Investment Status and Investment Strategy of Nestle in China

Nestle has a long history in China, and it is one of the first foreign businessmen to enter China, and it has a firm commitment to China. For a century, China consumers are very familiar with and trust the Nestle brand. As early as the beginning of this century, 1908, Nestle opened its first sales office in China. In the early 1980s, Nestle began to discuss with the government of China to invest and build a factory in China, and to transfer the world's best proprietary technology and rich expertise in nutritious food processing to China. From 65438 to 0990, the first joint venture factory of Queji in Chinese mainland began to operate. In the past thirteen years, Nestle's direct investment in Greater China from Switzerland totaled 6.7 billion yuan, and it operated 20 factories in China. In 2002, the annual sales of Nestle Greater China reached 8.5 billion yuan, and the annual tax payment was about 800 million yuan, providing employment opportunities for about 1 10,000 people. Nestle Greater China is headquartered in Beijing.

Second, Nestle's China Strategy

1. Nestle China's Market Strategy: Two Important Visits.

Since the headquarters paid more and more attention to the China market, Nestle Greater China has become one of Nestle's "main markets" in the world. On June 5438- 10, 2000, Nestle Twin Cities, the first joint venture project of Nestle in China, was officially put into production 10 anniversary. It has not only been highly valued by the local government, but also attracted the attention of senior personnel of Nestle Group. Mr. Bao Bida, CEO of Nestle Group and President of Asia, Africa and Asia, attended the ceremony and made a week-long inspection tour of the China market. In addition, senior managers from the group headquarters and other markets visit China every year. The changes in China and Nestle's business in China have made them realize that China has great market potential and China will eventually become the largest market in the world.

In 2002, with China's accession to the World Trade Organization, China's international status became more prominent. At the same time, Nestle Greater China has become a major market for Nestle. In the past, Nestle's "main markets" were defined as 13 markets with the largest sales. 200 1 Peter, CEO of Nestle Global Group? Mr. Bao Bida revised the above definition. Since 2002, Greater China has become one of the two markets independently nominated by Nestle's global CEO. At the same time, the Board of Directors and the Executive Committee of Nestle Global Group held a meeting in China for the first time and conducted a series of market investigations. China's booming economy, Nestle Greater China's achievements and future blueprint left a deep impression on Nestle's senior management. They are convinced that in the sense of economic profit, Greater China will soon become the main market of Nestle.

2. Nestle China's management strategy: management integration of two institutions.

Nestle China headquarters was established in Beijing 1996, and Nestle Greater China was established in 2000. As a very young Nestle organization, Nestle Greater China continuously improved its organization from 1999 to 2003. Instead of legally establishing various entities and business-oriented organizations (finance and control, technology, human resources and development, etc.) according to geographical location. ) has a clear definition.

200 1 1 In order to cooperate more effectively and support the rapid growth of water business, bottled water business joined Nestle China Co., Ltd. as a business unit.

In the middle of 200 1 year, in order to effectively utilize the advantages of Hong Kong dry goods and ice cream/freezing units, better cope with the fierce competition in the Hong Kong market, and help Nestle achieve long-term sustainable and profitable business growth, Nestle merged two operating units in Hong Kong into one entity, and the merged company was named Nestle Hong Kong Limited.

In July, 20001year, Nestle Taiwan Province Province officially joined the Greater China market, and strived to tap the potential business opportunities, realize the coordination of various operating units, and continuously reduce the cost and maintain the competitive advantage for Nestle.

In September, 20001year, in order to streamline the factory management and improve the operation efficiency, Dongguan Meiji Company was merged into Dongguan Nestle Co., Ltd., and the merged operation unit was managed by a factory director.

At the end of June, 2002, 5438+ 10, in order to constantly adapt to the rapidly changing market demand and respond quickly, Mr. Li Mu, President of Greater China, announced the reorganization of the management structure, which is essentially another continuation of the organization improvement in the previous period in Greater China. The core of the reorganization management structure is the newly established "Enlarged Management Committee", which is composed of 35 senior managers from most business areas and regions and meets quarterly or as needed. Plan and promote the company's future prospects, exchange ideas and experiences, and strengthen the construction of corporate culture in Greater China. The composition of the expansion committee reflects the characteristics of Nestle as a multinational company, and its members come from more than ten different countries except China people in Greater China. In addition to the expansion committee, Nestle has also established a streamlined and powerful "Executive Committee", which represents the important business functions of Greater China. The Executive Committee will hold a meeting every month or as needed to continuously summarize the company's business progress, so that Nestle can focus more on its main strategy and primary task and achieve its development goals.

