Spaghetti in one hand

Author: Eleonora Pakhomova, Business

One of the world’s largest producers of pasta and confectionery products – Italian concern Barilla – decided to strengthen its presence in the Russian market. The other day Barilla signed a contract for exclusive distribution in Russia with Ameria. With the conclusion of the contract, Barilla expects to increase sales of pasta and sauces in Russia – due to the centralization of flows, the company intends to reduce costs and move to a lower price segment.

About the fact that Barilla signed a contract with Ameria, told the marketing director of Ameria, Sergei Konstantinov. Export manager Barilla Fabio Fabris confirmed this information. «Previously, we used different channels of distribution to Russia, logistics costs were very high and our products in Russia were positioned in the superpremium segment. Now, due to the fact that we will be represented in Russia by one distributor, we expect to cut costs, reduce the price by 15-20% and go to the premium segment», says Fabrice.

According to Konstantinov, now Barilla products will be presented in all metropolitan retail chains. «We have established connections with all retailers and regional distributors, which will allow us to easily sell Barilla products», says Konstantinov.

Market participants call Barilla’s decision to transfer the right to sell their products in one hand in a timely manner. «To have an exclusive distributor means not only to be present on the market, but also to develop», says Alexei Konelsky, director of Agros’ joint sales service. However, he believes that Barilla was more logical to conclude an agreement on exclusive distribution with a larger player in the macaroni market. «But for Ameri this agreement is a significant acquisition of macaroni brands in the portfolio», he adds.

Previously, Barilla in Russia had a strong position only in the confectionery market – it owned the brand Dan Cake (one of the leaders in the market of rolls). According to Farbis, now the Italian concern will focus on promoting pasta and sauces in Russia. «In the long term, we expect to sell 10,000 tons of macaroni per year in Russia», he said. A source familiar with the plans of the Italian concern added that Barilla is considering the possibility of acquiring a macaroni factory in Russia. However, Barilla did not confirm this information.

According to Andrei Gurov, General Director of the Infolink Group (producer and large distributor of pasta), Barilla currently sells about 200 tons of macaroni a year in Russia. The whole market, according to his estimate, is 700-820 thousand tons. «In total, about 15,000 tons of Italian macaroni are sold in Russia, 12,500 of which are sold by our company. The demand for this product is limited», Gurov said. He calls Barilla’s plans to sell 10,000 tons of macaroni a year in Russia “unreal»: «This will be possible only if this segment grows two and a half times».

Julia Blinkova, Director for Strategic Marketing of Agrosa, on the contrary, is sure that Barilla will be able to sell the declared volumes in the Russian market. «But for this they will have to reduce prices», she said.

Participants in the sauce market doubt that Barilla will succeed in becoming a serious player in this segment. In order to become a serious player in the market (now the proportion of Barilla sauces is minimal), Italians will have to invest seriously in the promotion, says Baltimore owner Alexei Antipov. «When a producer produces several products, he still identifies the product that is the most important for him. For Barilla, this product – pasta, they are unlikely to invest serious money in the promotion of sauces», – says Antipov.

Barilla SpA – one of the largest producers of pasta, also produces sauces, bread and confectionery. It was founded in 1877. In 2003, the company’s revenue was $ 5.522 billion. In August 2003, Barilla acquired the French bread and confectionery manufacturer Harry’s, which, with the Dan Cake brand, holds about 22% of the roll market.
According to Business Analytica, the leaders of the Russian macaroni market in the first half of 2005 are Makfa (28.1%), Extra-M (14.3%), First Petersburg Pasta Factory (7.1% ), Europe Goods GB (6.6%), Pasta Zara (6.1%). Barilla occupies 0.12% of the market.

Barilla is strengthening in Russia. The company has an exclusive distributor.

Author: Rinat Sagdiev, Kirill Koryukin, «Vedomosti», No. 90 (1371)

The Italian group Barilla has concluded an exclusive distribution agreement with the Russian «Ameria» to increase sales of its macaroni in Russia by 50 times. If the partnership proves successful, the Italians plan to open their own production of macaroni in Russia.

