Nestlé May Axe Brands Due to Sales Slowdown

by Christopher Freeburn | August 19, 2013 10:59 am

nsrgy Nestlé May Axe Brands Due to Sales Slowdown[1]In its search to gain traction with consumers, Nestlé (NSRGY[2]) is considering plans to downsize its number of product offerings[3].

Nestlé’s global sales have been dented by lackluster growth in Europe and developing markets. Earlier this month, the company announced that it was reviewing its portfolio of 8,000 brands with an eye to identifying underperforming assets, Bloomberg notes,

The company, long regarded as highly profitable and stable, rarely sells off major assets. Still, it is assessing about 1,000 business units located in 194 countries, using various analytical tools to determine which struggling units can be coaxed into better performance.

Those that can’t face the prospect of a sale.

Earlier this year, Nestlé pulled two products from the European market after DNA tests identified the presence of horse meat[4]. The company blamed an outside meat supplier for the contamination and said it would subsequently use DNA tests on all meat obtained from third party suppliers.

Shares of Nestlé rose slightly in over-the-counter trading on Monday morning.

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2011/02/nsrgy.jpg
  2. NSRGY: http://studio-5.financialcontent.com/investplace/quote?Symbol=NSRGY
  3. to downsize its number of product offerings: http://www.bloomberg.com/news/2013-08-18/nestle-s-sales-slowdown-seen-leading-to-slimmer-brand-portfolio.html
  4. identified the presence of horse meat: http://investorplace.com/2013/02/nestle-pulls-two-products-in-horse-meat-scandal/

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