Nestle: Operating in a Global Economy

Nestle is a large company with over 150 years of history. The company deals with global production and competes around the world in an effort to achieve steady growth and profit. Competing in the global economy requires dealing with many challenges to meet production goals and market products to different cultures. Nestle also markets to third world countries that need nutritious food at a reasonable price. The company is a market leader in numerous product lines that have provided a solid foundation for sales and profit. Nestle has strong brand recognition that provides a competitive advantage to get into new markets and expand in existing markets. Operating in the global market means embracing numerous opportunities while avoiding various threats. The strategic management Nestle exhibited serves as an excellent case study in operating in a global economy.

History

The Nestle company traces its roots back to 1866 when Henri Nestle began searching for a healthy and economical alternative for mothers who were unable to breast feed their infants. Nestle’s first customer was a premature infant that could not tolerate the mother’s milk or any other substitutes available at the time (Nestle). The new product saved the babies’ life and people quickly recognized the value of the new product. By 1900, the company expanded to other products including powdered soup, bouillon cubes, sauces and flavorings. Through the early 1900s, production expanded and factories were operating in the United States, Britain, Germany and Spain. In 1904, Nestle added chocolate to its product line by reaching an agreement with the Swiss General Chocolate Company. The company continued to expand and began manufacturing in Australia and e...

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Nestle is a market leading company and serves as an excellent case study for illustrating strategic management in the global economy. The companies roots go all the way back to 1866 and the established history have created a strong company tested by the ups and downs of the world economy. Establishing a strong market base and vision for health and nutrition provide Nestle a positive reputation. The company has weathered two world wars and has continue to refine the corporate strategy. This flexibility and adaptability have enabled steady growth and success through these changing market conditions. Nestle can continue this success by establishing new markets and creating new products. In particular, continuing research and development to expand health and nutrition focused products will facilitate the ability to achieve above-average returns.