Competitive Advantage Of Nestle

725 Words2 Pages

essential for Fonterra to relocate manufacturing operation. According to Thongnoi (2015), the Thai Ministry of Agriculture reported that Thailand was the largest manufacturer and exporter of dairy goods under the number of trademarks in the ASEAN countries in 2015.

FDI and competition in Thailand
FDI is typically regarded as a mode of cross-border inter-firm collaboration which connects with important equity stake and efficient power in managerial decision making in international enterprises (de Mello, 1999). FDI is also an external factor which boost Thailand’s economic growth through employment, transfer of technology and knowledge and relocating manufacturing facility. However, there is increasingly movement of production base into China and India instead of Thailand. As a result, the Thai …show more content…

Firstly, vertical cooperation has created sustainable competitive advantage for Nestle to enhance entry to valuable resources on partner, including retail and people. Pritchard and Britcard (2000) pointed out that Nestle collaborates closely with local farmers, producers and a distribution channel and its research and development sector gets regional needs to develop products for expanding global customer base. Moreover, Nestle began making eight subsidiaries in Thailand, which have consisted of seven manufacturing facilities that were acquired in contract manufacturing for the commodity supplies, including powdered milk and much more (Pritchard & Britcard, 2000). Additionally, Nestle (Thai) Ltd. purchases products from its plants and then distributes Nestle goods throughout country and third parties internationally (Pritchard & Britcard, 2000). Secondly, first-mover advantage of Nestle has made a significant impact on Fonterra because it can control certain resources, discern new market better than latecomer and thus maintain market-share

More about Competitive Advantage Of Nestle

Open Document