In this months issue

July/August 2010

Exchange rates and tax hikes make buying in theNorth less attractive for shoppers from the Republic.

2 THE LAST OF THE ‘MOHICANS’

4 CROSSING OVER IS NO MORE

8 ARE PLASTIC BOTTLES FUTURE FOR WINE?

“The expectations keep ratcheting up. You have to dothe basics and then you have to that and that and that,”said Tim Mobsby, president of Kellogg Europe

M.D/Editor: Frank MaddenDeputy Editor: Ruth TimminsBsn. Dev. Managers: Niall P. Madden

Sarah GriffinContributors: Emma Maguire

Daire WalshCirculation: Margaret CorryDesign: 90% Proof

Todays Grocery Magazine Tel 2809466 (6 lines)The Mews email: info@todaysgrocery.comEden Road Upper editorial@todaysgrocery.comDun LaoghaireCo. Dublin www.todaysgrocery.com

Small PrintTodays Grocery Magazine is circulated to all proprietors, directors and managers of allrelevant manufacturers and distributors, to every cash and carry, every multiplesupermarket, group head office and wholesaler, all group affiliated shops and Londis outletsin addition to over 6,300 unaffiliated independent retailers and the country’s leading off-licence outlets. All articles are copyright of Todays Grocery Magazine and cannot bereprinted without the written permission of the editor. All letters to the editor of thismagazine will be treated as having been submitted for publication. The magazine reservesthe right to edit and abridge them.Disclaimer While every effort has been taken to ensure that all information is accurate atthe time of going to press, neither TGM Ltd or Todays Grocery Magazine acceptresponsibility for any inaccuracies or omissions. Please note that the opinions expressed inthe articles are strictly those of the authors.

38 ALMOND TO ARREST DECLINE OF BAILEYS

41 STIFF COMPETITION FOR NEWSPAPER ADVERTISING

10 UNEMPLOYMENT A THING OF THE PAST?

20 AN ERA OF THE ‘AND’.......

24 TOP 100 COMPANIESTGm features the top 10 major companies operating inIreland.

15 NEWS

42 NEWS

6 NEWS

Unemployment could effectively disappear by themiddle of the decade, according to a new report by theEconomic and Social Research Institute (ESRI).

A new innovation by an Irish-owned company mightmake it easier for wine lovers to carry wine throughairports.

22 NEWS

40 HOW GREEN IS GREEN?

44 FOCUS- SOFT DRINKS48 FOCUS - SNACKS

With a 7% drop in sales to the end of last December,Phil Almond, global marketing director for Baileyssets about arresting the decline in Baileys sales.

2 TGm

n 2002, TonyO’Brien (73) stooddown as chairmanof C&C plc after 21years as the group’schief executive.

The group hasgrown from a softdrinks businessthat sold into the

Irish market only, to analcoholic and non-alcoholicdrinks business that sells inthe UK and Ireland and islooking to expand further.Cider is at the core of what itdoes.

“Success for Magners inthe UK this summer is fairlyvital for us”, he said. Theweather is good, the WorldCup has been on and he isfeeling optimistic, but anyworries he has, he passes onnow.

“I’m the last of theMohicans,” he says,reflecting back on a lengthycareer where he wasaccompanied in the businessworld by other long-timerssuch as Richard Burrows ofIrish Distillers. He is the lastof his generation to be“hanging up my briefcase”.

As well as C&C, he hasalso served as chairman ofAnglo Irish Bank as a non-executive director of CRHand as president of Ibec. Heis currently chairman of theReview Group on HigherRemuneration in the PublicSector. C&C, formerlyCantrell & Cochrane, is atruly old Irish business. Itwas formed in 1852,became a partnership in the1870s and was bought byGuinness and Allied Domecqin 1968.

An accountant bytraining, O’Brien worked in anumber of other companiesincluding Erin Foods before

moving to Cantrell &Cochrane and becoming itschief executive. He couldhave had a good life, runninga Stg£2 million business,earning a good income. Sowhy the drive to grow anddevelop?

“What I find is that if youraspirations are not beyondthese shores, then reallywhat you are looking for is tobe taken over by somemultinational that wants aspot in Ireland. A lot of IrishSME’s have that aspirationin mind. They develop a niceniche business here andhope someone will buythem. It is a limited horizon.”

He spent 14 years on theboard of CRH, and has hugeadmiration for the way it hasspread its tentacles aroundthe world. The Kerry Groupis another Irish success storyhe hugely admires. “It is agreat shame there are notenough Irish multinationals.I always wanted to be thenext Kerry Group. And wemight be in time.”

He speaks withadmiration of young Irishcompanies in places such asChina. Ireland, in his view,needs to begin educating itsyoung people in suchlanguages as Chinese, Hindiand Japanese, “otherwisethe children will be let downthe way my generation wasin terms on language”.

O’Brien was involved inone of Ireland’s firstmanagement buyouts. “Itwas great fun.” The first stepin the move was to get hisowners, Guinness and AlliedDomecq, off the pitch.Guinness went first, then ayear later he made a pitch tothe board of Allied. He was adirector at the time and thepitch ran the risk of getting

him fired for disloyalty.However, he made a“shareholder friendly” pitchand the board went for it.

The effort to then floatthe business took three runsand almost didn’t make it.The first run was hit by thecollapse of the rouble, thesecond by currency troublesin South America, “factorsoutside our control”. Thethird time they made it, butit was close. “That was sixyears ago”.

But the most audaciousmove in his career, he says,was his bid for IrishDistillers. He was mad “for

expansion” at the time. IrishDistillers was going nowhere,with Irish whiskey being“murdered internationally byScotch”. He thought theproduct needed a route tomarket internationally andbelieved his then parents,Guinness and AlliedDomecq, could provide that.

Because he had beentold the Government wouldnot be happy with Guinnessbeing involved in a takeover,he came up with the idea ofmaking a joint bid withGilbeys, with a view tosplitting the brands betweenthem afterwards.

The last of the ‘Mohicans’

IT H E L A S T O F T H E ‘ M O H I C A N S ’

TGM

July/August 2010 3

Ireland in the late 1980sthough was a lot different tothe Ireland of today. Gilbeyswas owned by Grand Metand the unsolicited takeoverbid was “construed by IrishDistillers as the Brits takingover Irish whiskey”. Therewere “Keep the Spirit Irish”banners outside everychurch gate in Ireland. “Thiswas green flag stuff, likenever before. At the timethere was a kind ofnationalism still in thecountry, in business as muchas anywhere else. All thatold rubbish. How the worldhas changed.”

For months on end, hehad to devote time toaddressing political gather -ings and to being subjected

to abuse. In the end, IrishDistillers was bought byPernod Ricard, and IrishWhiskey went on to becomea huge successinternationally.

O’Brien feels thatsuccess vindicates his effort.“The political sector wasblinded by patriotism orsomething but it took a tollout of my life I can tell you.”

His satisfaction with theremaking of the public’sattitude towards cider isevident. The drink had longbeen “unfairly” portrayed asthe source of socialproblems, a drink for parkbenches. A long publicrelations campaign thatcapitalised on it being anatural drink, with an

attractive taste and thirst-quenching qualities, andbeing a drink that could bepoured over ice, led to aneventual growth in marketshare of the beer or longalcoholic drink sector.

“It took 10 years in total,but we got up to 12 per centof the beer market,comparable to Carlsberg orHeineken.”

The group also began tobuy up other brands,including international ones.It bought Tullamore Dewfrom Irish Distillers, withO’Brien having to convinceBurrows of the logic of themove.

Then they set their sightson the UK market, thelargest cider market in theworld. Again it was a long-well-founded campaign.They bought other brands soas to earn clout in themarket. There was a largecider market in the UK, butit was cheap cider with lowmargins. C&C sought tocreate a premium market forit Magners brand, buildingup towards a summer 2006national launch.

“There was huge fanfare,a huge spend. We had theWorld Cup, blistering heat,the thing took off like youcannot imagine.” Such wasits success that the cider ranout. “So we decided in ourlack of wisdom as ittranspired, to doublecapacity immediately. Wespent a couple of hundredmillion.”

But the followingsummer was atrocious, withfloods swelling England, andits competitors had by thenwoken up to the threat.There was no World Cup, nonovelty factor. “Magnersnose-dived and we had eggall over our face.”

One of the mistakes thecompany made was that itploughed money into an

advertising campaign thatboosted the image of cidergenerally, withoutnecessarily making peoplewant to drink Magners. “Thefight-back has been going onfor the past few years andthis year’s performance is“fairly vital for us.”

Meanwhile, expensiveexplorations continue insuch places as Spain andGermany to see if a newcider market can be created.“The internationaldevelopment of cider will beimportant for us goingforward.”

Given its small size,O’Brien believes the onlystrategy for the Irisheconomy is to becompetitive and awaitgrowth in larger economiessuch as th US. He believesthe Irish workforce iseducated and responsiveand that, after a few toughyears, the country will riseagain.

this year’sperformance is“fairly vital for

us”.“

4 TGm

Crossing the Border once meantbig savings on the weekly shop, butnot any more as exchange rates andtax hikes make buying in the Northless attractive for shoppers from theRepublic.

So, it turns, out that all ourpoliticians had to do to stem the flowof people crossing the Border to dotheir shopping was nothing. Over thepast few years, when pricediscrepancies between NorthernIreland, and the Republic of Irelandwere highlighted, the Governmentwrung its hands, commissioned costlyreports but seemed to do very little ofsubstance to address any of theissues.

Now it seems the problem has justgone away. Over the past three years,hundreds of thousands of shoppersfrom the Republic poured across theBorder. The favourable exchange rate,lower VAT and excise rates combinedwith lower profit margins for theNorth’s retailers brought about thesort of vast price differentials betweenthe jurisdictions that many cash-strapped consumers found impossibleto ignore.

Not any more. Recently, a shoppingexpedition was made across theBorder to find out if there were stillsignificant bargains to be had. It wasall quiet. “We have noticed a dramaticfall-off in the number of people comingin from the South in the last fewmonths,” said one shop assistant.“Most of it is down to the exchangerates. A year or so ago we wereoffering 90p for a euro, today it’s just79p.”

Exchange rates are one element.tax rates will be another. When theBritish Chancellor of the ExchequerGeorge Osborne published hisemergency budget recently there werehowls of protest from retailers in theNorth as he announced the UK’s VATrate is to increase from 17.5 per centto 20 per cent from January. Themove, the North’s retailers said, couldcost the economy there millions ofpounds in lost revenue from cross-Border shopping.

Francis Martin, president of the

Northern Ireland Chamberorganisation said the increase in VATcould in general have a negative effecton small enterprise because it willincrease the cost of doing business.The independent retail tradeassociation said it was a “regressivemove” which would hit everyone inNorthern Ireland, from low-incomefamilies to pensioners.

There was no such glumnesscoming from the southern side of theBorder. Politicians issued a statementwelcoming the moves while retailersrubbed their hands in relieved glee.Speaking at a corporate function TescoIreland’s chief executive Tony Keohanedescribed how Tesco had played itspart in successfully reversing the flowof cross-Border shopping.

He said Tesco was “in the happyposition of managing queues in-storeagain” and thanked his supplier basefor their support during a time ofgreat change. “Ireland has changedradically, Ireland has changedfundamentally and Ireland haschanged probably forever,” he said. Heclaimed that moves by the big groceryretailers in the Republic - and there isnone bigger than Tesco - has led to a40-50 per cent drop in cross-Bordershopping, this year rising to 70 percent in certain key categories such ashealth and beauty products. As aresult, he said, Tesco’s Irish arm hadseen nine consecutive periods ofgrowth for Tesco.

A year ago, when there were realbargains to be had in the north, theRepublic’s shoppers could load uptheir trolleys in Sainsbury’s with prettymuch anything, secure in theknowledge that it would work out

substantially cheaper. Today it’s notlike that.

A six-pack of Pampers baby wipeswhich can be bought in Tesco in theRepublic for €7.78 costs €8.93 inSainsbury’s. Pampers nappies - one ofthe products that drove many peoplewith young children across the Borderover the past three years - are nowalmost identically priced in bothjurisdictions.

A 50g jar of Nescafé which wasselling for €1.97 in the North has aprice tag of €1.66 in Tesco inDublin.There are still some bargains tobe had, although sometimes the pricedifferences are not as extreme as theymay once have been.

Cheaper generic medicines aside, itis alcohol where the biggest savingscan still be made, although one wouldhave to do some homework as someprice discrepancies are not as great asyou might imagine and sometimesalcohol actually cost more in theNorth.

Crossing over is nomore

..lower VAT and

excise rates combined with

lower profit margins for

the North’s retailers

brought about the sort of

vast price differentials

that many cash strapped

consumers found

impossible to ignore.

