Nestle plans to double sales in five years

Nestlé Waters provides double the sales in Brazil in the next five years. The bet is based on strong growth in emerging markets, to the detriment of developed countries.
John j. Harris, global President of Nestle Waters, who spent yesterday in Rio de Janeiro to announce the installation of the fifth factory of Nestle Waters Division in the country, said the value that the countries of Europe, even in crisis, still show growth of water consumption. But are the developing markets that will bring greater return to the company in the coming years.
The President of Nestle Waters said even if the company is aware of the new opportunities for acquisitions in the country, although there are negotiations in progress. Also stated that to achieve the planned growth, Nestlé Waters needs to grow above the competitors and gain greater market share.
In a ceremony held yesterday at the Guanabara Palace, the official seat of Government of the State of Rio, Harris announced investment of r $ 117 million in the acquisition of mineral water fountain Valley of the Sun and of its assets, which includes a distilled water in Silva Jardim, região dos lagos in the State of Rio. The plant will be adapted to international standards of Nestlé and is due to come into operation in August, with 100 employees and 800 indirect jobs.
The new plant will occupy a total of 300 hectares and will be surrounded by an environmental protection area of 1,100 hectares. The mineral water is bottled in small formats, from 300 ml, with and without gas, in addition to 10 liter returnable and 20 litres. The company does not inform the installed capacity of its factories.
Including this new unit, the company has earmarked over the past five years, a total of r $ 300 million on three acquisitions. The Director of Nestlé Waters, Alexander Carter, said that the units already guarantee the expected growth for the country and that the company is working on the consolidation of these assets.
Harris, who keeps secret the numbers regarding Brazil, reported that the average annual consumption of mineral water in the Brazilian market is "only" 50 liters per person, while in the United States this number has already reached 120 litres. According to the Executive, the Brazilian per capita water consumption must double over the next five years.
"We hope to get at least double the sales in that period," said Harris, the value. According to Harris, in the last four years, the Brazilian market of bottled water grew 14% in value and 5% in volume. In the State of Rio-where the company is market leader with 30%-the growth achieved was above the national average, with 19% in value and 7% in volume in the same period.
According to estimates of the Associação Brasileira da Indústria Mineral water (Abinam), the Brazilian mineral water segment moved about $ 2.1 billion in 2011, with selling 9 billion liters.
Nestle Waters is a global leader in water, with 10.5% of the volume of which is sold in 2011. However, in Brazil represents only 1.8% of the market. To achieve the planned growth in the country, Harris says that "the Brazilian team is the challenge to grow faster than the market."
In the first nine months of 2012, Nestlé Waters represented 8.28% of the Group's global sales of 67.6 billion Swiss francs (US $ 74.3 billion).