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Euromonitor: Nestlé Gearing For Growth Following Tie-Ups

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Food giant Nestlé, which releases its Q3 results this week, could soon be reaping the benefits of its proposed tie-up with R&R Ice Cream, Euromonitor International has said in a statement.

Lianne van den Bos, packaged food analyst at Euromonitor International, said,  “Nestlé’s joint venture with R&R is a clear example of the company’s long-term growth strategy.

“Whilst a tie-up with R&R might seem counterintuitive for a company aiming to be the world’s leading nutrition, health and wellness company, in reality, it is a good way to separate its ice-cream sales from its core business and gain operational efficiencies by joining forces.”

The company has also shown its interest in the premium chocolate market with the recent launch of an upmarket brand, Cailler.

Jack Skelly, packaged food analyst at Euromonitor, said of the launch, “Nestlé is performing below that of key chocolate market rivals such as Mars, Mondeléz and Lindt. It suffers from a lack of premium offering in Western Europe and North America, where brands such as Lindt and Brookside have performed very well over the past five years.

“It has lost nearly one percentage point [of] market share in Western Europe since 2010. In part, this is due to the company’s reliance on Kit Kat, which represents over 40 per cent of Nestlé’s chocolate sales.”

Nestlé’s Q3 results are expected to be published Friday morning, 16 October.

© 2015 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. To subscribe to ESM: The European Supermarket Magazine, click here.

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