“

C R O S S I N G O V E R I S N O M O R E

6 TGm

Health and consumer groupshave given a guarded welcome tothe decision by Kellogg to cut thesugar content of one of its best-selling children’s cereals.

The company said it would cutsugar levels in Coco Pops from 35per cent to under 30 per cent fromnext year. Minister of State at theDepartment of Food Ciarán Cuffewelcomed the announcement andcalled on Kellogg to extend the

initiative to other products.Children’s cereals have been

under fire from health groups fortheir high sugar, salt and fat levels,which campaigners claim arecontributing to rising levels ofobesity among young people. As aresult, sales of Coco Pops hadbegun to fall.

Kellogg said its move wasdriven by consumer demand ratherthan any scientific evidence thathigh sugar levels were contributingto obesity.

Jim McNeill, Kellogg Companyof Ireland managing director, saidthe sugar is to be replaced withstarch from grains and glucosesyrup with no use of artificialsweeteners. Vitamin D is also to beadded. He said Kellogg planned tomake further reductions in sugarlevels in Coco Pops in the future,and in other products in its range.

Salt levels have been cut by 44per cent over the past 12 yearsaccording to the company.

Irish cereal consumption is thehighest in the world, at 8.2kg perperson per year.

Kellogg Cut Sugar Levels

Jim McNeill

Irish cerealconsumption is thehighest in the

world, at 8.2kg perperson per year.

N E W S

8 TGm

First came plastic corks,and now plastic bottles arethreatening to nudge glassones off the shelves.

A new innovation by anIrish-owned company mightmake it easier for winelovers to carry wine throughairports.

The use of glass bottlesfor wine is a fairly recentinnovation. Up until the18th century, it wastransported and matured inlarge oak barrels, clay jarsor animal skins. Glass andcork protected wine fromoxidation in a way that wasnot possible before,allowing wine to be agedmore safely.

However, glass is heavyand bulky, and expensive toship. It also has a tendencyto break. In recent years,we have seen alternatives inthe form of Tetrapaks, bags-in-boxes and even cans. Allof these have been usedonly for less expensivewines.

This could all changewith the introduction ofPolythene Teraphthalate(PET) or plastic bottles.Proponents argue that theyoffer significant advantagesover glass. They weigh lessand take up less space, andare therefore significantlycheaper to ship, and easierto carry. They are alsounbreakable, and are 100per cent recyclable. PETbottles have been usedbefore, usually for cheap1.5 litre bottles ofinexpensive wine, andsometimes for quarterbottles. However, PETallows more oxygen into thewine than glass, and untilrecently this reduced thewine’s shelf life significantly.

Paul Sapin a French

bottling company majority-owned by Irish wineimporter Febvre & Co, haslaunched a new generationof PET bottles it claims willrevolutionise the way webuy wine. Instead of thenormal single layer ofPolythene Teraphthalate itsversion, the MLP, has twolayers, with a nylon layer in-between. The nylon acts abarrier to both carbondioxide and oxygen, andgives an extra six months’shelf life to the wine.

So will plastic bottlescatch on? There has beenconsumer resistance in thepast. They look smaller, fora start. Heavy bottles look

good, and are sometimesused to make cheap winelook more expensive.

But earlier this yearMarks & Spencer changedall of its 25cl bottles toMLP, and reported a 20 percent increase in sales. Itintends adding full bottlesto the range. Australianproducer Wolf Blass hasalso run trials with a fewwines. Febvre has launched

two South African wines inMLP at Dublin Airport,Hout Bay Shiraz andSauvignon Blanc.

Consumers can nowcarry three instead of twobottles at the same weight.Environmentalists, whoalready object to waterbeing sold in plastic bottles,are sure to voice theirconcern at thisdevelopment.

Are plastic bottles future for wine?

The use of glass bottlesfor wine is a fairly recent

innovation.“

. . . F U T U R E O F W I N E ?

It’s good to know there’s a great local store just around the cornerMusgrave supports more than 3,200 stores in Ireland, the UK and Spain.

Together with our retail partners we are Ireland’s second largest employer with more than 35,000 employees

It means great value on my doorstep

I can drop in on my way back from work

Supporting my local retailer supports local jobs

Local retailers understand local needs

Local retailers support local suppliers

It can help me reduce my carbon footprint

www.musgravegroup.com

Londis – GB only; Mace – Northern Ireland only

10 TGm

Unemployment couldeffectively disappear by themiddle of the decade,according to a new reportby the Economic and SocialResearch Institute (ESRI).This is the outcome itexpects under its “high-growth” scenario for theIrish economy over thedecade to 2020.

However, should theeconomy expand along thealternative “low-growth”trajectory the institute setsout, joblessness wouldaverage 7.1 per cent of theworkforce in the period2014 to 2020.

In part reflecting theheightened difficulties ofeconomic forecasting at atime of such change anduncertainty, the think tankhas constructed alternativescenarios for future trendsacross a range of indicators,including employment,output and public debt.

The ESRI believes itsoptimistic scenario for

employment is the morelikely medium-termoutcome owing to theflexibility of the Irish labourmarket. This flexibility, itsays, has been stronglyevident over the past 15years. During that period(up to 2008), the rate ofjob creation far outstrippedthe average in thedeveloped world andjoblessness all butdisappeared.

The institute does,however, hint that flexibilityalone may not be enough,citing the example ofFinland in the 1990s. In the

early years of that decade,the Nordic country sufferedone of the worst recessionsever to take place in anOECD economy.Unemployment soared to20 per cent and remainedin double digits five yearsafter growth had resumed.

To minimise the risk ofsuch an outcome in Ireland,the ESRI repeated its call

for a more activistGovernment approach tolabour market policy.

While the ESRI’s low-growth scenario is moreoptimistic than theforecasts of either theinternational MonetaryFund or the EuropeanCommission, it represents adownward revision on thesame long-term forecastingexercise carried out by theinstitute in May 2009.

The revisions areentirely related to the costsof the banking crisis, whichthe ESRI admits itunderestimated.

Most of the policy-relevant content of thereport focuses on the oftencomplicated andunpredictable relationshipbetween economic growthand fiscal policy.

In the Irish context,however, the ESRI harboursno doubts about what isrequired, and is emphatic inits view that budgetary

tightening was and isimperative.

It believes the economywould be in a worsecondition now ifadjustments had not beenmade; that internationalmarkets would have“punished” the country if notightening had taken place,that the government has nochoice but to adhere to thefiscal tightening package ithas set out for itself; andthat that package withadditional measures by2014 even under the ESRI’shigh-growth scenario for theeconomy.

Indeed, the reportsuggests that a largeradjustment in 2011 shouldbe considered. Such a front-loading of the consolidationprocess would drive downthe risk premium Irelandpays to borrow ininternational markets. Thiscould reduce debt-servicingcosts and boost investmentacross the economy.

Unemployment a thing of the past?

. . . A T H I N G O F T H E P A S T ?

The fact that health anddrink lobbies are in tune foronce is a real sign that thetime is right for legislation.

When it comes to thenarrative on alcohol misusein Ireland, it’s not often youget the public health anddrinks lobbies singing fromthe same hymn sheet.

In a recent debate whichincluded Prof Joe BarryTrinity College Dublin andtreatment counsellorRolande Anderson.representing the drinksindustry was PádraigCribben, chief executive ofthe Vintners Association,

The public health lobbyhas consistently argued forreduced per-capitaconsumption of alcohol,while the drinks industryspend millions each year inmarketing and advertising

trying to achieve theopposite effects. Consensusis therefore not easilyreached between the two.

Yet, what wasremarkable about thedebate was that both thepublic health and the drinksindustry (as represented bythe vintners) agreed on theneed for tighter controls onbelow-cost alcohol pricing.This could be verysignificant.

In both Ireland the UK,significant shifts in drinkingpatterns have emerged inthe past decade. Less andless drinking is taking placein bars and restaurants,with the off-premisesretailers, such assupermarkets, garages andoff-licences, now the maindispensers of alcohol.

This is creating

problems for publicans, butalso for society as a whole.The conscientious publicanis being bypassed by awhole generation who canbuy alcohol significantlycheaper than ever before.

Part of the alcohol Billbrought in by the ScottishNationalist Party recently ina bid to tackle Scotland’ssignificant alcohol problemssought to introduceminimum alcohol pricing forthe first time in any EUstate.

What this would haveallowed for was a setminimum price (somewherein the region of 25-75p) perunit of alcohol, therebybringing to an end below-cost selling in retail outlets.

Many aspects of the Billwere passed with littledebate, including a

clampdown on cheap drinkpromotions and tighter IDcontrols. Yet the minimum-pricing part was rejectedafter hard lobbying by theScottish drinks industry.

The Irish Governmenthas a chance to addressthis issue in the nextbudget. In contrast to theScottish experience, the factthat vintners and the publichealth lobby occupy thesame position on this maypave the way for a partconcensus approach.

These are measures theIrish Government will haveto legislate for themselvesas there is no greatEuropean concensus whenit comes to specificlegislative measures aimedat tackling below-costselling. Partly this isbecause Europeans engagewith alcohol very differentlyfrom country to country.

Generally in Europe, thefurther north you travel theless alcohol is associatedwith food and the more it isseen as a means of moodaltering in its own right. InIreland the drinks industrywebsite for promotingresponsible alcohol use -meas.ie - advises drinkersto “eat well” before goingout; the separation ofalcohol and food isculturally assumed.

The legislation is neededat this point becausesupermarket chains andother off-trade retailers arealleged to be engaged inscandalous practices ofselling low or below-costalcohol.

The other area ofconcern the Governmentneeds to tackle is outdooralcohol advertising.

It is now time to imposestricter regulations onwhere alcohol products canbe advertised publicly.

Governmentmust tacklecut-price alcohol sales

TGM

July/August 2010 11

14 TGm

Aldi co-founder TheoAlbrecht, whorevolutionised low-costretailing with his brotherKarl, has died aged 88.

He leaves behind anestimated €16 billionfortune, making himGermany’s second richestman and the world’s 16th-richest.

A recluse for fourdecades, only a handful ofknown photographs exist ofMr. Albrecht.

Born in Essen in 1922,

he grew up working in hismother’s grocery store withhis brother Karl, who wastwo years older.

After wartime service,and a spell in a prison-of-war camp, the brothers setup their own grocery storein Essen in 1948. Thelimited range of products,later a trademark of theirno-frills retail concept, wasmore a product of post-warfood shortages than long-term planning.

In 1961, the brothers

decided to split theirbusiness into two,reportedly over adisagreement on whetheror not to sell cigarettes intheir stores, known asAlbrecht Discount and latershortened to Aldi.

Karl called his cigarette-free company Aldi Súd(South) and traded in thesouthern half of Germany -this company wouldeventually expand intoIreland.

Theo headed Aldi Nord

which, over the years, hasstuck more rigorously to thefounding principle of lowcost through high volumeand limited range - evenafter he stood down fromday-to-day operations in1993.

“As founder and pioneerin discount trade, TheoAlbrecht influenced thefortunes of our company fordecades,” said his companyin a rare statement, notinghis “far-reaching innovationin German retail.”

His hard-nosednegotiating skills came inhandy in 1971 when afterbeing kidnapped, hereportedly negotiated downthe ransom demand to afinal Dm7 million.

After 17 daysimprisonment, he wasreleased unharmed. Hiskidnappers were caught twoyears later and given eight-year sentences. Mr.Albrecht went to court andwon the right to have theransom written off as a tax-deductible businessexpense. A lover of golf, hisonly known extravaganceswere a collection of oldtypewriters and a Niceapartment.

N E W S

Co-founder of Aldi dies

Procter & Gamble, theworld’s largest consumergoods company, dismissedthe threat of a double-diprecession in the US, butsaid it did anticipate abumpy path towardseconomic recovery in itslargest market.

”I think the economicrecovery in the US will beuneven... we are seeing thatalready, chief executive BobMcDonald told Wall Streetanalysts as P&G reportedquarterly and full-yearresults that reflected thefrugal mood of many of itsUS consumers. But “wedon’t expect a double-diprecession,” he said.

P&G said it expectedsluggish growth to continuein its developed markets inthe year ahead, with anincreasing divide betweenthe shopping behaviour ofthose with and withoutjobs. “In developed marketswe see a bifurcation,”McDonald said.

“Our new initiatives that

are premium pricedcontinue to do very well,and I would say that theyappeal to the people withjobs. At the same time wealso see... consumerswithout jobs.... trade down”.

During the past quarterin the US, the companysuccessfully launched newpremium-priced products,such as a new Pro-Glideversion of its Gillette Fusionrazor, while also pursuingfrugally minded consumerswith lower-cost versions ofits products, such as Bountyand Charmin Basic toiletpaper.

