Nestlé relaunches its activities to continue supplying food to Ukraine
After Russia invaded in February, many large multinationals suspended operations in Ukraine, citing concerns about employee safety, labor shortages and the difficulty of getting raw materials into the country. .
Nestlé initially closed its three factories in Ukraine after the outbreak of war. Then, two days later, it reopened its confectionery factory in Lviv and its condiment factory in the northwestern region of Volyn to continue supplying the country with needed food.
To protect factory staff from the continued threat of airstrikes, the owner of KitKat chocolate and Nescafé coffee has turned underground rooms into bomb shelters and shut down elevators. It has also adjusted production lines to allow for frequent stops and starts, and reduced the number of staff on site at all times to ensure everyone can fit into the shelters.
Lviv and the Volyn region have recently suffered air attacks. “Less than an hour ago I heard sirens saying that an attack could come from the air,” Volodymyr Spivak said in an interview earlier this month. Mr. Spivak, Nestlé’s general affairs director for Ukraine and Moldova, has moved from Kyiv to Lviv, where he has helped lead the company’s relief efforts.
Nestlé is among several food manufacturers, including General Mills Inc. and Smithfield Foods Inc., that have sent food donations to Ukraine. Meanwhile, companies ranging from German automotive supplier Leoni AG to tech company Fractal Analytics Inc. have made changes aimed at protecting their staff in the country.
Nestlé, which employs more than 5,000 workers in Ukraine, has had to deal with the relocation of almost a third of its staff during the conflict, as well as the disruption of its supply chains. For example, tomatoes once imported from Ukraine to make sauces are now imported from Italy and Portugal.
Since the start of the war, the company has been trying to change the way it does business in Ukraine while grappling with employee dissatisfaction with its initial decision to continue to sell the majority of its locally produced products in Russia, as well as some imports. Nestlé and other companies have been criticized by Ukrainian politicians and consumers. The company recently said it would reduce sales in Russia to essential products like baby food and medical nutrition products, halting sales of other products like pet food, coffee and confectionery.
Russia accounts for around 2% of Nestlé’s global sales, while Ukraine accounts for less than 1%, according to a spokesperson.
Nestlé’s instant noodle factory in Kharkiv, one of Ukraine’s most heavily bombed cities, remains closed but is now part of the company’s humanitarian efforts.
Line workers, loaders, engineers and other company personnel entered the facility – accompanied by armed guards provided by the National Police and the city’s Home Defense – to pack boxes of noodles for local residents, including those sheltering in subway stations.
“It is a dramatically difficult situation because even during the day it was not possible to just go to the store to buy bread, because it is 40 kilometers from the Russian border,” Mr Spivak said.
Nestlé has imported other products like baby food, soups, water and medical nutrition products from its factories elsewhere in Europe to donate to Ukrainians. Trucks arrive through Ukraine’s border with Poland from countries like Germany and the United Kingdom, and supplies are then dispersed across the country.
Ukraine’s government has relied on businesses to import more food into the country after Russia bombed depots, shops and warehouses while destroying packaging and bottling plants. The Polish government has told food companies it believes Ukraine needs nearly 10,000 tonnes of food a day from abroad, according to a briefing document. Nestlé says it has donated 2,080 tons of bottled water, baby food, instant noodles, coffee and other products so far and has worked to increase donated imports by 10 25 trucks per week.
Since the outbreak of war, Nestlé has rolled out a playbook it developed during the Covid-19 lockdowns to bring food donations to those in need, working with food banks, nonprofit organizations non-profits and local authorities.
To coordinate its donation efforts, a team of around 20 Nestlé employees in functions including logistics, corporate communications, operations and sales joins an hour-long call each morning.
In addition to its three factories, Ukraine is home to a business center in Lviv that supports accounting, payroll and social media functions for Nestlé offices in more than 70 countries.
Some staff at the Nestlé Lviv hub now run an internal helpline open from 9 a.m. to 8 p.m. that employees can call with questions about relocation or where they can receive medical treatment.
Nestlé said around 30% of its staff in Ukraine had moved, mostly from east to west, with some moving abroad. To help workers, the company has implemented a wartime employee support plan that includes paying wages in advance, offering one-time relocation payments and health services.
For workers leaving Ukraine, Nestlé has turned part of a baby food factory in Poland into a temporary shelter where they can shower, rest and eat before moving on to more permanent accommodation. Rooms once used for meetings now house rollaway beds, while a refrigerator and microwave have been placed in a conference room for families to heat up food and prepare simple meals. About 1,000 staff and family members passed through the site, most staying for a single night or a few hours, the company said.
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