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October 27, 2014

SIAL 2014: Lotte subsidiary E. Wedel eyes international expansion

E. Wedel, the Polish unit of confectionery giant Lotte Group, plans to grow its presence in existing international markets and expand into fresh territory in Africa, Asia and the Middle East.

E. Wedel, the Polish unit of confectionery giant Lotte Group, plans to grow its presence in existing international markets and expand into fresh territory in Africa, Asia and the Middle East.

The company has been owned by Lotte since 2010 when the South Korean group acquired the former Cadbury subsidiary from the then Kraft Foods after the takeover of the UK confectioner.

E. Wedel is a household name in Poland. It exports to around 25 international markets and has built up an export business in countries that have large Polish populations such as the UK, US and Canada.

Export sales, which now account for 5-6% of group revenues, have been rising rapidly. Since 2010, E. Wedel has doubled its international turnover. However, according to export director Rafat Perkowski, the group now plans to take its export business to the “next stage” in its largest international markets.

Speaking at this year’s SIAL trade show, Perkowski said: “In our largest export markets, the United States, UK and Canada, we sell to ethnic markets but we are also strongly looking to take the next step [and] launch on a national level.

“We would like to expand in national channels. For example, in UK we already use difference channels – we work directly with supermarket channels like Tesco, we work through other channels with distributors and we also work with the traditional or ethnic trade. We use different ways of getting to the customer but we would like to grow [into a] mainstream [brand].”

Elsewhere, E. Wedel is able to leverage its relationship with Lotte to support international expansion.

“We work independently, but we have their knowledge, their support. We cooperate in Japan through them. Because of their advantaged position there we can export our products through them, which is a great advantage,” Perkowski says.

The company is looking to grow its presence in other markets throughout Asia. “We have started with Japan, we have started with some other Asian countries like Vietnam, Thailand. But its still in the initial stage.”

Further afield, E. Wendel sees “great possibilities” in the Middle East. The company has developed a 40g tablet bar that was launched at SIAL and was “mainly created for Arabic markets”, Perkowski says.

“We also see great interest in African countries and also European countries,” he added.

While E. Wedel is leveraging its Polish heritage, product quality, connection to Lotte and innovation to grow internationally, Perkowski stresses that the task ahead remains challenging – not least in raising brand awareness among an international customer base.

“Once we deliver to Poles we don’t need to advertise because the brand is known, if we want to distribute our products to non-ethnic markets on the national level we need to make all these steps: adjust the base, adjust the packaging. It is hard work.”

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