1

Nestlé S.A. (French pronunciation: [nɛsˈle]) is the largest nutrition and foods company in the world,
[2]
founded and headquartered in Vevey, Switzerland. Nestlé originated in a 1905 merger of the
Anglo-Swiss Milk Company, which was established in 1866 by brothers George Page and
Charles Page, and the Farine Lactée Henri Nestlé Company, which was founded in 1866 by
Henri Nestlé. The company grew significantly during the First World War and following the
Second World War, eventually expanding its offerings beyond its early condensed milk and
infant formula products. Today, the company operates in 86 countries around the world and
employs nearly 283,000 individuals.

Contents
[hide]
• 1 Pronunciation
• 2 History
• 3 Products
• 4 Business
○ 4.1 Management
○ 4.2 Earnings
○ 4.3 Joint ventures
• 5 Controversy and criticism
○ 5.1 Marketing of formula
○ 5.2 Melamine in Chinese milk
○ 5.3 Zimbabwe farms
○ 5.4 Palm oil use
• 6 See also
• 7 Footnotes
• 8 External links
○ 8.1 Data

[edit] Pronunciation
Today, in English-speaking countries, "Nestlé" is most commonly pronounced /ˈnɛstleɪ/).
However, the original pronunciation was /ˈnɛsəl/, as in the English verb "nestle". This
pronunciation was common throughout much of the 20th century, but changes in its spoken form
in advertising influenced it to become more akin to its native pronunciation [nɛsle] in French-
speaking Switzerland. The old pronunciation, however, is still used today in some regions such
as the Black Country. "Nestle" in Alemannic German (Alemannisch – as spoken in southwestern
Germany and in Switzerland) refers to a small nest (Nest being the same word in English and
German). The -le ending makes the word into a diminutive.
[edit] History
 2

Nestlé headquarters in Vevey.

The company dates to 1867, when two separate Swiss enterprises were founded that would later
form the core of Nestlé. In August of that year, Charles A. and George Page, brothers from Lee
County, IL in the United States, established the Anglo-Swiss Condensed Milk Company in
Cham. In September, in Vevey, Henri Nestlé developed a milk-based baby food and soon began
marketing it. In the succeeding decades both enterprises aggressively expanded their businesses
throughout Europe and the United States. (Henri Nestlé retired in 1875, but the company, under
new ownership, retained his name as Farine Lactée Henri Nestlé.) In 1877 Anglo-Swiss added
milk-based baby foods to its products, and in the following year the Nestlé company added
condensed milk, so that the firms became direct and fierce rivals.

Henri Nestlé.
In 1905, however, the companies merged to become the Nestlé and Anglo-Swiss Condensed
Milk Company, retaining that name until 1947, when the name Nestlé Alimentana SA was taken
as a result of the acquisition of Fabrique de Produits Maggi SA (founded 1884) and its holding
company, Alimentana SA of Kempttal, Switzerland. Maggi was a major manufacturer of soup
mixes and related foodstuffs. The company’s current name was adopted in 1977. By the early
1900s, the company was operating factories in the United States, United Kingdom, Germany and
Spain. World War I created new demand for dairy products in the form of government contracts;
by the end of the war, Nestlé's production had more than doubled.
After the war, government contracts dried up and consumers switched back to fresh milk.
However, Nestlé's management responded quickly, streamlining operations and reducing debt.
The 1920s saw Nestlé's first expansion into new products, with chocolate the company's second
most important activity.

Nestlé's logo used until 1970s.

Nestlé felt the effects of World War II immediately. Profits dropped from US$20 million in 1938
to US$6 million in 1939. Factories were established in developing countries, particularly Latin
America. Ironically, the war helped with the introduction of the company's newest product,
Nescafé, which was a staple drink of the US military. Nestlé's production and sales rose in the
wartime economy.
The end of World War II was the beginning of a dynamic phase for Nestlé. Growth accelerated
and companies were acquired. In 1947 came the merger with Maggi seasonings and soups.
Crosse & Blackwell followed in 1950, as did Findus (1963), Libby's (1971) and Stouffer's
(1973). Diversification came with a shareholding in L'Oréal in 1974. In 1977, Nestlé made its
second venture outside the food industry by acquiring Alcon Laboratories Inc.
In 1984, Nestlé's improved bottom line allowed the company to launch a new round of
acquisitions, notably American food giant Carnation and the British confectionery company
Rowntree Mackintosh in 1988, which brought the Willy Wonka Brand to Nestlé.
 3