In May, 2002, in order to improve the business situation and because two legal entities were no longer needed, Nestle merged the ice cream production factory Tianjin Nestle Milk Co., Ltd. into the chocolate and candy factory Tianjin Nestle Co., Ltd., which was managed by a factory director.

3. Nestle's investment strategy in China: two localization models.

As one of the first multinational companies to enter China, Nestle witnessed the economic growth and development of China and the huge potential of China's consumer market. Localization is the core of Nestle's investment strategy in China.

The agricultural industry investment model of "upstream factories drive downstream farmers" is a successful model of Nestlé' s localized production.

From 65438 to 0990, Nestle Twin Cities officially started operation, and now it has become the largest dairy factory in China. During the first 12 year of factory operation, the annual purchase of fresh milk continued to increase, reaching nearly 300,000 tons in 2002. As a result, the lives of more than 20 thousand small farmers have been fundamentally improved. Nestle provides farmers with a stable daily income (currently, the average person per day is 80 yuan RMB), and constantly improves the living conditions, infrastructure and living conditions of local farmers. Meanwhile, Nestle Agricultural Service Department has been providing daily technical assistance and training. In 2002, Nestle's contribution to the local economy exceeded 654.38 billion yuan, and about 654.38 million people directly or indirectly benefited from the successful development of the Shuangcheng factory.

1992, Nestle Dongguan Coffee Factory was established. By the end of 2002, Nestle had invested 350 million yuan to build the factory into a world-class factory. In the past ten years, Nestle has helped Yunnan develop coffee cultivation in a pioneering way. In the first half of 2002 alone, it bought more than 3,000 tons of coffee in Yunnan, which effectively developed the local economy and helped thousands of farmers get rid of poverty and become rich.

Nestle has helped China save a lot of foreign exchange by using local raw materials to produce the same high-quality food locally instead of importing products. At present, 99% of products sold by Nestle in Chinese mainland are made locally.

Joint venture with domestic enterprises is an important model for Nestle to develop products to meet local needs and realize the localization of market sales.

1999, Nestle established a joint venture with Shanghai Taitai Le Group, and now it holds 80% of the shares. 200 1, Nestle and Sichuan Haoji Group set up a joint venture company, holding 60% of the shares. Through two joint ventures, both China and foreign countries have created and developed the chicken essence market in China. Nestle not only established its dominant position in the chicken essence market in China, but also quickly completed the process of product taste localization and extended its sales network to the west because China has a deeper understanding of the tastes of consumers in different regions of China.

Third, Nestle's management and corporate culture.

1, quality first

Quality is the cornerstone of Nestle's success. Nestle has always attached importance to product quality. More than 130 years of food manufacturing experience, constantly pursuing the latest nutrition and food processing technology, using high-quality raw materials, applying the most advanced technology and equipment, high-quality employees and huge R&D investment. All these ensure the high quality of Nestle products.

2. Consumers first

China is a country with a vast territory and great differences. Affected by its geographical location and cultural traditions, local customs are also different. With more and more brands and products entering the China market, the market competition is becoming increasingly fierce. Faced with numerous choices, consumers' choice of products has become more "picky". If Nestle's brand wants to get sustainable development and take root in China, it must have a clear understanding of consumers' consumption concept and a deep understanding of the rational or perceptual reasons behind consumers' behavior. For this reason, Nestle has conducted in-depth research on consumer behavior and completed many consumer research projects, involving dairy products, nutrients, coffee, water, ice cream and so on. The facts and data of the survey have effectively helped all business departments to make correct business decisions. At the same time, training courses aimed at helping all departments of the company understand consumer research are also being carried out continuously. "Consumer research" has become an important means for Nestle to increase consumer demand for Nestle products and ensure the company to achieve sustainable profit growth.

