Nestle bolsters infant formula position with new high-tech Russian factory

13 Oct 2017 --- The Swiss transnational food and drink company is strengthening its focus on the highly growing infant formula category with another investment in a Russian-based plant which plans to ramp up production and target export markets in neighboring countries.

Worth more than US$30 million, the latest investment at the Vologda site adds to Nestlé’s portfolio of factories in Russian which now amounts to eight. 

The foundations of the CHF30 million infant formula plant means Nestlé can offer a greater variety of infant nutrition to consumers, something it is specifically targeting as a high-growth category alongside other food and beverage categories including coffee, petcare and bottled water. 

The plant, due to be operational by 2019, will be part of the existing Vologda site, where Nestlé has successfully operated for 14 years. The factory will use state-of-the-art equipment to meet the highest quality standards and will also apply Nestlé’s principles on reducing environmental impact, aiming for zero waste.

In the last 20 years, Nestlé Russia has invested around CHF2 billion (US$2 billion) into the development of local production. 

“The factory in Vologda is a strategic plant for Nestlé in Russia and CIS, the only factory producing Nestlé infant formula in the Russia and Eurasia region. This new factory will allow us to strengthen our leading position in the Russian infant formula market by developing our ability to supply both the domestic and the export markets,” says CEO of Nestlé in Russia and Eurasia, Martial Rolland.

“We are happy to announce that we start construction of the infant formula site, which will allow us to double the capacity of our local production from 2019 onwards,” adds Eddy Dauphin, Nestlé baby food factory manager. “With the state-of-art equipment and technologies invested into the site, the Vologda team and the factory are ready to produce the product for the most sensitive consumers of Nestlé.”

Adapting to the changing economic and trade environment
Over the last two decades, Nestlé Russia has continually invested into the development of local production, with about 70 percent of raw materials and 90 percent of packaging of local origin, which allows Nestlé to produce locally more than 90 percent of the goods sold at the regional market. 

This contributes to a better satisfaction of consumer’s preferences and helps the company to adapt more effectively to the changing economic and trade environment.

The building of the new factory in Vologda will not only strengthen Nestlé presence in the region but will also contribute to its balanced growth, increase the prestige of the Vologda region from the social and economic point of view, as well as an employer of choice, according to Oleg Kuvshinnikov, Governor of the Vologda region.

"Vologda regional government highly appreciates professional attitude and readiness for a long-term cooperation from Nestlé side. From our side, we are ready to support Nestlé in implementing this investment project,” says Kuvshinnikov.