Logistics

Will take a few more days for supply chains to normalise, say top FMCG companies

Meenakshi Verma Ambwani New Delhi | Updated on March 30, 2020 Published on March 30, 2020

Inter-State and local truck movement has been severely impacted, say industry players   -  Kamal Narang

Shortage of trucks, availability of workers among challenges

 

With the Central government issuing several guidelines last week to tackle bottlenecks related to supply chains of essential goods during the ongoing lockdown, FMCG companies said it may take a few more days for supply chains to normalise.

Industry players said that while they have witnessed progress with State and district level approvals, they are still working to resolve challenges related to shortage of trucks and availability of workers as the country battles the Covid-19 outbreak.

Grievance cell

The Food Processing Ministry set up a grievance redressal cell to look into issues being faced by the packaged food industry last week. It also held a video-conferencing interaction with key industry bodies and stakeholders on Monday after urging State government to allow food units to operate.

Pushpa Subrahmanyam, Secretary, Food Processing Ministry, told BusinessLine, “We are attempting to resolve various issues of the industry related to closure of factories, warehouses, cold storages as well problems with inter-State movements..which we have received from industry associations and individual units. We have taken up these grievances with the State governments and many of them have been resolved. About 10 per cent of them were related to clarifications on MHA notification.”

According to sources, nearly 221 grievances were registered so far with the Ministry, while 98 of them have been resolved, 105 are under resolution.

Migration of workers

On Sunday, the Home Ministry also allowed transportation of both essential and non-essential goods and at the same time expanded the list of essential goods to include hygiene products. However, large scale reverse migration of workers to their home States is now posing as a bigger challenge for essential good manufacturers and supply chains.

Vivek Gambhir, Managing Director and CEO, Godrej Consumer Products Ltd, said the recent Central government guidelines will help ease the existing supply chain bottlenecks.

“Consequently, we are seeing some progress on-ground. Some factories have received permissions to manufacture essential hygiene products, at reduced capacity. Some CFAs too have received permissions to distribute goods. However, the number of workers reporting to factory/distributor locations is still very low due to social pressure and safety concerns,” he said.

Mayank Shah, Category Head, Parle Products, said the industry is likely to attain uninterrupted operations at factories, though with scaled down workforces in line with government directives, by next week and will be able to meet the demand of the consumers to a large extent.

Streamlining movement

A spokesperson for ITC too said, while the company has progressively obtained permissions in some States, availability of trucks continues to be the biggest challenge at the moment. “Inter-State and local truck movement has been severely impacted together with the challenge of shortage of manpower in factories. We believe it will take a few more days for the entire eco-system and processes to be streamlined for movement of essential goods,” the spokesperson added.

Stating that Central government directives has helped re-starting factory operations and some part of logistics operations, Piyush Patnaik, Managing Director, Cargill’s oils business in India, said more support on free movement of trucks and availability of labour is needed.

Dabur India Ltd Executive Director-Operations Shahrukh Khan said that situation has eased a bit with approvals for plant operations and bottlenecks of raw materials, packaging materials and finished products.

However, he added with most workers either leaving for their hometowns or staying at home during the lockdown, it would be a challenge to ensure smooth functioning.

Published on March 30, 2020

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