With over seven decades of experience in the canned food market, Salvest continues to lead the Estonian market for canned food
The method of preserving food in cans and jars originated in the early 1800s, and in the mid 19th century canned food became a status symbol amongst middle-class households in Europe, and considered rather a novelty. But as the techniques and processes improved and the use of canned goods became vital during wartime, demand for canned goods skyrocketed, and according to a recent report on the canned food market developed by Research and Markets agency, the global canned food industry is expected to reach $105 billion by 2021.
Clearly canned food has become a staple to consumers, and innovative manufacturers in this sector are continuously evolving their product offerings to keep their ranges new and exciting – there is now a huge variety of soups, vegetables, jams, baby foods, sauces and pickles to choose from. A perfect example of such a producer is Salvest AS, the biggest canned food producer in Estonia. Founded in 1946 and manufacturing 7500 tons of products annually, Salvest holds a 70 per cent market share in the canned ready meals and soups market in Estonia, as well as having a healthy export order book, as Lauri Betlem, CEO began by explaining: “Today approximately two-thirds of our turnover comes from Estonia and the rest from close to 15 different countries, with the main destinations being Finland, Poland, Latvia, Lithuania and Russia together with other CIS countries. We’ve also opened new markets this year in France, Germany and Slovenia, and what could be considered our most exotic destination, Ghana.” Continuing to expand its export activities is high on the agenda for Lauri and Salvest, and he noted that the business is looking to enter Denmark and Norway and is just about to start business in Sweden.
Lauri continued with more details about Salvest’s customers: “Our domestic clients are mainly retailers, such as Co-op or ICA,” he said. “If we look at export markets our sales strategy is to have local distributors in each country or region where we are present. Besides selling our own branded products we also have some major PL partners and co-packing projects.”
Focus on organic
This widespread customer base is served from Salvest’s factory, which is located in Tartu, the second biggest city in Estonia. Employing a team of 175 staff, Salvest is the biggest employer in the Tartu municipality, and its operation covers 15,000 m2 of production and warehouse premises. “Over the past ten years we have undertaken a major investment project at the factory, which has seen close to 15 million euros spent on production modernisation and capacity expansion. As a result of this strategy, the company is the most modern canned food producer in the region,” Lauri added.
This state-of-the-art factory is not only stocked with the latest equipment, but also has achieved IFS Food quality and HACCP certification as well as being qualified to both ISO 9001 and ISO 22000 standards. Lauri explained that quality is ingrained into the culture of Salvest, and the right accreditations are essential: “It all begins with controlled and certified raw materials, but this works in tandem with good relations with our farmers. We know the people, their fields, farms and storing conditions, and that ensures they can keep up with our own quality requirements.”
He continued: “As it is a strategic focus and core value for the company to produce the highest quality and most natural products, we have launched many organic ranges. In Estonia, we have some of the cleanest air and water in Europe and more than half our territory is covered with forests. When located in such a place, it is natural that we focus on organic ingredients. Products originating from organic farming today amount to 25 per cent of company turnover, and we have very well established relationships with local farmers -around 70 per cent of all raw materials come from within a 100km proximity of the factory.”
A prime illustration of Salvest’s organic products is the PÕNN brand of baby food, which is the leader in the Estonian baby food market, as well as being a main export item, sold in close to a dozen countries. “Our know-how of producing baby food dates back to 1966, when the first carrot puree was produced,” stated Lauri. “Today we produce one of the best baby foods in the world, and by being organic, our baby food contains just natural ingredients as they come from the field, with nothing added. Behind each recipe is a thorough joint development project with paediatricians, to provide exactly the right consistency, nutrients and energy for a specific age group. We even have a test panel of 150 babies! The end consumer always has the final word.”
Furthermore, Salvest’s focus on quality extends out from the product inside what were traditionally jars – Lauri explained that one of the fastest growing packaging solutions for baby food is the squeezable pack, and this has also been used as a base for a new product for adults. “In 2017, we launched a new concept of smoothies in a squeezable pack (similar to the baby food) called Smushie’s,” Lauri elaborated. “This is targeted to young, hardworking professionals, and Smushie’s are more than just an average smoothie. All of them are made with organic fruits, berries and vegetables, plus contain elements of superfoods. We add quinoa flakes, dates or blackcurrants, to make them functional in addition to being a simple, quick and healthy snack that you can take with you anywhere you go. Smushie’s do not need special storing conditions and are not as heavy to carry as traditional smoothies in glass bottles, making them much more portable.”
Successful Smushie trial sales have already been made in Casino France and have started in SPAR Slovenia. “We expect to launch Smushie’s in Germany and Latvia-Lithuania this year as well, and we consider all these markets to be strategic, where we work with partners and where we are willing to invest to build a strong position for our brand,” Lauri noted.
The launch of Smushie’s is just one of the new innovations Salvest has on its ambitious agenda, as Lauri indicated more investments were in the pipeline, that he hopes will be completed during summer 2018. “We will also invest close to one million euros to bring out a new pack type for our ready meals,” he hinted.
It is clear from speaking to Lauri that Salvest is enjoying a successful first half of 2018 and going forward he hopes to end the year with 15 per cent growth over last year. When asked the secret of the company’s success, he attributes it to ‘the combination of best-in-class know-how, that has been gathered and developed over such a long working period, and our agility and ambition to improve.’
“We are still small enough to be fast and flexible, meaning we can handle quick changes in demand and go through extremely fast product launches. In addition to that we have engaged with several CSR initiatives, so our focus will be even more on protecting the environment, people and the local community.
“But the most important of all, are our core values and strategic focus – our new products should always make the world a better place,” he concluded. “So, we will never stop concentrating on the highest quality and organic raw materials, continuously developing our brand and keeping up our competitive strengths.”