The Nestle USA - Beverage Division and Ocean Spray Cranberries, Inc. announced this week that they have formed a long-term agreement which, they hope, will enable both companies to increase manufacturing and supply chain efficiency and to maintain high-quality products for their respective juice businesses.
"Ocean Spray shares many of our same business values, in particular their commitment to high-quality manufacturing standards,'' said Mike Mitchell, President and General Manager of Nestle USA - Beverage Division. "By capitalising on each other's best practices, we feel both Nestle and Ocean Spray will be better equipped to grow in this highly aggressive juice category in which we compete.''
Under terms of the agreement Nestle will gradually move the manufacturing of Libby's Juicy Juice and Libby's Kerns Nectars to Ocean Spray facilities. The companies will also pursue collaborative procurement of common raw and packaging materials, and common operating supplies, as well as shared logistics to increase process efficiency across the supply chain.
"By bringing Nestle's juice production into our plants and joining forces with them on purchasing and distribution, we will establish an economy of scale that will boost the profitability of both companies,'' commented Ocean Spray President and Chief Operating Officer Randy Papadellis.
Ocean Spray, a grower-owned cooperative, is the No. 1 brand of canned and bottled juice drinks in the U.S., with fiscal 2001 gross sales of more than $1.3 billion (€1.5bn). Nestle USA has 17,300 employees and $8 billion