Nestlé LCA
Nestlé LCA
Nestlé LCA
MMFU 5013
SUSTAINABLE PRODUCT DESIGN AND
MANUFACTURING
This research paper through about Nestlé’s business and current product development
using Life Cycle Assessment (LCA). Four steps in LCA implement into Nestlé’s
product to ensure environmentally sustainability. First step is setup the
goal/aims/objectives. Secondly, inventory analysis. Third, impact analysis and lastly
interpretation. Nestlé’s product, Nescafé brand have life cycle in their development
from farmer/plantlet until end of life in inventory analysis. Nescafé define that their
product will be impact on three categories which are; Carbon Footprint, Water
Footprint, and Land Use. All this impact analysis will define that the product harm to
environment or not. Lastly this paper will interpretation all data in inventory and impact
analysis to resolve the environmental sustainability issues.
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TABLE OF CONTENTS
Title Page
Abstract i
Table of Contents ii
1.0 Introduction
1.1 Introduction 1
1.2 Background of Study 2
3.0 Methodology
3.1 Goal and scope 10
3.2 Inventory Analysis 10
3.3 Impact Analysis 11
3.4 Interpretation 11
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Title Page
5.0 Discussion and Conclusion
5.1 Discussion 18
5.2 Conclusion 18
Referances 19
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CHAPTER 1
INTRODUCTION
1.1 Introduction
Nestlé history begins in 1866, with the foundation of the Anglo-Swiss Condensed
Milk Company. Henri Nestlé develops a breakthrough infant food in 1867, and in 1905
the company he founded merges with Anglo-Swiss, to form what is now known as the
Nestlé Group. During this period cities grow and railways and steamships bring down
commodity costs, spurring international trade in consumer goods (Nestlé, 2017).
During the war in 1914, the Nestlé Group had experienced cross-border trade
restrictions causing them to open a plant in the US and Australia. This is due to the high
demand for condensed milk and chocolate during the war. As a result, nearly 40 Nestlé
factories built after the war ended.
After the war military demand for canned milk declines, causing a major crisis
for Nestlé & Anglo-Swiss in 1921. The company recovers, but is rocked again by the
Wall Street Crash in 1929, which reduces consumer purchasing power. However, the
era carries many positives: the company’s management corps is professionalized,
research is centralized and pioneering products such as Nescafé coffee and Milo are
launched (Nestlé, 2017).
Nestlé Group merges with Swiss company Alimentana, which produces Maggi
soups, bouillons and seasonings, and is renamed Nestlé Alimentana. Alimentana’s
history dates back to 1884, when Julius Maggi developed a protein-rich dried soup to
tackle malnutrition.
The post-war period is marked by growing prosperity, and people in the US and
Europe spend money on machines that make life easier, such as refrigerators and
freezers. They also favor convenience foods, and Nestlé Alimentana meets this need
with new products including Nesquik and Maggi ready meals (Nestlé, 2017).
Acquisitions enable Nestlé to enter fast-growing new areas such as frozen foods,
and to expand its traditional businesses in milk, coffee and canned foods. In the 1970s
the company diversifies into pharmaceuticals and cosmetics. It starts to attract criticism
from activist groups that allege its marketing of infant food is unethical. Nestlé later
becomes one the first companies to apply the WHO code on breast-milk substitutes
across its business (Nestlé, 2017).
Following years of growth, Nestlé disposes of unprofitable brands and promotes
those that satisfy increasingly health conscious consumers, in line with its new
‘Nutrition, Health and Wellness’ ambition. The company expands in the US, Eastern
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Europe and Asia, and targets for global leadership in water, ice cream and animal food
(Nestlé, 2017).
Nestlé articulates its Creating Shared Value approach to business for the first
time, and launches its Nestlé Cocoa Plan and Nescafé Plan to further develop
sustainable supply chains in cocoa and coffee. While strengthening its position in
traditional segments, infant formula and frozen foods, Nestlé strengthens its focus on
medical nutrition (Nestlé, 2017).
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CHAPTER 2
LITERATURE REVIEW
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Attribute Principles Description
Nestlé require our suppliers, agents, subcontractors and
Supplier and
their employees to demonstrate honesty, integrity and
customer
fairness, and to adhere to our non-negotiable standards. In
relations
Suppliers and the same way, Nestlé are committed to our own customers.
customers Nestlé contribute to improvements in agricultural
Agriculture
production, the social and economic status of farmers, rural
and rural
communities and in production systems to make them
development
more environmentally sustainable.
