Nestle Corp. Brent Hanson Justin Chen Lance Rambousek Randee Birkeland

History Founded in Vevey, Switzerland by Henri Nestle Combination of two companies Popular during WWI and WWII

Industry Analysis Brief for candy industry Health Issues Challenges Future Trends

Definition and History Definition of candy industry -It’s a part of snack industry and belongs to food industry. History of candy industry - Can be dated back to mid 1800’s.

Health Issues As a part of food industry, Candy industry is also facing health issues mainly as followings: - Tooth Decay - Obesity

Challenges Substitutes to candy in snacks risk the profit of candy industry. - Chips and crisp - Biscuits and cookies - Popcorn

Future Trends -Improved technology -High profit -Fierce competition in market

Global Analysis Nestle and Ethiopian Government Nestle and Infant Formula Nestle and Kit Kat Kit-Kat Commercial

Company Analysis STRENGTHS Strong brand name recognition some of the most recognized brands in the candy and chocolate industry: -Nestle Crunch -Pixy Stix -Wonka Products -Butterfinger -Baby Ruth

STRENGTHS Cont. Internationalization throughout the industry Very recognizable in nearly every country Chocolate and Candy are popular worldwide Very low operating costs – Allows Nestle to undercut pricing stategies of competitors

WEAKNESSES Candy division is small portion of company revenue----only 11% of annual sales---Nestlé's revenuesNestlé's revenues Company interests are more targeted toward other industries, not candy Dependence on Foreign production -many Nestle products are made overseas for low costs

OPPORTUNITIES Healthier approach to candy Countries including U.S. are becoming more health conscious Strong opportunity to join bubble gum market

THREATS Competitors U.S. market slump Foreign Labor Tainted ingredients (Melamine)

Competitor Analysis

Hershey’s Company Largest North American candy company Headquartered in Hershey, Pennsylvania Largest chocolate factory in the world Twizzler’s, Reese’s, Milk Duds, Jolly Ranchers Produces Kit Kat for Nestle

Mars Incorporated One of the largest private owned companies in the United States Headquartered in Hackettstown, New Jersey International Headquarters is Brussels, Belgium Skittles, Starburst, M&M’s, Snickers Recently purchased Wrigley Jr. Company

Pearson’s Candy Company St. Paul, Minnesota headquarters Salted Nut Roll, Mint Patty, Nut Goodie Very centralized – 80% of revenue from Salted Nut Roll and Mint Patty Several ownership changes

Cadbury plc Worlds largest candy company Based in London, England Cadbury Cream Eggs, Trident Gum, and Halls cough drops 60 countries, 50,000 employees Sold United States subdivision to Hershey’s

Recommendations Short Term – Find more efficient and labor friendly production practices – Create even more low cost products to match the budgets of homes. – Produce environmentally friendly packages

Recommendations Cont. Long Term – New product lines Health? – Expansion into untapped markets – Combine candy segment with another competitor

Conclusion Nestle is one of the top producers of candy in the world. They share just a small share in the global market as well as just 11% of their own companies revenue, but their ability to transition into foreign markets and produce top brands lets them compete with all other companies worldwide.