november-2010

BUSINESS
Businesstrends
Probably the best
water in the world?
Carlsberg looks beyond beer
The world’s fourth biggest brewer is
considering expanding its product line.
At Carlsberg’s annual investor day, chief
executive Jorgen Buhl Rasmussen announced
it could turn to bottled water and soft drinks
– pointing to its successful launches in Russia
of Somersby cider and Eve, a fruit-flavoured,
low-alcohol malt beverage aimed at women.
Without much fanfare, the group also
recently released fruit beer Tuborg Lime
Cut in Denmark and Norway.
Rasmussen stated that the Copenhagen
company was to target women in general,
and northern and western Europe, saying,
“When we look at innovation in the future,
we will see products that support beer.”
While beer sales are falling, Carlsberg claims
operating costs per hectolitre of beer are
also dropping this year, and is standing by
its mid-term target for operating margin in
its northern & western Europe division to
rise to 15-17% in 10 years. In 2009, the
margin was 11.6%. Carlsberg has entered
into a new five-year multi-currency revolving
credit facility of €1.75bn to fuel
future growth. What exactly the
funds will be used for remains
unclear; some of the money could
be used to refinance debt that is
due in the near future, but there is
much speculation, including talk
of a possible takeover.
Drinking ahead: Carlsberg’s future
includes more than beer, as these
new products testify
66 Brussels Airlines b.there! magazine November 2010
Tesco chief exec
Philip Clarke is
looking for online
profi ts in Poland
Supermarket sweep
Big-name western European brands gain ground in Poland
While supermarkets dominate western Europe, with a 70-80% market share, the corner shop
has remained a big part of Polish life. Supermarkets only account for some 30% of sales in
the country – but this is set to change as international giants such as British chain Tesco,
German brand Real and Portuguese-owned Biedronka take an ever larger slice of the market.
The Polish daily Rzeczpospolita estimates that 4,000 corner shops will close in 2010 alone.
Biedronka has emerged as the leader of Poland’s supermarket sector. Offering no-frills
shopping and discounted prices, the retailer entered the market in 1997 and expanded by
buying out smaller rivals and opening new stores. In 2007, Biedronka was opening a new store
in the country every three days; today its smiling ladybird logo graces the front of more than
1,500 outlets. And 2010 has been a record-breaking year: second quarter sales rose by 28%
to €1.13bn, reportedly accounting for 54% of Portuguese owner Jerónimo Martins’ profits.
The competition is hotting up, however. Danish retailer Dansk Supermarked is planning
a major expansion of its network of Netto stores in Poland, and one-time market leader Tesco
is also striking back. The British giant believes it has a new weapon, hoping to revolutionise
Poland’s online shopping sector when it debuts on the .pl domain next year.
Nutrition from Nestlé
Swiss giant to invest millions in new Health Science division
Nestlé is aiming to pioneer a new industry that sits “between food and pharma”, to exploit the
rising demand for nutritional products around the world. The company, based near Geneva,
has announced the creation of Nestlé Health Science, which will start operations from
January 2011 and will be run at “arm’s length” from the company’s food and beverage brands.
The driving forces behind the initiative are ageing populations, increasing healthcare costs
and the rapid advances in associated technology. The division takes responsibility for the
HealthCare Nutrition portfolio, an area delivering €1.2bn in revenues last year. Among the
products are Clinutren enriched food and drinks, Carnation instant breakfast and the Optifast
weight-loss line. Nestlé has also established an Institute of Health
Sciences, which is set to receive “hundreds of millions” of Swiss
francs in funding over the next decade. Its remit encompasses
research and translating findings into strategies that can be
employed by the company. “In 10 years, we will be the undisputed
leader in the new ‘health science nutrition’ business,” said chief
executive Luis Cantarell. “Our development
Nestlé plans
capabilities will help drive product
to take a big
innovation and organic growth.” The division bite of the
health science
also plans to acquire or licence products.
market
IMAGE GWTTY IMAGES