Nestlé commit ourselves to environmentally sustainable
business practices. At all stages of the product life cycle we
Environmental
strive to use natural resources efficiently, favor the use of
sustainability
sustainably-managed renewable resources, and target zero
The waste.
environment Nestlé are committed to the sustainable use of water and
continuous improvement in water management. Nestlé
Water recognize that the world faces a growing water challenge
and that responsible management of the world’s resources
by all water users is an absolute necessity.
Nutrition and
Health Science
Milk products
and Ice cream
Powdered and
Liquid
Beverages
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Categories Example
Prepared
dishes and
cooking aids
PetCare
Confectionery
Water
19792
Sales in Million CHF
15038 14331
12148 12067
8679
7414
Figure 2.1 above show how Powdered and Liquid Beverages leads other Nestlé
product in sales 2016. Nescafé is the world’s favourite coffee brand, with close to half
a billion cups served daily (Nestlé, 2016a). Second highest is product from category
Nutrition and Health and Science contributed 15,038 million CHF.
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Figure 2.2: Nestlé Product Growth (Wimmba, 2012)
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2.3.2 Packaging
Packaging is crucial for protecting foods and beverages, preventing food waste,
and providing important information for individuals and families. Nestlé work to
optimize their packaging to minimize resource use; use more materials from sustainably
managed renewable resources; support initiatives to recycle or recover energy from
used packaging; and use recycled materials wherever there is a clear environmental
benefit and it is appropriate (Nestlé, 2018c)
Nestlé have supported the Product Environmental Footprint project, helping the
European Commission develop category rules for packed water and pet food. Nestlé
conducted a pilot study of Purina ONE to determine how best to engage customers
about sustainable purchasing decisions. A second phase focused on how best to
communicate these results to individuals and families, which we tested using both
Purina ONE and Nestlé Waters Vittel bottled water. (Nestlé, 2018d)
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2.4 Life Cycle Assessment (LCA)
Life cycle assessment (LCA) also called Life-Cycle Analysis is a tool for
examining the total environmental impact of a product through every step of its life
from obtaining raw materials all the way through making it in a factory, selling it in a
store, using it in the workplace or at home, and disposing of it (Roisin, 2008).
Environmental inputs and outputs refer to demand for natural resources and to
emissions and solid waste. The life cycle consists of the technical system of processes
and transport routes used at, or needed for, raw materials extraction, production, use
and after use (waste management or recycling).
Life-Cycle Assessment is an objective procedure used to evaluate the
environmental impacts associated with a product’s entire life cycle, through the
quantitative determination of all exchange flows between the product system and the
ecosphere in all the transformation processes involved, from the procurement of
materials (these may be recycled instead of new) to their end for this product.
Four steps in a life cycle assessment:
i. Goal and scope
ii. Inventory Analysis
iii. Impact Analysis
iv. Interpretation
Figure 2.3 Adaptation of LCA’s stage/step according to ISO 14040 (Roisin, 2008).
In defining the scope of an LCA study, the following items shall be considered
and clearly described:
i. the functions of the product system, or, in the case of comparative studies,
the systems
ii. the functional unit
iii. the product system to be studied
iv. the product system boundaries
v. allocation procedures
vi. types of impact and methodology of impact assessment, and subsequent
interpretation to be used
vii. data requirements
viii. assumptions
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ix. limitations
x. initial data quality requirements
xi. type of critical review, if any
xii. type and format of the report required for the study
The scope should be sufficiently well defined to ensure that the breadth, the depth
and the detail of the study are compatible and sufficient to address the stated goal. LCA
is an iterative technique. Therefore, the scope of the study may need to be modified
while the study is being conducted as additional information is collected.
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CHAPTER 3
METHODOLOGY
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the use of resources and releases to air, water and land associated with the system.
Interpretations may be drawn from these data, depending on the goals and scope of the
LCA. These data also constitute the input to the life cycle impact assessment. The
process of conducting an inventory analysis is iterative. As data are collected and more
is learned about the system, new data requirements or limitations may be identified that
require a change in the data collection procedures so that the goals of the study will still
be met. Sometimes, issues may be identified that require revisions to the goal or scope
of the study.
3.4 Interpretation
Interpretation is the phase of LCA in which the findings from the inventory
analysis and the impact assessment are combined together, or, in the case of life cycle
inventory studies, the findings of the inventory analysis only, consistent with the
defined goal and scope in order to reach conclusions and recommendations.
