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Worm queers Cadbury's pitch

Arijit De & Reeba Zachariah in Mumbai | October 10, 2003 08:32 IST

The finding of worms in a sample of chocolates manufactured by Cadbury India earlier this week may have put paid to it becoming a major sourcing hub for British chocolates and beverages giant Cadbury Schweppes'.

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As part of a global realignment of its supply chain management, finishing touches were being given to a plan that would have seen Cadbury India emerge as a major supplier of chocolates to the Asia-Pacific region and the Middle East.

In an exclusive interview with Business Standard, Bharat Puri, managing director of Cadbury India, said: "This controversy, and the adverse publicity it has received in several countries, has set our plans back by several months. The outsourcing model would have resulted in significant revenue generation for Cadbury India."

Even the parent company, seen globally as a flagbearer of corporate governance, has expressed concern about the problem.

Puri is hopeful though that Cadbury India will begin supplying chocolates to other countries sooner than later. "But we surely can't do it now. Can you imagine the adverse impact it will create after this controversy?" Puri says ruefully.

Cadbury's Indian operations are not just the largest in Asia but also the cheapest. In India, Cadbury has the largest market share anywhere in the world and has been the fastest growing FMCG company in the last three years with a compound annual growth rate of 12.5 per cent.

Even in for its domestic operations, the "worms controversy" could not have come at a worse time. "The next few months are the peak season for us. We are carrying out market research to gauge the impact this controversy has had on our customers," Puri said.

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