Does It Make Sense For Nestle To Focus Its Growth Efforts On Emerging Essay

Does It Make Sense For Nestle To Focus Its Growth Efforts On Emerging Markets Why - Essay Example The growth level of Nestle is rising in developing nations such as China, South East Asia and a few markets of Middle East, Africa and Latin America. Thus, it makes sense for Nestle to focus its growth in emerging markets (Biotee, n.d.). The company through mergers and acquisitions developed its growth and expanded the operations along with increase in market share in emerging markets. As the rising markets are providing ample of opportunities for Nestle to expand their business in certain growing economies, thus it can provide them opportunity for future sustained growth (One World Trust, 2007). Nestle, one of the world's largest food groups have set out to expand their business in the fast-growing emerging markets which will enable them to make future market growth with the help of new products as well as their existing products (The Economic Times, 2011). Nestle is much conscious of the emerging markets importance to its businesses. In 2009, the company had a 42 per cent fall down in its net profit. In 2010, Nestle had seen a growth of 0.3 per cent from its established markets whereas in Asian countries such as China there was around double- digit growth for the company. In provisions of retail sales the company is also ranked in third after Mars-Wrigley and Cadbury in the emerging markets. Thus, it is important for Nestle to expand its market in emerging nations for its future growth (Greenmail, 2010)... In provisions of retail sales the company is also ranked in third after Mars-Wrigley and Cadbury in the emerging markets. Thus, it is important for Nestle to expand its market in emerging nations for its future growth (Greenmail, 2010) 2.0 What Is the Company’s Strategy With Regard To Business Development in Emerging Markets? Does This Strategy Make Sense? From An Organizational Perspective, What Is Required For This Strategy To Work Effectively? Nestle continues to expand in emerging markets by extending to Central and Eastern Europe with the creation of a new service centre. They had developed strategies in order to generate growth in the local economy by enhancing employment opportunities and creating a talent pool of young skilled workers in the developing nations (Nestle, 2010). In emerging markets Nestle grow by controlling ingredients along with processing technology for local conditions and utilising the suitable brand for that market. In Asia, Nestle attain local comp anies in order to make a group of independent regional managers as they are much acquainted with the culture of local markets than others. They are generally focussed on developing local foods for local markets and they are not providing importance to their global brands in emerging markets. It also localises its distribution and marketing strategy to the requirements of the local market (Slide Share, 2011). In Nigeria, Nestle selected local singers in order to visit towns as well as villages for providing a mix of entertainment along with product demonstrations. In China, the company built its own distribution of network which is branded as ‘milk roads’