Tuesday, July 6, 2010

Nestlé to invest PhP 4.3 billion in new Tanauan Factory

Nestlé Philippines Chairman and CEO John Miller announced in a press conference on July 2, 2010 that the company will invest PhP 4.3 billion over two years for a new factory to be built on a 27-hectare site in Tanauan, Batangas.

The construction of the new factory will start this month and is expected to be completed in March 2012. The facility will produce COFFEE-MATE Non-Dairy Creamer and BEAR BRAND Powdered Milk Drink. Mr. Miller said that demand for the two brands, both of which are market category leaders, continues to grow and the investment in the new factory will address the need to increase production. In 2010 alone, the domestic market demand for BEAR BRAND and COFFEE-MATE is projected to grow by 19% and 8%, respectively. Export of BEAR BRAND under the brand name EVERYDAY is also expected to grow by 38% this year.

The Tanauan factory, which is expected to help spur economic growth in the area, will directly employ a new work force of 170 initially, and generate hundreds of other jobs in sectors providing the facility with raw materials and services.

“Nestlé has been present in the Philippines as a part of everyday life for 99 years. The investment in the Tanauan factory starts a new chapter in Nestlé’s commitment to the country, as we look forward to the next 100 years of nurturing Filipino families by offering healthy and tasty products,” the chairman said. “We believe this investment is a clear demonstration of our full confidence in the Philippines. It is timely as the country restates its commitment to accelerate economic growth. As always, our strategy is guided by our belief in Creating Shared Value for all stakeholders.”

Apart from its latest investment, Nestlé is also continuing to invest in its four existing factories, particularly in technology and equipment upgrades to enhance capacities, in order to meet growing demand for its products. In 2009, Nestlé produced almost half a million metric tons of products in various categories that include coffee, milk, beverages, non-dairy creamer, food, infant nutrition, ice cream, chilled dairy, and breakfast cereals.

The company’s investments in the country during the last five years stand at close to PhP 10 billion. Some 80% of the investments have been deployed to its existing factories to generate higher efficiencies, create additional capacities, and safeguard the environment. The balance of 20% has been spent on sales infrastructure, distribution, and information systems.

Nestlé’s four manufacturing facilities in the country are the following:

• The Cagayan de Oro Factory which manufactures NESCAFÉ and BEAR BRAND;
• The Cabuyao Factory which manufactures NIDO, NESVITA, NAN, NESTOGEN, BEAR BRAND Choco, NESTLÉ All Purpose Cream, Ready-to-Drink MILO, BEAR BRAND Sterilized, and CHUCKIE;
• The Lipa Factory which produces MILO and NESTLÉ Breakfast Cereals; and
• The recently commissioned Pulilan Factory, which manufactures NESTLÉ Ice Cream and Chilled products.

The company’s Cabuyao, Cagayan de Oro and Lipa factories also serve as the Nestlé Group’s Export Centers for infant nutrition, filled milk powder and breakfast cereals, respectively. The factories manufacture these various products for Nestlé markets abroad. In the Nestlé Group, the designation of Export Center recognizes a factory’s world-class quality standards and efficiency levels.

“The designation of Export Center for the three factories is testimony to the world-class manufacturing capability and competence of Filipinos,” Mr. Miller said. “Our factories prove that the Philippines can compete with other countries in terms of quality, cost and reliability.”

Mr. Miller noted that in 2007, the Nestlé Group selected the Philippines as the site for its shared service center for financial and employee services requirements of Nestlé companies in the Philippines, Malaysia/Singapore, Indonesia, Indochina, Australia, New Zealand, South Africa and the Middle East. The shared service center is now known as Nestlé Business Services (NBS), located in Meycauayan, Bulacan. The NBS today has 500 employees.

Over the last five years, Nestlé Philippines has consistently grown, expanding by an average of PhP 4.6 billion per year. The company, which registered sales of nearly PhP 86 billion in 2009, paid some PhP10.6 billion in taxes to the government in the same year, an increase of 20% over the previous year. The Company is the second largest taxpayer in the country.

Nestlé Philippines, which is one of the key players in the fast moving consumer goods (FMCG) industry, is among the country’s top six corporations.

Related Stories:
Nestlé to invest P4.3B in new plant in Batangas
(Source: Inquirer.net)

Nestle to build P4-B factory in Batangas
(Source: abs-cbnnews.com)

Nestlé Phils. bares P4.3-billion investment to build creamer/milk factory in Tanauan
(Source: Manila Bulletin Online)

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