Nestle Supply Chain Management Analysis

Superior Essays
Executive Summary:

Nestle is a company which provides the food products from farm to fork. Its commitment to provide the food product to end users with high quality and value for money has led it to expand globally. How Nestle was established from a little idea to save a child till how it maintains efficient supply chain tail are discussed in this report. To manage the demand planning, how much important is forecasting and procurement activities are mentioned in detail in the report.

The second section consists of literature review and methodology used to research. To help developing the overall process of supply chain management some recommendations are also reviewed at the end. Lowering the cost by directly contacting the farmers will
…show more content…
To forecast the demand Nestle should determine the quantity, time, and place. Proper demand management accelerates the planning and use of resources for progressive and beneficial results and may involve marketing plans designed to increase or reduce demand in a relatively short time. If demand is underestimated, sales can be lost due to the lack of supply of goods. If demand is overestimated, the supplier is left with a surplus that can also be an economic drain. A good understanding of demand makes a company more competitive in the marketplace.
• Nestlé improves its forecast accuracy and make multi-million dollar cutbacks in their inventory by removing human arbitration and permitting the predictions of future demand through ‘demand shaping’.
Procurement Activities: Nestle operates with an objective to produce and market food products which satisfy consumer and customer expectation with high food quality and value for money. For this, Nestle buys raw material from farmers and by trade. The procurement approach targets mainly at obtaining the raw supplies in a commercial way to certify providing quality, avoiding delays in the acquisition of resources, and reducing the stock-out.
It is advisable for Nestle to buy the raw material directly from the farmers. As mediators will be removed, it will improve the transparency and will be beneficial with reduced
…show more content…
Nestle should start 24/7 transportation system for all of its departments. It will improve the Delivery Execution System, which in turn will be available to the end users as per the demand. There should be centralized load planning and vehicle scheduling.
The above stated recommendations can help Nestle in growing firmly and globally.
Conclusion:
In nutshell, being a leading food manufacturer, Nestle believes in commitment for the development of its business. Nestle will take the advantage of its strength in the procurement of raw material in global sourcing to maintain its competitiveness.
Works Cited nestle. (n.d.). igd.com. Retrieved from igd.com: http://www.igd.com/our-expertise/Supply-chain/Strategy-planning-technology/2671/Transport-Technology-User-Guide--Assessment-Tool/Case-Studies/Nestle-Technology-used-to-manage-the-Primary-Transport-operation-in-a-multi-category-business/ nestle. (n.d.). supplychaindigital.com. Retrieved from supplychaindigital.com: http://www.supplychaindigital.com/logistics/3367/How-DemandDriven-Forecasting-paid-off-for-Nestle

(nestle, igd.com) (nestle, supplychaindigital.com)

Related Documents

  • Improved Essays

    First is time series based forecasting. These models constructed forecasts using previous results. The first project, launched in 2010, is the Business Sufficiency program, which gives executives predictions about P&G market share and other performance stats six to 12 months into the future. At its core is a series of analytic models designed to reveal what’s happening in the business now, why it’s happening, and what actions P&G can take. These models captured the most recent data and conducted a large number of simulations to provide leaders with a measure of the likelihood that the business would be able to deliver on previously set goals and targets.…

    • 1492 Words
    • 6 Pages
    Improved Essays
  • Superior Essays

    Warrnambool Cheese Case

    • 1484 Words
    • 6 Pages

    In addition, the company keeps its brand name and customers’ loyalty through its high values that ensure that consumers ' demands are met. The 50 percent export to the international market is a clear indicator of the position of the company in both internal and local markets. WCB Weaknesses: The main challenge facing the company is the decreasing supply of raw materials vis a vis the increasing demand of dairy products. This affects the production levels of the company thereby reducing its opportunities of satisfying its consumers.…

    • 1484 Words
    • 6 Pages
    Superior Essays
  • Improved Essays

    Chipotle Ethical Issues

    • 554 Words
    • 3 Pages

    There are many companies in the world that provide services and catering to you and I, but do you actually know what the company does for the world? Hasbro, Bank Of America, L’oreal, Petco. Sound familiar right? I'm going to be talking about some very familiar companies such as Nestle, Chipotle, and Starbucks. What/…

    • 554 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    Pasta was one of the Top 20 foods on menus. However, approximately 88% of all pizza sold by restaurants while even frozen pizzas from supermarkets account for 16%. And customers which are in favor of pasta with the 77% had not tried pasta before but it is not the same situation for pizza which has bigger share by restaurants launching fresh concept before Contadina Pizza scenario. Besides that, Nestlé make easier to reach the market and to develop products, buying Lambert’s Pasta & Cheese, On the other hand they have not any experience about Pizza Product and distribution channels. It is possible to use the same channels to distribute the product but to enter entirely new market cause to take a vast amount of risks which will not provide so much profit according to numbers from tables and…

