In recent years, our country’s instant coffee market is expanding rapidly. According to the China Report Hall, the size of our country’s instant coffee market in 2023 is about 78.58 billion yuan, with a year-on-year growth rate of 6.28% to 8%. It is predicted that by 2026, the size of China’s instant coffee market is expected to reach 109.90 billion yuan. However, Nestle, which has been listed in the world’s top 500 for many times, showed a slowdown in growth in 2024 against the trend. Not only that, Nestle has also been caught in the “explosion” storm recently. ” Explosion “Food Safety Issues Caused by the Crisis Recently, a user in Xi’an, Shaanxi Province broke the news on social platforms that the Nestlé” Absolute Dark Black “instant coffee he bought online” exploded “instantly after opening the lid. The coffee powder in the can was violently sprayed under high pressure and rushed directly to the eyes, causing the face, clothing and ground to be covered with coffee powder, and even the skin near the nose to be scratched with 2-3 mm wounds. The incident quickly sparked a heated debate, and some netizens expressed amazement at it:” The coffee can actually explode when opened “; some netizens teased:” Terrible, what if the robbers bought this kind of can bomb? ” Subsequently, the user contacted the platform merchant and manufacturer immediately, but the reply was that the product had no quality problems. The phenomenon of coffee powder “exploding” after opening the lid was due to the high altitude of Xi’an. He was willing to give two cans of coffee as compensation, but refused to compensate for contact lenses and medical expenses. However, according to the data, the altitude of Xi’an City varies greatly due to topographic differences. The average altitude of the urban area is about 400 meters. As of May 30, 2025, the air pressure in Xi’an City is about 957 hPa (hPa), which does not seem to be much different from the standard air pressure of about 1.03 kPa (KPa). It is worth mentioning that when netizens mentioned whether they could use methods such as “marking on the product or SMS notification” to remind consumers, the factory staff said that “everything printed on the packaging has requirements and specifications”. In addition, food safety problems have occurred frequently in recent years. According to the Black Cat Complaint Platform, as of May 31, 2025, there were 2,175 Nestlé search terms, and Nestlé had 954 complaints. 933 had been replied, and 823 had been completed. On February 22, 2025, a consumer complained that Taobao Nestle bought an absolutely dark black one. When drinking it in the morning, it was poured out and found that there was a bug-like thing in it. It was dried. I had drunk two bags before that. The same batch, so unhygienic, and there was diarrhea. The feedback customer service did not deal with it and gave feedback. It is worth noting that Puna Water, a high-end water brand owned by Nestle, also failed three sampling inspections in two years. According to the State Administration for Market Regulation on December 29, 2023, the drinking natural spring water (330mL/bottle) produced by the Italian company SANPELLEGRINO S.p.A, which was labeled as the general agent of Shanghai Nestlé Products and Services Co., Ltd., did not meet the national food safety standards. The sampling value was 0.033mg/L, which exceeded the standard by 5.6 times. According to the Beijing News and other media reports, Nestlé China said, “Food safety is our top priority. The company reiterates that all natural mineral water products on the market are always safe to drink and have characteristic mineral ingredients as indicated on the label. The products sold by the company in China comply with relevant Chinese laws and regulations and have always been safe to drink.” “Nestle ́ needs to strengthen food safety management, improve product quality, and increase product innovation and localised research and development to better adapt to market changes and restore consumer trust,” suggests Bai Wenxi, China chief economist at the China Enterprise Capital Alliance. 2024 performance slowdown In addition to the frequent food safety problems in recent years, Nestle ́’s sales in 2024 also showed a slowdown compared with the previous year. On the product side, the coffee business achieved mid-single-digit growth, thanks to three coffee brands; Nestle ́’s health sciences business achieved mid-single-digit growth. The low single-digit growth in pet care was likely due to accelerating competition in the domestic market; the low single-digit growth in water was most likely due to growth bottlenecks and low-price competition in mature markets; and the low single-digit growth in infant nutrition was due to intense market competition. The negative growth in dairy sales was due to the decline in sales of coffee and room temperature dairy products, which offset the growth of affordable dairy products and cooked dairy solutions; the negative growth in condiments was due to the decline in frozen food business in North America. On a regional basis, although emerging markets and Europe showed organic growth, North America was still in a downward trend. In this case, Nestlé’s performance could not help but be affected slightly. On February 13, 2025, Nestlé released its financial report for 2024. The financial report shows that in 2024 Nestlé’s sales are about 91.354 billion Swiss francs, a decrease of 1.8% year-on-year; net profit is about 10.884 billion Swiss francs, a decrease of 2.9% year-on-year. The organic growth rate of sales reached 2.2%, the real internal growth rate (RIG) reached 0.8%, and the pricing contribution rate was 1.5%. In addition, the underlying transaction operating margin (UTOP) was 17.2%, which decreased by 10 basis points on the basis of the financial report and was flat in constant currency terms; the gross margin was improved, and the marketing investment increased by 40 basis points. Net profit fell 2.9 per cent to CHF 10.90 billion and underlying earnings per share fell 1.0 per cent to CHF 4.19 due to unfavourable currency movements. Mark Schneider, CEO of Nestlé, said: We expect a slow start to the year, but we can expect a strong rebound in our real internal growth rate in the second quarter and achieve our expected targets for the remainder of the year. Various measures within the group to help growth are now starting to take effect. Whether Nestlé can solve the frequent food safety problems in the future and improve the slowdown in performance remains to be seen by the market.
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