The Brazilian president, Lula da Silva, inaugurates a factory in Feira de Santana (Bahia),
February, 2007.
The first half of the 1990s proved to be favorable for Nestlé: trade barriers crumbled and world
markets developed into more or less integrated trading areas. Since 1996 there have been
acquisitions including San Pellegrino (1997), Spillers Petfoods (1998), and Ralston Purina
(2002). There were two major acquisitions in North America, both in 2002: in June, Nestlé
merged its U.S. ice cream business into Dreyer's, and in August a US$2.6 billion acquisition was
announced of Chef America, the creator of Hot Pockets. In the same time frame, Nestlé came
close to purchasing the iconic American company Hershey's, though the deal fell through.[3]
Another recent purchase includes the Jenny Craig weight loss program for US$600 million.
In December 2005 Nestlé bought the Greek company Delta Ice Cream for €240 million. In
January 2006 it took full ownership of Dreyer's, thus becoming the world's biggest ice cream
maker with a 17.5% market share.[4]
In November 2006, Nestlé purchased the Medical Nutrition division of Novartis Pharmaceutical
for $2.5B, also acquiring in 2007 the milk flavoring product known as Ovaltine. In April 2007
Nestlé bought baby food manufacturer Gerber for $5.5 billion.[5] [6][7]
In December 2007 Nestlé entered in a strategic partnership with a Belgian chocolate maker
Pierre Marcolini.[citation needed] Nestlé agreed to sell its controlling stake in Alcon to Novartis on 4
January 2010. The sale forms part of a broader US $39.3 billion offer by Novartis to fully
acquire the world’s largest eye-care company.[8]
[edit] Products
Main article: List of Nestlé brands
Nestlé has 6,000 brands,[9] with a wide range of products across a number of markets including
coffee (Nescafé), bottled water, other beverages (including Aero (chocolate) & Skinny Cow),
chocolate, ice cream, infant foods, performance and healthcare nutrition, seasonings, frozen and
refrigerated foods, confectionery and pet food.
[edit] Business

Japan headquarters

The Nestlé Tower in Croydon. This serves as their headquarters in the United Kingdom.
[edit] Management
The executive board, a distinct entity from the board of directors, includes:
• Peter Brabeck, Chairman of the Board of Directors, Nestlé S.A.
• Paul Bulcke, Chief Executive Officer, Nestlé S.A.
• Werner Bauer, Executive Vice President, Nestlé S.A., Chief Technology Officer, Head of
Innovation, Technology, Research & Development
 4

• Friz van Dijk, Executive Vice President, Nestlé S.A. Asia, Oceania, Africa, Middle East
• Luis Cantarell, Executive Vice President, Nestlé S.A. United States of America, Canada,
Latin America, Caribbean
• José Lopez, Executive Vice President, Nestlé S.A. Operations, GLOBE
• John J. Harris, Executive Vice President, Nestlé S.A. Chairman & CEO of Nestlé Waters
• Richard Laube, Executive Vice President, Nestlé S.A. CEO of Nestlé Nutrition
• James Singh, Executive Vice President, Nestlé S.A. Finance and Control, Legal, IP, Tax,
Global Nestlé Business Services
• Laurent Freixe, Executive Vice President, Nestlé S.A. Europe
• Petraea Heynike, Executive Vice President, Nestlé S.A. Strategic Business Units,
Marketing, Sales and Nespresso
• Marc Caira, Deputy Executive Vice President, Nestlé S.A. Head of Nestlé Professional
Strategic Business Division
• Jean-Marc Duvoisin, Deputy Executive Vice President Nestlé S.A. Head of Human
Resources and Centre Administration
• David P. Frick, Senior Vice President and ex officio Member of the Executive Board
According to a 2006 global survey of online consumers by the Reputation Institute, Nestlé has a
reputation score of 70.4 on a scale of 1–100.[10]
[edit] Earnings
In 2009, consolidated sales were CHF 107.6 billion and net profit was CHF 10.43 billion.
Research and development investment was CHF 2.02 billion.[1]
• Sales by activity breakdown: 27% from drinks, 26% from dairy and food products, 18%
from ready-prepared dishes and ready-cooked dishes, 12% from chocolate, 11% from pet
products, 6% from pharmaceutical products and 2% from baby milks.
• Sales by geographic area breakdown: 32% from Europe, 31% from Americas (26% from
US), 16% from Asia, 21% from rest of the world.
[edit] Joint ventures
Nestlé holds 26.4% of the shares of L'Oréal, the world's largest company in cosmetics and
beauty. The Laboratoires Inneov is a joint venture in nutritional cosmetics between Nestlé and
L'Oréal, and Galderma a joint venture in dermatology with L'Oréal. Others include Cereal
Partners Worldwide with General Mills, Beverage Partners Worldwide with Coca-Cola, and
Dairy Partners Americas with Fonterra.
[edit] Controversy and criticism
[edit] Marketing of formula
Main articles: infant formula and Nestlé boycott
One of the most prominent controversies involving Nestlé concerns the promotion of the use of
infant formula to mothers across the world including developing countries, an issue that attracted
significant attention in 1977 as a result of the Nestlé boycott.[11] Nestlé's policy[12], however,
states that breastmilk is the best food for infants; however, women who cannot or choose not to
 5

