Britannia to diversify food range
Company has developed a commodity buying strategy to control costs measures & sustain bottomline
| Britannia earlier had milk business which was sold to Britannia Newzealand Foods two years back. |
| The company has developed a commodity buying strategy to control costs measures and sustain bottomline growth in the face of rising input cost and declining consumer prices. |
| Wadia said the company was now looking into various new areas of foods like snacks and health drinks but had not yet finalised anything. |
| "The board will take a decision in this regard soon," he said. |
| According to Wadia, BIL will look for both organic and inorganic growth opportunities for venturing into new areas of foods. |
| However, he ruled out the possibility of reentering the milk business as it was now run by a subsidiary. |
| Entering fresh milk business was a mistake, he admitted. |
| Commenting on the commodity buying strategy, Wadia said the company would use the commodity exchanges as a mechanism for hedging. |
| "The company is heavily dependent on commodities like wheat and sugar. The hedging activity will help control costs. It is now implementing a commodity buying strategy for managing input cost," added Wadia. |
| According to him, the focus on cost control and supply chain management yielded savings of Rs 20.2 crore in 2004-05. |
| BIL has already appointed KPMG for supply chain management. |
| "KPMG is looking into 48 projects like efficient procurement of raw materials, manufacturing and distribution logistics etc," said Wadia. |
| The chief executive officer of Britannia, Vinita Bali, said the company was looking at new distribution channels like malls. |
| "The company is investing around 15-20 per cent of revenue from a brand into brand promotion," she said. |
| The company was also reorganising its structure from geography as the profit centres to brand as profit centres. |
| "Our company has six power brands in the portfolio each exceeding Rs 100 crore in annual sales," she added. |
| Manekshaw steps down Field Marshal Sam Manekshaw, one of the hero's of 1971 Indo- Pak war, is stepping down from the board of Britannia Industries. |
| The eminent soldier served in the board of BIL for more than a decade. |
| The company is not filling up the vacancy caused by Manekshaw's departure immediately. |
| "He intimated to the company that he does not seek reappoinment. The company will not propose to fill up the vacancy in the forthcoming annual general meeting," an official said. |