Westlife Foodworld - Supply Chain Bolsters Growth Prospects: Motilal Oswal

Motilal Oswal Report

The Westlife Foodworld Ltd.'s management organised a visit to the facilities of two of its key supply chain partners - Vista Foods and Radhakrishna Foodland. Both of them have had a long association with McDonald’s in India and are also critical for Westlife FoodWorld’s growth plans, especially as the company now plans to add an unprecedented 50-60 stores annually, following the unveiling of its Vision 27 program in December 2022:

Key highlights from Vista Food facility visit and management meet-

• Vista Foods India is a part of OSI international, a Chicago-based long-term global supplier to McDonald’s. It started the supply chain 1.5 years before McDonald’s opened its first store in the country in the mid-1990s.

• It is a key player for McDonald’s India in the meat (mainly chicken) and vegetable patties/nuggets processing supply chain. About 55-60% of its capacity is used by McDonald’s alone.

• Among many other plants, it also operates the largest frozen food plant in South India.

• Vista Foods India has also been crucial in setting up lettuce supply chain and the supply chain for potatoes used in french fries, both of which were nonexistent earlier.

• McDonald’s has been able to increase the average weight of chicken to nearly two times, since the beginning of its operations in India.

• Being privy to McDonald’s expansion plans over the next three years, Vista is a critical component of the much vaunted ‘cluster-based approach’, which lowers the cost of the supply chain.

Key Highlights from Radhakrishna Foodland facility visit and management meet-

• Radhakrishna Foodland is the sole transport and warehousing system provider for Westife FoodWorld.

• It works with McDonald’s India on inventory planning, replenishment, data analytics, demand planning, warehousing, transport (to and from vendors and stores), and vendor payment mechanisms, etc.

• Its association with McDonald’s goes back to the days when it started operations in India.

• In Westlife Territory (West and South India), RK Foodland has four distribution centers at Kalamboli in Maharashtra, Bangalore, Hyderabad, and Ahmedabad. The last two facilities have been recently set up. The Hyderabad facility reduces the distance travelled to supply significantly.

• All their modernised trucks have GPS trackers.

• The management focusses on ensuring that there are no stock-out at the store level and the trucks are fully utilised to transport inventory to and from the store as well as vendor partners, including Vista.

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