Britannia to wind up ‘unviable’ Lanka ops

The Nusli Wadia-promoted biscuit maker, Britannia Industries, has decided to wind up its ‘unviable’ Sri Lankan operations. Britannia had entered the Sri Lankan market in 2008 by launching a range of biscuits under the brand name Britannia Lanka.

“The company had decided to withdraw from the operations in Sri Lanka as they were not found to be viable. The right thing for a management to do was realise and recognise something and act on it and it is precisely for this reason that the company decided to withdraw,” Wadia told shareholders of the company recently.

Britannia could not turn around its business in the island nation, thanks to stiff competition from the local and already established brands in that counrty, sources said. Britannia could still sell its brand in Sri Lanka by exporting its products and selling its through local channel partners, sources added.

Britannia, as part of its overseas expansion, had set up shop in the island nation in 2008 by offering a slew of biscuits under the brand name Britannia Sri Lanka. Lankan biscuit maker Luckyland Biscuits were manufacturing the products for Britannia. The company then saw a high growth potential in Sri Lanka since the island nation has a very high per capita consumption of biscuits per annum.

However, despite a general slowdown, Britannia is bullish on the West Asian market and invested significantly to promote its brands there. “The West Asia business continued to be adversely impacted by the challenging global economic uncertainty and a real population decline in UAE, where it has sizable presence. Despite this, it revamped its marketing strategy and made significant brand investments that strengthened its competitive position,” he said. Britannia is also fighting a war against escalating cost fuelled by a spike in commodity prices. “The company addressed the cost challenge and reduced over Rs 70 crore in cost by consolidating operations, optimising manufacturing units, reducing complexity and eliminating wastages in the value chain. Over the last four years, the company has eliminated approximately Rs 200 crore of cost and continued to drive that hard in the current year as well”, Wadia said.

^{Indian Express}