Nestlé SA : Overview

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Nestlé SA


'Good Food, Good Life'

Industry Areas: Baby Milk, Food, Mineral Water, Pet Food

Overview

Market Share/Importance:

Nestlé employs approximately 253,000 people in some 511 factories worldwide. Nestlé is not only Switzerland's largest industrial company, but also the world's largest food company, considerably larger of than its nearest rivals Kraft Foods Inc. and Unilever plc.[1] With products like Perrier and Nescafé, it is the market leader worldwide in coffee and mineral water,[2] the largest manufacturer of pet food, and is fast increasing its share of the ice cream market.

Nestlé acquired Ralston-Purina, a US pet food company, in 2001. Despite producing pet food through its subsidiary, Carnation, since 1985,[4] this acquisition now sees it outstrip Mars as the world's largest pet food manufacturer. Not to be outdone by Unilever's acquisition of Ben and Jerry's, Nestlé's merger with US food corporation Dreyer's to form the Dreyer's Grand Ice Cream Company in 2003 has given it the number one spot in the US ice-cream market, having already bagged the Häagen Dazs, Schöller and Mövenpick brands. Globally, Nestlé is now hot on the heels of Unilever as the number one ice cream seller, a position that it seeks in every market and category in which it operates around the world.

History:

In 1830, German pharmacist Heinrich Nestlé arrived in Vevey, Switzerland, to work on a substitute for breast-milk. In 1866 he launched the product onto the market, founding the company in 1867. Nestlé's own versions of its history can be viewed at: www.Nestlé.com/all_about/history/index.html and at http://www.Nestlé.co.uk/about/ (Under 'Nestlé Heritage', for Nestlé's British presence). Needless to say, however, this version doesn't give a very full explanation of the scandals which have plagued the company. The most obvious damage to Nestlé's reputation has been its unethical marketing of artificial baby milk, particularly in the global south. (See Corporate Crimes section). This started to become a major issue in the 1970s when War on Want published a report called "The Baby Killer", which was translated into German by the Berne Third World Action Group who were subsequently sued for libel, having named their version "Nestlé Kills Babies". [3]

However, as McDonalds were later to find out, suing critics tends to have a rather galvanising effect, and the publicity which came out of the case hurt Nestlé much more than the activists. In 1977 a boycott was launched, which continued until 1984, when Nestlé agreed to abide by the World Health Organization's International Code of Marketing of Breast-Milk Substitutes. However, the fact did not match up to the promises and the boycott was re-launched in 1988, continuing vigorously today.

There is, of course, much more to Nestlé than the baby milk issue. The company has attracted criticism for its use of genetically modified ingredients, and for its cocoa and coffee-buying policies, including purchasing cocoa from Ivory Coast, which has recently received heavy press coverage due to the existence of child slavery on cocoa plantations. The company has also been implicated in lobbying against vaccination of livestock during the British Foot and Mouth Disease outbreak in 2001. From environmental destruction in Brazil to the intimidation of trade unionists in Colombia, from demanding millions in compensation from hunger-stricken Ethiopia to bolstering its image through proposing donations to breast cancer charities - Nestlé is easily one of the world's most hated companies. For more details on these issues, see the 'Corporate Crimes' section.


References

[1] www.Nestlé.com/all_about/at_a_glance/index.html

[2] www.hoovers.com/co/capsule/5/0,2163,41815,00.html

[3] www.babymilkaction.org/www.babymilkaction.org/pages/history.html

[4] www.Nestlé.com/in_your_life/pet_care/index.html

[5] Financial Times, 27th July 2001, http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3ZH24VMPC&live=true