Nestle's Supply Chain

 

        Welcome back Readers, This is Muhammad Jassim from Amrita school of Business. This week's blog is all about Supply chain strategies of Nestle.

Nestle :

        Nestle was established by Mr. Henry Nestle in the year 1866. At the earlier years they were into Production and Distribution of Milk product. It established as a World's largest food processing company in 2015, with total sales increased to 88785 Millions says the report from Statista report. There are 435 production factories operating in 35 Countries across the World. Nestle sells 15000 products across 189 countries. They focus on creating shared value across all channels. 

       

     Nestle product line includes,

            1. Powdered and Liquid Beverages

            2. Packaged Drinking Water

            3. Milk Products and Ice cream

            4. Nutrition and Health Science

            5. Prepared dishes and Cooking Aids.

            6. Confectionery

            7. Pet Care

Nestle's Supply Chain Model :

        Nestle has been following simple supply chain model since its beginning where the chain starts on from Collecting Raw material from the farmers as Nestle strongly believes farm grown fresh products are very much important for them to maintain their Global standard. The farm grown products collected from farmers then delivered to the Local suppliers. Then these suppliers are responsible for sending those products to the Production plants where these Raw materials are classified into specific product lines and they are into production of various products. The Products produced where taken to the Nestle Warehouses where they are stored in before getting delivered to the Distributors from where they are delivered to the customers through Retailers. 

Nestle's Sourcing and Procurement :

        Nestle is keen on procuring 10 percent of the total coffee grown across all the countries, ten percent of cocoa plantation and two percent of the overall production of milk and sugar for their various products. Nestle follows supply chain mapping program for traceability of sourcing products from various parts of the world. This create value among suppliers, farmers are provided with technical trainings and the standard of the products produced where improve gradually.

Nestle's Quality Management System :

        Nestle ensures its quality is maintained the same in all the places of their operations, as they maintain the same standard globally. Their practice starts with addressing key global environments and social issues. Research and Development network theme is quality by theme. 

Nestle's Distribution :

        Nestle transports more than fourteen lakh tonnes products from sixteen thousand warehouses. Most of the Nestle's transportation logistics are outsourced through third party operators. Nestle monitors its inventory level using Electronic Data Interchange which is responsible for inventory, pricing and product movement. Then Distributors further connects with the retailers to ensure delivery of products to its end consumers. 

        These are the various strategies followed by Nestle hope you find it interesting and insightful.