Startups push big brands to improve, says Nestlé India’s Suresh Narayanan

New Delhi: Startups and regional brands are not only good for providing variety to consumers but also give established players the push to improve their product offerings, Nestlé India's outgoing Chairman and Managing Director Suresh Narayanan said.

Stressing the importance of startups and regional brands operating in small catchment areas, Narayanan said Nestlé India is working with startups as part of its accelerator programme to identify their potential and see how to partner with them.

"Startups and regional brands are good for the business. They do two things, one, they extend the variety for the consumer, and secondly, they give us additional inspiration for improving, making ourselves faster and smarter," According to a Newsdrum.in report.

According to Narayanan, today every brand has to be relevant to Gen Z and Gen Alpha consumers who do not give much importance to the historical relevance of brands.

"It goes by what is in it for me, so Maggi noodles have to be relevant to the Gen Z consumer and not simply relevant because my father consumes it. So I think both of these are truths that we have realised as a company and are constantly working on to improve and control the price of our brands so that we do not become irrelevant in the context of the consumption story," he said.

Over the last few quarters, big FMCG companies have been facing stiff competition in some segments, such as food products and personal care, from small regional players, which have become more aggressive with renewed vigour following the softening of inflation.

Narayanan, who is hanging up his boots on Thursday, said, "Companies which are sustainable and contribute to communicating with the consumers digitally are becoming more favoured. We are accelerating our sustainable journey."

According to Narayanan, being a part of a Swiss multinational, sustainability is part of the DNA of the company and an intrinsic part of the corporate journey.

"Sustainability, usage of energy, air, usage of water and usage of packaging have been part of discussion in the boardroom for a long time," he said.

Nestlé is also working on reducing packaging materials. It has not only reduced 8 to 10 % of the packaging materials used but also made them more environmentally friendly.

"Sustainability is something that the consumer looks for but the consumer necessarily pays for. It is something that, within the context of how the company chooses to conduct its business, and for us, sustainability is an intrinsic part of our corporate journey," he said.

Besides sustainability, Narayanan, in his decade-long tenure at the helm of Nestlé India, also focused on diversity. During his tenure, diversity in the management team doubled to 20%, and across the organisation, it went up to around 25%, he said.

"With great pride, I say that we built a factory in Sanand in Gujarat, which is 45% women, women in manufacturing," he said. Moreover, almost 30 to 40 differently abled people are also working in Nestlé factories.

Sustainability initiatives have also been incorporated into procurement and sourcing.

According to Narayanan, now its entire coffee, milk, and spices are sustainably sourced, and the company has been plastic neutral for the last four years. "So there has been overall progress on sustainability," said Narayanan.

Plastic neutrality means balancing the amount of plastic used. Under this, a company uses an equivalent amount of plastic that is collected and recycled from the environment.

Nestlé India, which has a revenue of over Rs 20,000 crore, is among the top ten markets of the Swiss food multinational.