As Poslovni Dnevnik/Sergej Novosel Vuckovic writes on the 17th of November, 2019, Helle M. Petersen, CEO of Carlsberg Croatia discusses the business of the company operating under the auspices of the Danish beer giant and the state of the domestic sector in which large breweries are increasingly finding fierce independent rivals.
Although the main brewing season is behind us, beer continues to be well consumed at this time of year, moreover, the range, quality and range of beer styles make it a source of enjoyment for domestic consumers. One of the companies who recognises this is Carlsberg Croatia from Koprivnica, a company which operates under the well known global giant from Denmark, which stepped out with new products this year, achieving better results than last year.
The third brewing company in terms of market share has thus solidified its position, and Carlsberg Croatia’s CEO Helle M. Petersen sat down to talk about the challenges and opportunities in the beer sector in conversation with Poslovni Dnevnik. The Danish manager has been in Croatia for three years now, after having spent her career within Carlsberg around the world, and she touched upon the issues of the workforce, the popularity of beer brands, the health and safety of workers, investments, and so on.
The main part of the beer season has passed, autumn is in full swing, what are the results so far in 2019, are you satisfied?
We’re very satisfied, we have experienced the growth of all our brands, we’re also very happy that we’ve won a good part of the market which is a good indicator for strengthening our share, because, as you know, we are “only” the third player in Croatia and therefore getting stronger is very important to us.
Like other industries, bad weather hit us in May, but we still managed to maintain our position. Compared to the same period last year, this has been reflected in double-digit growth in sales volume. It’s definitely satisfying. However, we still detected some difficulties, the category is in decline, especially in the HoReCa channel, which is very worrying.
Although there were more tourists, they did not go out and consume drinks to the same extent as they did last year, and this is an area that leads me to think about what led to a change in their habits.
However, that depends not only on you but also on the prices in the HoReCa channel?
That’s true, but it’s still our responsibility to make our offer attractive to tourists, to encourage them to go out and spend money. It’s also our obligation to provide content that will attract guests to cafes and restaurants, and therefore that’s high on our list of priorities and questions we want to better understand what we as a brewer can do.
And have you found any solutions?
If I had, I wouldn’t tell you yet (laughs), but we truly believe that we have a responsibility to make the category of our products more efficient, more interesting. In other words, we need to look for ways to win over more customers, create a premium offer and generally make it attractive for the consumer to continue buying our beers in Croatia.
Remind the public of just how present Carlsberg already is in Croatia…
Ever since beer production started in Koprivnica with the establishment of a brewery. The history goes back to 1971 when we partnered with Podravka and actually secured a license for them to produce Tuborg, which was the first international beer brand produced locally in the entire former Yugoslavia.
This relationship warmed up and we entered into a brewery, but over time Podravka gave up the beer business, so we gained full control, renaming the company in the 90s first to Pannonian Brewery and finally to Carlsberg Croatia.
The name change was not warmly welcomed in the local public?
It was expected from the point of view of the native people. The Carlsberg Group was taking over a lot of companies around the world at that time, trying to ensure that the corporate culture of Carlsberg was carried everywhere to new markets, and that’s why the company here was renamed, whether it was a good or bad decision. But I think it’s fair to say that the Pan brand is much stronger than the Carlsberg brand in Croatia.
And then people know once again that Carlsberg is also Croatian, from Koprivnica…
I don’t think the name of the company makes it difficult for us, but on the other hand, we have the task of making sure people recognise us as Carlsberg, of having a wide product portfolio, but our biggest brand, I repeat, is the local Pan. And we have healthy growth in it.
To date, how much has Carlsberg invested in doing business in Croatia?
We usually don’t publish full amounts of investments, but as a company we have accelerated investments. In the last three to four years, we’ve invested a lot in production capacities, packaging machines, which has enabled us to sell, for example, the Somersby brand range (alcoholic beverages based on fruit juice, eg cider – cider, op.a.) from Croatia in 20 countries across the world.
We’ve also invested heavily in the area of occupational safety and health, it’s very important for us to get people to work in safe conditions, and however small things may seem, it is really important as a step forward in the production process. This is also linked to our investment in alco-lock systems in cars, as we don’t want to have any risk of our employees selling beer driving under the influence of alcohol. Last year, we invested around 11 million kuna in a new warehouse in Koprivnica, there was a big need to expand our warehouse space as bigger spaces allow us to export more.
Specifically, we’ve invested a lot in cider production capabilities, which commands a completely different method than brewing beer. This has two benefits – that Croatia has the benefits of exporting this product, and it is important for Carlsberg to have all the expertise of cider making.
Let’s go back to beer brands and their strength. What works best on our market?
If you look at the Croatian market, more than 80 percent of it belongs to the mainstream brands and those below. We therefore needed the Pan brand to show us its strength in that segment and it’s like “bread and butter” to us. Without a strong local brand, it doesn’t make sense to have a big drive and therefore our focus is on making Pan great. But we also strive to achieve good results in the premium segment, with Carlsberg and Tuborg, and this year also Blanc, a citrus-flavored wheat beer. We don’t think too much about brand size as long as all our brands grow.
It’s important to us how we deal with our competitors, since our range is wide, ranging from “discounted” Holsten to various types of Pan all the way to Carlsberg, Tuborg and Blanc, and Grimbergen, Budweiser and Guinness. We need to continue to innovate and create appropriate deals for stores and outlets to make consumers want to have a drink outside in company.
In terms of Somersby ciders, do Croatian consumers like it?
Absolutely, yes! Cider has been a pretty interesting “journey” for us, with it having double-digit growth year after year and with the growing acceptance of cider as a beverage category. With Somersby, we practically founded the category and started its growth. Somersby is still the number one leader in Croatia.
Cider also generates a good deal of revenue for caterers who are increasingly interested in selling it. It’s consumed equally by men and women, it is a true unisex product and it’s our responsibility as a market leader in the category to continue to “pump” that growth. We have introduced new flavours, changed the design and have to keep going. Everything is made here in Croatia. It is almost entirely a Croatian product.
Where does Somersby end up from here?
It goes to the countries in Croatia’s neighbourhood and the region, but also to the Far East – China, Malaysia, and Canada, a total of twenty countries worldwide. It is mainly exported in bottles, on this market in four flavours, but we export five more, so in total in Koprivnica, we produce about ten Somersby variants. This brand is here to stay.
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