Customer and market satisfaction:

Research and development:

The Nestlé research and development centers have two main tasks: to create new
products and manufacturing processes and to improve those that already exist.
These centers play a key role in product safety and quality and also have their role
in conserving resources and protecting the environment. Environmental concerns
are an integral part of any development process to ensure that our future
commercial operations meet the desired criteria.

The Nestlé Research Center provides the scientific support needed to prevent and
solve environmental problems arising in the development groups as well as
manufacturing. In addition, studies are carried out to find new ways of using
industrial residues to create value added by products. This will reduce total
emissions and effluents.
The Nestlé development centers prepare environmental impact studies for new
products and manufacturing processes. These cover all aspects, from raw
materials, through processing, to the final packed product. These analyses
provide additional elements for use in deciding whether to commercialize a new
product, or to introduce a new or modified process.

Flexibility and productivity:

The public's sense of the power and size of a corporation is often inaccurate, for a
company's power is limited by a host of factors including legislation, competition,
regulatory bodies and publicity. From a business point of view, it is desirable for a
firm to achieve the size best suited to a specific industry or mode of production. To
be competitive internationally and make significant investments in research and
technology, a larger company has an advantage. From a strictly organizational
point of view, flexible, simple structures work best and excessively large units
should be avoided whenever possible. In both respects Nestlé has a natural
advantage: Although it is a big company, it is spread out over many countries and
each of Nestlé's factories has its own management and responsibility.
Handling of raw materials

The Nestlé Group is in principle not directly involved in primary production of raw
materials and other food ingredients. In general we use locally available raw
materials and purchase them either directly from producers or through existing
trade channels.

Raw materials have to meet clearly established quality criteria and are checked
for possible contaminants including environmental contaminants. Our purchasing
specifications comply not only with legal requirements but go further to ensure
highest safety and wholesomeness of our products.

Whenever possible we give preference to those goods for which environmental

aspects have been taken into consideration. In those cases where the required
agricultural raw materials are not available locally, but the natural production
conditions exist, we encourage local production and provide assistance for
cultivation and dairy farm management.

We support plant growing and livestock husbandry methods which:

• preserve and improve natural soil productivity and economize and protect
water resources
• allow the lowest, most appropriate and safe use of agro-chemicals
• use the least energy.
Packaging

Manufacturing comprises all unit operations necessary to transform perishable

raw materials into finished products, with the aim to make them safe and
convenient for the consumers. The manufacturing activities of the Nestlé Group:

• respect natural resources by efficient use of raw materials and energy

• minimize waste generation and emissions
ensure environmentally safe disposal of all waste which cannot be
recycled.
Regular assessments of processing practices are carried out. These
assessments include:
• evaluation of individual plant performance with regard to operations which
have an impact on the environment
• definition of targets for improvement
• review of plant compliance with local government regulations, company
environmental standards, as well as results achieved in comparison with targets
for improvement
• full investigation of incidents which may affect the environment.

Information on developments in environmental protection technology and

practices is disseminated as required to ensure that all plants are using the most
effective environmental practices for their type of processing. This applies also for
co packers.

Marketing and distribution

Marketing is based on the principle of satisfying consumer needs. This is the

foundation also for the environmental marketing approach of Nestlé.

Environmental product claims in advertising, promotional material and on

packaging are in accordance with legal requirements, based on solid scientific
evidence and used in a serious and reasonable manner.

Our aim is to minimize wastage in communication, publicity and promotional

material, in particular through more precise targeting of marketing activities.

Consumer promotions and merchandising material such as consumer offers, in-

store promotions, display material, leaflets, printed matter, etc. take
environmental aspects into account.

QUALITY

Everyday, millions of people all over the world show their confidence in us by
choosing Nestlé products. This confidence is based on our quality image and a
reputation for high standards that has been built up over many years.

Quality is the cornerstone of our success

Every product on the shelf, every service and every customer contact helps to
shape this image. A Nestlé brand name on a product is a promise to the customer
that it is safe to consume, that it complies with all regulations and that it meets
high standards of quality. Customers expect us to keep this promise every time.

Under no circumstances will we compromise on the safety of a product and every

effort must be made to avoid hazards to health. Likewise, compliance with all
relevant laws and regulations is a must and is not negotiable. People, equipment
and instruments are made available to ensure safety and conformity of Nestlé
products at all times. The effort is worth it. Companies with huge quality
standards make fewer mistakes, waste less time and money and are more
productive. They also make higher profits. Quality is their most successful
product. It is the key to their success, today and tomorrow.

