Heinz ketchup, in "upside down" bottles, rests on a shelf in a grocery store.
Photo: AP
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Heinz to Step Up in Russia
World’s ketchup blockbuster, the U.S. Heinz, is launching production at Petrosoyuz facilities, Russia. Until recently, Heinz has manifested no ambitions plans concerning the Russia’s market, but now the company is apparently targeted at winning the leadership.
“The decision to localize Heinz ketchup production in Russia has been prompted by the significant surge in consumption,” explained Dmitry Filatov, a general manager at Heingz-Petrozoyuz. “The sales grew over 60 percent in the last quarter vs. the similar period of the previous year.” Filatov said, vowing to start producing three basic types of ketchup in St. Petersburg already this year. “It will bring down the price for the product by 10 percent.”
The market players explain this move of the company by its desire to materially expand on the market of Russia. “Since early this month, they have cut down prices for their sauce by 20 percent to 25 percent, shifting from the premium segment to the mass one,” said Milada Gudkova, general director at Baltimor Holding.
Heinz accounts for no more than 0.1 percent of the Moscow market, according to Business Analitika, and its share is negligible, if taken for Russia in general.
The analysts say Heinz will have to make every effort to advance on the sauce market of Russia, where the locals are dominating and which is rather stagnant now (the annual growth is between 1.5 percent and 2 percent in terms of quantity).
“Having cut down the price, they entered the mass segment, which accounts for 60 percent of the market, but shows higher acceleration because of reduction in the low-price segment,” said Pomidorprom CEO Maxim Protasov. But Heinz will have to invest at least $15 million a year to promote the project, the analysts pointed out.
www.kommersant.com
All the Article in Russian as of July 21, 2006
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