China No Longer Just A Commodity Story - Luxon
China remains New Zealand’s biggest market, taking $23 billion of our exports, but it’s no longer a commodity story, says Prime Minister Christopher Luxon.
A new regional market called Business Unit Asia is being established; it will be headquartered in Kuala Lumpur from March 1.
The co-op says Asia is vital to its ambitions to grow and to increase earnings for its cooperative farmer-owners.
As the world’s fastest growing economic region with a raw milk deficit and a total population of 2.3 billion people, Asia holds great potential for dairy export, in particular for family nutrition products.
China is a strategic growth market for Arla, while South East Asia (SEA) has been identified as a region, which could potentially become a new strategic growth market.
Arla expects revenue for the region will exceed $1.5 billion within the next five years. The consumer needs in China and SEA have many similarities and therefore possible synergies within brand and product portfolio, marketing and innovation, says Finn Hansen, head of Arla Foods’ business group, consumer international.
“In close cooperation with our partner Mengniu, we have developed our market in China,” he says.
“We have gained important experience and insight, which will be levers to accelerate our expansion in Asia. We have strengthened our presence in several SEA countries and it’s time to move the senior management and main leadership functions to the region.”
The new Business Unit Asia management will be based in a regional office in Kuala Lumpur and will be setting the strategy for all retail and food service activities in Asia. The unit will cover the Chinese retail sales through the partnership with Mengniu Dairy China as well as the SEA market. During 2014, Arla has established or strengthened the country management in Bangladesh, Indonesia, Myanmar and Philippines, and these, as well as the management in Japan and South Korea and distributor sales in SEA, will all report to the regional office.
The new business unit will be headed by newly appointed senior vice-president Jesper Colding.
Colding is currently vice-president for marketing with Mengniu Dairy China. From 2009 to 2012, Colding was senior vice-president in global categories in Arla with responsibility for cheese and the BSM category. Earlier in his career, he was based in Malaysia as associate director in P&G with sales and marketing responsibility for Malaysia and Singapore.
“Jesper has a broad strategic and commercial experience and an in-depth knowledge of the consumers in both China and South East Asia. I am confident that he is the right profile to continue the development of China even further and to lead both the new regional team and country managers to a successful delivery of growth in Asia,” says Hansen.
Colding is excited to relocate to Kuala Lumpur to take up a new challenge for Arla.
“Asia holds so much potential,” says Colding. “There is a growing affluence among people and they are becoming increasingly aware of the importance of good health and choice of nutrition.
“We will build on the great foundation that has been created to refine our approach to the market in order to accelerate delivery of the strategic ambition.”
Arla Foods is owned by 13,500 farmers from Denmark, Sweden, the UK, Germany, Belgium, Luxemburg and the Netherlands.
