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Nestlé invests in Asia expansion strategy

By Kacey Culliney , 14-Sep-2011

Nestlé is investing a total of $320m in expansion projects in Indonesia and Thailand in an effort to target health conscious consumers in Asia, the company said.

Nestlé said it has noticed an emerging market of health conscious consumers in both countries, combined with increasing demands for Nestlé products.

In Indonesia, the company has put $200m into the construction of a new production factory in Karawang, Indonesia – its fourth in the country, which began this week, and will create over 600 jobs.

President director of Nestlé Indonesia, Arshad Chaudhry, said: “We are very optimistic about the growth opportunities in Indonesia. It has a large, progressive population and the economic environment is very conducive for growth.”

In Thailand, Nestlé pledged $120m last month as part of a two year growth strategy to increase manufacturing of its products, support the expansion of existing factories and construct a new Nestlé quality assurance centre.

CEO Paul Bulcke said: “The sophistication of Thai consumers, and their increasing focus on higher quality products with greater health and nutritional benefits, is giving Nestlé an increasing competitive advantage in Thailand.”

Nestlé already has a vast presence throughout Asia with operations in over 15 Asia-Pacific countries including Thailand, Indonesia, China, Japan and the Philippines.

Nestlé expansion: Thailand and Indonesia

Investment in Thailand and Indonesia has been ongoing for the past few years, with investments in milk and coffee production facilities and launches of Nestlé’s Cocoa Plan in Indonesia and its Nescafé Plan in Thailand.

According to Nestlé, the recent investment in Thailand aims to meet the growing demand for Nestlé products in the country and surrounding region.

Bulcke said that Nestlé has great confidence in the future of the Thai economy and that Thailand has a very important role to play in its Asian and global strategy.

The new production facility in Indonesia will strengthen Nestlé’s position in the emerging market of health conscious consumers in Indonesia, the company said.

Chaudhry said in a statement that Nestlé is fulfilling its responsibility to provide consumers with high-quality, nutritious products and the company said the factory will satisfy consumer demands for nutritious, branded products at affordable prices.

It will produce Cerelac infant cereals, Milo chocolate malt drinks and eventually Dancow milk powder.

Nestlé said the additional factory will also boost its expansion of products fortified to address common micronutrient deficiencies among lower-income consumers.

The Indonesian factory is due to be completed by early 2013 and will meet halal requirements and conform to the highest environmental standards, the company said.

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