Nestlé goes organic in India 

Nov 21, 2018

Nestlé SA, being one of the bidders for GSK’s ‘Horlicks’, is pursuing strong organic growth in India.

Speaking to the media person CEO Ulf Mark Schneider said, “We have been pursuing acquisitions everywhere — it’s part of our business model of seeing a growing company in gaining additional market presence. When there are opportunities, we are interested in those.”

Schneider added, “Going forward, we are interested in strong organic growth — that, to us, is the life blood of a successful company. Organic growth tells you how much in favour you are with the consumers. It’s a sign of health and we are dedicated to that and it’s always been a lead metric for Nestlé.”

Nestlé India ($90-billion Nestlé SA has a holding of about 63%) saw its net profit increasing 30% to Rs. 446 crore on a 17% growth in net sales at Rs. 2,922 crore in September 30, 2018.

India contributes only 2% to global incomes, has been a big base of learning for the company. Nestlé, with the Maggi noodles crisis in 2015 and from which it successfully sprung back, has learnt a huge lesson on the importance of responding quickly to any unfavorable post on social media. “The learning from the Maggi noodles case has been that staying very close to local governments and local consumers is super important. The other important learning is — as much as you want to be absolutely sure that what you say to the last degree is true, reliable and right — you also have to be very fast because these days the slightest concern, the slightest thing that gets out on social media, interest builds up to sentiments. It’s important at all times to be totally factually correct, but it is also important to react very early on, as quickly as you see sentiments building,” said Schneider.

Today, 6.4 million packs of Maggi Masala noodles are served per day as Maggi stands with a market share of around 60%.

Schneider was interacting with media on Nestle’s  initiatives around “Healthier Kids”. He stated, “With the company looking at nutrition as an intersection between business and society, Nestlé renovates a third of its product portfolio every year. The company is talking about totally different starting points market by market. With each country having specific dietary preferences, the progress is measured in different ways”.

Any change that Nestlé sees is the response to the changing set of consumer’s choice, preferences and tastes towards healthier life and products. Schneider also added that cost-consciousness is equally important to stay competitive and make products that consumers are willing to pay for.

Manufacturer of brands like Nescafe, Kit Kat, Milo and Cerelac plans to help 50 million children lead healthier lives by 2030. Nestle, the 150-year-old company, which has a base in 189 countries, aims to reduce salt, sugar and saturated fats and enhancing ingredients containing fibre, vegetables and micro-nutrients in its products. The company has reduced sodium by 10% and sugar by 850 tonne in relevant product categories in recent years. By the year 2020, the Nestle products will be produced with reductions of 6% in added sugar, 10% in salt and 2.5% in fat.

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