P&G said it expected itsglobal organic sales -excluding the impact offoreign exchange,acquisitions and mergers -to increase by between 4and 6 per cent in thecoming year, compared withthe 3 per cent seen in its2010 fiscal year.

But it predicted much ofthe growth would comefrom emerging markets.

McDonald, who tookover as chief executive lastyear argued that fourth-quarter and full-year resultsshowed that his strategy ofpursuing profitable top-line

growth through increasedinnovation and marketingwas working.

Net sales rose 5 percent to $18.9 billion duringthe quarter, while full-yearnet sales were up 3 percent against a year ago, to$78.9 billion. Volume unitsales increased by 8 percent, with emergingmarkets growing at morethan twice the rate of theUS and western Europe.

P&D, the world’sbiggest advertiser, said itincreased its advertisingspending by about $1billion, close to 11 per centof sales.

“The reason we aregrowing market share on60 per cent of our businesstoday is that we aresupporting it withadvertising, as opposed toa year ago,” saidMcDonald.

P&G dismisses double-dip recession

“Our new initiatives that are

premium prices continue to dovery well, and I would say thatthey appeal to the people with

jobs...”“

TGM

July/August 2010 15

18 TGm

Cork-based wholesaledistributor James A. Barry& Company Ltd hasannounced an increase inpretax profits to €3 millionfor 2009, an increase of 12per cent on its 2008results.

Turnover reported in thefinancial year endingJanuary 31st 2010, showeda fall in sales from€212.5m in 2008 to€207m in 2009, which thecompany attributed to aslowdown in consumerspending and a reduction in

the average “cost per box”across the distributionbusiness.

The company attributedits performance to areduction in its cost andincreased levels of servicesto its customer base.

Managing director JimBarry said the companyhad managed to increasenet profits on a reducedturnover through aggressivemanagement of its costbase and prudentmanagement of credit risk.

“The Irish retail

environment continues tobe extremely competitiveand operating marginscontinue to be squeezed,”the 2010 Ernst & YoungEntrepreneur of the Yearnominee said. “Our profitsin 2009 were drivenprimarily through reducingour cost base,outperforming the marketand reinventing our retaileroffering. Our desire to growand outperform the marketis deep-rooted and wecontinued to invest heavilylast year - first in acquiringthe Carry Out specialist off-licence business at the tail-end of 2009.

“The full benefit of thattakeover is expected to add€42 million to ourannualised turnoverreported next year. We alsorecently invested €1.5million in doubling thecapacity in our centraldistribution facility” saidBarry.

The company said it wasactively seeking new sitesacross Ireland for Buy Lo,its discount store brand,with the aim of openinganother eight stores beforethe end of 2010.

The group also plans todouble the number of CarryOut stores nationwide by2012.

Founded by James ABarry in 1955, thecompany originally soldfruit and vegetables in thenorth Cork area. It nowsupplies products to morethan 700 stores operatingunder the Costcutter, CarryOut, Buy Low and QuikPick brands, as well astrading in more than 10other countries.

The company employs240 staff and operates

from a central distributioncentre in Mallow, Co Cork.

Profits up 12 per cent at Barrys

Jim Barry

N E W S

20 TGm

According to TimMobsby, Dublin-basedpresident of Kellogg Europewe are in “the era of the‘and’,”. “The expectationskeep ratcheting up. Youhave to do the basics andthen you have to that andthat and that,” he said.

But Kellogg’s is doingsomething unexpected inIreland: it is hiring. Fiftynew jobs will be in place bythe end of the year withmost of the positions basedat the 104-year-oldcompany’s Europeanheadquarters in Swords.

Even with a 12.5 percent corporation tax rate toenjoy a multinational likeKellogg’s is not expected tobe here in uncompetitiveold Ireland, when it has avariety pack of cheapercountries to choose from. Ithelps that Ireland has thehighest per capitaconsumption of cereals inthe world - a statistic thatMobsby, somewhatparadoxically, attributes inpart to Ireland’s dairytradition.

“It certainly didn’t do usany harm - the fact that wehave a very well-developedbusiness in Ireland,” saysMobsby, an Englishmanwho arrived in Dublin in2005 when Kellogg’s firstset up its European HZ inAirside Business Park.

“I don’t like the termbusiness-friendly because Ithink it sets the wrong tone,but there’s an environmenthere that is actuallyconducive to doingbusiness,” he says.

“Cost, obviously, is afactor, and the cost base

here is probably not itsgreatest advantage, I’ll behonest about that. Thereare some unfortunateconsequences in the currentrecession, but there may besome positives for thelonger term as well if itactually makes Irelandmore competitive in theEuropean context.”

Not that Kellogg’s hashad to cut the pay of its200 staff. “We’re fortunatein that regard,” saysMobsby, who also goes bythe title senior vicepresident of KelloggInternational.

The food industry hasundergone changes sinceMobsby, a marketingspecialist, ended a seven-year stint at Heinz to joinKellogg in 1982. Shiftingproduct - Kellogg’s shiftedalmost €9.9 billion in 2009- is just the starting point.These days there are trafficlights to negotiate.

Kellogg’s has beennamed as one of the keyplayers in the foodindustry’s estimatedexpenditure of €1 billion inlobbying to prevent theintroduction of the trafficlights food labeling scheme,which had been advocatedby the UK Food StandardsAgency, among others.

In June, the EuropeanParliament sided with theindustry and voted againstproposals to obligemanufacturers to label theirproducts with red, amber orgreen symbols to denotethe amount of fat,saturated fat, salt andsugar per serving. MEPsvoted instead for the

industry’s favoured methodof front-of-pack labelling ofguideline daily amounts(GDAs).

“People talk aboutlobbying, but actually theway a lot of regulationcomes about is aboutcollecting input from awhole variety ofstakeholders. We’re aplayer, in that wecontribute to that debateactively.”

While healthcampaigners says trafficlights are better atpreventing consumers frombuying unhealthy food andsimpler to understand, theindustry and somenutritionists complained itwas too simplistic.

“I would describecommon sense prevailed,”said Mobsby. “Theproblem with traffic lightsis they suggest there aregood and bad foods, andwe would argue that there’sno such thing as good andbad foods there’s good andbad diets.

“The traffic-light systemtends to demonise certainfoods. If it gets labelled red,if a consumer sees red, itdoesn’t say moderation, itsays stop, don’t go there.”

GDAs, on the otherhand, are “more friendly,more practical” and “not ascomplicated as peoplebelieve”.

Anyone who spent theirchildhood breakfastsreading the nutritionalpanels on the side of cerealboxes and wondering whatvitamin B12 was all aboutwill know that cerealcompanies were among the

first to provide anyinformation.

“Industry can move thatmuch faster in manyrespects than regulatorscan. We can decide what we

An era of the ‘and’.........

A N E R A O F T H E ‘ A N D ’ . . . . . . . .

want to do “boom!”. On theother hand the words “fullof salt” and “full of sugar”do tend to be uttered bynutritionally consciousparents in connection withKellogg’s products - aconnection Mobsby isunderstandably keen tobreak.

“There’s about 40 percent less salt in our rangeof cereals, if you combineall of the tonnes of cerealthat we sell, than 10 yearsago. Now there was never alot in the first place, but thescience around salt isactually very, very strongso, as that has come along,we’ve tried to respond tothat.”

Sugar is more of “a

perceptual issue”, hebelieves. “Sugar tends toattract a vast amount ofattention, which I wouldargue is disproportionatewith the realities of thescience, but hey, the sciencein the end doesn’t matter,it’s what the consumerfeels, what they want. If theconsumer thinks we havetoo much sugar, we havetoo much sugar, and we’llfind ways to take it down.”

As with salt reduction,“it’s critical that we do it ata speed that the consumercan accept.” Kellogg’s callsthis modification ofproducts “renovation”.Mobsby disputes thesuggestion that theevolution of cereal to cereal

bars has negativenutritional consequences.He says people use cerealbars as an alternative tofattening snacks, ratherthan as a processedbreakfast.

Mobsby is notcomplaining about thegreater entanglement ofindustry with “the socialagenda” that has redefinedhis job. Since he swappedbeans for All-bran he hasn’tlooked back, with his careertaking an upward spiralaround Kellogg’s, from itsUK based in Manchester toits corporate headquartersin Michigan, to Paris.

Neither Kellogg’s, orMobsby and his wife haveany immediate intentions to

leave Dublin. “Ireland is ourhome now, that’s wherewe’re based, we treat is ashome”

While Mobsby expectsthe recent bout ofconsolidation in the foodindustry to continue thecereals segment is already“reasonably wellconsolidated”, particularlyin Europe. Despite“disappointing” quarterlysales figures released,Kellogg’s has increasedshare in its two keyEuropean markets, the UKand France as well as inIreland, where AC Nielsenfigures show it has a 58 percent share of cereals.

Meanwhile, the financialcrisis has reminded him ofthe importance of what hecalls the “ordinary person”test. “What would anordinary person do is agood way of thinking abouthow business today shouldoperate. What is reasonableas judged through the eyesof an ordinary person” Andif you can pass that test,you don’t tend to do toobadly.”

TGM

July/August 2010 21

22 TGm

Started 50 years ago bya carb-loving mum in NewYork, WeightWatchers hasgrown into a lucrativeinternational franchisewhose dietary advice is nowendorsed by UK scientists.

Not bad for acommercial franchisestarted in 1963 by acompulsive eater who didn’thave a full-length mirror,because she hated the view.Jean Nidetch, was in 1961a cookie-obsessed workingmother fed up with yo-yodieting and appetitesuppressants onprescription. It was onlywhen she took her 214lb,5ft 7in figure to a New Yorkcity public health clinic thatshe lost 72 pounds at arate of two pounds a week.

Such was her bulbous-to-babe transformation thatfamily and friends gatheredaround her kitchen table tohear how she did it. Themessage was public healthdoctors had taught her wasbasic: eat less and exercisemore. She patented it, toldher friends, and she put herfamily on the programme.She told anyone who wouldlisten that food wasn’t theanswer to life’s challengesand to stop eating forcomfort, love andexcitement.

Word spread, andbefore long she had a clubof women gathering in aroom above a pizzarestaurant.

Then Nidetch, had hereureka. She branded herkitchen-table wisdomWeightWatchers. Just likeMcDonald’s, she franchisedacross the US. Within adecade, franchises in 48 USstates were pumping backmoney. In 1978 she got out

and sold high to Heinz for$71.2 million - aphenomenal amount evennow. Nidetch became a rarerole model to other womenin an age when aggressiveselling was seen asunfeminine.

WeightWatchers held onto her as a spokeswomanfor a while, then replacedher with Lynn Redgrave,Sarah Ferguson and,currently, the African-American actor JenniferHudson - a consideredchoice, as WeightWatchersmembers are traditionally

middle class, female andwhite.

Ireland has one ofWeightWatchersInternationals mostsuccessful franchises.started 31 years ago by 13people, nine of whom arestill involved, Ireland’sfranchise is a profitableregistered company, though

it won’t say what its profitsare. But you can do thesums.

Every week 40,000 Irishpeople attend meetings runby 150 self-employedinstructors, including fourmen who run 31 men-onlygroups. Most of these40,000 pay a one-offregistration fee of €20,followed by a weekly fee of€10 per meeting. That’s agross income of up to €20million a year across theIrish franchise for whatamounts to a supportgroup.

Out of that gross - anaverage of €133,000 aninstructor - you have tosubtract overheads: apercentage to the mainfranchise, discounts forstudents and older people,lower rates for people whopay for a six or 12-weekprogramme in advance, freemembership for the one or

two “gold” members inevery group who have keptthe weight off, rents,teaching materials, travel,tax and so on. Even if youcut the €133,000 perinstructor in half, it’s still agood average income. Someinstructors, conduct twomeetings a week, others doeight, so, as with all salesschemes, the harder youwork, the more money youcan make.

Keeping up withtechnology, WeightWatchersgive every member a swipecard that contains theirpersonal information -payment, weight and the“points” they are allowed toeat. The simplified pointssystem replaces thepainstaking task of countingcalories and weightportions. Save a few pointsduring the week and youcan have a couple of pints,a bottle of wine or a dessertat the weekend. Stickingwith the programme shouldproduce an average weightloss of one or two pounds aweek, but keeping theweight off requires a life-time of changed habits.

WeightWatchers atHome is a new service inIreland where individualsjoin online and get a weeklypersonal phone talk with aninstructor It lacks the groupdynamic, but needs must.

Would 12 weeks reallytake the L out of your flab?The medical researchCouncil found that the 58per cent of people who stickwith the 12-weekprogramme lose 5.2kg onaverage, with committedmembers losing 5 per centof their weight.

It’s slow, it’s effectiveand it can be lucrative.

N E W S

Thin people release the fork!

