FrieslandCampina’s strategy is to increase our added value and, at the same time, ensure all the milk produced by the member dairy farmers of our co-operative reaches its full value. To this end in our strategy route2020 we want to achieve accelerated growth in selected markets and product categories.
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We have a number of strengths on which to build further. We have strong brands and good market positions in various geographic regions and product groups including dairybased beverages, ingredients for infant & toddler nutrition and for the pharmaceutical industry and in the field of cheese. We also occupy strong market positions in specific countries and product groups including desserts, coffee enrichers, fruit drinks and various ingredients for the food industry.
Value drivers to achieve value growth
In developing and expanding our activities, we are primarily concentrating on growth, profitability and milk valorisation (adding value to milk). In our route2020 strategy we have defined six value drivers to achieve value growth.
- Worldwide growth in dairy-based beverages by increasing the share in total consumption.
- Strengthening market positions in infant nutrition, both ingredients and end products, worldwide.
- Increased market share in branded cheese, including through expanding the brand portfolio.
- Geographical growth in the above categories and improving the strong positions outside of these categories.
- Foodservice in Europe: strengthening and expanding existing strong positions in the eating-out category, partly through geographical expansion.
- Strengthening of basic products, such as standard ingredients, industrial cheese and private labels in order to reduce the share of member milk that is processed into commodities.
More than half of our investments will be related to these value-drivers and will include investments in marketing, the education and training of employees and acquisitions. Efforts in the field of marketing and innovation will be focused on the benefit platforms of growth & development, daily nutrition, health & wellness and functionality.
Climate neutral growth
We will strive for the climate neutral achievement of our foreseen growth. Throughout the entire chain from cow to consumer. We want to achieve this by working with our member dairy farmers and chain partners to improve energy-efficiency, reduce greenhouse gas emissions and stimulate the production of sustainable energy on dairy farms.
Our strategy is built on the existing firm foundation that is reflected by our intrinsic FrieslandCampina hallmarks. Because the company FrieslandCampina is directly linked to the dairy co-operative FrieslandCampina we control the entire production chain from raw milk to distribution.
This means we can guarantee the quality of our products. The emphasis of the cooperation with dairy farmers will, more than ever before, be on safe food and sustainable operations. Good cooperation between every part of the organisation is vital.
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We expect following route2020 to enable the following results to be achieved:
- an increase in the share of specialities and branded products in the total sales volume;
- further growth of the operating profit;
- a higher performance premium for all milk supplied by the member dairy farmers and a higher pay-out in the form of equity registered in the names of members via member bonds;
- climate-neutral growth throughout the chain from cow to consumer
.
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