Nestlé Announces Long-Term Growth Plans: What Refreshment Operators Need to Know

Image Source: Nestlé

Nestlé is unveiling an ambitious plan aimed at driving growth, improving efficiency, and positioning the company for long-term success. This strategy focuses on increasing investments in marketing, saving costs to reinvest in the business, and making strategic moves in key growth areas like water and premium beverages. Additionally, the company is accelerating its use of digital tools like artificial intelligence to enhance operations and sustainability.

“Our iconic brands and innovative products connect with people every day, at every stage of their lives. These strengths give us a unique advantage and position us to win in the marketplace,” said Laurent Freixe, Nestlé CEO, in the recent press release. “We will now invest further in our brands and growth platforms to unlock the full potential of our products for our consumers and our customers.”

As part of this plan, Nestlé will boost its marketing spend to 9% of sales by 2025, ensuring greater visibility and consumer appeal for its products. The company also aims to save CHF 2.5 billion by 2027 through procurement efficiencies and cost reductions. Its water and premium beverage division will become an independent business starting in 2025, allowing for more targeted growth. At the same time, Nestlé is embracing digital tools like AI to drive efficiency, with the goal of achieving steady annual sales growth of 4% or more and maintaining profit margins above 17%.

Why This Matters for Refreshment Operators

Will refreshment operators benefit from these changes? Nestlé’s strategy offers several benefits and opportunities for refreshment operators:

  • Stronger Beverage Focus: With water and premium beverages becoming a standalone business, operators can expect better support and possibly more tailored product options to meet consumer needs.
  • Increased Marketing, More Demand: Increased marketing means Nestlé products will be even more recognizable and in demand, potentially driving higher sales for operators who stock them.
  • Operational Efficiency: Cost savings and digital transformation may result in competitive pricing and improved product availability, making it easier for operators to manage inventory and boost profits.
  • Innovation and Sustainability: Nestlé’s focus on innovation and sustainability aligns with consumer trends, offering operators fresh, appealing products that meet today’s workforce preferences.

Nestlé’s plan aims to streamline operations, enhance agility, and drive sustainable growth, delivering value for all stakeholders. This strategy not only positions Nestlé for long-term success, but also creates valuable opportunities for refreshment operators through stronger support, increased demand, and innovative offerings.