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280	280	Several risk factors are prevalent in the business of Nestlé.
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282		-Product quality and safety is one of the top risk factors according to the annual review of the company, 2021.
	282	+* Product quality and safety is one of the top risk factors according to the annual review of the company, 2021.{{footnote}}Annual Review 2021, p.61. Available at: https://www.nestle.com/sites/default/files/2022-03/2021-annual-review-en.pdf{{/footnote}}
	283	+* Oftentimes, compromised quality of the products caused hazard to the consumers triggering a controversy like the one in China in 2002.
	284	+* Failure to predict consumer preferences and to anticipate the competition accurately can cost the company market shares and a dip in sales. The market dynamics of the FMCG industry can change very quickly. Although Nestlé has adequate R&D facilities along with proper focus towards consumer needs and market dynamics, it always remains a risk factor.
	285	+* Increased regulation from authorities concerning the misleading labelling of products’ nutrition factors is another risk factor for the company. The company is also subject to pressure from the propaganda of international organizations. For example, when in 1990s, Nestlé advertised its Children Breast Milk substitute, //Save the Children //issued a statement regarding this issue which outrightly denied all the claims of Nestlé’s advertisement that their product can be a substitute to mother’s milk. Apart from that the company is subject to increased regulation for human rights-related issues such as child labour, child trafficking, forced labour etc.
	286	+* Operational nature of the company creates environmental hazard such as plastic wastage, excessive use of natural resources, air emissions, waste discharges and so on. Plastic packaging alone can create an environmental hazard which may bolster climate change. The company understands this risk and is complying with the regulations related to it. However, increased awareness about environmental preservation is a risk for the company from a compliance point of view; it is a risk from ethical and corporate social responsibility point of view as well.
	287	+* Supply chain disruption is always a major risk for a company as big as Nestlé. Major events such as commodity shortages, strikes, sanctions, natural disasters, health outbreaks etc. can affect the transport, sourcing, and internal/external manufacturing facilities of the company.
	288	+* (((
	289	+Other systematic risks such as macro financial factors and geo-political factors are present in the risk profile of the business. Macro financial factors include sudden disruption in inflation, interest rate, exchange rates, and other macro-economic variables. Geo-political factors include political instability, conflicts, pandemic, trade wars, labour or infrastructure-related risks.
	290	+)))
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	292	+= Business Overview =
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	294	+The business of Nestlé is driven by the purpose of unlocking the power of food to enhance quality of life for everyone, today and for generations to come. Nestlé sold in 2021 powdered and liquid beverages of 24.0 billion CHF, PetCare of 15.6 billion CHF, nutrition and health science products of 13.2 billion CHF, prepared dishes and cooking aids of 12.1 billion CHF, milk products and ice cream of 10.7 billion CHF, confectionery of 7.5 billion CHF, and water of 4.0 billion CHF. The company geographically divides its worldwide operation in 3 segments (see competition analysis of Nestlé). Highest sale of the company comes from American region – 39.1 billion CHF; second highest from European region – 25.8 billion CHF; and third highest from Asian and African region – 22.2 billion CHF.
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	296	+The company employs 276000 employees as of 2021. It sells its products in 186 countries. The company’s total group salaries and social welfare expenses amount to CHF 14 billion and it paid 2.7 billion in corporate taxes.
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	298	+The strategic choice of the company has resulted into the following results in 2021 –
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	300	+* Coffee, pet care, nutrition, water and nutritional health science, together representing 63% of sales, grew by 8.2%.
	301	+* Plant-based food products generated sales of around CHF 800 million with organic growth of 16.8%.
	302	+*
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