FDBusiness.com

Netherlands-based dairy multinational Royal FrieslandCampina, which operates production plants in 24 countries and markets its products in more than 100 countries, has unveiled its new strategic plans and priorities for the coming decade. Entitled route2020, the new strategy focuses on extra investment in products such as dairy, branded cheeses and infant and toddler nutrition ingredients in order to achieve growth, and on geographical expansion of consumer products in Europe, Africa and Asia. FrieslandCampina will aim for 5% average annual volume growth in added-value products.

The dairy co-operative is also committed to improving energy efficiency throughout the dairy chain and reducing associated greenhouse gas emissions. The new strategy is designed to add extra value to the milk supplied by FrieslandCampina’s member farmers.

“The route2020 strategy marks the next step towards achieving our ambitions. After our merger in early 2009 we focused on integrating the two organisations and establishing a strong management team, while also putting in place plans for a better streamlining of various parts of the production chain. Now, 18 months after the merger, we can consider the integration a success. And last autumn we and our top 70 managers started working on our long-term strategy,” explains Cees ’t Hart, chief executive of FrieslandCampina.

Cees ’t Hart, chief executive of Royal FrieslandCampina.

He continues: “Worldwide we are seeing sharp movements in dairy prices, as well as a shift in the economic focus towards Asia, a globalisation of markets and businesses, increasing attention to sustainability and growing consumer demand for good, healthy food. We firmly believe that we are well-positioned in this market thanks to our expertise throughout the dairy chain, our broad-ranging product portfolio, our geographical spread and our strong brands. We will be using our route2020 strategy to continue reinforcing our international presence and increasing the focus on our activities that create added value.”

In developing and expanding its activities, FrieslandCampina is primarily concentrating on growth, profitability and adding value to milk. By increasing sales volumes of its differentiated products by an average of 5% a year, route2020 will lead to further improvement in FrieslandCampina’s financial results, with larger numbers of added-value products, fewer commodities and a strong focus on cost management. This in turn will be reflected in the performance price paid for all milk supplied by member farmers. FrieslandCampina expects to be able to fund the costs of implementing route2020 from profits.