Tobacco smuggling hasreached record levels, withmore than 127 millionillegal cigarettes seized sofar last year, but 120million of these wereaccounted for by a singleoperation at Greenore, CoLouth.The proportion ofcounterfeit cigarettesamong those seized is alsoon the rise, from about 50per cent last year to almost80 per cent so far this year.

Revenue recentlyannounced the results of atwo-week crackdown oncigarette smuggling carriedout this month. Aconfidential freephonenumber, 1800 295295,has also been introducedfor members of the publicto provide informationabout smuggling or the saleof illegal cigarettes.

Revenue CommissionerLiam Irwin warned peoplewho bought cigarettes onthe black market that theywere putting money intothe hands of criminals.

“Anyone tempted to buycheap cigarettes from anirregular source of supplymust realise that there is ahigh possibility that theyare buying counterfeit

goods, which provide anunknown additional set ofhealth risks, as the productis not the subject of qualitycontrol,” he added.

“These actions are notjust robbing the exchequerof much needed funds, theyare also hurting localbusinesses.”

Airports, freightterminals, markets, postalservices and white vanoperators were all targetedduring the blitz, whichresulted in the seizure ofcigarettes and tobaccoworth almost €6 million.

The action resulted infour arrests, and 73prosecutions are pending,Revenue said.

Some 1.3 million of thecigarettes were seized frompassengers alighting fromaircraft; most of these weresmuggled from the CanaryIslands, Poland and China,according to Tom Talbot,head of the Customscriminal investigationbranch.

More than half the343,000 cigarettes seizedin the post were importedfrom China.

Revenue seeks information

Dunnes urged to boycott

Companies threaten to axe jobs

Dunnes stores hasreceived a petition signedby 6,000 of its customerswhich calls on thesupermarket chain to stopstocking Israeli productsbecause of its policies onPalestine.

The Ireland PalestineSolidarity Campaign (IPSC)handed in the petition toDunnes Stores’ head officein Dublin after collectingthe signatures in storesaround the country overrecent weeks.

IPSC chairperson FredaHughes said allsupermarkets selling Israeligoods would be targetedeventually but Dunnes hadbeen chosen to start thecampaign because of thehistorical significance of theanti-apartheid strike at theretailer in the 19890s.

Coca-Cola in Sligo,Baxter in Castlebar,Hollister in Mayo andAllergan in Westport havetold the government thatthey may have to cut jobs if€220m is not spentimproving the N5, a134km national routerunning through Longford,

Roscommon and Mayo.A spokesman for the

four firms said that theywere “embarrassed” by thecondition of the roadduring visits by senior stafffrom their internationalheadquarters in America.

Up to 3,000 people aredirectly employed by thecompanies, while anestimated 6,000 more jobsare reliant on them.

The four multinationalsare part of the MayoIndustries Group, whichmet Brian Cowen, theTaoiseach, and NoelDempsey, the TransportMinister, a year ago tooutline these concerns.They claim they were givenassurances by thegovernment that theproblem would beaddressed.

TGM

July/August 2010 23

Margaret Heffernan

24 TGm

T O P 1 0 0 C O M P A N I E S

DCC markets and distributesleading own and third party brandedfood and beverage products withingrowth segments of the Irish foodand drinks market as well as the UKwine market.

Among the key segments withinits portfolio are snack foods. Thegroup markets and distributes KP,Ireland’s leading savoury snackfoodbrand including nuts and popcorn,and many other well-known own andthird party branded productsthroughout Ireland. Among these is

McCoys crispsand Hula Hoops

snack rangesDCC is also

one of the maindistributors ofground coffee,and winesincluding theFindlater Wine &Spirit Groupunder the Robt-Roberts brandand is also aleading supplierto the off-tradewine market inthe UK with itsBottle GreenWinebusiness.Robt-Robertsare

responsible for some of the bestknown brands in the countryincluding tea, coffee, snack foods,soft drinks, wine and confectionery.Robt-Roberts distributes acombination of own brands and“principals’’ brands to all tradesectors including multiple, symbols,cash & carry, independent TSN’s,garage forecourts, and off-licenses.The company is focused on impulseproducts such as snack foods andconfectionery and on growthmarkets such as coffee and wine tothe foodservice markets.

Robt-Roberts has been blending

and packing tea in Dublin since1905 and its range includes a decafand fair trade offering.The companyhas also been roasting coffee since1905 and this continues today at itsfactory in Tallaght. It specialises inpremium coffees that are 100%Arabica. Each pack has a valve atthe back to ensure maximumfreshness. Robt-Roberts is also theexclusive distributor for theRobinsons for Milk range in Ireland

In the healthy food segment,DCC distributes Kelkin, Ireland’spremier health foods company. TheKelkin brand is a well establishedand trusted brand which offersconsumer a healthy choice withFunctional Foods, Organic, GlutenFree, Dairy Free and sugar freeproducts featuring strongly in therange.There are over 80 products inthe range including Multivitamindrinks, Cranberry Juice, AppleJuice, Natural Muesli, MicrowavePopcorn, Honey and sugar-freepreservatives. Some of the brandsrepresented by Kelkin includeJordans Cereals, Phileas Foggsnacks, Hipp Baby Food and StDalfour Spreads.

Turnover:

€6400mProfit:

€138mDescription:Sales & Business Support

DCC HouseBrewery RoadStillorganCo DublinTel: 01 2831011CEO/MD: Tommy Breen

1

The Musgrave Group has been asuccess story since 1876 and hasbecome a national and internationalretail giant with a turnover of €4.8bn.It is the partner to entrepreneurialretailers and foodserviceprofessionals across Ireland. Thegroup supports well known retailbrands both here and in the UK andSpain including SuperValu, Centra,Daybreak and Day Today in Ireland;Budgens, Londis, Mace and XLStop & Shop in the UK andSuperValu, Dialprix and Dicost inSpain. It is also well known in Irelandfor its wholesale brands MusgraveCash and Carry and MusgraveFoodservices.

Musgrave had a strong set ofresults for 2008, with retail andwholesale sales increasing. Groupprofits were down 20% to €75.5million. Musgrave Group itselfgenerated sales of €4.8 billion and ifyou combine turnover of all of theirretail partners across all fourmarkets together the company hada turnover of €7. billion, an increaseof 6%.

Unsurprisingly, for a group withits years of experience, the businessmodel has worked extremely well sofar. Musgrave’s operates over 240SuperValu stores and over 500

Centra stores in Ireland. In addition,Musgrave has been investingsignificant resources in developingthe Centra brand and its corporateimage. This has involved focussingthe Centra brand around the coreidea of “bright ideas for everydayliving” and has led to a range of newdevelopments including the popularconvenience deli offering “Good toGo” range. Sales at Centra storesincreased 15% to €1.383bn.

Musgrave has accomplished agreat deal towards strengthening theBudgens and Londis brands. As withthe brand work in Ireland, this hasbeen about establishing clear pointsof value and differentiation andleveraging Musgrave’s provenbusiness model and retailers’position in local communities. Thework to date certainly points the wayfor the future, but at the same timehelps

Musgrave understand just howmuch more is required to continue toraise the bar. In the UK, its priority inrecent years has been in ramping up

IT and logistics to support itsretailers; committing to a five yearplan of improvement to the supplychain with the aim of making it thebest in the country. And this wascarried out through sustainedinvestment and by placing retailersat the heart of the programme.

Another important area ofachievement for the retailer hasbeen in the area of corporate socialresponsibility (CSR). In the Republicof Ireland it became the firstindigenous Irish company to winChambers Ireland’s President’sAward for Overall OutstandingAchievement in CSR, and inNorthern Ireland it receivedBusiness in the Community’sCompany of the Year, both inrecognition of it’s contributions to theenvironment, the workplace, and thecommunity. It has also developed asustainability agenda to support theretailer in the local community withinitiatives such as packagingreduction and recycling.

Turnover:

€4847mProfit:

€76mDescription:Wholesale & Retail Distribution

C/O Musgrave LtdBallycurreenAirport RoadCork

Tel: 021 452 210CEO/MD: Chris Martin

Chris Martin ceo

2

T O P 1 0 0 C O M P A N I E S

July/August 2010 25

26 TGm

Kerry Group is a leading brandedconsumer foods processing andmarketing organisation. It is also aleader in global food ingredients andflavours markets. The group hasgrown organically as well as througha series of significant acquisitions inits relatively short history, from itscommissioning of its first dairy andingredients plant in Listowel, Co.Kerry in 1972 to a global player withsales in excess of €4bn.

The group is best known for itsconsumer foods division. Through aseries of acquisition in both brandedand private label sectors, KerryFoods’ brands are leadinghousehold names in both the Irishand UK markets including categorybrands such as Denny, Dawn,Ballyfree, Low Low, Kerry Spring aswell as Cheesestrings and Walls.

Kerry Foods is also a majorsupplier of added-value chilled foodsand it has top positions in most of itsmarkets and has developed a wellbalanced business supplyingsupermarket private label. Its majormarkets are chilled conveniencefoods. The division supplies both itsown leading brands and privatelabel products to major retailers.Kerry Foods has fine tuned itsinnovation capturing key snackingand convenience food trends with its

brands.The Denny range of meats is one

of its top Irish brands and continuesto innovate to suit changing markettrends. For instance, consumerusage of rashers has developedoutside the more traditional fry orgrill usage and they are now part ofgeneral snacking patterns. Thisincludes usage in BLT’s, pizzas orpasta dishes. Kerry has made itsrashers more convenient to suitthese trends through theintroduction of its microwaveablelines under its Denny and Wallslines. In addition, Kerry’s chilled juiceand smoothies are enjoying a majorgrowth in Ireland and its Dawn brandholds a leading position.

The general increase inpenetration of butter and butterspreads in Ireland can be explainedprincipally by the introduction of arange of both spreadable andhealthy products which are low in fatand salt.This has encouraged manyconsumers who want a healthyconvenient option to put butter backon the kitchen table. The buttermarket is enjoying higher levels ofmarket penetration. This increase is

also related to the success of somewell established butter brands;however it also demonstrates thateven with a strong marketingcampaign there are always ways toimprove growth.

Since the 1970’s Kerry Foodshas been to the fore in developinghigh quality dairy and low fatspreads at the group’s flagship plantin Listowel. It enjoys leadingpositions with its brands including,Low Low, Kerrymaid, Golden Olive,EasiGold and Golden Olive to namea few.

There is a particularly lowconsumption of cheese in Irelandcompared with other Europeancountries. Ominously, consumerresearch highlights a decline inconsumption levels in recent yearswhile global cheese consumptionsoars.

However, within the sector itself,there is a growing demand for non-cheddar varieties and specialitycheeses. Cheese snacks have alsobeen a growth segment for sometime, driven by an increasingdemand for lunchbox products in thegrowing snacking trend.

Turnover:

€4791mProfit:

€240mDescription:Food processing

Prince’s StreetTraleeCo. Kerry

Tel: 066 718 2000CEO/MD: Stan McCarthy

Stan McCarthy

3

T O P 1 0 0 C O M P A N I E S

July/August 2010 27

Kerry has also developed itscheese and cheese snack portfoliofollowing its acquisition of GoldenVale. The range includes cheddarcheese blocks, sliced packs,savoury cheese spreads andcheese snacks marketed under theCharleville, Easi Singles, GoldenVale and Cheesestrings brands.

Kerry Foods was launched as apublic company in 1986 and it islisted on both the Irish and UK stockmarkets. The group has developedas one of the largest and technicallyadvanced manufacturers ofspeciality ingredients in the world.Kerry Ingredients incorporates coretechnologies and global resourcesin speciality ingredients, seasoningsystems, sweet ingredients,nutritional systems and specialityproteins provides innovative,practical product solutions to food.

Developing the nutrition area isan obvious focus for growth.Nutrition is a consumer trend drivenby growing awareness of the linkbetween diet and health. Trendsshow consumers are now seekingadditional nutritional benefits fromthe food they eat, leading to ademand for fortified foods (i.e.mineral or vitamin enriched), dietarysupplements, sports drinks and barsetc. Obviously, milk is an idealsource of proteins and minerals andthe dairy component of theinternational nutrition market isestimated to be worth about $15billion annually and is growingrapidly.

Kerry Group supplies over10,000 food, food ingredients andflavour products to customers inmore than 140 countries. The grouphas manufacturing facilities in 19countries as well as sales offices in20 countries worldwide.

The group’s headquarters are inTralee, Co. Kerry, it employs 20,000people throughout its manufactu-ring, sales and technical centresacross Europe, North America,South America, Australia, NewZealand and Asian markets.

Dunnes Stores is an icon of Irishretailing and a powerful marketingforce. One of the few Irish-ownedretailers, the guiding principles ofthis company has always been good

quality and competitive prices.Dunnes combines grocery, textilesand homeware at 151 stores andemploys 18,000 people.

