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Premier Foods targets China, US and Australia

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By Mike Stones+

11-Aug-2014
Last updated on 11-Aug-2014 at 09:04 GMT

Chinese consumers are tucking into Ambrosia rice
Chinese consumers are tucking into Ambrosia rice

Premier Foods’s formation of a new business unit and the launch of Ambrosia rice in China are spearheading the firm’s plans to step up global sales in three key markets.

The International business unit is a new group within Premier Foods, with its own dedicated resources, tasked with growing sales particularly in China, North America and Australia.

In an exclusive interview Peter Ellis, head of international business at Premier Foods, told Food Manufacture that while the firm was active in a range of overseas markets – including the Middle East and Europe – the three target markets showed the greatest long-term growth potential.

“The good news for Premier is the categories [in which the firm specialises] within those markets are big. Simple meals, cakes and desserts are very large in all those markets. So, it is a good opportunity,” said Elllis.

One of the fastest growing retail markets

China, one of the fastest growing retail markets in the world, presents particularly strong opportunity, especially with the growth of the urban middle class in major cities, such as Shanghai. To exploit that potential, Premier teamed up just over a year ago with Swire Foods, owner of several large sugar firms in the country and part of Swire Pacific, owner of Cathay Pacific airlines.

The latest development in that partnership is the perhaps surprising launch of the quintessentially English product Ambrosia rice. “It [news of the launch] gets a bit of a giggle but we did a piece of research looking across the categories and Ambrosia rice researched incredibly well,” said Ellis.

“The fact that it is a dairy-based product, that will be imported, is a good thing because the challenges they have had with the domestic dairy market in China,” he added.

Test launches started in Shanghai at the end of last month and, if successful, will be repeated in other leading Chinese cities.

North American market

In the North American market, the star of Premier Foods’s portfolio is Sharwoods Indian range. While the firm has sold Sharwoods products in North America for some time, the rapid rise in the popularity of Indian food underpins strong growth prospects for the brand. “In the same way that after Indian restaurants opened up here and people wanted to replicate [the experience] at home, a similar pattern is unfolding there.”

Australia is the last market on Premier’s big three global hit list. It recently relaunched Kipling and Cadbury into the Coles supermarket group. The Australian retail scene is dominated by just two big players – Coles and Woolworths.

“While China is a very complicated distribution market, Australia is a very simple – probably more like the UK than the UK in some ways,” said Ellis. “With 23M people in the market – a lot of them familiar with our brands – we think there’s strong potential in that market too.”

Ellis emphasised that the core focus of Premier’s business plan remained the domestic market . But, with the launch of the dedicated International business unit, the firm was well-placed to unlock the potential of three strategic markets, based on consumer research, he concluded.

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