breast feed for whatever reason do need an alternative to ensure that their babies are getting the
nutrition they need.
[edit] Melamine in Chinese milk
Main article: 2008 Chinese milk scandal
In late September 2008, the Hong Kong government claimed to have found melamine in a
Chinese-made Nestlé milk product. The Dairy Farm milk was made by Nestlé's division in the
Chinese coastal city Qingdao.[13] Nestlé affirmed that all its products were safe and were not
made from milk adulterated with melamine. On October 2, 2008 the Taiwan Health ministry
announced that six types of milk powders produced in China by Nestlé contained traces of
melamine. Nestlé has announced that it will begin a recall of milk products produced in China.[14]
[15]

[edit] Zimbabwe farms

In late September 2009, it was brought to light that Nestlé was buying milk from illegally-seized
farms currently operated by Robert Mugabe's wife, Grace Mugabe. Mugabe and his regime are
currently subject to European Union sanctions.[16] Nestlé later stopped buying milk from the
dairy farms in question.[17]
[edit] Palm oil use
Rapid deforestation in Borneo and other regions to make way for oil palm plantations sends
massive amounts of carbon dioxide into the atmosphere.[18] In particular, where peat swamp
forests are cleared, destroying the habitat for many threatened species of animals such as the
orangutan, much public attention[19] has been given to the environmental impact of palm oil and
the role of multi-nationals such as Nestlé in this.[20] There is ongoing concern by various NGO's
including Greenpeace.[21]
Nestlé were met with "a deluge of criticism from consumers, after a large number of Facebook
users posted negative comments about the company's business practises."[22] Nestlé's attempt to
engage with the issue were met with criticism, including headlines stating: "Nestlé fails at social
media",[23] and "Nestlé Loses Face On Facebook"[24]. Nestlé Chairman, Peter Brabeck-Letmathe,
in answer to a question from Greenpeace, told the Company’s Annual General Meeting in
Lausanne on April 15 2010 that in 2009 Nestlé used 320,000 tonnes of palm oil worldwide,
comparing this with the 500,000 tonnes of palm oil used for biodiesel in Germany and Italy
alone.[25]
In May 2010 Nestlé said it was inviting The Forest Trust, a not-for-profit group, to audit its
supply chain and promised to cancel contracts with any firm found to be chopping down
rainforests to produce the palm oil which it uses in KitKat, Aero and Quality Street. Greenpeace
welcomed the agreement promising to monitor it closely .[26][27][28

The Nestlé boycott is a boycott launched on July 4, 1977, in the United States against the Swiss
based Nestlé corporation. It spread quickly throughout the United States, and expanded into
Europe in the early 1980s.[1] It was prompted by concern about the company's marketing of
breast milk substitutes (infant formula), particularly in less economically developed countries
(LEDCs), which campaigners claim contributes to the unnecessary death and suffering of babies,
largely among the poor.[2] Among the campaigners, Professor Derek Jelliffe and his wife Patrice,
who had contributed to establish the World Alliance for Breastfeeding Action (WABA), were
 6

particularly instrumental in helping to coordinate the boycott and giving it ample visibility
throughout the world.

