Competitor Analysis

Nestle Corp. • Brent Hanson • Justin Chen • Lance Rambousek • Randee Birkeland

History • Founded in Vevey, Switzerland by Henri Nestle • Combination of two companies

• Popular during WWI and WWII

Industry Analysis •

Brief for candy industry

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Health Issues

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Challenges

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Future Trends

Definition and History • Definition of candy industry - It’s a part of snack industry and belongs to food industry.

• History of candy industry - Can be dated back to mid 1800’s.

Health Issues • As a part of food industry, Candy industry is also facing health issues mainly as followings: • - Tooth Decay • - Obesity

Challenges • Substitutes to candy in snacks risk the profit of candy industry. • - Chips and crisp

• - Biscuits and cookies • - Popcorn

Future Trends • -Improved technology • -High profit

• -Fierce competition in market

Global Analysis • Nestle and Ethiopian Government • Nestle and Infant Formula

• Nestle and Kit Kat Kit-Kat Commercial

Company Analysis STRENGTHS • Strong brand name recognition some of the most recognized brands in the candy and chocolate industry: -Nestle Crunch -Pixy Stix -Wonka Products -Butterfinger -Baby Ruth

STRENGTHS Cont. • Internationalization throughout the industry • Very recognizable in nearly every country

• Chocolate and Candy are popular worldwide • Very low operating costs – Allows Nestle to undercut pricing stategies of competitors

WEAKNESSES • Candy division is small portion of company revenue----only 11% of annual sales---Nestlé's revenues • Company interests are more targeted toward other industries, not candy • Dependence on Foreign production -many Nestle products are made overseas for low costs

OPPORTUNITIES • Healthier approach to candy Countries including U.S. are becoming more health conscious

• Strong opportunity to join bubble gum market

THREATS • Competitors • U.S. market slump

• Foreign Labor • Tainted ingredients (Melamine)

Competitor Analysis

Hershey’s Company • Largest North American candy company • Headquartered in Hershey, Pennsylvania

• Largest chocolate factory in the world • Twizzler’s, Reese’s, Milk Duds, Jolly Ranchers • Produces Kit Kat for Nestle

Mars Incorporated • One of the largest private owned companies in the United States • Headquartered in Hackettstown, New Jersey • International Headquarters is Brussels, Belgium • Skittles, Starburst, M&M’s, Snickers • Recently purchased Wrigley Jr. Company

Pearson’s Candy Company • St. Paul, Minnesota headquarters • Salted Nut Roll, Mint Patty, Nut Goodie

• Very centralized – 80% of revenue from Salted Nut Roll and Mint Patty • Several ownership changes

Cadbury plc • Worlds largest candy company • Based in London, England

• Cadbury Cream Eggs, Trident Gum, and Halls cough drops • 60 countries, 50,000 employees • Sold United States subdivision to Hershey’s

Recommendations • Short Term – Find more efficient and labor friendly production practices – Create even more low cost products to match the budgets of homes.

– Produce environmentally friendly packages

Recommendations Cont. • Long Term – New product lines • Health? – Expansion into untapped markets – Combine candy segment with another competitor

Conclusion Nestle is one of the top producers of candy in the world. They share just a small share in the global market as well as just 11% of their own companies revenue, but their ability to transition into foreign markets and produce top brands lets them compete with all other companies worldwide.