Nestle will change a new way of playing next year and set up a new Greater China region!
Just now, the world’s largest food and beverage company announced that the board of directors has approved the motion to establish a new region, which will take effect from January 1, 2022. The new structure will strengthen the company’s market-oriented management mode and further enhance the company’s ability to succeed in a rapidly changing environment. “The new structure also demonstrates once again the company’s determination to succeed in all regions of the world, including the two largest markets of North America and greater China,” the company informed.
It is worth noting that according to the latest arrangement, Zhang Xiqiang, CEO of Nestle Taitaile group and head of food business in Greater China, will join the group’s executive board as executive vice president and CEO of Greater China. This means that Zhang Xiqiang will take over the “handsome seal” from Luo Shide, the current chairman and CEO of Nestle Greater China.
Let’s take a look at the details.
Establishment of Greater China
According to the arrangement, Nestle’s new structure will include five regions, of which Asia, Oceania and Africa (AOA) will now include the Middle East and North Africa (MENA), with an annual sales of 17.5 billion Swiss francs.
Nestle pointed out that the Greater China region (GC) is one of the fastest growing food and beverage markets in the world, providing the group with great growth potential. The region’s annual sales are CHF 5.7 billion.
The above sales figures do not include Nestle’s global management business espresso and Nestle Health Sciences, which have annual sales of 9.2 billion Swiss francs in 2020. Nestle will report sales and growth figures according to the new regional architecture for the first time on April 21, 2022.
Mark Schneider, chief executive of Nestle group, said: “Through the new regional structure, we will significantly strengthen our focus on key regions to promote sustainable profitable growth in all regions we operate. This will bring us closer to consumers and customers, open new business opportunities, and enable us to be more flexible in a rapidly changing consumption environment.”
The briefing also pointed out that Zhang Xiqiang, the current CEO of Nestle’s very successful food and condiment business unit Taitaile group and head of food business in Greater China, will join the group’s executive board as executive vice president and CEO of Greater China.
Statistics show that Zhang Xiqiang started his career in Wyeth China in 2000, where he held various positions related to financial departments. After Nestle acquired Wyeth in 2012, Zhang Xiqiang transferred to Nestle and served as the head of dry goods sales in Nestle China from 2015 to 2016.
“Mr. Luo Shide, the current head of Greater China who has served in many regions of Nestle group and has an excellent career for many years, has decided to leave the company and will transfer his responsibilities in this region on December 31, 2021,” the circular said.
The briefing also quoted Paul BOCAI, chairman of Nestle, as saying: “I fully support mark and the team’s initiative to raise Nestle’s regional structure to a new level. This is an important and timely change and will strengthen the effective implementation of our company’s local attributes and group strategy.
According to an internal notice from Nestle to its employees seen by the snack generation today, the significance of this structural adjustment is further explained. The circular said that the new structure will strengthen Nestle’s regional focus in the world and establish a direct reporting relationship for key markets and global headquarters. This management method will make Nestle closer to consumers and customers, open new business opportunities and enable the company to More flexible in a rapidly changing consumer environment.
Rochester “cross stick”
Xiaoshidai once introduced that Rochester became president of Nestle Greater China in August 2016. In the past five years, Rochester has witnessed many major events and milestones in Nestle’s China business. During this period, Nestle has not only strengthened its localization production capacity in China, but also made efforts to improve its localization R & D and innovation capacity.
On the one hand, Nestle announced a new package of additional investment in China in May and September last year, including a series of projects in Tianjin with a total amount of more than 100 million Swiss francs (about 730 million yuan) Capital increase plans and projects are used to expand the production capacity of local pet food and candy business; and RMB 400 million is invested in Harbin Shuangcheng to further strengthen the high-end production of Nestle in local factories.
At the beginning of this year, Nestle announced a series of new investments in China, including: Nestle coffee R & D center project settled in Qingdao, will invest in the construction of new coffee R & D and production base and infant supplementary food production base in Qingdao Laixi factory, and the newly established Nestle Greater China ready to drink product innovation center will bring six independently developed patents to Qingdao to explore and develop more new coffee products.
On the other hand, Nestle also adjusted some of its businesses in China, announcing that it sold its local water business to Tsingtao Beer Group, as well as Yinlu peanut milk and Babao porridge.
According to Nestle’s arrangement, Rochester will transfer its management responsibilities for the Greater China business on December 31 this year.
Approaching Zhang Xiqiang
For Zhang Xiqiang, Nestle employees in China are quite familiar with him. He has worked as a leader in many business departments of Nestle. This is also five years later, a Chinese took charge of Nestle’s leadership in China.
Zhang Xiqiang joined Nestle group with Wyeth nutrition M & A in 2012. He has successfully held leadership positions in the fields of finance, operation and sales and has rich experience. He became president of Taitaile in January 2017 and created a good performance record during his tenure.
It is worth noting that since March 1 this year, he has been appointed as the head of Nestle’s cooking food business in Greater China. He also manages the business of Taile and Haoji.
As president of Taitaile, Zhang Xiqiang explained the three “uniqueness” in his mind to the snack generation in February this year: in 2021, the core strategy of our operation can be summarized in three sentences: growth is the only way to solve all problems, innovation is the only driving force of growth, and consumers and customers are the only focus of our innovation.
During his tenure, Zhang Xiqiang also led the major adjustment of Nestle’s cooking food business in China, that is, the business integration of its two major seasoning brands, Taitaile and Haoji.
“In the past four years, with its strong leadership and passion for success, he has successfully increased Tai Tai’s business and has reached the highest level in COVID-19’s case.” Nestle praised Zhang Xiqiang in an internal circular this year.
Zhang Xiqiang said that as long as we strive to achieve growth, we can basically solve the problems in terms of cost, operation, expenses and channels.
As for innovation, for him, it is far more than product innovation, but also includes the innovation of operation mode, team organization and workflow. “We do so many innovations around how to serve consumers and customers.”
From the many measures taken by Zhang Xiqiang to manage Taile, his practices are quite grounded, focusing on people, goods and field.
For example, during his tenure, in order to further release the growth potential, Taile focused on the broad low-line urban and rural markets. Since the beginning of this year, Taile has launched the “fresh partner” plan for dealers, relying on dealer partners to sink the channel. For the sinking market, Taile launched specific products and launched the “WanDian plan” project, hoping to occupy 10000 high-end stores in the vast rural areas. In addition, the business continues to overweight o2o.