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Danone opens Chengdu plant to meet consumer demand
June 6, 2013, Thursday
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FRENCH food and nutrition company Danone Group is expected to begin operations at its new 600 million yuan plant (US$96.7 million) in the Qionglai Industrial Park of Chengdu at the end of this year.
The 146,667-square meter site will have annual production capacity of 250,000 tons, producing the company's vitamin drink Mizone.
Shanghai Daily talked to Danone China Chairman Qin Peng about the company's investment plans in Chengdu and its overall strategy in China.
Why did Danone choose to build a factory in Sichuan? What are the major factors that you considered in making the decision? Can you tell us how the project is going there?
Danone China has been growing at very rapid pace in recent years. Our vitamin drink Mizone and bottled water Robust have been well received by consumers. In the southwestern market, demand for these products sometimes outstrips supply.
We decided to set up a new factory in the southwestern region to expand our production capacity to meet current and future demand.
In September 2011, Danone China's water business unit set up a special investment group for the southwestern region.
The group considered Danone's business development history in China's southwestern region and looked at future trends of the market in assessing potential sites.
It used scientific methodologies to weigh the advantages and disadvantages of each candidate site before selecting Chengdu for our manufacturing facility.
We decided to invest in Qionglai because it offers such an ideal business environment. We signed the investment agreement in February 2012.
We expect the new site to be a valuable addition to Danone's water businesses in China.
What role will the Qionglai site play in Danone's global water manufacturing supply chain?
Danone has been deepening its operations in China for more than two decades. This market has now become one of the company's most important worldwide.
The Qionglai site is a strategic base for Danone's operations in western China. It's a wise business decision given regional urbanization and economic growth under the country's "Go West" campaign.
We have laid a very good foundation for our water business in this region. Mizone is a leading brand in Chengdu and in Sichuan. Local consumers like this drink very much.
We'll continue to offer more products catering to local tastes and to deepen our penetration in the market with the Mizone and Robust brands. This year, we launched a blueberry version of Mizone in Sichuan, targeting female consumers. We also introduced three new flavors under the Robust brand.
They have achieved initial success in the market, and we will stick to our strategy of offering localized products for consumers.
Boosting domestic consumption is a key policy of China's central government. How does Danone's business plan fit with that strategy? China has already become one of the most important markets for Danone, especially in infant food and dairy products. Will you introduce more products?
Danone has been focusing on our key product categories in China including fresh dairy, water, baby nutrition and medical nutrition.
Danone has maintained double digit annual growth in China, one of our most important markets. Danone brands, such as Dumex in the baby nutrition sector, Volvic mineral water and BIO yogurt products, are all leading brands with continuing sales growth.
We'll continue to invest in China. Our commitment to the Chinese market is long-term, with great confidence in the future.
The 146,667-square meter site will have annual production capacity of 250,000 tons, producing the company's vitamin drink Mizone.
Shanghai Daily talked to Danone China Chairman Qin Peng about the company's investment plans in Chengdu and its overall strategy in China.
Why did Danone choose to build a factory in Sichuan? What are the major factors that you considered in making the decision? Can you tell us how the project is going there?
Danone China has been growing at very rapid pace in recent years. Our vitamin drink Mizone and bottled water Robust have been well received by consumers. In the southwestern market, demand for these products sometimes outstrips supply.
We decided to set up a new factory in the southwestern region to expand our production capacity to meet current and future demand.
In September 2011, Danone China's water business unit set up a special investment group for the southwestern region.
The group considered Danone's business development history in China's southwestern region and looked at future trends of the market in assessing potential sites.
It used scientific methodologies to weigh the advantages and disadvantages of each candidate site before selecting Chengdu for our manufacturing facility.
We decided to invest in Qionglai because it offers such an ideal business environment. We signed the investment agreement in February 2012.
We expect the new site to be a valuable addition to Danone's water businesses in China.
What role will the Qionglai site play in Danone's global water manufacturing supply chain?
Danone has been deepening its operations in China for more than two decades. This market has now become one of the company's most important worldwide.
The Qionglai site is a strategic base for Danone's operations in western China. It's a wise business decision given regional urbanization and economic growth under the country's "Go West" campaign.
We have laid a very good foundation for our water business in this region. Mizone is a leading brand in Chengdu and in Sichuan. Local consumers like this drink very much.
We'll continue to offer more products catering to local tastes and to deepen our penetration in the market with the Mizone and Robust brands. This year, we launched a blueberry version of Mizone in Sichuan, targeting female consumers. We also introduced three new flavors under the Robust brand.
They have achieved initial success in the market, and we will stick to our strategy of offering localized products for consumers.
Boosting domestic consumption is a key policy of China's central government. How does Danone's business plan fit with that strategy? China has already become one of the most important markets for Danone, especially in infant food and dairy products. Will you introduce more products?
Danone has been focusing on our key product categories in China including fresh dairy, water, baby nutrition and medical nutrition.
Danone has maintained double digit annual growth in China, one of our most important markets. Danone brands, such as Dumex in the baby nutrition sector, Volvic mineral water and BIO yogurt products, are all leading brands with continuing sales growth.
We'll continue to invest in China. Our commitment to the Chinese market is long-term, with great confidence in the future.
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