Contents
[hide]
• 1 The baby milk issue
• 2 History of the boycott
• 3 Current status of the boycott
• 4 Boycott in the media
• 5 Other Nestlé operations targeted
• 6 References
• 7 External links

[edit] The baby milk issue

Groups such as the International Baby Food Action Network (IBFAN), and Save the Children
claim that the promotion of infant formula over breast-feeding has led to health problems and
deaths among infants in less economically developed countries.[3][4] There are four problems that
can arise when poor mothers in developing countries switch to formula:
• Formula must normally be mixed with water, which is often contaminated in poor
countries, leading to disease in vulnerable infants. [5] Because of the high illiteracy rates
in developing nations many mothers are not aware of the sanitation methods needed in
the preparation of bottles. Even mothers able to read in their native tongue may be unable
to read the language in which sterilization directions are written.
• Even mothers that can understand the sanitation standards required often do not have the
means to perform it: fuel to boil water, electric (or other reliable) light to enable
sterilisation at night. UNICEF estimates that a non-breastfed child living in disease-
ridden and unhygienic conditions is between six and 25 times more likely to die of
diarrhea and four times more likely to die of pneumonia than a breastfed child.[6]
• Many poor mothers use less formula powder than is necessary, in order to make a
container of formula last longer. As a result, some infants receive inadequate nutrition
from weak solutions of formula.[7]
• Breast milk has many natural benefits lacking in formula. Nutrients and antibodies are
passed to the baby while hormones are released into the mother's body.[8] Breast-fed
babies are protected, in varying degrees, from a number of illnesses, including diarrhea,
bacterial meningitis, gastroenteritis, ear infection, and respiratory infection.[9][10][11] Breast
milk contains the right amount of the nutrients that are essential for neuronal (brain and
nerve) development. [12] The bond between baby and mother can be strengthened during
breastfeeding.[10] Frequent and exclusive breastfeeding can also delay the return of
fertility, which can help women in developing countries to space their births.[13] The
World Health Organization recommends that, in the majority of cases, babies should be
exclusively breast fed for the first six months.[14]
 7

Advocacy groups and charities have accused Nestlé of unethical methods of promoting infant
formula over breast-milk to poor mothers in developing countries.[15][16] For example, IBFAN
claim that Nestlé supports the distribution of free powdered formula samples to hospitals and
maternity wards; after leaving the hospital, the formula is no longer free, but because the
supplementation has interfered with lactation the family must continue to buy the formula.
IBFAN also allege that Nestlé uses "humanitarian aid" to create markets, does not label its
products in a language appropriate to the country where they are sold, and offers gifts and
sponsorship to influence health workers to promote its products.[17] Nestlé denies these
allegations. [18]
[edit] History of the boycott
Nestlé's perceived marketing strategy was first written about in New Internationalist magazine in
1973 and in a booklet called The Baby Killer, published by the British non-governmental
organization War On Want in 1974. Nestlé attempted to sue the publisher of a German-language
translation (Third World Action Group) for libel. After a two-year trial, the court found in favour
of Nestlé because they could not be held responsible for the infant deaths 'in terms of criminal
law'. [19] However, because the Defendants were only fined 300 Swiss Francs, and that Judge Jürg
Sollberger commented that Nestlé "must modify its publicity methods fundamentally", TIME
magazine declared this a "moral victory" for the defendants. [20]
The widespread publicity led to the launch of the boycott in Minneapolis, USA, by the Infant
Formula Action Coalition (INFACT) and this boycott soon spread to Australia, Canada, New
Zealand, and Europe. In May 1978, the US Senate held a public hearing into the promotion of
breast-milk substitutes in developing countries and joined calls for a Marketing Code. In 1979,
WHO and UNICEF hosted an international meeting which called for the development of an
international code of marketing, as well as action on other fronts to improve infant and young
child feeding practices. The International Baby Food Action Network (IBFAN) was formed by
six of the campaigning groups at this meeting. [16]
In 1981, the 34th World Health Assembly (WHA) adopted Resolution WHA34.22 which
includes the International Code of Marketing of Breast-milk Substitutes. The Code covers infant
formula and other milk products, foods and beverages, when marketed or otherwise represented
to be suitable as a partial or total replacement of breast-milk. It bans the promotion of breast-
milk substitutes and gives health workers the responsibility of advising parents. It limits
manufacturing companies to the provision of scientific and factual information to health workers
and sets out labeling requirements.[21]
In 1984, boycott coordinators met with Nestlé, which agreed to implement the code, and the
boycott was officially suspended. However, in 1988 IBFAN alleged that baby-milk companies
were flooding health facilities in the developing world with free and low-cost supplies, and the
boycott was relaunched the following year [5]
In May 1999 a ruling against Nestlé was issued by the UK Advertising Standards Authority
(ASA). Nestlé claimed in an anti-boycott advertisement that it markets infant formula “ethically
and responsibly”. The ASA found that Nestlé could not support this nor other claims in the face
of evidence provided by the campaigning group Baby Milk Action.[22]
In November 2000 the European Parliament invited IBFAN, UNICEF and Nestlé to present
evidence to a Public Hearing before the Development and Cooperation Committee. Evidence
was presented by the IBFAN group from Pakistan and UNICEF's legal officer commented on
Nestlé's failure to bring its policies into line with the World Health Assembly Resolutions. Nestlé
 8

