally recognized HACCP(Hazard Analysis and Critical Control Point) system to
ensure food safety. This preventive and science based system identifies, evaluates, and controls hazards
that are significant for food safety. It covers the entire food production process from raw materials to
distribution and consumption. Our HACCP plans and systems are verified by external certification bodies
against the international ISO 22’000:2005/ISO 22002-1
Outbound Logistics
Our Brands
Most people know us through our brands. Our portfolio covers almost every food and beverage category
– giving consumers tastier and healthier products to enjoy at every eating occasion and throughout life’s
stages including times of special nutritional need. Here is a sample of some of our brands. For more
information, visit our Brands section.
Baby foods: Cerelac, Gerber, Gerber Graduates, NaturNes, Nestum
Bottled water: Nestlé Pure Life, Perrier, Poland Spring, S.Pellegrino
Cereals: Chocapic, Cini Minis, Cookie Crisp, Estrelitas, Fitness, Nesquik Cereal
Chocolate & confectionery: Aero, Butterfinger, Cailler, Crunch, Kit Kat, Orion, Smarties, Wonka
Coffee: Nescafé, Nescafé 3 in 1, Nescafé Cappuccino, Nescafé Classic,Nescafé Decaff, Nescafé Dolce
Gusto, Nescafé Gold, Nespresso
Culinary, chilled and frozen food: Buitoni, Herta, Hot Pockets, Lean Cuisine, Maggi, Stouffer's, Thomy
Dairy: Carnation, Coffee-Mate, La Laitière, Nido
Drinks: Juicy Juice, Milo, Nesquik, Nestea

Food service: Chef, Chef-Mate, Maggi, Milo, Minor’s, Nescafé, Nestea, Sjora,Lean Cuisine, Stouffer's
Healthcare nutrition: Boost, Nutren Junior, Peptamen, Resource
Ice cream: Dreyer’s, Extrême, Häagen-Dazs, Mövenpick, Nestlé Ice Cream
Petcare: Alpo, Bakers Complete, Beneful, Cat Chow, Chef Michael’s Canine Creations, Dog Chow, Fancy
Feast, Felix, Friskies, Gourmet,Purina, Purina ONE, Pro Plan
Sports nutrition: PowerBar
Weight management: Jenny Craig

Marketing Sales
Marketing
As the function driving our brand-building efforts, Marketing is right at the heart of what we do. Indeed,
“Brand Building the Nestlé Way” is a distinctive process that sets our marketing function apart in the
industry – from both a commercial and a career point of view.
Our Marketing team provides an end-to-end marketing service reflected in our three key areas: brand
management, communications and consumer insight. Importantly, marketing is not an isolated activity
here – our focus on the consumer ensures that we provide a seamless service, working hand-in-hand
with our Customer & Sales teams.
Customer and Sales
Fast-moving consumer goods (FMCG) have made us the business we are today. We sell over a
billion FMCGunits every day, generating sales of some CHF 83.6bn in 118 countries across the world in
2011.
Driving all this forward is our Customer and Sales team. We have a very varied brief. We handle category
and shopper management, customer relationships, route to market strategies, field sales activities and
our customer-facing supply chains. All of these areas are focused on delighting our consumers and
making sure our products are where they want them when they want them.

Service
Brands and services
Through science-based nutrition products and services, Nestlé helps enhance
the quality of people's lives by supporting health and providing care for
consumers with special needs.
Nutrition has been a cornerstone of Nestlé since 1867 when Henri Nestlé developed his first infant
formula to save the life of his neighbour’s child who was unable to breast feed and suffering from
malnutrition.
We continue to help people lead fuller, happier lives by developing and delivering innovative, effective,
scientifically proven nutrition products with functional benefits,designed to help infants grow and develop
into healthy, robust adults; to promote peak mental and physical performance and to address weight
problems.

Firm Infrastructure
Nestlé Research Center
At the heart of scientific research in Nestlé lies the Nestlé Research Center (NRC), the world's largest
private food nutrition research institute. Based in Lausanne, Switzerland, with additional locations
worldwide, the scientific excellence and technical knowledge of the Nestlé Research Center helps fulfill
Nestlé's vision of Good Food, Good Life for all consumers.
Research at the Nestlé Research Center encompasses the nutritional value and sensory characteristics
of products, commercial feasibility and food technology, along with consumer behaviour, nutrition needs
and social aspects of food and eating. At the forefront of all of Nestlé’s research activities is the
commitment to utmost quality and safety. A diverse selection of scientific disciplines is necessary for this
global approach to nutrition research.NRC’s current scientific research axes include:
• Nutrition & Health
• Food Science & Technology
• Quality & Safety
• Sensory & Consumer Science
Research at the NRC encompasses every step of the innovation and development process.Click here to
find out how.
Nestlé R&D Network
The Nestlé Research Center does not work alone. It is part of the worldwide Nestlé R&D Network, which
translates science and technology into products, business and systems. This dynamic network is
comprised of over 5,000 people, including leading scientists, technicians and engineers. These centres
cultivate diverse research and development expertise to respond to ever-changing consumer and
business needs. Click here for more information on the Nestlé R&D Network.
External Partnerships
In addition to the Nestlé internal R&D network, NRC collaborates with a wide-reaching network of external
partners such as universities, private research institutes, hospitals and start-up companies. The value of
such partnerships facilitates access to external scientific expertise, technologies and early stage
innovation to complement Nestlé's internal research and development activities

Human Resources Management
Human Resources (HR)
As the function attracting, developing and engaging more of the amazing talent that we need to grow our
business, HR offers opportunities in three key areas. You could build a career inHR business partnership
helping line managers improve commercial performance through people. Or perhaps your passion lies in
a specialist area of HR, such as recruitment or training and development. Finally, you could join our
Centre of Scale, the group that ensures our employees have their essential needs taken care of so they
can focus on what they do best.
Information Technogy Management
Information Systems/Information Technology (IS/IT)
As part of our IS/IT team, you’ll unleash technology’s potential by unlocking your own. One of the key
channels you’ll have for doing this will be our GLOBE team. GLOBE is a major worldwide business and IS
initiative that is creating common best practices and infrastructures. As a part of GLOBE, you’ll join a
project team working to implement Best Business Practices and Processes through systems and
technology. Be prepared for plenty of challenge and work alongside colleagues from diverse backgrounds
with the scope to make your ideas felt.

Value chain nestle analysis

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