Dunnes has a 24% share of theIrish grocery market, placing itsecond only to Tesco. The companyhas elements of great businesswhich it is constantly tweaking butnever straying too far from itsformula.

Dunnes has seen the value inmoving into non-food areas, asidefrom homeware and textiles with theintroduction of CDs, DVDs andmarketing one-off promotionaloffers. In addition, the chain hasadopted a highly successful M&Sapproach to marketing by invitingcelebrities to introduce new lines atits stores.

A host of high profile names suchas Paul Costelloe and Twiggy havebeen recruited in recent years togive a sharper edge to its clothingand homeware offerings.

Turnover:

€3500m-4000m(e)Profit:

n/dDescription:Retailing

46-50 South Great Georges StreetDublin 2

Tel: 01 4751111CEO/MD: Margaret Heffernan

Margaret Heffernan

4

T O P 1 0 0 C O M P A N I E S

28 TGm

Dunnes has always beenattuned to new trends and respondsquickly to what consumers want.Take a browse through any of itsstores and this quickly becomesevident. So successful has itshomeware department been, thecompany has opened a number ofupmarket and standalonehomeware stores.

In recent years it has seenstores open throughout the countryincluding its 45,000 sq ft outlet inEnniscorthy, Co.Wexford, as well asthose at Edenderry, Mallow,Letterkenny, Leopardstown, Corkand Portlaoise and a standalonehomeware store in Carlow.

The St Bernard brand wasfounded in 1956 and it is a symbolfor value in Irish retailing. Thecompany operates from 111 storesin the Republic; 24 stores inNorthern Ireland; seven in England;4 in Scotland and 5 in Spain.

The first store in Northern Irelandopened in 1971 and this expansioncontinued at a fast pace. Its firstforay outside of Ireland was in Spain

on the Costa del Sol in 1980. In theUK the company has expanded withtextile stores only and it purchasedits first Scottish outlet in 2000, asecond in Glenrothes in 2002, athird in Clydebank in 2004 and afourth in Parkhead.

The company is run by a boardof directors including managingdirector Frank Dunne, director oftextiles, Margaret Dunne andAndrew Street chief operatingofficer. Dunnes Stores has keptthings in the family and a newgeneration of Dunne off-spring iswaiting in the wings to shine.

Insiders say Anne Heffernan,Margaret’s daughter is the nextleading light in the company. Anne isa doctor by training but changedpath and joined Dunnes in 2000 andnow works on store development onthe grocery side of the business.She is apparently well liked andtakes an innovative approach to thebusiness. Frank Dunne’s childrenare not involved in the business.Then there’s Michael Heffernan,Anne’s brother who has been

involved in the business most of hislife. However a more likely rival toAnne Heffernan is her cousinSharon McMahon, daughter of lateElizabeth McMahon. Sharon is aqualified solicitor who also works inthe business. It is believed that all ofthese family members will featureprominently in the company’sdecision making in the future.

Dunnes Stores (Bangor), theholding company for the retailer’soperations in the North and Britain,paid its shareholders a dividend of€33.6m back in 2006. This was thefirst time the owners had taken asizeable dividend from the Co. Downcompany. Dunnes Stores (Bangor)is the only significant company in thegroup which publishes its financialinformation.

Dunnes Stores is a companywhich knows its market well andgets on with it as outlined by AndrewStreet, the company’s chiefoperating officer;

“We look forward to developingour store numbers and creatingfurther employment into 2010.”

4

T O P 1 0 0 C O M P A N I E S

Topaz Energy Ltd is Ireland’sleading energy and forecourtretailer. Since 2005, Topaz hassuccessfully acquired the retail andcommercial fuels operations of bothShell and Statoil in Ireland. TopazEnergy is now the largest Fuelsdistribution business in Ireland andone of the country’s largest privatelyowned companies.

Topaz Fuel is involved in allaspects of the Irish oil businessincluding retail, commercial fuels,lubricants and home heating oil.Thecompany has significant interests inthe storage and distribution of oilproducts and owns the worldwiderights for the Fareplay Conveniencebrand, the number one forecourtretailing brand in Ireland.

Topaz Energy acts as a licenseeof the Shell and Statoil brands inIreland. Building on the heritage of100 years in Ireland, the groupcombines innovation and growthwith customer service and aims tobecome the leading oil company inIreland.

Topaz operates a network ofapproximately 350 petrol fillingstations across Ireland. It is themaster distributor for Shell lubricantsin Ireland and it supplies thecomplete range of Shell products.

The group also offers a range offuel card services with the TopazFuel Card and Statoil fuel cards,tailored to suit individual businessneeds. It also offers the StatoilRoutex fuel card for customersbuying fuel in the UK, and on theContinent and this currently includes17,000 sites in 34 countries.

Topaz is also the leadingterminal operator in the country andowns and operates a number of oilimport and storage facilities inDublin (2), Cork, Galway (2),Limerick, Derry and Greencore.

The Topaz network is furtherenhanced by a web of Authorised

Distributors who operate 64 depotsacross the country, fed by largearticulated road tankers.

The group sells its productsthrough a network of 145 Shellbranded retail service stationsacross 32 counties. Of these 45 aredirectly owned and operated byTopaz and 105 are independentlyowned and operated.

Many of Topaz stations areopened 24-hours and also provideconvenience retailing – the answerto today’s fast-paced lifestyle byproviding the convenience of one-stop shopping.

Turnover:

€3004mProfit:

€-19mDescription:Fuel/Convenience retailer

Topaz HouseBeech HillClonskeaghDublin 4

Tel: 01 202 8888CEO/MD: Eddie O’Brien

Eddie O’Brien

5

T O P 1 0 0 C O M P A N I E S

July/August 2010 29

30 TGm

Today the group is Ireland’slargest food retailer operating 135multi-format stores nationwide andemploying 13,500 people. Its shareof the grocery retailing market is asizeable 25.% with turnover of€2.9bn, 32% of which is accountedfor by its own brand portfolio ofproducts. Over €500m has beenspent in the business over the lastfive years mainly in the developmentof new and replacement stores,modern IT systems and logisticaldevelopments.

Tesco operates supermarketsunder the ‘Tesco Ireland’ brand aswell as retail formats under theTesco Ireland Local, Tesco Expressand Tesco Metro brands. TescoMetro stores are sized betweenstandard Tesco stores and the TescoExpress format is mostly located intown and city centres. These storesare largely convenience storesmainly stocking food with anemphasis on higher marginproducts alongside everydayessentials. In addition 29 Tescostores across the country operateon a 24-hour basis.

Consumers are familiar withTesco’s own brand offerings and thecompany now offers a ‘good, betterand best’ policy for its productcategories. This now encompasses

several product categories such asfood, beverages and some non-foodlines. On-line grocery shopping wasfirst introduced in 2000 with over17,000 registered customers

Chief executive Tony Keohaneappointed to the job in February2006 said it best when he describedthe focus on the customer as beingmore ingrained in the DNA of Tescothan most others; “there is less thathappens by chance”, he onceshrewdly commented. And right hewas too. In 2006, for example,someone in the echelons of Tescosat up and noticed a certain patterntaking place in the highly lucrativeIrish petrol forecourt sector.

Tesco first stepped into thismarket in Ireland in 2003, havingtaken the plunge else-where and inthe UK back in 1974.The group nowoperates 15 petrol stationsalongside its supermarkets includingamong others those in Finglas,Wexford, Dundrum, Killarney,Maynooth.

The Tesco retail concept is nowbigger than food; it’s a one-stop-

shop and this exploration of non-food linesis in constant development. Thesimple fact is that non-food lines liketoiletries, drapery or fashion havelarger profit margins than grocery lines.This is further emphasised whensold by supermarket chains in large,low-rent out-of-town premises. Itwas reported last year that in the UKTesco accounts for every pound ofevery 8 spent on anything. Thedominance of supermarkets of non-food lines is being felt by moretraditional players. For example,Tesco’s successful clothing line theCherokee and Florence & Fred linesare among the fastest growingclothing ranges on the high street.

Tesco’s rise to a 25% marketlead has been well-documented.From the introduction of non-foodlines, to breaking in to the petrolforecourt market and operating 24-hour stores, the chain has taken abreak-neck approach to innovation.Long may it last.

Turnover:

€2995m(e)Profit:

n/dDescription:Supermarket Retail

Gresham HouseMarine RoadDun LaoghaireCo. Dublin

Tel: 01 280 8441CEO/MD: Tony Keohane

6

Tony Keohane

T O P 1 0 0 C O M P A N I E S

July/August 2010 31

Fyffes is the oldest fruit brand inthe world and is most easilyidentified with the banana although italso markets Fyffes GoldPineapples and Fyffes Melons.Bananas are one of the mostpopular fruits and in Europe they areone of the biggest selling items insupermarkets. This has much to dowith the fact that the bananacontains just 95 calories, has little fatand has one of the best, mostnatural and biodegradablewrapping.

Fyffes is one of the largestimporters and distributors in Europewith a turnover of €500m and aninfrastructure that reaches acrossthe globe. The group is a true globalplayer operating in a considerablyfragmented industry.

Fyffes is primarily involved in theproduction, procurement, shipping,ripening, distribution and marketingof bananas, pineapple and melons.It currently markets fruit in Europeand the US under the Fyffes,Turbara and Nolem brands.

Although Fyffes enjoys a prolificposition in the global fruit business,the market has faced volatility on alarge scale which has taken its tollon all players. In the last two years,

the industry has had to contend withexchange rates, spiralling rawmaterial prices as well as Bananaimport regulations implemented in2006.

In March, Fyffes stated that itsprofits were in line with expectationsgiven a changed environment duelargely to new EU importingregulations. The group’s statutorypre-tax profit declined to €38m from€105.8m in 2005. However, grouprevenue from continuing operationsrose €406m from €386m.

The adjusted EBIT (operatingprofit, before exceptional items,amortisation, interest and taxincluding the equivalent share ofjoint ventures operating profit) forFyffes continuing operationsdropped to €19m in 2006 from€79m the previous year. Thisreflects in particular the changes inEU import regulations which costFyffes €40.9m in the year mainlydue to the significant increases inimport duty.

Analysts say a strong balancesheet holds the key to thecompany’s future. The fruit groupplans to double in size over the nextfive years. At the end of 2006, Fyffesreported net funds of €80m placingit in a more optimistic position tomake acquisitions than most of itscompetitors. Analysts also believethere is significant potential forsynergies in relation to theacquisition of a rival banana group.

The growth in revenue reflectsthe impact of the acquisitions ofBrazilian melon producer Nolem inJanuary 2006 and the full yearimpact of the acquisition of Turbarain North America in the final quarterof 2005. In addition, Fyffes grew itsbanana volumes by 6% and itspineapple volumes by 25% during2006.

A number of key restructuringprogrammes have taken place atFyffes. In April 2006, Fyffes outlineddetails of a property company it hadspun out of the group and listedseparately. The property is

Blackrock International Land andinitially traded with 30 propertieswith a combined gross asset valueof €207m.

The following September, thegroup announced a demerger of itsgeneral produce and distributionbusiness into a separately quotedcompany. Fyffes current operationscomprise broadly two distinctbusinesses; its tropical fruit businessand its general produce business.The general produce division is thelarger of the two businesses andhas sales of an estimated €2bnwhich compared to €500m withintropical produce.

The tropical fruit business isconsidered highly capitalised with€200m in cash and other liquidassets including a 40% stake inBlackrock International Land. Thegroup’s chairman, Carl McCanncommented that this would make it‘very much able to play strongly inthe arena of the big deal’. Hereferred the general producedivision as ‘stable, steady business’.

He added that the generalproduce firm, which will be listed onthe Dublin stock exchange, couldprobably spend up to €30m onacquisitions each year and thusmaintain a double-digit growth rate.The underlying general produceoperations are growing by 4% peryear.

McCann said the decision todemerge the general producedivision had been prompted, in part,by the success of the Blackrockinitiative. Fyffes shareholders getone share in the new entity for eachshare they own in the existing group.

McCann handed over thechairmanship of Fyffes to his brotherDavid after the demerger to becomechairman of the new company. Thisrestructuring of the business hasbeen generally well received in thetrade however; obviously suchconsolidation has brought thepossibility of acquisition into theequation.

Turnover:

€2251mProfit:

€30mDescription:Wholesaler fruit and vegetables

Total Produce (Fyffes)Charles McCann BuildingRampart RoadDundalkCo. Louth

Tel: 042 933 5451CEO/MD: Rory Byrne

7

T O P 1 0 0 C O M P A N I E S

32 TGm

Glanbia is not just an indigenousIrish success it is a global consumerfoods triumph. Over the last fewyears, it has reached out to newmarkets expressing an impressiveeye for innovation while retaining itscore product values. No mean featconsidering it was first formed as aresult of the merger betweenAvonmore and Waterford dairy co-operatives. The group now boasts aturnover of €2.2bn and enjoysleading positions in key dairymarkets such as milk, cheese, freshdairy products and fresh soups andsauces.

