Essen Production's exports hit record highs in 2020
Essen Production AG in 2020 increased export sales by 19% in physical terms and by 32% in revenue compared to the previous year. According to preliminary data, the company's export revenue amounted to about 4.7 billion rubles. VAT included. Including shipments in the mayonnaise group increased by 12%, tomatoes - by 20%, spices - by 24%, sweet group - by 46%, sauces - by more than 70%. “In general, 2020 has passed well in terms of foreign economic activity. In spite of everything, this was our record year for the entire existence of the company, both in terms of tonnage and revenue, "said Nikolay Orlov, Commercial Director of Essen Production AG.
The growth was due to the emergence of new customers and the expansion of the geography of supplies. In the countries of the Middle East, the growth was 38%, in Azerbaijan, Armenia, Abkhazia and Georgia - 44%, in Latvia, Estonia, Greece, Norway, Germany, Italy - by 23.8%. Exports to China, Mongolia and the Republic of Korea showed a cumulative increase of 118%.
In China, the positive dynamics was provided by the supply of confectionery products, which increased from 1.5 thousand tons to 3 thousand tons. There was also an increase in the shipment of ketchups and jams to existing partners. Due to the pandemic, deliveries to China were not carried out in March-May, but resumed in June.
A lot of work was done to organize deliveries to China, which took more than one year. The company faced a number of peculiarities of doing business in this country. “First of all, the Chinese are ready to do business only with the Chinese, so we had to look for a local partner. In addition, it is very important for them that we respond quickly to their requests, otherwise they may perceive it negatively and refuse to cooperate, ”explains Orlov. Essen Production AG has found a partner who is deployed in the northern part of the country. He has stable financial support and distribution channels throughout China, therefore, according to Orlov, we can say that confectionery products are delivered throughout the country.
Sweets with a new recipe, unusual for the Russian market, have been developed especially for the Chinese market - they contain 30% less sugar than the usual Essen Production AG product, and the amount of milk has been increased. “The peculiarity of the Chinese diet is that they do not eat a lot of sugar, but they do eat a lot of dairy products,” says Orlov. “This was a special project, for which, in addition to the low sugar content, new tastes, types of packaging were developed, and the design of the packaging was updated”. In general, the company approaches the adaptation of the product to local requirements in terms of the possibility of improving the quality, Orlov adds. If, for example, grilled ketchup, in the opinion of the Germans, should be a little sharper, then these wishes are taken into account, but they can be applied not only to the “German” batch of the product: if this change has improved the taste and made it brighter, it goes into series.
This year, Essen Production plans to increase the export of sauces, ketchups and jams, as well as confectionery products. In particular, the supply of confectionery products to China is expected to increase by 10-12%. “We look forward to increasing the activity of our partners and lifting the restrictions set during the pandemic. The minimum plan that we set for ourselves for the grocery product is to grow by 5% in relation to 2020, in the confectionery business - by 20%".
The company is trying to expand its export supplies to all product categories it produces. Thus, the new products released last year - caramel and chocolate flavored toppings, tomato sauces and sesame mayonnaise, were positively accepted in most countries and have already been included in the permanent assortment.
At the same time, a certain category of products is sent to each country, Orlov draws attention. Most of the sauce group is supplied to European countries, the USA and Canada. “European cuisine is characterized by a developed culture of consumption of mayonnaise, tomato sauces and spices, which are widely represented on the shelves of local stores,” Orlov said. In the countries of the Middle East, Central Asia and the Caucasus, confectionery is in demand: these countries are characterized by large families in which the traditions of visiting, celebrating holidays, giving sweets, treating children and the older generation with sweets are preserved.
Essen Production AG JSC (TM Maheev, 35, CHO KO-TE, etc.) was founded in September 2001 in Tatarstan and today is one of the leading food manufacturers in Russia. The company's annual turnover in 2019 amounted to 23.26 billion rubles, and the share of exports exceeds 15% of total sales.
According to the Federal Customs Service, in 2020 Russia increased the export of sauces and products for their preparation by 7.5% to 139 thousand tons worth $ 166 million (+ 7.5%). Sales of confectionery products abroad increased in physical terms by 11% to 688 thousand tons, in monetary terms - by 3.6% to $ 1.4 billion, including the supply of chocolate confectionery products increased by 2.3% to 740 million dollars, flour - by 6.6% to 455 million dollars, sugary - by 2.1% to 181 million dollars. Export of jams, fruit jellies and marmalades increased by 48% to 26 thousand tons in the amount of 37 million dollars (+ 29%).