3. Human factors are the first.

On April 5, 20001,at the annual general meeting of shareholders held in Lausanne, Switzerland, Rena, Chairman of Nestle Global Group? Mr. Gott emphasized that "in the fierce competition, people are the key factor". Nestle believes that the excellent performance of Nestle Group comes from the efforts, innovation, passion and loyalty of employees all over the world. Nestle employees have always been the key to bringing Nestle spirit into life, and it is this "human" spirit that makes Nestle develop from a rural workshop to a leading food company in the world today. Employees are Nestle's most valuable asset. Nestle provides equal job opportunities for people of different races in more than 80 countries, and a close working atmosphere has been formed between managers and employees, making Nestle the preferred employer.

The speed of change requires Nestle to constantly adjust, especially how to continue to develop, motivate and retain qualified and potential employees who can grow with China's great future has become one of Nestle's primary tasks. To this end, Nestle conducts continuous training in all countries and business fields, so that the knowledge and skills of Nestle employees are constantly updated. Nestle launched the Rolling Training Program (CCAT) from 1998, emphasizing the main characteristics of Nestle culture and excellent management, namely, change, communication, attitude and teamwork. All employees participated in the first training and follow-up training. In addition, for young local employees with potential, Nestle has designed a training program of NCMDP (Nestle China Management Development Plan), aiming at giving these employees the responsibility of leaders, enabling them to understand and contact with different aspects of the business and expand their overall understanding. In 2002, the training of "Effective Leadership Skills" specially designed for supervisors was launched to help them manage their employees under "Nestle Management and Leadership Principles" and "Nestle Group Business Principles".

For employees, Nestle also provides internal functional skills training programs (such as "Customer Management Best Practices" training) and lets employees participate in international training of Nestle Group. Since 200 1, Nestle has sent important backbones to the world-famous International School of Management in Lausanne, Switzerland to participate in special training programs.

In addition, every company in Nestle Greater China holds an annual Nestle Family Day every year 10, which not only reflects Nestle's humanistic culture, but also enhances employees' team consciousness and inspires their confidence and enthusiasm for Nestle through "family-like" contact.

Fourthly, the sustainable development of Nestle.

Nestle regards sustainable development as a process to better meet the world's demand for high-quality food and make long-term contributions to social and economic development. At the same time, we also consider the interests of future generations and pay attention to environmental protection. In 2002, Nestle Group issued a very important document: a review of Nestle's sustainable development.

1, sustainable economic performance and development

Nestle's basic purpose is to meet the needs of customers and consumers for quality food with value for money. If we succeed in this respect, we can achieve long-term and sustainable economic benefits and development for all stakeholders. Nestle has factories in more than 80 countries and companies in almost every country. The global economy can feel the impact of Nestle's business development. Among them, Nestle's fresh milk purchase in Shuangcheng, Heilongjiang Province and coffee planting in Yunnan Province have benefited local farmers and effectively promoted the local economy, which has become an important content listed in Nestle's sustainable development review.

2. Sustainable environmental protection measures

Nestle transforms perishable food into safe and high-quality food that meets the needs of consumers. In the process of transformation, environmental factors should be considered from beginning to end in the whole supply chain from raw materials to consumers, and systematic management of environmental protection work is a basic factor of Nestle's sustainable development strategy. In Nestle Shuangcheng Factory, due to the cold climate and the large temperature difference between winter and summer, Nestle engineers managed to install the wastewater purifier indoors, and through heating the building, the temperature was controlled in the stable range of effective wastewater treatment all the year round, thus establishing a wastewater treatment workshop that can run in a long-term environment.

3. Sustainable social development

The basic point of Nestle's business is to invest in improving personnel skills and establish long-term trust relations with employees, suppliers, business partners, the government and the whole society.

Nestle takes an active part in various undertakings in China.

1, cheer for Beijing's Olympic bid.

Beijing succeeded in bidding for the 2008 Olympic Games. Previously, in order to support Beijing's Olympic bid, Nestle (China) Co., Ltd. and the National Youth Working Committee held the theme activity "New Beijing, Great Olympics, let's describe it together". The activity has been enthusiastically participated by about 1 10,000 primary school students in 12 major cities across the country, and has gained a wide and good social impact.

2. Actively support the development of medical industry in China.

Nestle has spared no effort to support various academic activities in China, and has established a long-term cooperative relationship of mutual trust with the medical community in China. Through a series of activities such as discussion and exchange and providing research funds. , greatly promoting the exchange of scientific research information.

3. Pay attention to the development of cultural undertakings in China.

In 2000 and 20001year, Nestle became the exclusive sponsor of major events of Beijing Music Festival for two consecutive years.