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Insight of the Day: Rebel investors want KitKat maker Nestlé to cut back on junk food—but the fortunes of its Mindful Chef brand suggest customers aren’t ready for a health kick

The article discusses how rebel investors are urging Nestlé to reduce its focus on unhealthy products like KitKat due to changing consumer preferences and societal trends towards healthier options. These investors, with a significant financial stake in Nestlé, are concerned about the risks associated with the company's heavy reliance on high-fat, high-sugar products in the face of increasing regulatory measures and growing consumer demand for healthier alternatives.

While Nestlé has made efforts to diversify its portfolio with acquisitions like Mindful Chef, a health-focused meal-kit company, the company has faced challenges in successfully transitioning towards healthier products. Mindful Chef's performance, despite a surge in sales during the pandemic, has seen a decline in recent years with widening operating losses and decreasing revenues.

The push for healthier offerings by the investors is met with some resistance from Nestlé, which argues that it aims to cater to the diverse needs and preferences of consumers across all segments of its portfolio. However, with pressure mounting from investors and changing consumer behaviors, Nestlé is facing a critical juncture in its strategic direction – balancing the demand for healthier products against the challenges of market dynamics and inflation impacting consumer choices.

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