HUL to set up six nano factories in India

The fast-moving consumer goods (FMCG) major has set up six nano factories in the country to manufacture its D2C brands and premium products in these nano factories. These plants can produce product batches ranging from 50 to 200-kg.  

“With new-age channels like eCommerce, pharma and digital channels are growing 5X times compared to the traditional channels, and this has also been reflected in the channels’ contribution to HUL sales. The conventional manufacturing system has been designed for scale with large batch sizes. This is suitable for the general trade market and mass brands, but for the new channels where a high assortment is table stakes, the volume per pack will be low and the number of Stock Keeping Units (SKU) will be very high. That is when we introduced the concept of nano factories,” Yogesh Mishra, executive director-supply chain, HUL, told a business daily.

The factories have managed to reduce the innovation lead time by 40%, wastage by 30%, and improved agility by 30% with respect to the number of SKU made by HUL. The company revealed, SKUs that were manufactured once a month are now made every week.

“Lakme has always been one of the foremost beauty brands of this country and we’ve also got D2C for Tresemme, Ponds and Indulekha. And now, the premium business unit has added three brands,” said Kedar Lele, executive director-customer development, HUL.

“We have started using very different approaches of agile innovation cycles, speed-to-market, failing fast and pivoting something if it doesn’t work. When there are smaller volumes, it allows the team to fail fast using these online systems and close the loop better with consumers. And, by closing the loop better with consumers, the company can bring in a very different energy into the organisation,” Lele added.