Analysis Of Nestle Coffee Purchasing

Since entering the Chinese market, Nestle coffee business development and stability,market share has remained the leading edge, but the challenges and risks in theChinese coffee market is also increasing, which is mainly reflected in the Nescafedomestic procurement. Coffee beans supply will reduce the yield of coffee production,higher production costs, make the Nestle coffee competition in the market at adisadvantage. Challenges facing research and purchasing patterns, and reform ofoptimization can reduce procurement costs; enhance the company’s overallcompetitiveness.In this paper, basis on a full analysis of Nestle coffee purchasing model, made anexposition on four challenges that Nestle faced: regional economic policy; thecompetition with industry competitors; exchange rate fluctuation risk and4C andother international industry-standard restrictions. Using the SWOT analysis method toanalysis the advantages and disadvantages, opportunities and threats of the Nestle inthe coffee market, using the competitive theory, market theory, as well as procurementmanagement theory and methods to find the reform programs for the problemsencountered: the first, on the exchange rate as well as regional economic policy toimprove the investment strategy, risk management, risk early warning system; second,the reform of the procurement model, the organizational form of procurement, theestablishment of the "company+agriculture specialized cooperative economicorganizations+farmers" mode, enhance the degree of organization of coffee growers,and the coexistence of a variety of acquisitions, reduce business risk for companiesand farmers; green responsibility for procurement mode, and enhance the awarenesslevel of4C and other standards, and strive to make these standards become theregional coffee industry standards.