Malaysia: Nestle’s new plant to boost competitive edge

By Francis Dass

GROWING INVESTMENT: Ready-to-drink beverage facility in Shah Alam to be ready mid-2014


NESTLE (Malaysia) Bhd, which currently controls half of the domestic ready-to-drink market, is set to shake up the food and beverage market when its spanking new plant in Shah Alam opens in mid-2014.

The 40,601.9 sq m land on which the plant is being built, is located next to Nestle’s existing factory in Shah Alam. It was bought from British American Tobacco two years ago.

“The ready-to-drink market is very competitive and important to us as Nestle Malaysia is a market leader in the segment with a 50 per cent share,”Nestle Malaysia managing director Alois Hofbauer said in an interview.

He however, did not reveal the investment amount nor capacity of the new plant.

Nestle’s stiff competition comes from rivals such as Dutch Lady, F&N, Polka and Yeo’s.

The company currently has seven factories in Malaysia and two in Singapore.

Last month, Nestle Malaysia rolled out Maggi Magic Meals, an easy-to-prepare chicken dish that comes in three flavours.

Hofbauer, who took over the helm of Nestle in February 1, is confident of the success of the new product, terming it as “a guaranteed success”.

Another product, Nescafe Ipoh White Coffee, has been popular locally since it was launched in September 2012, and is also exported to other countries.

On Malaysia’s halal food industry, Hofbauer is excited about its prospects.

“Nestle Malaysia is the centre of halal expertise in the world, exporting to 50 countries because Malaysia’s halal certification is recognised around the globe.

“In terms of investments, Nestle sees Malaysia as a manufacturing hub and is continuously upgrading facilities in the country.”

Hofbauer said that “substantial investment will be coming to Malaysia from Nestle’s accelerated investment in this country”, hinting that it will be more than in the past.

He did not reveal figures but gave an assurance that the group is very committed to investing in Malaysia.

It may be an assurance worth its weight in gold as Nestle has been in Malaysia for 100 years and currently employs 6,000 people throughout the nation.

Hofbauer said although the outlook for the year has been very good, Malaysia is not isolated from fundamental issues affecting the US and European economies.

However, the country’s continued growth keeps it in good stead, he said, adding that “the food and beverage industry is a good business to be in during volatile economic times as the demand is great”.

Besides high demand for its consumer goods, Nestle Malaysia’s proactive business practices have placed it on solid tracks.

“Nestle works on a continuous innovation and renovation principle … both things are happening now,” he said.

That is why products like Nescafe, which recently celebrated its 75th anniversary, has survived for so long.

“Our challenge is to build on a big base. In almost every household, everybody consumes a Nestle product in one form or another,” Hofbauer noted.

The Swiss multinational corporation is on very high gear as it moves forward.

It reported a staggering Sfr92.2 billion (RM299 billion) in global sales last year, representing an increase of 10.2 per cent from the previous year.

Business Times