Fruits
of labour
With
backward integration assuming epic proportion in both global and domestic
markets, TFPJ explores Dabur Foods latest processing facility in Siliguri
Dabur
Foods have invested Rs 200 million to set up a multi-fruit processing
facility at Siliguri, West Bengal. This investment is a critical step
for Dabur Foods in order to help the company achieve a most crucial
process – backward integration. Backward integration is becoming
a must in the current global and domestic scenario where complete accountability
is becoming increasingly important especially in case of food items.
On the other hand this move could turn out to be an extremely profitable
investment, as the company would have a greater access to fresh fruits,
which in turn would increase its production volumes. Amit Burman, CEO,
Dabur Foods, said typically, food processing units like the one at Siliguri
do not make profits in the first year so quantifying the benefit would
be difficult. Mr Burman also said that the commissioning of the Siliguri
plant would help Dabur Foods improve monitoring of raw material quality
of its products besides ensuring a substantial overall cost reduction.“We
have been procuring fruits from different parts of the country till
now – pink guavas from Bihar, mangoes from southern India, pineapples
from Thailand and some eastern states of the country and grapes from
Mangalore. But with the Siliguri plant expected to become operational
soon, procurement will largely be concentrated in and around Siliguri.
This will mean up to 10 per cent reduction in raw material sourcing,”
Mr Burman said. Besides, the pulp processing plant will also help the
company in implementing technology it has developed inhouse for the
fruit drinks brand Coolers. Thus, Dabur Foods will be able to develop
and market more ethnic fruit drink variants, Mr Burman added.
TFPJ spoke to Dabur Foods to gain further insights; following are
the excerpts from the interview.
Why did Dabur Foods choose Siliguri as the location
for the processing plant?
Dabur Foods chose Siliguri as the location for this major investment
as the region is a major fruit producing and trading area for pineapple,
banana, litchi, mango, guava and others. It has a well-established network
of transportation that brings about minimal wastage which is vital for
the processing of any food product. Abundant availability of skilled
labour and power at competitive costs are the other attractions.
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