Nestlé Essay ⋆ Business Essay Examples ⋆ EssayEmpire

Nestlé, which specializes in sales of processed food, traces its origins to the Farine Lactée Henri Nestlé, founded in 1866. Heinrich Nestle (1814–90), the company’s founder, was born in 1814 in Frankfurt-au-Main, Germany; he was apprenticed to a pharmacist, learning how to produce chemicals and make up prescriptions. He moved to Vevey, Switzerland, and there changed his name to Henri Nestlé, changing his Christian name to a French one and adding the acute accent to his surname. He became very interested in rapeseed oil, which he manufactured and used for oil lamps, and in the manufacture of liqueurs and absinthe.

During the 1840s, Nestlé established a business making and selling carbonated mineral water and lemonade. In 1847 he was forced to stop selling mineral water, and 10 years later, he was focusing on sales of fertilizers and gas lighting equipment. During this time, he became interested in the development of infant formula due to the high infant mortality rate at the time. Half of his own siblings had died when they were young.

When some mothers were unable to breastfeed children, they generally used a mixture of cow’s milk, sugar, and wheat flour. Nestlé decided to manufacture his own milk formula, removing acid and starch to make it easier for babies to digest. To sell it, he made it in a powdered form as Farine Lactée Henri Nestlé (Henri Nestlé’s Milk Flour), which became the name of the company. By the mid-1870s, the product was being sold throughout the United States as Nestlé’s Infant Food. Soon afterward, Henri Nestlé-Ehmant, as he was then called, retired to Montreux and then to Glion, where he lived in what became known as Villa Nestlé until his death in 1890.

Processed Foods

In 1905 Farine Lactée Henri Nestlé merged with a rival, the Anglo-Swiss Milk Co., which was established in 1866 by Charles A. Page and George Page, brothers from the United States, at Cham, Switzerland. Together, the two companies had competed in the manufacture of milk formula; together, they formed Nestlé, which built on the strengths of both businesses to manufacture milk products, confectionary items, bottled water, ice cream, coffee, food seasonings, and pet foods. The companies also had the rights to manufacture chocolates as Peter, Kohler, Nestlé, and Cailler. In 1927 the firms bought from Gerber & Company AG the right to make cheese. Then they moved into the making of instant coffee, which was sold under the name Nescafé and is now one of the most profitable and best-known lines in the company.

The company later grew larger with the purchase of Fabrique de Produits Maggi SA in 1947. In 1960 it took over Crosse & Blackwell (established 1830) and its affiliated companies, which operated in Great Britain, Australia, South Africa, the United States, and many other parts of the world. Gradually, Nestlé started buying up other European brands, including Vittel in 1990 and Perrier in 1992. In 1998 it bought Sanpellegrino, Rowntree Mackintosh, and Spillers Petfoods. In addition, it bought several U.S. companies, including Carnation Co. After the purchase of Ralston Purina in 2002, a new division of Nestlé was established, called Nestlé Purina PetCare. Then Nestlé expanded into frozen food with Chef America, Inc.

Nestlé, which maintains its headquarters in Vevey, currently employs 276,000 people (2007) and has assets of $129 billion, with operating income of nearly $17 billion and profit of $12 billion.

Bibliography:

Mark Casson, ed., The Oxford Handbook of Entrepreneurship (Oxford University Press, 2006);
Jean-Louis Flandrin and Massimo Montanari, Food: A Culinary History From Antiquity to the Present (Columbia University Press, 1999);
Otto Hunziker, Condensed Milk and Milk Powder, Prepared for the Use of Milk Condenseries (Read Books, 2007);
Albert Pfiffner and Hansjörg Renk, Wandel als Herausforderung: Nestlé 1990–2005 [Change as a Challenge] (Verlag Neue Zürcher Zeitung, 2007);
Oliver F. Williams, Peace Through Commerce: Responsible Corporate Citizenship and the Ideals of the United Nations Global Compact, The John W. Houck Notre Dame Series in Business Ethics (University of Notre Dame Press, 2008).

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