Coronavirus impact: FMCGs on toes to keep manufacturing on track

The lockdown in several Indian cities to tackle the COVID-19 outbreak has had an unintended consequence: Manufacturing of essential items has been hit hard. 

State governments on Sunday and Monday had exempted makers of groceries and staples from its list of manufacturers included in the lockdown to ensure supply of essential goods and services wasn't hampered. 

But with people unable to move around and strict enforcement of section 144  in many places, chief executive officers of fast moving consumer goods (FMCG) companies admit that running factories has been a challenge. 

Workforce is down to 25 per cent in many units. Some are even thinner at 15 per cent attendance only. While some others have had to shut their units down temporarily simply because workers have been unable to report to work as transportation grinds to a halt. 

"We are thinly staffed across our plants due to the lockdown," Mohit Malhotra, chief executive officer, Dabur India, said. "Some units like in Ghaziabad, Alwar and Kolkata are shut.This is a tough time. But having said that, the first priority for us is the safety of our people. The workers who are reporting for duty are doing so in batches and there is rotation of staff that is happening," he said. 

MR Jyothy, managing director, Jyothy Laboratories, said that only five of her company's factories were operational on Monday out of a total of 25 units. "We will see how to get the twenty units up and running in the coming days. The situation is fairly unpredictable currently and we will have to wait and watch how it unfolds," she said. 

Given the uncertainty and the likelihood the lockdown stretching beyond March into the first week of April, CEOs said that they were in constant communication with their people to avoid confusion and panic on the factory floor. 

"We are communicating closely with our team members across regions and functions to ensure business continuity and the movement of our products into the market. Our biggest priority is to ensure that sufficient supplies of high demand items like sanitisers, hand washes and soaps are replenished across channels," Vivek Gambhir, managing director and chief executive officer, Godrej Consumer (GCPL) said. 

Most hygiene makers including Hindustan Unilever, GCPL and ITC have ramped up production and distribution of hygiene products as demand surges. For this, they are talking to local authorities to allow production to continue at their factories, creating buffer stocks of inventory and managing staff movement around their plants. 

"We have sought clearance from the authorities in the notified locations to continue manufacturing essential items like Savlon hygiene products and food products like Aashirvaad Atta," an ITC spokesperson said. 

Gambhir said that his company was working closely with raw and packaging material suppliers to facilitate their timely and uninterrupted supplies. 

" To manage contingencies, we are building stocks to prepare for longer periods of disruption and are providing extra stock to our distributors, along with short term credit to help them during these uncertain times," he said. 

A V Anoop, managing director, AVA Group, which manufactures the Medimix brand of soaps, said it was impossible to match demand and supply given the strictures around the lockdown. 

" Soap making is a laborious and time-consuming process and we rely heavily on our workers, who've been with us for over 25 years. But with the stay-at-home directive, they are unable to make it to work," he said.