Scandinavian dairy cooperative Arla Foods has introduced its new Strategy 2020, which charts out the company’s growth plan in eight global dairy categories and six market regions around the globe.
Under the new strategy, the company plans to increase its milk production by another 2.5 billion kilos by 2020, thus providing the dairy cooperative more growth opportunities. Since 2007, Arla's milk production has increased from eight billion kilos to 14 billion kilos through acquisitions.
The company's management has laid out a business plan for growth strategy named 'Good Growth 2020' by focusing on creation of maximum value for increase in milk volume with enhanced focus on eight dairy categories, across six regions in the world, and by strengthening its position as a unified cooperative.
Arla Foods CEO Peder Tuborgh said: "We are launching a new strategy. However it is not a radical change of direction for Arla. Over the past years we have prepared for this moment by expanding our size and our competencies. In Strategy 2020 we will focus even more on organic growth and growing our brands through innovation that focuses on what consumers and customers want and need. This will help us create the most profitable growth with our farmer owners' milk."
Arla has recognized eight dairy segments which will have a central focus for the company to maximize its new offerings made with natural ingredients, nutritional abundance and good taste. These eight categories include butter and spreads, spreadable cheese, speciality cheese, yogurt, milk-based beverages, milk and powder, mozzarella, and ingredients.
The dairy cooperative intends to build its business in these categories with enhanced focus on its three global brands - Arla, Lurpak and Castello.
Under its new strategy, Arla will continue to focus on its established regions such as Northern Europe and the Middle East and will also build its focus on new growth markets such as China, sub-Saharan Africa and Russia. Overall, the company intends to strengthen its market in Europe, the Middle East, China, Russia, Nigeria and the USA. In Europe, Arla's strong markets include the UK, Sweden, Denmark and Germany.
In Good Growth 2020, Arla intends to take its expansion plan through mergers and acquisitions to the next level. In the last five years, the company undertook six mergers Central Europe, the UK and Sweden, and has spent six years in streamlining its businesses that were created as a result of the mergers.
