Coronavirus: FMCG firms limit operations only to essential items

FMCG companies such as ITC, Nestle, and Dabur Indiaon Tuesday said they were producing only the essential items at their manufacturing units amid the lockdown to prevent spread of coronavirus.

The fast-moving consumer goods (FMCG) sector, which is producing beverages, foods, and essential personal hygiene products such as hand wash, soaps, and sanitisers that are needed to fight COVID-19, is in talks with local authorities to resume operations at some their units.

Like others, FMCG makers have adopted work from home for all employees at their head and regional offices to contain the spread of coronavirus.

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According to ITC, it is "extremely critical" to ensure adoption of precautionary measures during this period, but it is also important, that during such challenging times, "essential products are made available to consumers in a safe and sustainable manner across the length and breadth of the country through continuity of supply".

"As various state governments issue notifications, we are in discussions with them to ensure that manufacture and distribution of essential products are streamlined," an ITC spokesperson said.

ITC, which manufactures personal hygiene products like hand wash, soaps, and sanitisers under Savlon brand and food items under brands such as Aashirvad, is "operational with bare minimum people" as these are essential products, said the Kolkata-headquartered company.

A total of 32 states and Union Territories had already declared complete lockdown in the wake of the coronavirus outbreak. From midnight, the lockdown will be imposed across the nation.

Following this, several companies have halted their manufacturing operations till March 31.

Scaling down operations

Nestle India, maker of Maggi noodles, Nescafe coffee, Cereal for infants and KitKat chocolate, which operates eight factories in the country, have either suspended operations or scaled down the operations at its manufacturing units.

"In view of the lockdown in many of the states and union territories across the country, the operations in some of the locations (manufacturing, distribution centres/ warehouses, offices, suppliers) are scaled down or suspended," said Nestle in a regulatory filing.

However, the company said as it is "in the manufacture and sale of food and beverage products, the company is in discussion with the authorities to continue operations in the factories/ distribution centres where the operations has been suspended".

Beverages major Coca-Cola India has also suspended its manufacturing operations and is only producing "essential beverages", such as water, juices, tea and coffee, at its manufacturing facilities in small number complying to the local government's regulations.

"In compliance with the government directive, we at the Coca-Cola system in India have temporarily suspended production at our manufacturing facilities," said Coca-Cola India.

With respect to the essential beverages, the company is "operating our manufacturing facilities in very small number", it said.

Varun Beverages, PepsiCoIndia's bottling partner, has also suspended manufacturing operation.

Home-grown FMCG major Dabur India has also suspended its manufacturing operations, excluding essential items such as Ayurvedic medicines, chyawanprash, hand sanitisers and hand wash.

On the financial impact, Dabur said, "The situation is still dynamic and uncertain and it is difficult to evaluate or quantify the impact at this point of time. A lot will depend on the stabilisation of the overall scenario arising from the COVID-19 pandemic."

Similarly, Nestle India said, "Impact on the operations of the company cannot be assessed at this point."

According to data from the health ministry, over 500 coronavirus cases have been reported in India so far.

(Edited by Teja Lele Desai)