TheinternationalroadtoChinaforNestleEnvironmentEntrymodedecisionLifecircleIntroductionBackgroundDistributionandpromotionBackgroundNestle,(HenriNestle)createdin1867andheadquarteredinVevey,LakeGeneva,Switzerland(Vevey)Nestleisa138-year-oldcompanyoriginatedinSwitzerlandIn2005,Nestlehasmorethan500factoriesworldwide,25millionemployeesandannualsalesofupto91billionSwissfrancs.DIVISIONSOFTHECOMPANY1BabyFoods2BreakfastCereals3Chocolate&Confectionery4Coffee5Dairyproducts6Drinks7IceCream8IntheKitchen9NestléProfessional10Nutrition&Health11Petcaremainproducts:1:Nescafe1Introducingfreeze-driedsolublecoffeewiththelaunchofGoldBlend2Sustainablepackaging:Findingtherightmaterials.3Ateamworkwithsustainableagriculture2:DairyProductsTherearemanyessentialnutrientsintheNestlemilkproductsprocessingtechnologyEnvironmentEnvironmentPESTAnalysis:Ascanoftheexternalmacro-environmentinwhichthefirmoperatescanbeexpressedintermsofthefollowingfactors:Political/Economic/Social/Technological.(1)PoliticalanalysisChina'stoplegislatureapprovedtheFoodSafetyLaw.In2001Shanghainestleresearchcenterwasfounded.PreconditonsandRiskPreconditon:China'sopeninguppolicywassettled.Risk:ThegovernentofChinatakesactiontoproctectnationalindustry.(2)Economicanalysis1、Acertainlevelofpurchasingpowerisdirectlyaffecttheeconomicenvironmentformarketingactivities.2、China’highpurchasingpowerprovidesabroadmarketspaceforNestletointroduceamoresecure,high-qualitydairyproducts.(opportunity)3、Threat:(1)ThreatofNewEntrants:1)multinationalbrands2)domesticcoffeebeansuppliers(2)AvailabilityofSubstitutes(3)Socialanalysis1、ChanginglifestylesandgrowingurbanizationinlargercitiesinChinahavebroughtinwideracceptanceofnewerproductsandthepursuitofhigherlivingstandards.2、Nestlecompanycouldmeetpeople'sdemandforit.ThisprovidesthebasisforNestletoexpandmarketinChina(opportunity).3、Threat:DuetotheinfluenceofChineseteadrinkingcustoms,someChinesepeoplestilladvocatetodrinkthetraditionalhotdrink-----tea.(4)Technologyanalysis1.Withthedevelopmentofscienceandtechnology,moreandmoreChinesepeoplehaveahighdemandfortheirdairyproducts.2、ThePRCgovernmentstronglysupportsthedevelopmentofe-commerceintheretailsector.3、NestlehastwoR&DcentersinChina,andfullyguaranteetheproductqualityandsafetyandinnovation.Soitoffersaninexhaustiblemotiveforce.(opportunity)4、Chinahasrapidlydevelopedinrecentyears,especiallyinthefieldsoftechnologyandinnovation,whichhavefarmorethanmanycountries.Therefore,manyhigh-techdomesticenterprisesareemerging.Threat:ThereforethiscausesagreatthreattotheNestlecompanyintechnology.MarketEntryModeInternalfactors1.Firmsize2.Control3.Internationalexperience4.Productcomplexity5.ProductdifferentiationadvantageWhydoesNestlechoosethismode?Externalfactors1.Countryrisk/demanduncertainty2.Marketsizeandgrowth3.Directandindirecttradebarriers4.IntensityofcompetitionAstoNestle1.Large-size2.Diversification3.Internationalexperience4.Goodquality,innovationandgooddesignofadvertisement5.Chinesegovernment'ssupport6.LargedemandinChinaExportModeDirectexportingminimalrisksandinvestmenttoaspecificcauseacquiringexistsaleschannelsinanunfamiliarmarketHowever……hardtocontrol,farfromthetargetmarket,contractscanbetroublesome,andcurrencyrisksuselocalmaterialsandsellinthelocalmarketIn1908,setupsalesagentinShanghaiIntermediateEntryModeLicensingAsellerallowsitstechnology,trademarks,companyname,design,processes,orintellectualpropertytobeusedbyabuyerIntheearly80s,begintonegotiatewithChinesegovernmentaboutinvestingtobuildfactoryinChina,chansferitstechnologytoChinaIntermediateEntryModeJointventuresharerisks,costs,andmanagementwithapartnerinaforeigncountrySince1987,cooperatewithChinesegovernmentIn1990,setupthefirstNestlejointventure—ShuangchengNestlelimited(双城雀巢有限公司)In2000,cooperatewithTaitaileGroup(太太乐集团)andhave80%shareholdingIntermediateEntryModeJointventureIn2001,signajointventureagreementwithHaojiGroup(豪吉集团),andhave60%shareholdingNow,NestletakesupalargemarketinChina.EntryModeDecisionTosumupitsEntryModeDecisionlaysasolidfoundationonitssuccessfullymarketinginChina.•Consumerproducts:convenienceproducts•Blackcoffee•Instantcoffee•ThesourceofrawmaterialsinChinaTop3salesvolumeinChina(2010)•Nescafe•Maxwellhouse•CafeMochaThetasteThepackageTheprice“Goodtothelastdrop”•Brandimage•Thetaste•ThepackageTheTasteisgreat•ThePopularity•Variousstrategiesofproduct•ProductinventionLifecircleThematuritystageTheproducthadachievedacceptancebymostpotentialbuyers.Competitorsbegintoreact.Theymarketdownprices,increasetheadvertisingandsalespromotion,andtrytofindbettervisionsoftheproducts.Ahighmarketrate.Itpossesstrongchallengestomarketingmanagements.During1998—2009,thetotalmarketsalesofcoffeewasincreasingbyarateof90%.In2005,Nestle’sannualsalesinChiareach10.2billionRMB,submittaxpaymentforaboutonebillion.Pricing雀巢公司餐饮部产品价目表NestleFoodservicesPriceList产品编号产品名称产地规格单价(元)1959雀巢1+2咖啡(袋装)东莞700g551934雀巢1+2咖啡(小袋装)东莞100*13g952116雀巢纯咖啡(袋装)东莞500g704154雀巢精选朱古力粉上海700g261907奇巧巧克力(迷你装)天津11*50块303096雀巢经典巧克力天津800g301971雀巢巧克力威化