INTERVIEW WITH MR. ABEL SANTOS SÁEZ – INTERSNACK

February 10, 2023

1. Kindly tell us something about your work profile/business including yourself.

Intersnack was founded in Germany more than sixty years ago and made its first potato chips in 1968. Since then, we have grown and flourished to become a market leader in savoury snacks, present in over 30 countries across Europe, Australia, New Zealand and beyond. In 2021 we sold more than 650K MT of tasty snacks with a turnover higher than 3 billions of Euros.

We are passionate about enriching people’s lives with the right choice of great tasting savoury snacks. Every day, more than 15 million consumers around the globe enjoy our products.

Intersnack has a large portfolio of local and international snack brands, from potato chips, nuts, and baked products to specialty snacks. Our most famous brand names include funny-frisch, Chio, Estrella, Hula Hoops, POM-BÄR, McCoy´s, ültje, Vico, Tayto and Griffin´s.

As a privately owned company, we operate with a long-term view. Intersnack’s strength lies in our unique blend of local knowledge and international expertise; our people and teamwork plus our entrepreneurial spirit and a drive for excellence in everything we do.

Several category risk analyses showed a demand for action in the cashew supply chain, to mitigate existing issues. Therefore, the idea evolved to dedicate a specific operation, specialized in raw cashew nut procurement and pre-processing. This operation is called Intersnack Cashew Company (ICC). Intersnack Cashew Company is a 100% Intersnack-group owned subsidiary with its base in Singapore and holding entities in Vietnam, India and Ivory Coast.

My full name is Abel Santos Sáez, I am natural of a small Village in the centre of Spain and currently, I as leading ICC operations as Chief Operating Officer up to the end of 2022 and I have been appointed Managing Director since January 2023.

I am graduated from Salamanca University (Spain) and Bern University (Switzerland) with an MSc in Chemistry. I hold also a MSc in Marketing and Sales Management from ENAE Business School in Spain. I have accumulated more than 20 years of experience in the food manufacturing industry in the fields of innovation, quality and operations.

In 2015, I was placed in charge of supplier management and collaboration at Intersnack Procurement, where I oversaw supplier’s compliance with the company’s sustainability, food safety and quality requirements. Consequently, I acquired extensive knowledge and established good relationships with business partners in sourcing countries building the needed capabilities to access in 2018 to my current role as COO, leading our Asia and Africa operations from our Singapore office.

2. What are some important factors to expand your business in Vietnam?

“We believe the cashew sector can provide a bright future for everyone involved in the supply chain”.

Global consumer demand for cashews is growing. However, the cashew industry is complex. Brazil, Africa, India and Vietnam are the most important sourcing regions for cashews, but most of the raw cashew nut processing (the next step after the harvest) is executed in Vietnam. Cashew processing is highly labour-intensive and consists of four main steps – steaming, shelling, peeling and grading – that are carried out before the nuts can be packaged and shipped to Europe for roasting.

One of the industry’s biggest concerns over the past years has been labour standards, especially at processing level. In Vietnam and India home processing and facilities dispersion makes it extremely difficult to monitor safety, child labour and working hours. Even today at factory level, we find gender discrimination and workers exposed to hard jobs for small money (people exposed to smoke, high temperatures and the nut’s corrosive oil).

Focusing on social responsibility, there are growing NGO campaigns regarding ethical practices and media attention. Ethical misconduct/ bad practices is a no go that may damage not only the company involved in such practices but the entire industry. It’s a bad product exposure and a big reputation risk for the sector in front of the consumer.

Therefore, it is absolutely imperative that the whole cashew industry raises the bar to meet our customer’s requirements and expectations and thus improve and develop the members of our cashew community and to take ownership to improve the livelihoods, working conditions and general business ethics for everyone involved in our supply chain.

One of our answers to these challenges comes as a concrete initiative: Honest Cashew. The scope of the initiative and more visible element is the Intersnack Cashew Company’s aiming to improve the entire supply chain: from Intersnack processing facilities in Asia to further down the supply chain to farmers in Asia and Africa.