declined an invitation to attend, claiming scheduling conflicts, although it sent a representative of

the auditing company it had commissioned to produce a report on its Pakistan operation.[23][24][25]
[edit] Current status of the boycott
This article may need to be updated. Please update this article to reflect recent events or
newly available information, and remove this template when finished. Please see the talk
page for more information.
The boycott is coordinated by the International Nestlé Boycott Committee, the secretariat for
which is the UK group Baby Milk Action [26]. Company practices are monitored by the
International Baby Food Action Network (IBFAN), which consists of more than 200 groups in
over 100 countries.
In parallel with the boycott, campaigners work for implementation of the Code and Resolutions
in legislation and claim that 60 countries have now introduced laws implementing most or all of
the provisions.[27]
Many[quantify] European universities, colleges and schools have banned the sale of Nestlé products
from their shops and vending machines. In the United Kingdom, 73 Student Unions, 102
businesses, 30 faith groups, 20 health groups, 33 consumer groups, 18 local authorities, 12 trade
unions, education groups, 31 MPs, and many celebrities support the boycott.[28][29]
Nestlé claims that it is in full compliance with the International Code.[30] According to their CEO,
Peter Brabeck-Letmathe, "we also carry out annual audits on WHO Code compliance with a
sample of Nestlé companies, and we investigate any substantiated claims made by those who
believe we have broken the Code.... If we find that the Code has been deliberately violated, we
take disciplinary action."[31] The company maintains that many of the allegations are
unsubstantiated, out-of-date, or use IBFAN's own non-standard interpretation of the Code. [18]
[edit] Boycott in the media
An episode of the TV show The Mark Thomas Product made by the British Channel Four in
1999 investigated the boycott and Nestlé's practices concerning baby milk. Mark Thomas
attempted to find evidence for claims against Nestlé and to speak to heads of the company. In
one portion of the show he "received a tin of baby milk from Mozambique. All instructions are
in English. 33 languages and dialects are recognised in Mozambique. Portuguese is the official
language. However, only about 30% of the population can speak it. English is usually the second
language for people in Mozambique. [32]
In 2001, comedian Robert Newman and actress Emma Thompson called for a boycott of the
Perrier Comedy Award, because Perrier was owned by Nestlé.[33] An alternative competition
called the Tap Water Awards was set up the following year.[34]
In 2002, authors Germaine Greer and Jim Crace withdrew from the Hay Festival in protest over
Nestlé's sponsorship of the event.[35]
A 2007 article in The Guardian highlighted aggressive marketing practices by Nestlé in
Bangladesh.[5]
[edit] Other Nestlé operations targeted
Nestlé is sometimes targeted for other aspects of its operations. A Brazilian group called
Cidadãos pelas Águas (Citizens for Water) has called a boycott of Nestlé in Brazil over the
company's extraction of water from an aquifer in São Lourenço. Some also boycott Nestlé coffee
 9

