Zurich, Nov 2 - Nestle, the world's biggest food group, should have reacted faster to competitors' price cuts to avoid slowing sales, Chief Executive Paul Bulcke said in an interview with the Wall Street Journal.
Bulcke said the group, whose sales growth this year lagged that of competitors such as Unilever, Danone and Kraft Foods, should have seen the danger of losing market share to aggressive pricing by competitors earlier.
"Sometimes during the year we should have engaged faster to counter these actions... Sometimes we should have had more intensity in our reaction," Bulcke said.
However, the Nestle chief said the company's long-term business plan remained intact, and had "traction" and "mileage". He said major acceleration in growth could come from emerging markets, where Nestle has accelerated its introduction of low-cost products.
Nestle's organic growth slowed to 3.6 percent in the third quarter, but Bulcke said the company was sticking to its long-term growth guidance of 5 percent to 6 percent. He said the company, whose best-known brands include Nescafe coffee and KitKat chocolate, saw higher volume growth in the third quarter than in the previous one, and that the slowdown was partly due to the removal of underperforming items.
"That negatively impacted our growth but it is like weeding out your garden so what you keep can flourish better. That all bodes well for growth in the future," Bulcke said.
The crisis is likely to drag on, and it would be some time before sales momentum would return, with the United States recovering faster than Europe, he said.
Price increases would probably be in the 2 percent range for next year, but increased costs for commodities such as cocoa were structural, and likely to remain at higher levels.
Bulcke refused to comment on whether Nestle would make a counterbid for confectionary-maker Cadbury following that company's rejection of an offer from U.S. rival Kraft.
With respect to the company's sale of its stake in eye-care company Alcon he said the sale, to pharmaceuticals company Novartis would not play out until January, but refused to comment on whether the company would use the proceeds of up to 30 billion Swiss francs ($29.30 billion) for acquisitions.