Laurentiu-Florin Dimitriu (Nestlé): The main generator of our significant sales growth is volume growth

This year, Nestlé is celebrating twenty years of operations in Croatia. In addition to this anniversary, the reason for celebration is the significant sales growth in the first half of this year, which the General Director of Nestlé for Croatia, Slovenia, and BiH Laurentiu-Florin Dimitriu claims is not related to the increase in prices of their products, but rather to the growth in sales volume.

Nestlé achieved a 17.8 percent growth in the Croatian market in the first six months of 2024. How much of this is attributed to prices?

– This is truly a great result that we achieved in the first six months of this celebratory year for us, in which we mark twenty years of successful operations in Croatia. I am particularly proud that the main generator of growth is volume. A total of 9.5 percent of growth of Nestlé in the Croatian market in the first half of this year comes from volume, which means that consumers are buying our products, we are gaining more consumers, and capturing market shares. The second generator of growth is the category mix at 6.2 percent, meaning we sold more categories of products that have a higher price per kilogram. Given that, prices have had the least impact on the result, with only 2.1 percent of growth coming from price increases. This year, we only raised the prices of products containing cocoa because that raw material has become incredibly expensive.

One of the main generators of growth is the new wholesale route to market in the hospitality channel. What has changed?

– The wholesale route to market (RTM) is a strategy, or the way we deliver our products to the customer, whether in the retail channel or HoReCa. Until recently, we had multiple distributors for coffee, for example. At the end of last year, we entered into a strategic partnership with Jamnica, which is now our coffee distributor for the HoReCa channel in the Croatian market. Thanks to its strong distribution network, our largest and leading global coffee brand, Nescafé, is now available to coffee lovers in cafes across Croatia. We have laid excellent foundations, the reactions from coffee lovers and hospitality providers are extremely positive, and we continue to work on developing this segment of the business.

Is Nestlé’s pet food brand more successful in the Croatian market than the company’s confectionery products?

– Yes, that is correct. Purina, our pet food brand, has a larger market share in Croatia than our confectionery products. The reason is that we are represented in all segments with pet food, including dog food, cat food, dry food, etc., and in all channels, including retail and specialized pet stores and veterinary programs. On the other hand, in the confectionery segment, we are mainly present in the energy bar category, specifically in the KitKat, Lions, Smarties chocolate categories… and we see significant potential for development and growth in that area.

In which category are you the most successful?

– In the Croatian market, we are most successful in the coffee category, followed by pet food, and the third category is food. With Nescafé coffee, we are present in all segments, from instant coffee, capsules to whole bean coffee, and in all channels: retail and the HoReCa channel. We are constantly developing innovations to offer healthier, tastier, and more sustainable products and to be present in as many segments and channels as possible because that is how we grow.

What challenges does the company face and how does it cope with them?

– In the past few years, we have experienced record and incredible price increases for key raw materials such as cocoa, coffee, sugar, and rising energy, transportation, and distribution costs… We can only cope with such challenges through efficiency in all business segments: production, logistics, marketing, sales, and distribution.

How this company addresses the labor shortage, what benefits it brings to the local community, and where they see new potential for capturing a larger share of the Croatian market can be found in the printed and digital edition of Lider.