and chocolate products in favour of fair trade alternatives. However, Partners Blend coffee,
launched by Nestlé during 2005, has obtained Fairtrade labelling status. Baby Milk Action has
also condemned this development.[36]
In the Philippines, there exists a Boycott Nestlé campaign due to suspected labor rights
violations in a factory in Laguna province.[37] This campaign is led by Kilusang Mayo Uno.
There are few medical reasons to use infant formula – "The vast majority of mothers can and
should breastfeed, just as the vast majority of infants can and should be breastfed," and "Only
under exceptional circumstances can a mother's milk be considered unsuitable for her infant."[6]
[28]
Alternatives to breast-feeding include:
• expressed breast milk from an infant’s own mother,
• breast milk from a healthy wet nurse,
• breast milk from a human-milk bank,
as well as infant formula.[6] Among these, the WHO states that "the choice of the best
alternative ... depends on individual circumstances."[6]
Reasons to not breastfeed or it is not possible to breastfeed include:
• The mother's health: The mother is infected with HIV[29] or tuberculosis.[29] She is
malnourished or has had certain kinds of breast surgery. She is taking any kind of drug
that could harm the baby,[29] or drinks unsafe levels of alcohol. The mother is extremely
ill.
• The baby is unable to breastfeed: The child has a birth defect or inborn error of
metabolism such as galactosemia that makes breastfeeding difficult or impossible.
• Absence of the mother: The child is adopted, orphaned, or in the sole custody of a man.
The mother is separated from her child by being in prison or a mental hospital. The
mother has left the child in the care of another person for an extended period of time,
such as while traveling or working abroad. The mother has abandoned the child.
• Financial pressures: Maternity leave is unpaid, insufficient, or lacking. The mother's
employment interferes with breastfeeding.
• Societal structure: Breastfeeding is difficult or forbidden at the mother's job, school,
place of worship or while commuting.
• Social discomfort: The mother may feel uncomfortable breastfeeding around other
people.
• Personal beliefs: The mother may choose to not breastfeed for varied personal reasons –
for instance, she may feel that breasts are too sexual for a baby.
• Lack of training: The mother is not trained sufficiently to breastfeed without pain and to
produce enough milk.
• Dietary concerns: The contents of breastmilk are influenced by the dietary habits of the
mother. If the mother consumes a food that contains an allergen breastfeeding may, for a
brief period after consumption, provoke an allergic reaction in the infant.
Reasons to supplement by alternatives, in addition to breastfeeding, include:
• Social structure or discomfort: The mother may be able to breastfeed at some hours, but
not at others, for reasons cited above.
 10

• Lactation insufficiency: The mother is unable to produce sufficient milk, which affects
around 2 to 5% of women.[30]
Reasons to use infant formula specifically, as opposed to the alternatives of expressed milk, wet
nurses, and milk banks, include:
• Lack of education: The mother, her doctor,[31] or family may believes that her breast milk
is of low quality or in low supply, or that breastfeeding will decrease her energy, health,
or attractiveness, and be unaware of other alternatives. Nursing by a relative or paid wet-
nurse may be believed to be unhygienic.
• Social pressures: Family members, such as mother's husband or boyfriend, or friends or
other members of society may encourage the use of infant formula.
• Personal beliefs: The mother may choose to use formula for varied personal beliefs.
• Lack of alternatives:
○ Lack of refrigeration: Expressed breast milk requires refrigeration if not
immediately consumed, and sanitary preparation conditions – this latter
requirement is shared with infant formula.
○ Lack of wet nurses: Wet nursing is illegal and stigmatized in some countries, and
may not be available.[32] It may also be socially unsupported or expensive, and
safe use of wet nurses requires health screening of the nurses.
○ Lack of milk banks: Human-milk banks may not be available; relatively few exist,
and they require screening and refrigeration.
Infant formula is nutritionally inferior to breast milk but superior to other substitutes such as
animal milk. Besides breast milk, infant formula is the only other milk product which the
medical community considers nutritionally acceptable for infants under the age of one year –
note that solid food is nutritionally acceptable in addition to breast milk or formula during
weaning.
Although cow's milk is the basis of almost all infant formula, plain cow's milk is unsuited for
infants because of its high casein content and low whey content which may put a strain on an
infant's immature kidneys, and untreated cow's milk is not recommended before the age of 12
months. The infant intestine is not properly equipped to digest non-human milk and this may
often result in diarrhea, intestinal bleeding and malnutrition[citation needed]. To reduce the negative
effect on the infants digestive system, cows milk used for formula undergoes processing in order
to be made into infant formula. This includes steps in order to make protein more easily
digestible and alter the whey-to-casein protein balance to a ratio closer to human milk, the
addition of several essential ingredients (often called "fortification", see below), the partial or
total replacement of dairy fat with fats of vegetable or marine origin, etc.
Most of the world's supply of infant formula is produced in the United States[citation needed]. The
nutrient content of infant formula for sale in the United States is regulated by the American Food
and Drug Administration (FDA) based on recommendations by the American Academy of
Pediatrics Committee on Nutrition. The following must be included in all formulas produced in
the U.S.:[33]
• Protein
• Fat
• Linoleic acid
 11

