Didn’t anticipate India to shut down like this, says Colgate-Palmolive CEO

Colgate-Palmolive said it is still experiencing disruptions to both supply chain and retail network, and while trends have started to improve it still expects an impact from the crisis in the second quarter. “India, we didn’t anticipate would shut down like it shut down. We had plants and distribution channels […]

Colgate-Palmolive said it is still experiencing disruptions to both supply chain and retail network, and while trends have started to improve it still expects an impact from the crisis in the second quarter.

“India, we didn’t anticipate would shut down like it shut down. We had plants and distribution channels shut down for almost two weeks. They are obviously coming back online, but that had a significant impact at the back end of the quarter and has had a significant impact in April,” Noel Wallace, president and CEO of the US multinational, said in an investor call.

Over the past few weeks, chief executives of Unilever, Mondelez, Hershey’s Procter & Gamble, Coca-Cola and Kimberly Clark have said India’s Covid-19 lockdown protocols had led to severe supply chain disruptions and labour shortages, hurting business in the key market.

A three-week lockdown imposed across the country on March 25 was extended to May 3 to contain the spread of Covid-19. This forced several consumer companies to scamper for licences so that their products, mostly groceries, packaged food and household care can be made and supplied smoothly.

While the situation has eased significantly after factories were closed in several places by law-enforcement authorities initially, many employees, especially at these units, refused to come to work for fear of catching the disease or have gone back home to their villages. As a result, most companies are operating at roughly half their capacities in production as well as distribution.

The $16-billion oral care multinational, however, said its plans are beginning to ramp back up and it will dial up more of innovation, particularly in lower price points in emerging markets including India. “We are doing a lot of things very, very quickly to adapt to some of the consumer behavior changes we have seen, particularly around the importance of health and hygiene and how that plays out with some of our products,” added Wallace.

Source Article

Lois C. Ferrara

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