Nestle Nigeria PLC forms part of the 22 regions under the control of Nestle Central and West Africa (CWA) Limited who is the major shareholder of the company. This is a concept Nestle has followed world wide in which smaller companies are organised into different regions. Although in 2014 Nestle CWA transferred it's 59.59% shareholding to Nestle S.A, Switzerland resulting in that company now holding 63.48% of total shares.
Nigeria itself has a population of over 170 million with more than 500 languages being spoken with English remaining the official language. Although rich in natural resources Nigeria remains one of the poorer countries with high unemployment rates and much corruption and political instability. This would present Nigeria PLC with the challenges of keeping prices low and distancing themselves from any form of bribery or corruption.
The product offering in the region is limited and not as extensive as you may find in other countries. Not surprising considering the previously mentioned high unemployment. With lower disposable incomes I would think the product line would have to be kept simple to thrive in the region. For instance the popular Kit Kat, of which 150 are consumed worldwide every second, is not distributed in Nigeria or in fact the entire Central and West Africa region. In fact there are no Nestle chocolate or confectionary brands distributed in Nigeria other than the aptly named Chocomilo.
Other than Chocomilo the other products include baby foods, cereals, water, Milo, some Maggi foodstuffs, full cream milk and coffee.
Taken directly from the Annual Report the company's objective is 'to be the recognised leader in Nutrition, Health and Wellness and the industry reference for financial performance'. As part of their "creating shared value" program the company is also committed to several social projects aimed at both people and the environment. These projects range from reducing saturated fats and removing trans fats in products to raising awareness of water conservation and improving access to water sanitisation to elimination of child labour in key categories.
It does make me wonder what they mean by "key categories". Surely they should want to eliminate all child labour not just in "key categories".
Other issues facing the company revolve around sustainability. Nestle has identified an increase of 70-80% by 2050 in agricultural food production to meet the demands of a growing global population. In Nestle Nigeria PLC much of this focus has been placed on water management.
Also of importance to the company is the issue of nutrition. Not only is this relevant in a global population that is increasingly looking for healthier options thus becoming more popular. But I would also think this is important considering the socio-economic status of the Nigerian people. With lower incomes sometimes the first sacrifice is nutrition and as such I would hope there is a high importance within the company to produce low cost high nutrition foods.
Further information on other commitments and creating shared value can be found on the following links. There is also a YouTube clip posted below the discussion.
- http://www.nestle-cwa.com/en/csv/what-is-csv/commitments
- http://www.nestlecocoaplan.com/
- http://www.bloomberg.com/news/articles/2015-08-31/nestle-s-kitkat-to-change-cocoa-supplies-to-address-child-labor
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