• Vitamins: A, C, D, E, K, thiamin (B1), riboflavin (B2), B6, B12

• Niacin
• Folic acid
• Pantothenic acid
• Calcium
• Metals: magnesium, iron, zinc, manganese, copper
• Phosphorus
• Iodine
• Sodium chloride
• Potassium chloride
• Carbohydrates
○ Carbohydrates are an important source of energy for growing infants as it
accounts for 35 to 42% of their daily energy intake. In most cow's based formulas,
lactose is the main source of carbohydrates present. But lactose is not present in
cow's milk-based lactose-free formulas nor specialized non-milk protein formulas
or hydrolyzed protein formulas for infants with milk protein sensitivity. Lactose is
also not present in soy-based formulas. Therefore, those formulas without lactose
will use other sources of carbohydrates like sucrose and glucose, natural and
modified starches, monosacchardies and indigestible carbohydrates. Lactose is not
only a good course of energy, it also aids in the absorption of various minerals
like magnesium, calcium, zinc and iron.[34]
• Nucleotides
○ Nucleotides are compounds found naturally in human breast milk. They are
involved in many different critical metabolic processes in the body like energy
metabolism and enzymatic reactions. Also, as the building blocks of
deoxyribonucleic acid (DNA) and ribonucleic acid (RNA) they are essential for
normal body functions. Compared to human breast milk, cow's milk has lower
levels of nucleotides like uridine, inosine, and cytidine. Therefore, several
companies that produce infant formula have added nucleotides to their infant
formulas.[34]
• Nestle India has weathered a challenging environment of high agro-commodity prices
and food inflation during the June ’10 quarter. The maker of Maggi noodles and Nescafe
continued to report double-digit growth in sales and profits during the quarter.

Good news, for investors, is that this growth was fuelled by higher volumes. Given the
expectation of a sustained demand for its key products, the momentum is likely to
continue in the near term. Net sales of the company grew by 21.3% year-on-year to Rs
1,466.7 while net profit increased by 20.3% to Rs 194.8. The impressive revenue growth,
however, couldn’t culminate into a similar growth in operating profit. At 16%, its
operating profit before depreciation grew at a slower pace due to higher input costs.

The company’s exports grew faster than its domestic business. However, the appreciating
rupee partially offset the growth in exports. One concern is rising competition in its most
 12

profitable segment of instant noodles. The company has one of the most popular brands
Maggi in this category. So far, the brand has enjoyed a clear hegemony in this segment
with a market share of more than 80%.

Of late, high growth and higher profitability have attracted other players to the fast-
growing instant noodles category. It is currently growing at around 20% per annum,
according to company estimates. Maggi now faces competition from HUL’s Knorr Soupy
Noodles and GSK Consumer’s Foodles. Nestle’s dependence on the category has only
increased in recent years. Today, Maggi contributes over 26% to total revenue, much
higher than the 19% share four years ago. This increases the company’s exposure to the
increasing competition in the noodles segment. Further, to maintain its market share,
Nestle may need to increase its advertisements and promotional spends in the future. This
may weigh heavy on its overall margins, given the prominence of the segment in its
business mix.

However, Nestle’s past experience in the noodles category suggests that it has a
significant customer recall for Maggi. This has helped the company wade through
competition successfully for the past many years. It needs to be seen how well Nestle
fares this time, given that it would meet some of the FMCG giants head on. As a first
response to the competition, Nestle has extended the Maggi brand and rolled out new
products.

Going ahead, the trend in inflation would play a crucial role. Nestle’s other businesses,
including milk products, beverages and chocolates, contribute around 74% to its
revenues. Major raw materials used are milk, sugar and wheat. Rising prices of these raw
materials can be a concern since they would put pressure on operating margins. An
expectation of better monsoon, however, may soften food prices. This may provide some
solace for the company.
•

• Nestlé Professional extends its strength in the out-of-home industry with the launch
of a new Nescafé drink distributed by ‘roaming sales people’ in Senegal.
• Launched on March 9 in the capital city of Dakar, the Nescafé Ginger and Spice beverage
was rolled out to consumers by over 100 newly-recruited Nestlé roaming sales people. In
a second launch at the Nestlé Senegal head office, around 100 females joined the street
selling initiative on June 8. In a third boost the day after, another 50 males joined in
Kaolack in west-central Senegal.
• A total of 306 roaming sales people sell around 70 cups each per day, while maximising
the brand’s visibility and backing Nestlé’s concept of Creating Shared Value in the
region. A target of 1,000 roaming sales people are expected to take to selling more
Nescafé and Nescafé Ginger and Spice in the out-of-home market before the end of the
year.
• Alain Diop, Nestlé Professional manager for Nestlé Senegal, said: “In our developing
market where many small street vendors are actively presenting all sorts of products to
the consumers, it is critical for us to reduce the distance and the obstacles which separate
us from our consumers; and to be perfectly visible and accessible in order to be chosen
first.
 13

