Manufactured Capital

Management Approach

Our manufactured capital consists of the supply chain infrastructure, i.e., offices, manufacturing units,warehouses, distribution centers, logistics, etc. The vast network of our manufactured capital helps us in being flexible and responsive to the customer demands as well as provides speed for our products to reach the markets efficiently.

The key focus area to upgrade our manufactured capital is continuous efforts to improve our supply chain efficiency. Also, along with process sustainability, we also emphasize on enhancing the quality and safety of our products. Moreover, we are in perpetual pursuit to integrate technology into our systems and processes.

Our mission to serve our customers with the best of nature and science is supported by a well-established but a complex global supply chain. Our manufactured capital enables us to retain the goodness of our diverse product portfolio and cater to the dynamic aspirations of our customers across several geographies.Though the pandemic tested the resilience of our manufactured capital, our ESG embedded strategy helped us to navigate through the uncertain times and create value for all the stakeholders across the supply chain.

Supply chain efficiency and transformation

Our supply chain includes 13 plants all over India,ranging in plot size from 5 acres to 50 acres, with an annual manufacturing capacity of approx. 6 Crore cases. Additionally, there are45 contract manufacturing locations across the country, producing 0.75 Crore cases per annum. These facilities produce Ayurvedic,Cosmetic, Hair care, Foods, Home care and Health Supplement products. Our distribution network has 2 Mother Warehouses and 26 CFAs in India. These supply an average monthly volume of more than 48 lakh products to more than 5000 distributors In more 1400 towns across 550 districts in the country. Our warehouses support vertical storage. where the stocks are stored on pallets. The infrastructure aids in improving warehouse storage and transit efficiency.Our Carrying and Forwarding Agents (CFAs) have an average 26 days inventory for all divisions and additionally, 10 days of stocks is present in transit or factory.

We, at Dabur, have been following kaizen’s approach to improve our supply chain capabilities. where we strive to incorporate and upgrade our process,systems and controls for maximizing efficiency. Our value chain focuses on providing quality products, a world class distribution system and cost effectiveness.During the peak pandemic period, the supply chain partners were agile to take proactive measures for unrestricted catering of customer demand.

As a sustainable organization, it is important for us not to limit the scope of ESG initiatives only to the internal stakeholders. Our suppliers are one of the key stakeholders and long-term partners of value creation. At procurement level, we constantly engage with our suppliers in order to embed ESG in our supply side operations. All our suppliers are compliant with the socio-environmental regulations existing in the geography of operation. Our Code of Conduct and Purchase Order’s terms and conditions clearly states our rules of engagement with the suppliers.

At manufacturing level, we have made several capital investments in terms of machines’ upgradation,digital transformation and integration of the latest state-of-the-art technology. These investments have provided us returns in terms of cost reduction, product improvement, increased efficiency and incorporation of circular economy in plants. Furthermore, we are also transitioning to alternate cleaner fuels such as bio-briquettes and Piped Natural Gas (instead of furnace oil) to reduce our dependence on fossil fuels for production. Our OHSAS-certified state-of-the-art production facilities are equipped with systems and procedures to ensure employee well-being and safety.

In line with our carbon neutral ambitions, coupled with the Indian government’s focus on promoting green India, we are in pursuit of transforming our supply chain by inducting Electric Vehicles (EV) in our transportation fleet in downstream operations to assist last-mile product distribution. The first batch of the new Electric Vehicles was inducted in North India and commenced deliveries in Haryana’s Sonepat area.

Since then, the initial lot of EVs have been deployed in East, West and South regions too, covering key cities like Pune, Hyderabad, etc. This makes Dabur the first domestic consumer goods company to have a fleet of electric vehicles for distribution, helping the company move closer to its mission of achieving Carbon Neutrality in its Operations. We intend to induct a fleet of 100 EVs by the end of 2022-23 fiscal.

We understand that technology will play a key role in supply chain sustainability. We have been upgrading and integrating future-ready technological capabilities to achieve enhanced product quality,process improvement, increased production capacity and cost reduction. The total Capex in technology in fiscal 2021-22 is 21.6 Crores. The use of AI, machine learning, blockchain, IoT and other advanced IT solutions has helped us create an integrated techenabled, competitive supply chain which has led to both cost and time savings. We believe that our digitization drive is a necessary element of our overall supply chain sustainability and group level ESG strategy.

Product Quality and Safety

We are a customer health-conscious company, and therefore, the quality and safety of our products is the topmost priority for us. We have established well defined policies and controls to ensure compliance with the regulatory requirements of our areas of operation. We have also adopted stringent internal quality standards, due diligence process and quality assurance practices. Also, we maintain hygiene & quality standards as per Dabur internal quality control standard and FSSAI for Foods & Beverages business. All our products provide necessary quality and safety information such as sourcing of our raw materials for the product, content present in the product and instruction for the safe use of the product as part of product details in their packaging material.We have zero incidents of non-compliance related to regulations or voluntary codes concerning product information and labeling.