Nestlé plans to expand its baby milk business in China by launching a new line aimed at smaller cities. In the past, the Swiss food giant simply focused on big cities like Beijing or Shanghai where, due to the milk scandal in 2008, parents are eager to spend money on more expensive foreign milk. However, due to slowing growth, the company is under pressure to expand into new markets.
Expanding into smaller provincial cities could be challenging though because those markets are already dominated by local players which better understand the wishes of Chinese customers. In addition, more logistical hurdles exist.
Further reading:
In-depth article about the subject / Reuters
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