Nestle Philippines
NESTLÉ PHILIPPINES
I. INTRODUCTION
Nestlé Philippines, Inc. (NPI) is a leading manufacturer of food and beverage in the Philippines. It was established in the country in the early 1930s, initially as a trading company. By the year 1962, it formed a joint venture with San Miguel Corporation (SMC), a company specializing in brewing with extensive interests in agribusiness and food products. In 1996, San Miguel’s Magnolia Foods Division had been merged with Nestlé. It produced and sold products like Magnolia ice creams and tetra pack juices, Bear Brand and Carnation condensed milk, Bertolli pastas and tomato sauce, Maggi seasonings, pasta and mayonnaise, and Smarties candies. Nestlé’s Instant Drink Division produced and sold Nescafé, Nestea, Milo, Coffee Mate and Milkmaid powdered milk. Nestlé Philippines is ranked number 10 among Nestlé subsidiaries worldwide and number 3 in Asia-Pacific, behind Japan and Australia. Nestlé is the only foreign-owned coffee producer in the Philippines.
Nescafé –already a household name in the Philippines needs to respond to major changes in the environment. Competing brands like Great Taste and Nescafé’s nearest competitor, Blend 45 already reduced or are planning to reduce their prices. There are also major changes in Government Regulation, Imports and Market Entry resulting to the potential entry of foreign brands like Kraft General Foods’s Maxwell House and Procter & Gamble’s Folgers Coffee. The company needs to decide whether it should import Arabica beans for blending Master Roaster coffee, change the composition of Nescafé by importing Arabica beans to the same composition as those sold abroad, and whether it should continue producing Taster’s Choice which are made from Philippine-grown Robusta and Imported Arabica.
II. STATEMENT OF FACTS
Nestlé’s Instant Drink Division contributes 75% of the company’s total sales; Nescafé contributes 53% of the department sales. In 1996, Nescafé’s market share increased from 52% to 66%.
I. INTRODUCTION
Nestlé Philippines, Inc. (NPI) is a leading manufacturer of food and beverage in the Philippines. It was established in the country in the early 1930s, initially as a trading company. By the year 1962, it formed a joint venture with San Miguel Corporation (SMC), a company specializing in brewing with extensive interests in agribusiness and food products. In 1996, San Miguel’s Magnolia Foods Division had been merged with Nestlé. It produced and sold products like Magnolia ice creams and tetra pack juices, Bear Brand and Carnation condensed milk, Bertolli pastas and tomato sauce, Maggi seasonings, pasta and mayonnaise, and Smarties candies. Nestlé’s Instant Drink Division produced and sold Nescafé, Nestea, Milo, Coffee Mate and Milkmaid powdered milk. Nestlé Philippines is ranked number 10 among Nestlé subsidiaries worldwide and number 3 in Asia-Pacific, behind Japan and Australia. Nestlé is the only foreign-owned coffee producer in the Philippines.
Nescafé –already a household name in the Philippines needs to respond to major changes in the environment. Competing brands like Great Taste and Nescafé’s nearest competitor, Blend 45 already reduced or are planning to reduce their prices. There are also major changes in Government Regulation, Imports and Market Entry resulting to the potential entry of foreign brands like Kraft General Foods’s Maxwell House and Procter & Gamble’s Folgers Coffee. The company needs to decide whether it should import Arabica beans for blending Master Roaster coffee, change the composition of Nescafé by importing Arabica beans to the same composition as those sold abroad, and whether it should continue producing Taster’s Choice which are made from Philippine-grown Robusta and Imported Arabica.
II. STATEMENT OF FACTS
Nestlé’s Instant Drink Division contributes 75% of the company’s total sales; Nescafé contributes 53% of the department sales. In 1996, Nescafé’s market share increased from 52% to 66%.