The findings of this interpretation may take the form of conclusions and
recommendations to decision-makers, consistent with the goal and scope of the study.
The interpretation phase may involve the iterative process of reviewing and revising
the scope of the LCA, as well as the nature and quality of the data collected consistent
with the defined goal. The findings of the interpretation phase should reflect the results
of any sensitivity analysis that is performed.
Though subsequent decisions and actions may incorporate environmental
implications identified in the findings of the interpretation, they lie beyond the scope
of the LCA study, since other factors such as technical performance, economic and
social aspects are also considered.
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CHAPTER 4
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Objective Achievement
By 2020: Achieve zero waste 253 of our factories achieved
for disposal in our sites. zero waste for disposal in
2017.
By 2020: Make date labels
understandable to our 217 office, R&D and
consumers to reduce food distribution centers also
waste at consumption stage. reached zero waste for
disposal, which makes a total
of 470 sites globally.
Regarding from the result, Nestlé on track in objective achievement and have a
certain objective have been achieved.
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Figure 4.1 Inventory Analysis For Nestle Product. (Gueye, 2016)
Nestlé have been setup their inventory will be impact on three major section
which are, Carbon footprint, Water footprint and Land Use.
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footprint is expressed in kg CO2 equivalent and measures GHG emissions over the
entire life-cycle of a cup of coffee.
The largest contribution to the carbon footprint of a cup of Nescafé comes from
growing coffee through the production and application of agrochemicals, and from
deforestation. The second largest aspect is the consumer use stage, which is dominated
by the energy used through cup washing, beverage preparation and any extra water
boiled.
39%
11%
11%
2%
37%
Figure 4.3 Contribution to Carbon Footprint
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40%
7%
3%
1%
41%
Figure 4.3 Contribution to Water Footprint
88%
1%
1%
1%
10%
Figure 4.3 Contribution to Land Use
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4.4 Interpretation
There some solution from inventory analysis and impact analysis for Nestlé
(Nescafe Product) continues sustain.
Solution
Agriculture i. Training farmers in agriculture techniques
(including irrigation)
Raw Material ii. Distributing high-yielding drought resistant
coffee plantlets
Processing i. Zero waste for disposal
ii. Reduced water withdrawal and greenhouse
gases (GHG) emissions.
iii. Spend Coffee grounds used as a factory fuel
Packaging i. Development of materials made from
responsibly managed sources and with
improved environmental performance.
ii. Design for recovery
iii. Eco design
Distribution i. Alternative modes of transport and reduce
journeys to reduce GHG emissions.
Consumer i. LCA communication tools to encourage
customers to compare energy and water use
of different machines, cups and types of
coffee.
ii. Online courses developed Nestlé
Professional for hospitality and food service
customers on waste management, including
food loss and waste
iii. An efficient and cost-saving machine due to
a better idle and an energy-saving mode
Recovery i. Tool created by Nestlé Professional to help
providers understand environmental impact
of serving coffee to customers and offers
practical suggestions for waste disposal.
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CHAPTER 5
5.1 Discussion
Nestlé has made a lot of strides in reducing the environmental impact of its
operations. However, going forward, the company needs to increase focus on the first
and most important stage of its supply chain – production. The future of the entire coffee
industry is at stake and focusing primarily on reducing Nestlé’s gas emissions, while a
worthwhile venture, will not be enough to save it. Nestlé must invest more in research
and development, to help improve the quality of coffee bean production. There are
opportunities to partner with other food and beverage companies, or with organizations
such as World Coffee Research which conducts research to develop new genetic
varieties of coffee that will be more resilient to extreme temperatures.
The company may also need to consider opportunities to help coffee farmers earn
more revenue on their harvests. New competitors entering the market are willing to pay
farmers more, and Nestlé may lose some suppliers to companies such as Thrive which
essentially eliminates the middle man in the supply chain (distributors, wholesalers and
retailers) by buying directly from the farmers and selling directly to consumers.
5.2 Conclusion
According to estimates from Rabobank International, 2017 is gearing up to be the
fourth consecutive year of coffee deficit. The price of green coffee continues to stay
relatively low despite increasing costs to produce and depleting supply. Can Nestle
afford these increasing costs to make coffee available to consumers? Will Nestle be
forced to increase the price of their coffee, and how will that affect demand?
Many coffee farmers have begun to diversify their farmland to ensure that they
can make a stable income to offset the loss of income due to decreased yield as a result
of global warming. How did that affect already dwindling supply and what role can
Nestle play in mitigating this?
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References
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