(Bloomberg) --
Nestle SA plans to further expand the three Swiss sites where it produces Nespresso capsules for consumers worldwide, Chief Executive Officer Mark Schneider told newspaper Schweiz am Wochenende.
Schneider rejected the notion that it would be wiser to diversify production internationally to avoid the risk of the coronavirus disrupting supply. Nestle will instead add capacity at the sites in western Switzerland, as the “the sheer quality here where billions of capsules are produced is unmatched,” he said.
Nestle has been increasingly offloading sugar-laden food brands and doubling down on its coffee, water, pet food and nutrition businesses. Schneider in 2018 spent $7.2 billion to acquire the right to market Starbucks products, including coffee capsules for the Nespresso system.
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The virus pandemic has lifted Nestle's sales online. Accounting for only about 10% of total sales, electronic sales channels are seeing an increase of about 30%, he said. Demand for coffee capsules and pet food have “noticeably grown.”
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