Nestle
in comfort
Successful
models of supply chain management in Indian food businesses are isolated
cases that have not been replicated; we study Nestlé India as
a pioneer in popularising the process
Nestlé
with headquarters in Vevey, Switzerland, was founded in 1866 by Henri
Nestlé and is today the world’s biggest food and beverage
company. Sales at the end of 2003 were CHF 88 billion, with a net profit
of CHF 6.2 billion. The company employs around 253,000 people and has
factories or operations in almost every country in the world. It owns
famous brands like Kitkat, Nescafé, Perrier Nestea, Mint and
many of these are also present in India. Along with global sourcing,
Nestlé also believes in local sourcing. In India, as elsewhere,
sourcing is mainly done locally for milk, packaging and so on.“The
main issue for Nestlé India is traceability,” said Vineet
Khanna, Vice President, Supply Chain, Nestlé India. “We
are in the foods business, and we must maintain high standards of hygiene,
quality of edible inputs and personnel,” said Mr Khanna. He defines
the supply chain in Nestlé as“From the vendor to the customer.”
True to this definition, Nestlé goes right down to the vendors
of all kinds – the milk, the truckers, the cold chain, and the
packaging. “We want to monitor our entire chain to ensure quality
throughout – and that we can do if we have information and can
trace the path of materials from manufacture to sales. That is what
we mean by traceability in Nestlé – where from and where
to.” Mr Khanna said that Nestlé India studied the chain
very carefully, fully aware that there were specific challenges in India,
not found – or dealt with – elsewhere by Nestlé. Transport
quality, transit time, retail structures and costs involved were all
different. The external supply chain cannot be controlled fully.“However,
we aimed to control internal processes as well as supplier quality,
hoping that it eventually translates into better supply chain management”,
he added.
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