The customer comes first

Nestle want to win and keep customers: distributors, supermarkets, hotels,
shopkeepers and the final consumers. They have very different requirements.
Trade customers expect excellent service, correct information and timely delivery.
Consumers consider taste, appearance and price when they make their choice. Its
task is to understand what customers want and respond to their expectations
rapidly and effectively. We serve various groups of consumers and there is
demand for products at different levels of perceived quality and price. All
customers, however, expect value for their money – good quality at a reasonable
price.
When offering quality to customers we also mean environmental quality. Nestlé
shares society’s concern for the environment and is committed to
environmentally sound business practices throughout the world. Customers are
central to their business and they always respect their needs and preferences.
Competition

Baby food and Instant coffee are categories where brand loyalties are very
strong and Nestle is the market leader. HLL is a significant competitor to Nestle in
instant coffee; while Heinz is the main competitor in the baby foods market. The
market for culinary products, semi-processed foods such as noodles, ready mixes
for Indian ethnic breakfast and sweets, is largely an urban market. HLL and Indo
Nissin Foods are the main competitors in these product segments. Nestle has also
achieved a significant 25% share in the chocolate/confectionery market. The
company has recently expanded its dairy products portfolio to include, milk, curd
and butter. The company also forayed into the bottled water
segment with the launch of its Perrier brand in the premium mineral segment and
Pure Life in the purified water segment.
Quality is a competitive advantage

We live in a competitive world and must never forget that their customers have a
choice. If they are not satisfied with a Nestlé product, they will switch to another
brand. Their goal, therefore, is to provide superior value in every product
category and market sector in which we compete. The pursuit of highest quality
at any price is no guarantee for success, nor is a single-minded cost-cutting
approach. Lasting competitive advantage is gained from a balanced search for
optimal value to customers, by simultaneous improvement of quality and
reduction cost. Success can never be taken for granted. We must watch and learn
from our competitors. If they do something better, we must improve our own
performance. We can achieve competitive advantage through Quality.

Quality is a joint effort

Operating companies are fully responsible for maintaining agreed quality
standards. Not only Production units, but also Marketing, Purchasing, Distribution
and Sales have a vital role to play in providing quality to customers. This implies a
thorough knowledge of the products and services we offer. Quality units at
different levels of the organization provide specific support, promote quality
awareness, assume guardianship and audit the system. Quality departments
monitor operations against agreed standards and must intervene in case of non-
conformity. Quality policy and principles, the mandatory standards and the
recommended tools for implementation are laid down in the Nestlé Quality
System which is applicable throughout the group. Further directions are given
through instructions, norms and guidelines, often specific to a product. Our
business products, such as raw material producers, packaging suppliers, contract
manufacturers and distributors are expected to share our concern for Quality.
They too must set up an adequate quality system, so as to meet our requirements
consistently. The quality efforts must be shared by every function and
department in the company as well as our business partners.
Quality is made by people

Adequate equipment, procedures and systems are needed to make Quality; so

are involved and dedicated people. Each and every Nestlé employee must do his
best to provide quality products and services. Training and teamwork are crucial
to the successful implementation of high quality standards. Continuous training
ensures that everyone understands his tasks and has the necessary skills to carry
them out. Teamwork allows us to achieve results that are greater than the sum of
individual efforts. We motivate employees by demonstrating management
commitment to Quality, by setting challenging goals and by giving them
responsibility and recognition. It is through employee involvement that goals and
targets can be achieved in the shortest time. Quality must be a way of life for
everyone in the company.

Quality is action

Quality is the result of deliberate action. It is the responsibility of senior managers to

communicate the quality objectives and to provide the resources necessary for their
implementation. It is then up to all employees to make Quality happen throughout the
company. Progress is followed by listening to our customers and by measuring our
performance. Shortcomings and mistakes must be analyzed and corrected. Problems
must be anticipated and prevented before they occur. We also must identify and take
advantage of opportunities. To stand still is to fall behind. So we must strive for
continuous improvement in every area. It is through many small improvements as well
as through major breakthroughs that we will achieve excellence. At Nestlé, Quality is
our first priority.

Costing stratigies:

These are following objectives of nestle pure life regarding price fixation:
 Profit Earning:
Profit earning is the main objective of every company but in case of nestle their
profit margin is low. Only a few amount of profit is collected from pure life water.

 Customer satisfaction:
In nestle pure life price is not fixed by keeping in mind profit motive, only
customer satisfaction is kept in mind while fixing the prices.
 STRATIGIES FOR FIXING THE PRICE:
In nestle prices are set on cost basis as given below:
Price = Cost + Profit
Break even or Target price
Per Unit Price = variable cost + fixed cost / units of sale

Delivery process:

Nestle pure life is making full efforts to supply its product to ultimate consumers.
For this purpose the company uses the conventional marketing channels of
distribution to supply the product. In this method company supply the product to
whole seller who responds it to retailers who supply to ultimate user.

In this method Nestle feel little consumption of time because retailers cannot
directly approach up to the company.
The company also uses the vertical marketing system in which retailers also take
supply from directly company resources without contact with wholesellers. In this
way the margin of company decrease and going into the interest of the ultimate
consumer.