Nespresso: Product of Nestle

Nespresso is an espresso coffee-making machine consisting of a coffee capsule and a machine. The coffee capsule is hermetically sealed in aluminum and contains 5 grams (about one teaspoon) of roasted, ground coffee.

The product has been first developed for a niche market: coffee in offices where the price elasticity of demand is rather low, convenience seemed to be more important than price.

The coffee capsule is placed in the handle, which is then inserted into the machine. The act of inserting the handle pierces the coffee capsule at the top.

At the press of a button, pressurized hot water is passed through the capsule. Nespresso was founded in 1986 as a wholly owned, but autonomous, subsidiary of the Nestle Group with headquarters in Lausanne, Switzerland.

The Nespresso machines were designed internally by Nestle and a Swiss design company and manufactured under license by Turmix for European markets. Sobal, a Swiss based distributor, purchased the machines from Turmix and the coffee capsules from Nestle Coffee Specialties and then sold it two t0gether as the Nespresso System.

Nespresso SA has two business divisions: Nespresso and Nespresso Business Solution. For its business-to-consumer (B2C) business, Nespresso offers a range of six machine models with various functions at different price points.

Nestle controls the market for distributing the consumable component of product, the little capsule filled with coffee that is used in a Nespresso machine to make a beverage.
Nespresso: Product of Nestle