    • 641 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    Each food and beverage industry company have their own plans and strategies to become more innovative with their customers and to get their products out in our society. Most of the food…

    • 922 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    According to the reports third world mothers from places as Mexico, the Philippines, Central America, and Africa consisted of the majority of geographical places around the third world were Nestle was accused of “hard selling”…

    • 1319 Words
    • 6 Pages
    Improved Essays
  • Improved Essays

    Ice Fili Case Study

    • 2520 Words
    • 11 Pages

    The modern production management was what Ice-fili lacked. With plenty well trained managers Nestlé could leverage this advantage to produce relatively high quality ice cream with a lower cost. Using locally supplied component further reduced the cost of production. Its long presence in Russian ice cream market and strong marketing ability generated a strong preference among Russian customers. Its abundant experience on distributing enabled its strong control over the channels and massive coverage over the whole market.…

    • 2520 Words
    • 11 Pages
    Improved Essays
  • Improved Essays

    The Nestlé Company was founded in 1905 by brothers Charles and George Page, and Heinrich “Henri” Nestlé, and was formed through the merger of Anglo-Swiss Milk Company. Today Nestlé is a Swiss transnational food and beverage company and are based and head-quartered in Vevey, Switzerland. Nestlé’s first products were condensed milk and infant formula products. During the first and second World Wars Nestle made significant strides in growing their company and began expanding their product line.…

    • 803 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    TASK # 1: Nestle is one of the leading brand in Pakistan. There are many stakeholders of nestle corporation, the people or group of people to be affected by its regular operations directly or indirectly knowns as stakeholders. Those people or group affected directly is called internal stakeholders and those who are indirectly affected are external stakeholders. Its internal stakeholder involves its employee, managers, and the owners of company or shareholders. And its external stakeholders involve the society, government and regulation, non-governmental organization, its customers, suppliers etc.…

    • 918 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    According to The Nestlé Management and Leadership Principles 2011, Nestlé want to put their main attention on permanent business expansion rather than the temporary. However, they will never forget the importance of constantly giving excellent outcome to the…

    • 913 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    HBR CASE STUDY Excel-Pls supply chain management at Haus Mart 1. How is value added in supply chain management through better planning versus better execution? Ans. Supply chain management as we have learnt in this course is managing the movement of goods and services. It involves the storage and flow raw materials, inventory of work in process as well as finished goods from their point of origin to their point of consumption or use.…

    • 1315 Words
    • 6 Pages
    Improved Essays
  • Improved Essays

    On the contrary, Nestle Company is an extraordinary extent to get good things from the speedy economic maturation and the advancement of surrounding conditions, especially in developing countries. When Nestle Company wants to launch a new product to the particular area or enter some products into the market, it needs to pay attention and implement based on the level of consumer incomes and purchasing power. According to the performances and results around the world, Nestle has changed to fit new conditions for differences versions in consumer’s demand and price sensitivities as the price change. In anticipating, the number of middle class is growing and there is more and higher disposable income level in these economies as Nestle company shift the company’s industries importance and prominence gradually from America Europe to Asia-Pacific and the Middle East markets. Last but not least, Nestle is a multinational company which achieves the advantage of superior competitive over the rivals nowadays.…

    • 920 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    They want be the top and revolution in their products. Nestlé maintain the quality of the products at the same time low charging in selling price of products will helps in maximise…

    • 848 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    INTRODUCTION: There has been a significant rise of Internet based information, developments in communication and technology. A dedicated SCM can be framed with these advancements in order to face the strategic and operational objectives of a company. It is estimated that one in six firms had reshored its manufacturing to UK from other countries. The concept of Supply chain is to integrate the end to end operations of a business, managing the sources, flow of materials considering a total systems perspective among multiple functions and suppliers.…

    • 731 Words
    • 3 Pages
    Improved Essays
  • Great Essays

    1.0 Executive Summary Supply Chain refers to the flow of products or services start from the point of origin from the supplier to end consumer (Investopedia, 2003). Supply chain management refers to the design and management of seamless, value added processes across organizational boundaries to meet the needs of end consumer. Supply chain management is very important for a company to success especially for those multinational companies as nowadays the supply chain emphasizes on building trust-based relationship with the supplier and the company can focus on their core competencies for a long term benefits with a common goals. A supply chain management started with key suppliers and has four important elements.…

    • 5288 Words
    • 22 Pages
    Great Essays