Nestle has said it will make a change to its sales-recognition policy that it hopes will boost profit margins and reduce revenue figures.
The firm said today (19 November) that the change will reduce reported sales by around 15% as expenses such as discounts as well as certain allowances and promotions for retailers will in future be deducted from proceeds of sales, leading to a corresponding increase in profit margins. The change will not affect net income, earnings per share or the balance sheet, it said.
Changes will be effective from 1 January 2011.
The firm also announced the appointment of Patrice Bula to the position of head of strategic business units, marketing, sales and the Nespresso coffee brand.
Bula, market head for Nestle’s greater China region, will replace Petraea Heynike, who is retiring at the end of April.