New Delhi: Tata Tea has hired international consultancy firm Accenture to streamline its supply chain processes. In a related move, the company has also embarked upon a outsourcing business model to bring down the processing costs within the company.

Tata Tea’s deputy managing director Percy Signaporia told The Financial Express soon after announcing its foray into the lowest priced segment of the domestic packaged tea market with the launch of a new brand Agni Sholay.

Commissioned a month ago, the consultancy has been assigned to formulate a strategy to help the company track sales through an analysis of stock movements and accordingly enable an effective forecasting and inventory control.

"The aim is to create deliverable processes in our logistics and seamlessly integrate it with strategic inventory management, credit control and sales generation," Mr Signaporia said.

According to Mr Signaporia the first phased report will come in the next six months and will be implemented nationally for the company.

The company may also put in place an Enterprise Resource Planning Solutions and eventually create a converging action plan to integrate marketing strategies.

In line with that initiative, Tata Tea has—for the first time—adopted an outsourcing business model ala local players. As per the strategy, Tata Tea is sourcing tea across auction centres despite having its own tea plantations, and packaging it under its own brand name. For its newly launched brand Agni Sholay, for instance, the company has joined hands with a Calcutta based company for procuring and packaging tea. "The idea is to procure locally, and distribute locally to cut down the logistics costs," Tata Tea’s vice president Mr Girish K Tyagi said.

"Normally, for a brand with a potential of three digit turnover we would have required huge investments to hire new facilities and manpower resources. But, we haven’t hired a single person," Mr Signaporia added. According to him, the exercise should result in a saving of about 10-15 per cent of the company’s gross processing costs. Giving reasons, Mr Tyagi said that the company has begun outsourcing despite having its own tea plantations, mainly because in recent times tea prices at the auction centres have fallen to rock bottom levels. "Cost of production is not recognised in an auction," he said.

As a result the lowest end of the economy segment is currently being flooded with all types of branded teas and at all prices and encouraged by the profit margins of branded tea markets local players have started selling their unblended teas in sloppy packets under obscure brand names.