We want to contribute improving the cashew sector, so farmers can get better yield and income, employee’s better opportunities and consumers a better quality. We are building a fully transparent supply chain to ensure a safe place to work, to contribute to a decent income for workers and farmers and to prevent child labour.

3. What is Intersnack presence in Vietnam?

The Intersnack Cashew Company (ICC) operates five factories in India and Vietnam.

ICC’s three factories in Vietnam are located in Tay Ninh, Phan Thiet, and Long An with a total of 1500 employees and we do operate also a central office in HCMC district 1.

Cashew processing has many different steps and is highly labour-intensive. One of ICC’s important achievements has been the establishment of ‘single roof processing’, meaning the main steps are now carried out under one roof, instead of being scattered across a network of smaller processing facilities. This move to ‘single roof processing’ will vastly improve transparency within ICC’s supply chain, as well as allowing the company to better ensure food safety and guarantee that employees’ health and welfare are protected in the workplace.

The ETI standard is Intersnack’s primary reference for social compliance in all factories that are part of the Group. It governs Intersnack’s conduct in terms of labour conditions and human rights issues. Consequently, the three ICC production plants are in the process of acquiring ETI/ SMETA assessment and making a range of improvements.

4. Has the impact of Covid-19 arose any new trends in Vietnam’s snack market? Can you shed more light on the 3 key trends that you’re seeing in Vietnam?

Indeed, Cov19 was an unprecedented phenomenon that has bring many lessons to all of us.

One of our major takeaways was the strength and maturity of our teams, the circumstances forced them to operate and decide quickly and more autonomously, they managed to drive the business excellently in this difficult context.

To guide ourselves to navigate the pandemic, we defined our key “pillars of action”. Here the 5 that we used to sustain everyday decision and mid-term approach in our organization;

1. People’s safety, to avoid risk of contamination (for the health of the Individuals) and Covid19 spread (for community protection).
2. Peoples emotional stress management (long term related to health issues but in the short-term impacting decisions, performance in professional and personal life)
3. Supply. Keep the flow, maintain it alive. (Digital technologies boost)
4. Economic impact. Control & minimise the risk for the organization. Risk management and cost competitiveness.
5. CSR activities to support our local communities.

Now that the major outbreaks seem to be left behind, we have taken time to evaluate how Cov19 has impacted our market, the sector and the company and we can draw some first conclusions:

a. SC disruption is felt across the entire globe (now due to many different reasons) and we all know that given the interconnectedness and complexity of global supply chains, the disruption is likely to persist for many months more.

b. Evolving demand and supply requirements. New era requires of higher capacities to adapt/adjust to changes in type and quantities. (ie. Empty Shelves, demand peaks in snacks up to 70% during Cov19 or -30% due to Ukraine war)

c. Visibility and flexibility are key so data must be placed on the core of supply chain resilience so we do increase visibility and ability for timely decisions. Artificial intelligence (AI) and machine learning (ML) may pay a more relevant role in the near future.

d. The decline in demand due to the outbreak containment activities, combined with the difficulty of getting products to market, is causing many companies to re-evaluate their cash positions and take actions to release cash. Inventory management is critical to achieve cash goals.

5. Please tell us a little about the future plans of Intersnack Cashew

As consumers’ demand for cashews grows, so too does their interest in the product’s origins and the conditions facing the people involved in the supply chain. Sustainability has become a major consideration for our customers. Transparency of supply chains, good agricultural practices and decent working conditions has become the norm.

We are striving to create a strong community within this supply chain, and we have already made achievements that put us well on our way toward improving transparency, social responsibility and food safety for the long term. In recent years, we have processed impressive volumes of cashews, bringing expansion and growth to the industry. We are proud to contribute to creating wealth for hundreds of thousands of people in more than 20 countries.

We plan to continue sharing knowledge and create collaboration and training programmes for our entire supply chain to leverage capabilities and make across-the-board improvements. For the next ten years and beyond, people development and labour conditions will play a significant role in our strategy, enabling us to deliver a wide range of responsibly produced products that fulfil the highest quality standards and are still competitive in all the European markets in which we operate.

Many thanks to Mr. Abel Santos for sharing your experience with us.