Founded in 1877, Barilla SpA – one of the largest producers of pasta, also produces sauces, bread and crackers. The company is controlled by the brothers Paula, Luca and Guido Barilla. Revenue in 2004 was $ 5.5 billion. The subsidiary of the group – the French Harry’s own confectionery factories «Sunny Kake Baking» (Moscow region) and «Condi» (Ufa).
The group of companies «Ameria» was established in 1993, engaged in the production and distribution of food products. He owns a macaroni factory in the Kursk region. Owners are not disclosed. Turnover in 2004 amounted to 920 million rubles. The import of Italian macaroni in 2004 amounted to 15,700 tons in the amount of $ 12.65 million (at a cost after customs clearance).

«We used to be a distributor of an Italian company along with a few other companies, but now Barilla decided to significantly increase sales in Russia and chose us as an exclusive distributor, says Sergey Konstantinov, marketing director of Ameria. According to him, Barilla wants to increase sales at least 10 times, and in the long term to open its own production of macaroni in Russia. Export manager Barilla Fabio Fabris confirmed the words of Konstantinov, specifying that the group plans for several years to increase sales of pasta in Russia to 10,000 tons per year. The volume of Russian sales of Barilla in 2004 in the company did not disclose. According to Fabrice, they were small, because the Barilla pasta is designed for very well-to-do customers. Due to the good logistics of Ameria, Italians want to reduce the cost of their products on store shelves by 15%. «Now we do not plan to open production in Russia, but in the future it is not ruled out,» Fabrice told Vedomosti.

Competitors were skeptical about the possibility of a sharp increase in sales of Barilla in Russia. Alexei Konelsky, director of Agros’ joint sales service, believes that for Barilla, it would be more logical to conclude an agreement on exclusive distribution with a larger player in the market. But Konelsky endorses the idea: «For Barilla, this is a true strategic step, since the exclusive distributor is not only a presence in the market, but also an opportunity for development.» The general director of the group «Infolink» Andrei Gurov, referring to customs statistics, said that in 2004, only 180 tons of pasta Barilla was imported to Russia. For comparison: the total import of macaroni from Italy last year was 15,700 tons, of which 12,500 tons were imported by Infolink. Gurov believes that in the first year of partnership with Barilla, «Ameria» at best can increase sales five-fold – up to 900 tons. «But it must be taken into account that the segment of premium macaroni is very narrow and you can increase Barilla’s share on supermarket shelves», Them other brands. Such as Agnesi or Buitoni, which is also promoted by «Ameria», – says Gurov.

The largest Russian producer of pasta, which might interest Barilla, is Agros, which owns three pasta factories in Russia. But in Agros, Vedomosti was told that negotiations with the Italians about the possible sale of business are not conducted. «Barilla at the current stage is not included in the circle of foreign companies with which Agros is negotiating on joint activities for the development of pasta business,» Elena Yevstigneyeva, director of public relations of the group, told Vedomosti.

Group of companies «Ameria» on Prodexpo 2005

From February 14 to 18, the Ameria group of companies participated in Prodexpo 2005, where partners and new customers were intoduced with the assortment and new brands presented by the group of companies. Pasta products of «Ameria»  received a silver medal in the degustation contest «Best Product 2005».

Business people

«Delovaya stolitsa: Business people» magazine

Austrian quality at an affordable price

About 10 years, the company «Ameria» delivers high-quality Rauch products (juices, nectars, ice tea) to domestic consumers. A drink made from the leaves of freshly picked Ceylon black tea with the addition of pure fruit juice of lemon, peach, kiwi, strawberries managed to win the tastes of many Russians. To be closer and more accessible to its consumers, the Austrian company Rauch together with the company «Ameria» opened in Russia the production of cold tea with lemon and peach flavor in a 1-liter tetra-pack package. With the same high quality, the price of the product has become much more affordable.

In July 2004 the production of pasta «Ameria» was started – packing 4 kg

In July 2004 the production of pasta «Ameria» – packing 4 kg was started. In a convenient package with a handle.