What is Nestlé CEO Laurent Freixe’s Action Plan?

New Nestlé boss Laurent Freixe has set out an “action plan” to turn around the world’s biggest food company. 

Nestlé’s action plan sets out to advance category growth within the multinational food giant and support market share performance.

The action plan will make the company “more efficient, responsive and agile” said Freixe in a press release. 

Freixe also plans a marketing push to try to restore the lustre of some underperforming brands, a move that looks set to tighten profit margins in the medium term.

The CEO is increasing advertising and marketing investment to 9% of sales by the end of 2025 to bolster Nestle’s brands, which range from Purina pet food to Nespresso coffee and KitKat biscuits, generating the investment needed from cost savings and growth leverage. 

By the end of 2027, Nestlé plans to deliver cost savings of at least US$2.8bn. 

It has started on key initiatives across:

• Procurement
• Commercial investments 
• Structural costs

Nestlé's water and beverage activities will become a global standalone business under the leadership of Muriel Lienau, Head of Nestlé Waters Europe, from 1 January 2025. This will include looking at additional partnership opportunities, to assist Nestlé's iconic brands and growth platforms to reach their full potential.

Using the latest in AI technology, Nestlé will advance its digital transformation to become a real time, end-to-end connected enterprise. 

Nestlé also plans to ensure that sustainability is embedded across its activities, from its frozen food supply chain to regenerative farming.

Looking to 2025, Nestlé expects to see an improvement in organic sales growth compared with 2024, although the underlying trading operating profit margin will be lower than the 2024 guidance.

Organic sales growth is expected to be at 4% plus with an underlying operating profit margin 17% plus.

Nestlé CEO shares his vision

Nestlé CEO Laurent Freixe said he was proud of Nestlé’s iconic brands and innovative products, which are able to connect with people every day, at every stage of their lives. He sees these strengths as being able to give the company a unique advantage and position for them to win in the marketplace. 

"Nestlé is a strong company with global reach, exceptional demand generation and in-market capabilities. We have a diverse and strategically well-positioned product portfolio,” he said in a press release. 

“We will now invest further in our brands and growth platforms to unlock the full potential of our products for our consumers and our customers.

“Our action plan will also improve the way we operate, making us more efficient, responsive and agile. This will allow us to deliver value for all our stakeholders. I am confident that we can deliver superior, sustainable and profitable growth and gain market share, while transforming Nestlé for long-term success."

A 38-year company veteran, Freixe took over in September following on from his predecessor Mark Schneider, who led Nestle for almost eight years. 

Last month the new CEO lowered the company’s target for organic sales growth this year to around 2%, which would be the lowest annual rate since at least the turn of the century.

Nestlé operates in 86 countries and sells products in more than 190 of them, from the beloved KitKat to San Pellegrino, employing over 291,000 people globally.

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