Nestlé: History and Products

• Nestlé is a Swiss multinational food and beverage company
• The headquarters are in Vevey, Switzerland
• Henri Nestlé founded it in 1866
• It is one of the largest and most recognized food companies globally
• Nestlé operates in over 180 countries
• The company offers a wide range of products
• Products include dairy, confectionery, beverages, baby food, cereals, coffee, and pet food
• Key brands include Nescafé, KitKat, Maggi, Purina, and Nestlé Pure Life
• Nestlé focuses on nutrition, health, and wellness
• Aims to provide high-quality and sustainable products
• Nestlé is committed to reducing plastic waste
• The company is aiming to achieve net-zero greenhouse gas emissions by 2050

Early Years: Foundation & Growth (1866 – 1900)

• In 1866, Henri Nestlé, a Swiss pharmacist, founded Nestlé
• Nestlé created an infant cereal, “Farine Lactée,” to combat infant malnutrition
• By 1867, Nestlé's product gained popularity across Europe
• The Nestlé & Anglo-Swiss Condensed Milk Company was established in 1867
• Between 1875 and 1900, Nestlé expanded into new markets
• New markets included the USA, Latin America, and Australia
• Milk production factories were acquired

Expansion & Diversification (1900 – 1950)

• In 1905, Nestlé merged with the Anglo-Swiss Condensed Milk Company.
• The merger increased its dairy product range
• Nestlé acquired Peter-Cailler-Kohler in 1929
• Peter-Cailler-Kohler was one of the first Swiss chocolate manufacturers
• Nestlé entered the confectionery market
• In 1938, Nescafé was launched and became a global coffee brand
• During World War II (1939–1945), Nestlé expanded by supplying condensed milk and coffee to soldiers

Post-War Boom & Globalization (1950 – 1980)

• In 1947, Nestlé acquired Maggi, a leading brand in soups and seasonings
• During the 1960s – 1970s, Nestlé diversified into frozen foods
• The frozen food brands included Findus
• Diversified into mineral water (Perrier), and pet food (Purina)
• In 1974, Nestlé became a shareholder in L'Oréal, expanding into cosmetics

Innovation & Strategic Acquisitions (1980 – 2000)

• Nestlé entered the frozen pizza market with the acquisition of Stouffer’s in 1984
• In 1988, Nestlé acquired Rowntree
• It acquired the maker of KitKat, Smarties, and After Eight
• During the 1990s, Nestlé expanded into bottled water (Nestlé Pure Life) and pharmaceutical nutrition

Health, Wellness & Digital Transformation (2000 – Present)

• Roche’s nutrition division was acquired in 2001
• It strengthened its healthcare segment
• In 2012, Nestlé Health Science was created to focus on medical nutrition
• In 2017, Nestlé entered the plant-based food sector with Garden Gourmet
• During the 2020s, there was a focus on sustainability, digital transformation, and AI-driven food production

Nestlé's Primary Competitors

• Unilever is a British multinational consumer goods company
• Unilever sells food, beverages, cleaning agents, and personal care items
• Unilever's competing brands include:
  • Ice Cream: Ben & Jerry's, Magnum
  • Tea: Lipton
  • Seasonings and Sauces: Knorr
• The Coca-Cola Company is an American multinational corporation
• It is known for its non-alcoholic beverages, primarily soft drinks
• Competing brands include:
  • Bottled Water: Dasani
  • Juices: Minute Maid
  • Ready-to-Drink Teas and Coffees: Gold Peak, Honest Tea
• PepsiCo is an American multinational food, snack, and beverage corporation
• PepsiCo competes with Nestlé in various categories
• Competing brands include:
  • Snacks: Lay's, Doritos
  • Beverages: Pepsi, Gatorade
  • Breakfast Cereals: Quaker Oats
• Danone is a French multinational food-products corporation
• Danone specializes in dairy and plant-based products, waters, early life nutrition, and medical nutrition
• Competing brands include:
  • Dairy Products: Activia, Actimel
  • Plant-Based Products: Alpro
  • Bottled Water: Evian, Volvic
• Mondelez International is an American multinational confectionery, food, and beverage company
• Mondelez focuses on snack foods and beverages
• Competing Brands include:
  • Chocolate: Cadbury
  • Biscuits and Cookies: Oreo, Chips Ahoy!
  • Gum and Candy: Trident, Halls
• Mars is an American multinational manufacturer
• Mars produces confectionery, pet food, and other food products
• Competing Brands:
  • Chocolate: M&M's, Snickers
  • Pet Food: Pedigree, Whiskas
  • Rice: Uncle Ben's
• General Mills is an American multinational manufacturer and marketer
• It is known for branded consumer foods sold through retail stores
• Competing Brands:
  • Breakfast Cereals: Cheerios, Wheaties
  • Snacks: Nature Valley
  • Yogurt: Yoplait
• Kraft Heinz is an American multinational food company
• Kraft Heinz is known for its condiments, sauces, and packaged foods
• Competing Brands:
  • Sauces and Condiments: Heinz Ketchup, Kraft Dressings
  • Cheese Products: Kraft Singles
  • Ready-to-Eat Meals: Oscar Mayer