The group’s principal activitiesare carried out through threedivisions, food ingredients,consumer foods and agri-business.Under its food ingredients division itprocesses a range of cheese, andwhey protein ingredients. Thedivision also supplies the globalnutrition industry with a wide rangeof solutions designed to addressspecific health and wellnessbenefits.

The consumer foods it providesare liquid milk, chilled foods andpork processing as well asmozzarella cheese. This divisionalso supplies branded and value-added liquid milk, fresh dairy

cheeses, soups and spreads to theretail market. Among the group bestknown brands are Avonmore,Yoplait, Everybody, Snowcream andPremier Milk.

Glanbia is based primarily inIreland, UK and USA and servesmarkets for dairy and meat productsacross the world. In total the groupemploys 4,000 people in Ireland, theUK and the US. Quoted on theDublin and London StockExchanges; the Group is rankedamong Europe’s largest dairycompanies and is one of the world’s

largest cheese manufacturers. Itholds strategic positions in the UScheese and European pizza cheesesectors.

The dairy market is a constantlyshifting one, where trends must becreated as well as catered to or theconsumer will simply move on. Twoof the most important segments ofthe dairy market are health andindulgence with a focus onconvenience thrown in for goodmeasure. For instance, the increasingtrend towards convenience food andsnacking on-the-go has probably

Turnover:

€2232mProfit:

€100mDescription:Cheese/Nutritional ingredients

Glanbia HouseKilkenny

Tel: 056 777 2200CEO/MD: John Moloney

8

John Moloney

T O P 1 0 0 C O M P A N I E S

encouraged many consumers toswitch categories and purchaseyogurt drinks instead of thetraditional pot of yogurt becausethey are more easily consumedwhen pressed for time in themorning or throughout the course ofthe day. Hence, manufacturers facea challenge in encouragingincreased consumption unless theproduct is made more accessible forout of home usage.

For Glanbia, an obvious focus forgrowth is developing the nutritionarea. Nutrition is a consumer trend

driven by growing awareness of thelink between diet and health.

Trends show consumers are nowseeking additional nutritionalbenefits from the food they eat,leading to a demand for fortifiedfoods (i.e. mineral or vitaminenriched), dietary supplements,sports drinks and bars etc.Obviously, milk is an ideal source ofproteins and minerals and the dairycomponent of the internationalnutrition market is estimated to beworth billions annually and isgrowing rapidly.

Whey, a bi-product of cheese isthe basis of many protein drinks andnutrition bars that are a rapidlygrowing part of the food businessand Glanbia wants to participate inthese on a larger scale. It is used ina range of health products,nutritional supplements andfunctional foods – those that arepromoted as providing a healthbenefit beyond basic nutrition.

Glanbia is active in advancedtechnology nutrition products suchas wpi, milk minerals, andlactoferrin. The Group is also activein formulated milk powders, servingmarkets where dietary, supply chainor economic needs drive demand.Moreover, it is the second largestsupplier in this global market whichis growing extremely rapidly.

Innovation is integral to Glanbia’ssuccess abroad. In October 2006, itopened one of the largest cheeseplants in the world. The plant,located in New Mexico propelled thegroup into the big league as thelargest producer of cheddar cheesein the United States. Glanbiaoperates the plant and markets theproduct while its joint venturepartners, Greater SouthwestAgency provides the milk supply.New Mexico is the fastest growingmilk production region in the US andSouthwest Cheese chairman MikeMcCloskey said this growth hadgenerated a desire for partnershipwith a major food producer.

Glanbia’s expansion plans arenot limited to the US. In 2007 itopened a manufacturing plant inShanghai in China to producespecialist ingredients for customers.The plant in Shanghai focuses onwhey-based nutritional products.The office generates sales of about€12m a year.

The group’s ability to diversifyand expand its portfolio beyondbasic dairy to consumer foods,ingredients and agri-business iswhat makes Glanbia one of thegreat Irish success stories of thiscentury.

T O P 1 0 0 C O M P A N I E S

July/August 2010 33

34 TGm

The word Diageo comes fromthe Latin word for day (dia) and theGreek word for world (geo). Diageo’sroots in Ireland stretch back twocenturies and today it brings Irishbrands such as Guinness andBailey’s Original Irish Cream Liqueurto global markets in 150 countrieswith a turnover which exceeds€10.150bn.

Diageo Ireland is headquarteredin St James’ Gate Brewery in Dublin.Bailey’s Irish Cream is produced inits facility on the Nangor Road inDublin; and its regional sales officesoperate from Kilkenny, Cork,Galway, Limerick, Sligo; and inNorthern Ireland its headquartersare in Belfast. Diageo Irelandemploys thousands of peopledirectly and has exports worthhundreds of millions.

In this country, Diageo Ireland issynonymous with Guinness, itssignature Irish brand. The companyclaims that 10 million glasses of theblack stuff are consumed each dayand it is the world’s number onestout.

Guinness continues to be astrong brand for the group with yearon year sales up 2% for the first sixmonths of the financial year up untilJanuary of 2009. Internationally, itssales were up 7% during this period

enjoying strong growth in Africa andAsia with sales of 22% and 18%respectively. Like most companieshowever, the famous brand has notescaped some of the fallout of theeconomic downturn. John Kennedy,CEO Diageo Ireland explains;

“Europe is one of the toughestareas to grow for a consumer goodscompany and we have seen someslowdown in markets that weregrowing at an exceptional rate likeRussia. The biggest thing that hashappened more than consumerspending is our customers andwholesalers are very cautious aboutkeeping stock so the traditionalstock levels have gone down. Thewholesaling industry in Spain forexample went through a massivede-stock in December which wasone of the big things that affectedour results. So while there is aconsumer slowdown and we have towatch that, there are some one-offimports from customers managingthe recession.”

However, despite the obviouschallenges of recession time,Diageo is well tuned to its customer;

“We conducted research amongconsumers and the findings thatcame out were people want to turnback to their local community andthe pub is part of that and we willdrive that. Within the pub we arefinding that Guinness and draft beerare popular because of theperceived value of a pint andtherefore we believe everything weare doing to drive Guinness in theon premise is a great opportunity topush.”

He continues;“We are also ramping up the

innovation plan particularly aroundour big brands like Smirnoff in theoff-trade. The trend we are trying toexploit there is the growing interestin cocktails and premixed spiritswhich has been in other markets foryears but is coming into Ireland nowso we are doing work around howwe use the Smirnoff brand in this. Sowe are going to play hard at a more

select range of areas particularlyaround Smirnoff in innovation,Budweiser, Carlsberg andGuinness.”

Baileys Original Irish Cream isanother top brand in its portfolio. Itwas introduced to the world in themid-seventies and was the first Irishcream liqueur in the world. It is thefastest growing of the eight globalpriority brands in the portfolio ofDiageo and it is the world’s eighthlargest international spirit brandaccounting for 70% of the totalcream liqueur category globally.

Budweiser is another familiarname in the Diageo Ireland portfolio.Budweiser is brewed in Kilkenny byDiageo under license from ownerAnheuser-Busch. It has been a firmfavourite with Irish consumers since1986. Its success in Ireland hasmuch to do with its image throughquirky humorous advertising whichcommunicate the beer’s qualityincluding the ‘Clydesdale’ and ‘Kingof Beer’ adverts

Another firm favourite from theDiageo Ireland portfolio is Carlsberg.It s brewed in Dundalk from maltedbarley, yeast, hops and water whereit has been brewed and marketed byDiageo Ireland under license since1988.

Globally, Diageo is the world’sleading premium drinks businesswith an impressive menu ofbeverage brands across the spirit,wine and beer categories. Just someof these well known brand namesinclude; Bushmills Irish Whiskey,Smirnoff, Johnnie Walker andSterling Vineyards Wines.

Diageo is a global companytrading in more than 100 countriesacross the globe. The company islisted on both the London and NewYork stock exchange. It employsover 22,000 people with offices inover 80 countries andmanufacturing facilities in Ireland,the UK, Canada, Spain, Italy, Africa,Latin America, Australia, India andthe Caribbean.

Diageo was first established in

Turnover:

€1800m-2000m(e)Profit:

n/dDescription:Brewing/Distilling / Manufacturer ofbeers and spirits

Diageo Ireland,St. James’s GateDublin 8Tel: 01 453 6700CEO/MD: John Kennedy

9

T O P 1 0 0 C O M P A N I E S

1997 after the merger of GrandMetand Guinness, and isheadquartered in London. ItsEuropean division accounts for athird of Diageo’s total business.There are five business units inDiageo Europe including Ireland,UK, Continental Europe, Iberia andRussia. Its top brands in Europe areSmirnoff Vodka in Ireland and theUK; Johnnie Walker

In Germany and Russia; Baileysin the UK, Spain and Germany; J&BRare in Spain and France; Guinnessin Ireland and the UK and BlossomHill in Ireland and the UK.

T O P 1 0 0 C O M P A N I E S

July/August 2010 35

36 TGm

The Irish Dairy Board (IDB) is thebiggest international exporter ofIrish dairy products, servicing theneeds and quality demands ofcustomers world-wide. It was formedin 1961 and has grown in responseto the changing European andglobal business environment.Today,it is one of the country’s mainexporters and a major fooddistribution company with annualsales of €1.8bn.

The IDB owns the well knownKerrygold brand. Kerrygold dairyproducts include; Kerrygold PureIrish Butter, Kerrygold SpreadablePure Irish Butter, Kerrygold DublinerIrish Cheese, Kerrygold ProcessedCheese Spread, Kerrygold IrishCheddar Cheese and KerrygoldCream for Coffee. Its productportfolio is divided into three keysectors including; retail business,food ingredients and commoditytraining. The Irish based marketingand sales staff is supported in theiroverseas operation by local agentsand distributors, sales offices andsubsidiary companies. Groupsubsidiaries in Europe and the USmarket a wide selection ofspecialised cheeses, cooked meats,fish and delicatessen products of

both Irish and non-Irish origin.The IDB operates and trades in

a variety of markets across theglobe. However, its main focus isincreasing sales within the EUthrough improved distribution andmarketing structures. The IDB’smain products include cheeses,butterfats, whey products, powdersand casein & caseinates.

Its Kerrygold range include,butter, cheese and cream products.Kerrygold Pure Irish Butter is asalted sweet cream butter with asmooth rich taste. Its naturally softtexture and wholesome purity are allderived from the full cream that iskey among Kerrygold’s brands.

Kerrygold Spreadable Pure Irishbutter is 100% pure Irish buttermade with only the finest quality milkfrom cows grazing on lush greenpastures. This yields a cream withnaturally softer fat which whendouble churned, makes KerrygoldSpreadable even softer and easierto spread.

Kerrygold Dubliner Irish Cheeseis a unique cheese type with adistinctive rounded flavour, achievedby combining a secret recipe andthe skills of the Kerrygold mastercheese maker. The cheese istypically matured over 12-monthsduring which time it is checked byexperienced cheese graders toensure that it has a consistently highflavour profile. Dubliner is a versatilecheese suitable for vegetarians, thatcan be used on a cheese board, insandwiches and in a range ofrecipes. Dubliner is particularlydelicious as an aperitif cheeseserved cut into cubes or slices.

In the cream sector, the IDB hasKerrygold Cream for Coffee. Madefrom pure Irish single cream,Kerrygold Cream for coffee is aunique ‘ultra heat treated’ topreserve freshness and extendedproduct life. The brand is an idealcompliment to a coffee. Available asten connected ‘snap-off portions’with sealed printed foil lids, eachportion contains 10ml.

10

T O P 1 0 0 C O M P A N I E S

Turnover:

€1823mProfit:

€32mDescription:Export of Dairy Products

Grattan HouseMount Street LowerDublin 2

Tel: 01 661 9599CEO / MD: Michael Cronin

38 TGm

With a 7% drop in sales to the endof last December, Phil Almond, globalmarketing director for Baileys, setsabout arresting the decline in Baileyssales in the last few years.

Almond, 48, is no stranger to theBaileys brand. As head of Diageo’s UKmarketing team he was responsible forthe company’s biggest brands, whichinclude Guinness, Smirnoff, Bells andPimms. He was appointed to theBailey’s job a year ago and spendsabout three days a week at the StJames’s Gate.

