Real-world companies Essay Example | Topics and Well Written Essays - 1500 words

Real-world companies - Essay Examplegeographic barriers trade and tariff rules are great bane for it. Maintaining the brand image is also a declamatory threat for approach (Nash, 2000). PEST Analysis Political Political factors can mold the credit line in a great extent. Due to which nest may bear different taxes which increase the operational address of near. Economical Economical factors like inflation have a great encroachment over the approach business. Socia-cultural People have more awareness about brand due to cultural factors so it is costly to maintain the social symbol. Technology Rapid change in technology is a great threat for Nestle to maintain its innovation and enhance the R&D operations (Peter and Olson, 2004). Porters 5 forces Model The threat of substitute Substitute low price products are the biggest threat for the company part Nestle is providing its customers with quality products at a reasonable price. The threat of new main course Low entry barriers are there. Entry of any new firm having same standard products can be a great threat for Nestle. Competitive rivalry There is high agonistical rivalry because Nestle is competing with former(a) organizations which tolerate the same products at low cost. The bargaining mightiness of supplier Due Supplier of Nestle have increased bargaining power. The bargaining power of buyers New entrants and their offers have increased the bargaining power of buyers (Nash, 2000). Competitive advantages of Nestle Nestle Company started off as the single idea from Henri Nestle who was a pharmacist. He formulated a mil formula for infants who had less tolerance for mother milk in 1866. This was the breakthrough for him as the entire Europe came up with the largest demand for this formula. Since then Nestle has been increasing the size the company and expanding in almost all countries. Not only business expansion but Nestle also has expanded the product line by introducing variety in every product they offer (Etzel, et. al., 2004). By using the innovation and renovation in the product line, Nestle has been able to gain competitive advantage in the global market. Nestles trademark has become a barrier to many an(prenominal) other companies with people considering its products as a benchmark to follow. Here are some of the competitive advantages that Nestle is enjoying at the moment Nestle is leading the overall global market position. It is either number wiz or two brands in most of the countries and regions globally. The larger scope of Nestles extraordinary business is providing significant and sustainable economies of scale in marketing, manufacturing and administration processes of the business. Nestle has developed a wide investigate and development department with capabilities and expertise that allow the company to lead in the innovative products which ultimately leads to flexibility in portfolio maximization and profitability (Etzel, et. al., 2004). Business strate gies used by Nestle Innovation Innovation is iodin of the key business strategies that is bringing a sustained competitive advantage to Nestle. A great turn of applied and pure science research is part of R&D centers of Nestle in collection to bring innovation but consumer benefit remains at the core of the business. Whatever designed or produced is customer oriented. The Nestles innovative strategy focuses on providing Health and nutrition Quality and asylum of every Nestle products