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Nestle to sell more smaller-size items

Bloomberg News / February 25, 2009
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GENEVA - Nestle SA, the world's largest food company, will sell more products in smaller quantities in the United States and Europe as customers seek to cut their shopping bills, chief executive Paul Bulcke said.

Reduced product sizes will be offered in the United Kingdom, France, and the United States, Bulcke told analysts yesterday, mirroring what Nestle has already done in Brazil, and the Philippines to make its food more affordable for low-income shoppers in emerging markets.

"In the developed world, we are accelerating initiatives that are linked with the same concept," the chief executive said at a conference in London that was available via Internet. "It's an initiative that's very timely."

Revenue from smaller packs of Nescafe soluble coffee and Maggi instant noodles is helping Nestle meet its sales targets as consumers eat out less and switch to cheaper brands.

Sales of the so-called popularly positioned products rose 27 percent to about $4.3 billion last year and will probably gain more than 25 percent in 2009, Bulcke said yesterday.

In the United Kingdom, Nestle is selling soluble coffee in smaller packages of 100 grams compared with regular 750 gram tins.

Bulcke said the food maker is also seeking to add sales by offering products that are tailored to foreign communities. Nestle sells food including Abuelita chocolate to the Hispanic population in the United States through small stores, generating about $301 million in sales.

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