PESTLE and SWOT analysis of Nestle 2017

By: Jonathan Kush

While Nestle continues to perform relatively well compared to some of its rivals such as PepsiCo, and Coca Cola, it is also facing the same critical challenge facing the entire food and drinks industry; new eating habits and lifestyles in much of the developed world. Consumer-focus on healthy beverages with less sugar content is, for example, driving the decline in sugary drinks consumption in the United States. Americans are for instance so turned off by sugary drinks they are now drinking more bottled water than soda, the first time it’s happened, amidst increased concern over their impact on health and obesity levels that have risen to the highest level in the world (Purdy 2016; Sun 2017). Such trends are not going away and mark a critical transformation in core markets, presenting both opportunities and challenges for an industry that is now at a crossroad. For many food and beverage firms such as Nestle, the pressure is to respond with new innovations, build new capabilities remaking their brand portfolios either through innovative reformulations of existing products or adding new product categories in order to tackle these new food and beverage trends sweeping the industry (Kell 2017b). This report will identify the global food and beverage trends driving Nestlé’s external market environment focussing especially on the core UK and US markets. This will help us understand how the biggest food and beverage corporation in the world can utilize its brand competencies and take advantage of macro environmental opportunities while at the same time neutralizing emerging threats that could undermine its progress.

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