The slide in the sales of Baileys maynot be as severe as some drinks on themarket but Almond isn’t taking anycomfort from that and has plans toreverse it. Part of the decline is the factthat Baileys is sold as a premiumproduct, and the reluctance ofconsumers in its main market of NorthAmerica and Western Europe to splashout is hurting. It doesn’t help that,despite the fact it is the seventhbiggest-selling spirits brand in theworld, for most people it isn’t theirregular tipple when they wander into apub.

“Baileys is currently something youtreat ourself to. In a recession peoplehunker down and we’re suffering fromthat. There’s a tendency for consumersto come off things they regard as atreat or indulgence,” he says. “We havehuge numbers of people who say theylove it and drink it regularly andrelatively few who do drink it regularlycompared with other alcohol drinks. Ittends to be more of an occasionaldrink and it tends to be more seasonal.It is not often somebody’s main drink.It is something they will turn to nowand again.”

While never neglected by its parentcompany, Baileys has fallen off theradar a bit and Almond says there willbe a new marketing drive to give thebrand a push. Added to the campaignto reinvigorate sales is the launch ofanother flavoured version of Baileys, tosupplement existing ones such ascoffee, caramel and mint, which haveproved popular with consumers. Justwhat the new flavour is will remain amystery for another few months as

Almond says it is a closely-held secretwithin the company. The danger,though, with too many variations onflavour is that it takes away from theoriginal product, he says.

“It is a brand that responds tomarketing pressure. The main thing is

the taste. You do too much and you gotoo far away from the base brand andyou risk damaging it. It’s not like vodkawhere you can add mixes. People knowand love and have an expectation of aBaileys taste,” he says.

Almond to arrest decline of Baileys

. . . D E C L I N E O F B A I L E Y S

Though sales in Ireland are “stableto slightly declining”, Almond saysthere are a few tentative signs that itsmajor international markets areshowing improvement.

“The US is tough but slowly comingout of recession. Britain is lookingstrong for us actually this year. Othermarkets you’d expect - Spain, Italy andIreland - are still very tough.”

In the near-term Almond isfocusing on rebuilding sales in Americaand Europe, where Baileys still hasn’texploited its full potential.

“If I could get the per capita sales inthe US to be the same as Canada thatgets me more than two million extracases. If I could get four otherEuropean markets to the same level asthe UK I could get another two or threemillion cases. So that is before I evenstart on places we haven’t really been.

But he is eyeing emerging markets,which account for a lesser proportionof Baileys sales than many otherbrands in the Diageo portfolio. He alsopoints to Brazil, where there are now23 million people who would bedefined as middle class consumers,

making it a market the size of Australiaat the moment.

“We are starting to get going inAsia but it is still relatively small. We’vebeen busy in our core markets ofEurope and North America but areonly getting into emerging markets. IfI’m looking five or 10 years out I wouldwant the proportion of Baileys in thoseemerging markets to be close on whatit is in the rest of the Diageo portfolio,which would be 30% and we areprobably at about 10%. There is goingto be a lot of growth generally in thosemarkets and there is no reason whyBaileys shouldn’t be part of that.”

The enormous potential for newmarkets is bound to be good news forthe Irish dairy industry, which suppliesthe milk that goes into Baileys. About80% of all the ingredients that go intoBaileys are sourced on the island ofIreland and the drink is one of thecountry’s biggest exports.

Even allowing for the short-termchallenges, Almond says he’s confidentthat Baileys will resume growth. It maybe one of the youngest brands in theDiageo group, but he points out, Irishdrinks have a history of thriving.

“Great brands like this aren’tsuccessful by accident. Managing bigbrands in a recession is the right placeto be. You look at most of our brands -Bushmills is 400 years old, Guinness is250. These brands have seen morewars, revolutions, economic crises thanwe will ever see and they’ve comethrough because they are greatproducts. They are safe ships in astorm.”

TGM

“Managing big brands in a recession is the

right place to be. You look at most of ourbrands - Bushmills is 400 years old,Guinness is 250. These brands haveseen more economic crises than

we will ever see and they’ve come throughbecause they are great products..”

“

July/August 2010 39

40 TGm

How can we be sure that claimsmade by manufacturers are not afiction invented to curry favour withconcerned consumers?

Which? the British consumermagazine recently tested the claimsof a range of eco-friendly productscommonly found on Irishsupermarket shelves and many werefound wanting. Brands were accusedof confusing shoppers or not beingable to substantiate the claims madeon their green labels.

A couple of Which? scientists andan environmental communicationsexpert examined 14 everyday itemsand reported that nearly 50 per centof the “eco” laundry tablets, nappiesand toilet cleaners were makingclaims unsupported by sufficientevidence.

“When companies make cleargreen claims it helps consumers makeeco-choices with confidence. But ourexperts concluded that many of thecompanies did not provide enoughevidence to back up their claims andthought that some were exaggerated.This makes it hard for people tochoose,” the magazine said.

Its study found that each of theeco toilet cleaners it scrutinised madeat least one green claim that was notbacked up by evidence from themanufacturer. Which? expressed“reservations” about Ecover, whichclaims that its products biodegraderapidly and have less of an impactthan conventional cleaning productson aquatic life once they have beenthrough a water treatment plant. Forits part, Ecover insisted its productswere ‘fully degradable in anaerobicand aerobic conditions, going furtherthan legislation and differentiatingEcover from market leaders”.

Tesco’s “Naturally” branded toiletcleaner was criticised for claiming itwas unique in containing nophosphates, despite the fact that alarge number of toilet cleaners aresimilarly phosphate-free.

Which? also questioned logos onwashing powders. One had a “futurefriendly” stamp on its products whilethe other goes for “cleaner planet

plan” logo. Both could causeconfusion and don’t market it clear ifit is the shopper’s or themanufacturers’ action which is futurefriendly and part of a cleaner planetplan.

A study published last year by theBritish government’s watchdogConsumer Focus said that two thirdsof consumers found it difficult toknow which products were better forthe environment and more than halfthought that a lot of companiespretended to be green just to chargehigher prices.

Whether or not that is true, onething is beyond any doubt hugemultinational companies have beenhoovering up smaller businesses withsolid green credentials because theyknow it is what consumers want.

Last year Coca Cola bought asubstantial share of InnocentSmoothies; Unilever has swallowedthe archetypal hippy ice-cream Ben &Jerry’s; Cadbury Schweppes is pullingthe strings at Green & Black’s organicchocolate while Clorox, a bleachmanufacturer, has acquired Burt’sBees, a considerably easier on theeyes manufacturer of lip balm, soapsand shampoos. While it may notmatter who owns the world’s eco-friendliest companies, it certainlydoes matter that they tell the truthand this is an area in which manyhave been found wanting.

Greenwashing is one of thefastest-growing areas of complaint inBritain and it has prompted the ASAto introduce a new code of conductfrom next September. Under the newrules the basis of any green claimmust be made clear and comparativeclaims such as “greener” will only beallowed if they can be justified; allenvironmental claims will have to bebased on the full life cycle of theproduct and if a product has neverhad a negative effect on theenvironment, ads will not be allowedto imply the formulation has changedto improve the product. Marketingmust not mislead consumers aboutthe environmental benefit a productoffers and companies will be

forbidden from drawing consumers’attention to the absence of anenvironmentally damaging ingredientif it is not usually found in similarproducts.

There are no similar guidelineshere. While the Consumer ProtectionAct 2007 prohibits misleadingadvertisements and the making offalse claims about goods or servicesto consumers, there are no explicitreferences to greenwashing althoughactions have been taken.

How Green is Green?

H O W G R E E N I S G R E E N ?

TGM

Newspaper advertisingaccounted for more than athird of overall advertisingspend in Ireland last year,according to a new report.PricewaterhouseCoopersEntertainment and MediaOutlook 2010, which is dueto be published inSeptember, shows thatspending on newspaperadvertising was €343m in2009.

The total advertisingmarket in Ireland was worthan estimated €940m lastyear, according to thereport.

The figures emerged asPwC published a report ononline advertising spending,carried out by theaccountancy andaccountancy firm on behalfof IAB Ireland, the tradeassociation for the Irishonline advertising industry.

Television advertisingaccounted for €209m,while radio represented€139m last year.

At €97.2m, spendingon online advertising hasovertaken the spend onoutdoor, magazine andcinema advertising.

PwC’s Bartley O’Connorsaid that this reflectedonline’s move “to centrestage”.

IAb Ireland’s SuzanneMcElligott described the€100m threshold as a“milestone” for onlinemedia, and said theassociation expects theonline market to grow by afurther 10 per cent over thecoming year.

According to the report,search advertising -predominantly using thepay per click model -accounted for more than 46per cent of the overallonline advertising spend.

Classified and displayformats achieved a 27.2per cent and 26.6 per centshare respectively.

Meanwhile, theBroadcasting Authority ofIreland (BAI) is to increasethe amount of advertisingpermissible on independentIrish commercial televisionstations.

The maximum amountof advertising permitted onstations such as TV3,Setanta Ireland and CityChannel will increase from10 minutes to 12 minutes

per hour, and from 15 percent to 18 per cent per day.

The rules restrict theamount of advertisingpermitted during children’sprogrammes to 10 minutesper day.

National Newspapers ofIreland (NNI) has sharplycriticised the decision,which it says was taken“with undue haste” and inthe absence of an impactassessment to measure theeffect on other mediacompeting in themarketplace.

Chief Executive of theBAI Michael O’Keeffe, saidthat while every mediaprovider in Ireland has beenchallenged by the seriousdecline in advertisingrevenues in the last twoyears, independent Irishcommercial televisionproviders face significantadditional competitivechallenges due to theexistence of UK-licensedservices which sell opt-outadvertising in thisjurisdiction.

Stiff competition for Newspaper advertising

July/August 2010 41

Oil company Maxol is oncourse to complete a €12million investment in sevennew ‘super’ service stationsbefore the end of the year.

The company has justopened a €2.25 millionservice station on a 3,200square metre site in the westCork town of Clonakilty. Thefacility has a 290 squaremetre convenience store, runby BWG-owned retail chainMace, and seating for 40customers.

It is in keeping with thecorporate design thecompany launched in theNorth in 2008, where it hasopened super-stations inRosepark, and Cherryvalleyin Belfast, Saintfield in CoDown and Scaffot inEnniskillen. Another servicestation opened in Holywood,Co Down in July.

In the south, Maxolinvested €1.6 million in anew station in Dublin lastOctober, creating 20 jobs.Situated on a one-acre siteon Newcastle Road inAdamstown, the facility hasa convenience stores of 150square metres, alsooperated by Mace, aMaxwash-branded carwashcentre and indoor seating forcustomers.

Maxol plans to develop

five further sites in the southalong the same lines. Threewill be located in and aroundCork city, and two moreplanned for Bray, CoWicklow and Castlebar, CoMayo.

The company is investing€12 million in all sevensites. It has a total of 214service stations, including120 dealer-owned sites and94 company-owned sites.

Commenting on the newservice station at Miles inClonakilty, Tom Noonan,chief executive of Maxol saidit would create 20 jobs forthe area.

“This is a very importantdevelopment for Maxol, inwhich we believe that we aresetting a new standard,which will become thebenchmark for futureforecourt convenienceoffered to Irish motorists,”Noonan said. “In manyrespects, Clonakilty is thegateway to west Cork, whichis popular with foreigntourists and Irish holiday-makers alike. We areconfident that our extendedoffering will attract many ofthese passing visitors intothe area, which will be ofbenefit to the extendedbusiness community inClonakilty.”

Willie O’Byrne, managingdirector of BWG Foods, saidthe site was an importantmilestone in the retailer’spartnership with Maxol.

“The Clonakilty openingbrings to 45 the number ofMace convenience stores onMaxol company-ownedforecourts in Ireland. This isin addition to the manyMaxol Mace brandpartnerships within theindependent petrol retailsector. Forecourt retailingremains an important andgrowing part of our

business, and we lookforward to delivering notonly great food andbeverage options toconsumers on the move inwest Cork, but also greatvalue too.”

Established in 1914,Maxol employs 200 staffdirectly and 1,000 indirectlyin 224 company and dealer-owned service stationsaround the country. Thecompany has itsheadquarters in Dublin’sIFSC and has annual revenueof €700 million.

‘Super’ Service Stations fromMaxol

N E W S

Willie O’Byrne

42 TGm

A Tipperary-based crisp-maker has secured anexclusive deal withMusgrave Retail PartnersIreland, which will stock itsproducts in 192 SuperValuand 474 Centra stores

around the country.Under the terms of the

three-month contract, whichhas a retail value of€100,000, O’Donnell’s willsupply the stores with twovarieties of crisps; Irish Cider

Vinegar & Sea Salt andMature Irish Cheese & RedOnion.

The O’Donnell’s launchedtheir crisp-making businesslast May as a means ofgenerating additional

income from their familyfarm. They use potatoesgrown on the farm to makethe hand-cooked crisps andlocally sourced ingredients,including cider vinegar fromCon Trass’s apple farm in

Tipperary andcheese from MountCallan farmhouse inClare.

