The handover of power was swift – as quick as drinking a Nespresso coffee. On Sunday, September 1, Laurent Freixe of France officially took the helm at Swiss food-processing giant Nestlé, owner of the famous coffee brand, just 10 days after the announcement of the surprise departure of his predecessor, Ulf Mark Schneider of Germany.

As a sign of the speed of this eviction, the "fireside chat" organized jointly with Barclays on August 30, at which the Vevey-based group's CEO was due to speak, was hastily canceled.

Freixe was ready to take over. His name had already circulated in the summer of 2016 when Nestlé was looking for a successor to Paul Bulcke who wanted to give up his position as CEO to become president of the board. However, at the time, an external candidate was preferred.

Eight years on, his in-depth knowledge of the multinational company, acquired over a 38-year career in which he rose through the ranks to become head of the Latin America zone, is seen as a major asset.

His work will have to involve "mobilizing" the 270,000 employees of the world's number one food-processing company, "aligning them behind specific actions with discipline and right direction, all in the framing of the nutrition, health and wellness strategy," stressed Bulcke, listing the challenges that Freixe will have to meet during a speech to analysts the day after the decision to change the captain of the Swiss liner.

Faced with a wave of inflation

The president of the board therefore seems to be looking to this casting choice for more effective execution rather than a complete overhaul of strategy – and he has confidence in the new CEO, who has been a member of the executive board for 16 years, to reinvigorate Nestlé.

This call to mobilize the troops has a clear and repeated objective: The food-processing giant must return to marked organic growth. Schneider had set this same course of action in 2016. At that time, the group wanted to return to the Nestlé model of 5% to 6% annual sales growth, accompanied by higher margins.

During his time in office, the German CEO radically reshuffled the Vevey-based group's portfolio. This was done by selling off the American confectionery business, the life insurance subsidiary, the skin care business and bottled water in the US, while making acquisitions in the food supplement, vitamin and coffee sectors, as well as forging an alliance with Starbucks.

But not all these purchases delivered the expected results. Above all, Nestlé was faced with the unprecedented wave of inflation that swept through the food department. With their budgets squeezed, consumers made trade-offs in favor of private-label products, which are more affordable than products from major brands.

You have 31.63% of this article left to read. The rest is for subscribers only.