Revenue Growth Over Time (1866 - Present)

• Nestlé started as a small infant food manufacturer
• The company has grown into a global food giant
• Key milestones in revenue growth:
  • 1900: ~0.05 CHF Billion due to expansion in Europe and the U.S.
  • 1945: ~0.5 CHF Billion due to WWII supply contracts increasing demand
  • 1970: ~3.5 CHF Billion due to the acquisition of Maggi and major diversification
  • 2000: ~81 CHF Billion due to expansion into health & nutrition, and pet food
  • 2010: ~109 CHF Billion due to strong presence in emerging markets
  • 2023: ~94.4 CHF Billion due to focus on sustainability & digital transformation

Profitability & Market Value

• Consistent growth in profitability is due to strategic acquisitions, product diversification, and global expansion
• Net Profit:
  • 1990s: CHF 3-4 billion
  • 2000s: CHF 9-11 billion
  • 2010s: CHF 12-15 billion
  • 2023: CHF 14.5 billion
• Market Capitalization:
  • 2000: ~CHF 80 billion
  • 2010: ~CHF 180 billion
  • 2023: ~CHF 300 billion+

Geographic Revenue Distribution (2023)

• North America: 32%
• Europe: 29%
• Asia, Oceania & Africa: 21%
• Latin America: 18%

Product Segment Contribution (2023)

• Beverages (Nescafé, Nespresso, etc.): 27%
• Dairy & Nutrition: 19%
• Pet Care (Purina): 18%
• Confectionery (KitKat, Smarties, etc.): 13%
• Prepared Dishes & Cooking Aids (Maggi): 12%
• Water (Nestlé Pure Life): 11%

Workforce Growth & Sustainability

• Workforce Growth:
  • 1900: ~1,000 employees
  • 1950: ~10,000 employees
  • 2000: ~250,000 employees
  • 2023: ~270,000 employees
• Sustainability Goals:
  • Carbon Neutral by 2050
  • 100% Recyclable Packaging by 2025
  • 50% Reduction in Water Usage (2030 Goal)

Revenue Growth Observations:

• In 1900, Nestlé’s revenue was barely 0.05 billion CHF
• By 1945, revenue had increased to 0.5 billion CHF
• The 1970s marked a sharp rise as Nestlé diversified into new markets
• In 2000, revenue had skyrocketed to 81 billion CHF amid expansion in the health and nutrition sector
• The peak revenue was around 2010 (109 billion CHF)
• The revenue slightly declined to 94.4 billion CHF in 2023.

Product Segment Contribution Observations

• Beverages (27%) contribute the most, with brands like Nescafé and Nespresso
• Dairy & Nutrition (19%) is the second-largest segment with brands like Cerelac and NAN
• Pet Care (18%) via Purina has become a strong revenue driver
• Confectionery (13%), like KitKat and Smarties, remains an important sector
• Prepared dishes & cooking aids (12%), such as Maggi continue to perform well
• Water (11%), including Nestlé Pure Life contributes