The company’sdeal with Musgraveis its first retaild i s t r i b u t i o nagreement.

B r e n d a nMacken, categorymanager withMusgrave Group,said the contractwas awarded aspart of the retailer’spolicy of supportinglocal Irishproducers.

According toMusgrave’s, 75 percent of all stock inSuperValu andCentra stores iseither sourced orproduced in Ireland.

“ O ’ D o n n e l l sArtisan Crisps isboth a family-runbusiness and a trulyIrish brand. We arealways looking tosupport and helpsmall suppliers andbring new Irish foodbrands to Irishconsumers. We aredelighted to bringO’Donnells ArtisanCrisps, a seventh-generation farmingbusiness, to join theextensive range ofIrish productsalready on theshelves ofSuperValu andCentra stores.”

O’Donnell’s secure exclusive deal

TGM

July/August 2010 43

44 TGm

Indeed, it is also the mostdominant sector in the drinks market,with an estimated share of 50%, withyear-on-year growth of 2.7%. Thecategory is said to have an estimatedvalue of €593m, and has seen a majorshift towards low calorie and no addedsugar items. They make up 57% of thesoft drinks market, so the shift makessense from that point of view, but thepromotion of health and well-being canalso be established in these areas.

Soft drink products haven't alwaysbeen seen as the healthiest option fora consumer in the past, so it isimportant that manufacturers movetowards healthier options in the futureas people look for ways to quench theirthirst. Smoothies, juices and bottledwater have grown in popularity over

the last few years, although sales insmoothies have fallen in the past 12months or so, as they are now seen asa luxurious and somewhat expensivecommodity.

The carbonated soft drinks marketcurrently has a value of approximately446 million litres in volume. Amongstthe advertising that has taken place inthe recent years was the 'Diet Coke'promotions featuring Grammy award-winning musician Duffy. Coca-Colachose Duffy for this campaign as theysee her as a hugely talented andaccessible artist as opposed to justbeing a mere pin-up, which in turnwould make the advertisementsattractive to younger female viewers inthe 20-35 age bracket.

In the campaign, Duffy (real name:

Aimee Ann Duffy) is shown cyclingthrough a supermarket singing one ofher hit songs “I Gotta Be Me”. It waslaunched on British television stationITV, following the 2009 BRIT Awardson February 18th last year, whereDuffy came home with three wins toher name.

As a whole, the campaign hasproven to be a success, although it didcome in for some unusual criticism asregards the issue of health for children,as it shows Duffy riding her bicyclewithout protective gear. A formalcomplaint was lodged to the UnitedKingdom’s Advertising StandardsAuthority, but the claims wererejected.

As well as Coca-Cola, the otherbrands in the market also engaged

SOFT DRINKSSOFT DRINKSThe carbonated soft drinks market is one of the most heavilyThe carbonated soft drinks market is one of the most heavily

advertised in the whole of the drinks market, with suchadvertised in the whole of the drinks market, with suchrecognisable brands like Coca-Cola, 7-Up and Red Bull beingrecognisable brands like Coca-Cola, 7-Up and Red Bull beingfirmly ingrained in the thoughts and minds of various Irishfirmly ingrained in the thoughts and minds of various Irish

consumers.consumers.

in plenty of advertisements andmarketing innovations, which wouldexplain why they have always been toable to coax new customers intobuying their products.

There are plenty of brands thathelp this market to be as popular as itis, but there are a select few that wouldbe easily recognisable to the Irishpublic.

In every market in Ireland, there isalways one brand that seems to setthemselves apart from every brand inthat particular market, and thecarbonated drinks market is nodifferent, with Coca-Cola enjoying anunquestionable stranglehold over theother brands currently available on theIrish market. They currently hold closeto 38% of the market share of the

Carbonated Soft Drinks market inIreland.

There are currently concentratefactories in Drogheda and Ballina, andthere are also bottling plants in Dublinand Belfast as well. In these factories,the concentrate is mixed withcarbonated water, bottled and sold.

A total of 910 people are employedin Coca-Cola businesses in Ireland,with payroll to employees being in theregion of €15 million each year. Thismight seem like quite a bit of money,and it is, but this is only a fraction ofthe money that Coca-Cola contributesto the Irish economy. In addition towages, Coca-Cola spends €50 millionon raw materials and €25 million onIrish services, such as marketing andtransport. That represents €90 millionploughed back into the economy byCoca-Cola each year.

Owned by the PepsiCo company(who also house brands like Pepsi,Tropicana and Walkers), 7-Up has amarket share of around 10%, whichmeans that it is well behind Coca-Cola,but is at the same time the secondmost tasted brand for Irish consumers.

It is regarded as being Ireland's No.1 lemon and lime drink, and hasbrought the true nature of 7-Up intopeople's homes with their 'Nature iscloser than you think' motto. Inaccordance with this, Irish householdshave shown plenty of appreciation forthis particular brand, with its being'100% natural flavours' beingespecially pleasing to those who drinkit.

For a while, it was bought by morehouseholds than any other soft drinkin Ireland, and their sugar-freeproduct, Britvic's 7-Up Free has soldpretty well in the past couple of years.

TGM

COCA-COLA

7UP

July/August 2010 45

Duffy

46 TGm

Club Drinks have always had asteady popularity in Ireland, and eventhough there is no specific club drinkthat stands out as being a major sellerin the market, the fact is that Clubproduce so many different types ofdrinks that they managed to forge aplace in the subconscious of theaverage Irish consumer.

At present, there are elevendifferent types of club drinks: orange,lemon, rock shandy, soda water, tonic,ginger ale, soda and lime, whitelemonade, red lemonade, bitter lemonand apple. These drinks appeal to anumber of different age groups, andalso to different tastes, meaning thatthere is something for everybody toenjoy in their range.

The most recent products that theylaunched were in 2007, when theyreleased Club Diet Orange and ClubDiet Lemon onto the Irish market. Thiswas more of a re-introduction thananything, but it came at a time whenbeing healthy was becoming a very bigissue for so many people, making it avery worthwhile and engaging businessdecision.

Fanta, and their supplement FantaLight, have had a very strong volumeshare in the past few years, withfigures showing that they have had upto 26% volume share of the orangeflavour market. They have been one ofthe most innovative and strongestperforming flavour brands over thepast eight years, especially since theintroduction of their 'splash' and FantaExotic items.

2005 saw them launching theirvery first global brand campaign called'Bamboocha', which was hugelysuccessful, and they swiftly followed itwith the introduction of Fanta Greenz,which was made with a blend of apple,lime and kiwi. They usually expect amarket share of around 3% each year.

CLUB

FANTA

SNACKS - THE NORM?From a health point of view, frequently eating snacks in betweenmeals

would not be seen as the ideal thing to aid a person's well-being, but numerousstudies have shown that this is fast becoming the norm for a lot of people in

Ireland today. Lifestyle can play a big part in how often people consumesnacks, and crisps in particular. For instance, for those who have to work longhours, or have to deal with an extended commuter time (whether it be on bus,

train or otherwise), then there is a good chance that theymay start to eatsnacks to keep themselves going.

48 TGm

July/August 2010 49

Also, there are those who may notnecessarily possess a strong ability tocook, and would have a strong needfor food on the go, which snacks andcrisps would ably provide for. In termsof value, the Irish crisps and snacksmarket is valued at an estimated€194m per annum. The market haswitnessed a value decline of 6.7% inthe past year, yet remains one of themost profitable FMCG categories.

This shows us that comfort eatinghas been a notable past time for manyIrish people during the economicdownturn. So, question is, who are thepeople who eat snacks/crisps, andwhen do they eat them?

Well, snacks are generally seen assomething that is aimed at a youngertarget audience, and there is certainlya good deal of truth in this. However,adults have also been known to takesnacks, with adult snacking becomingan occasion in its own right,representing 'me-time' during the busyworking day. Vending machines, whichsell both snacks and drinks, arebecoming a regular fixture in a lot ofworkplaces, so it is no surprise thatmore and more adults are starting toeat snacks at varying intervals.

Apart from working hours, researchhas shown that 38% of consumerssnack in the evening, when they arerelaxing at home. 2% of those whohave been surveyed in the past admitthat they snack during or after playingsport, while 5% say they snack whenthey are with their friends.

9% do it when they are at work, orwhen they are at their desk, 13% picka specific time of day to do it, whereas15% take snacks if they have missed ameal for some reason. These resultsmake for interesting reading, but it nosurprise to see that many people stillchoose to snack when they are on thego, with 21% of those surveyedrevealing that this is the most likelytime that they would take a snack.

It should be stressed though, thatsnacks does not just include sweets, asit can also mean food items whichwould be viewed as healthier andmuch more nutritious than what isconsidered the norm. For example,fruit is considered a snack with up to57% saying that they snack on itregularly, with 22% also saying that

they snack on vegetables and salads.Consumers tend to divide snacks

into categories based on 'good' and'bad'. There can often be a trade-offbetween indulgence and health, whichleads to people taking snacks that theyfeel will benefit their health, which theywill see as far more important than theactual enjoyment of the product.

The influence of both is fairly evenlyspread, with 54% choosing it forhealth reasons, and 46% for itsindulgence.

Largo Foods is the largest Irish-owned crisp and snack manufacturer,and is home to the Tayto brand. Thecompany has a share of about 47 percent of the Irish crisps and snacksmarket, with manufacturing plants inMeath and Donegal, and one inBritain. Other brands include HunkyDorys, Velvet Crunch, Perri, King andSam Spudz.

Tayto are certainly their No. 1brand though, and currently hold a23.2 % value share of the crisps andsnacks market, which helps to makethem the top brand in this sector aswell. The favourite products in theirportfolio tend to be Tayto Snax, Tayto

Chipsticks and Tayto Mighty Munch, aswell as the traditional Cheese & Onion,and Salt & Vinegar crisps.

They have also released newproducts like Tayto Velvet Crunch andTayto Bistro, which have beenintroduced to the market following

detailed insights from consumers.Snackfood consumers are looking forhealthier, great tasting products thatthey can eat on the go and share withfriends and family, and the above twocertainly have the ingredients toprovide for these.

Tayto's main Irish plant is inAshbourne, Co. Meath, and theyemploy over 500 people, which makesthem the largest snack foodmanufacturer in Ireland, and one of thebiggest employers in the region. Thepotatoes used in the manufacturing ofTayto's crisps are sourced from localIrish farmers, which means that 10%of the total potato crop in Ireland endsup in bags of Tayto crisps.

TGM

TAYTO

Walkers, who are part of thePepsiCo International Corporation,have driven growth in the crisps andsnacks market since it was introducedonto shelves in 2000. Their growth cansimply be put down to the love thatconsumers have for the taste ofWalkers crisps.

Walkers have demonstrated plentyof innovation in promotions andproduct development. They have anextensive portfolio, which includesWalkers Crisps, Walkers Lites, WalkersMax and Walkers Sensations. Quavers,Wotsits, Monster Munch, Doritos,Dippas and Latinos also fall under theWalkers brand name.

They are currently the number onecrisp and snack brand in volumeterms, and have outperformed the 1%overall category growth and deliveredan outstanding 8% year to dategrowth in volume. Their core crispsgrowth has risen by 14% in volume aswell.

King Crisps has a national marketshare in crisps of 11.4%, and is thenumber two best selling crisp inDublin, making it a very popular choicefor some consumers. Knownaffectionately as 'The crisps lovers'crisp', King have performed quite well

in the market over the past 12months, and haven't shown much of asign of dropping off.

Their market share was higher in2005 (it was 14.5% at that point), buta lot of that can be put down to thefact that King Lite was introduced theyear before, which would have seenconsumer interest at a greater levelthan usual.

Though King has been viewed asthe fastest-growing crisp and snackbrand in the past, Hunky Dorys couldarguably now take that tag, as theyhave come on in leaps and bounds inthe past few years. They are currentlythe top-selling crinkle-cut crisp inIreland, and with a 14.1% crispcategory share, are outselling theirnearest crinkle-cut competitor byalmost five times.

They have shown good initiative interms of promotions in recent times aswell, having launched a new adcampaign entitled 'Rugby' on April 26,which presented a somewhat uniquetake on the lineout, the scrum and theplace kick. These ads were shot by theworld famous photographer WalterLoos, with a new website showcasingall of the ads from the campaign andsome additional bonus content for itsdigital followers.

This campaign did cause quite a bitof controversy as regards the

provocative nature of the way theHunky Dory brand was beingadvertised, and it has subsequentlybeen banned as a result. However, itcertainly did get people talking, andhelped to raise the profile of the brandin a major way.

50 TGm

WALKERS

HUNKY DORYS

KING