• “On the other hand, because of the high unemployment rate in such environments, there
are so many young people very eager to earn a living. Therefore, the new creative
concept of the roaming Nescafé sales people, with a box, simply symbolises our
permanent efforts to anticipate the needs of our consumers and get the closest possible to
them wherever they are.”
• During a visit to Senegal on July 12, Etienne Benet, Head of Central and West Africa
Region, also expressed his vision for a combined effort of consolidation from Nestlé
Professional and Nescafé to encourage the roll out of the roaming sales plan in other
countries of the region.
• Another initiative which maximises visibility for the Nescafé brand, is the 'Nescafé
Grains club' was launched in June 2010. Meeting to share ‘Nescafé moments’, the group
has around 10,000 members, including 220 Nescafé direct sellers.
• Each direct seller – recruited by Nescafé in Dakar and in the North of Senegal – receives
the product from Nestlé's distributor and sells directly to the consumers in their homes
with cup tasting and personalised communication. From August 2010, a total of 430
direct sellers will be recruited at national level and in Gambia. Thanks to the combined
work of Nestlé Professional and Nescafé retail direct sellers, sales of Nescafé Classic are
maximised and the speed of new products to market are improved, in particular the new
African Coffee range.
• The Nestlé Professional beverages division provides the commercial and institutional
restaurant industry with branded hot and cold non-carbonated drink solutions under
brands such as Nescafé, Coffee-mate, Nesquik, Nestea and Nestlé.
• Globally, Nestlé Professional is present in over 100 countries with over 10,000
employees.
• Creating Shared Value
• This is Nestlé's way of doing business that focuses on specific areas of its core business
activities – namely water, nutrition, and rural development – where value is created both
for society and the Company.
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Nestlé’s relationship with India dates back to 1912, when it began trading as The Nestlé Anglo-
Swiss Condensed Milk Company (Export) Limited, importing and selling finished products in
the Indian market.
Nestlé India is a subsidiary of Nestlé S.A. of Switzerland. With seven factories and a large
number of co-packers, Nestlé India is a vibrant Company that provides consumers in India with
products of global standards and is committed to long-term sustainable growth and shareholder
satisfaction.The company is acknowledged amongst India’s ‘Most Respected Companies’ and
amongst the ‘Top Wealth Creators of India’.
After India’s independence in 1947, the economic policies of the Indian Government emphasized
the need for local production. Nestlé responded to India’s aspirations by forming a company in
India and set up its first factory in 1961 at Moga, Punjab, where the Government wanted Nestlé
to develop the milk economy. Progress in Moga required the introduction of Nestlé’s
Agricultural Services to educate, advise and help the farmer in a variety of aspects. From
increasing the milk yield of their cows through improved dairy farming methods, to irrigation,
scientific crop management practices and helping with the procurement of bank loans. Nestlé set
up milk collection centres that would not only ensure prompt collection and pay fair prices, but
also instil amongst the community, a confidence in the dairy business. Progress involved the
creation of prosperity on an on-going and sustainable basis that has resulted in not just the
transformation of Moga into a prosperous and vibrant milk district today, but a thriving hub of
industrial activity, as well.
Beginning with its first investment in Moga in 1961, Nestlé’s regular and substantial investments
established that it was here to stay. In 1967, Nestlé set up its next factory at Choladi (Tamil
Nadu) as a pilot plant to process the tea grown in the area into soluble tea. The Nanjangud
factory (Karnataka), became operational in 1989, the Samalkha factory (Haryana), in 1993 and in
1995 and 1997, Nestlé commissioned two factories in Goa at Ponda and Bicholim respectively.
Nestlé India has commissioned in 2006 its 7th factory at Pant Nagar in Uttarakhand.
Nestlé has been a partner in India’s growth for over nine decades now.
Nestlé India manufactures products of truly international quality under internationally famous
brand names such as NESCAFÉ, MAGGI, MILKYBAR, MILO, KIT KAT, BAR-ONE,
MILKMAID and NESTEA and in recent years the Company has also introduced products of
daily consumption and use such as NESTLÉ Milk, NESTLÉ SLIM Milk, NESTLÉ Fresh ‘n’
Natural Dahi and NESTLÉ Jeera Raita.
Head Office:
Nestlé India Ltd.
Nestlé House, Jacaranda Marg
M Block, DLF City Phase II
Gurgaon – 122 002
Haryana
India
 15

Tel: +91-124-2389300, 2389411

Registered Office:
Nestlé India Ltd.
M-5A, Connaught Circus,
New Delhi – 110 001
India.