Issue Issue 105 September 2015
A refreshing approach
With market opportunities presenting themselves around the world, Danish soft drink manufacturer CO-RO is looking to use its long-standing experience to fund its vision of further growth
Founded in 1942 by brothers Flemming and Jep Petersen, fruit juice manufacturer CO-RO A/S has grown steadily to become a prominent player in close to 80 countries around the world. Driven by a strong commitment to high quality and taste-leading products, a targeted and compelling brand strategy, and continuous product development, CO-RO has carved particularly strong footholds in Northern Europe, the Middle East, North Africa, China and South East Asia.
Three core brands sit at the centre of CO-RO’s global offering: Suntop, a fruity non-carbonated, cartoned soft drink; Sunquick, a concentrated cordial available in over 20 flavours; and Sun Lolly, a home-freeze ice lolly, which leads the market in Denmark. Across its global spread, to which 90 per cent of the company’s products are exported, up to 3.4 billion servings of CO-RO’s brands are sold every year. With a worldwide reach, CO-RO has adopted a strategy to ensure that the final product is delivered to the end user as locally as possible. “We produce super-concentrate compounds of our products here in Denmark, which are then sent out to be mixed and bottled in 12 factories around the world,” explains Søren Holm Jensen, President at CO-RO.
Establishing itself as a leader in many of its markets around the world is a vast achievement for CO-RO, and is one that has been accomplished through steady, controlled growth and commitment to its product. “Our R&D department has developed some great products,” highlights Søren. “Therefore, all our products have outstanding taste, and when measured up against competitors’ products by the end user, our brands come out as winners on taste. Another big advantage we have in the market is that we entered it very early. We had far away export markets as early as the late 60s and early 70s, so being a first mover in places like the Arab Gulf and Malaysia with our brands has really cemented consumer awareness. The third key advantage we have is our ability to build brands. As we cater a lot for kids and families we have focused on making sure we are relevant and attractive to these consumers.”
CO-RO’s mission statement reads: ‘To deliver outstanding taste, high quality products and compelling brand experiences to consumers through fruit-based soft drinks and concentrates.’ By harnessing the strengths that have defined its historic success the company has been able to perform to this mission through a tight and structured strategy. “We don’t compromise on taste at all,” says Søren. “We have always carried out comprehensive testing and we produce a lot of our aromas and flavourings in-house. We maintain quality by not using artificial flavourings, colours or sweeteners so we have a very natural product, but still have a very robust product that maintains its quality in the markets we sell to that have harsh climates. Finally, in order to keep the brand experience right for the consumer we have worked closely with our global partners to fully understand the consumers’ needs and then deliver on them. For example, for Ramadan, which is a big occasion for Sunquick in the Middle East, we make sure we have programmes and packaging sizes in place that fit that exact need.”
Innovation is a particular area of interest for CO-RO at present and Søren expresses that there will soon be a major programme of innovation in the future, based on the company’s existing brand range. With a finger on the pulse of its markets, recent developments in its product portfolio demonstrate CO-RO’s ability to deliver innovation into the market. “In April/May this year in Denmark we launched the first home-freeze, milk-based ice cream, called Sun Lolly Creamy. This has been developed so that it can be bought at ambient temperature and then frozen later, which is a first for milk-based products, and we hope to take that further in the near future,” outlines Søren. “Another example is Sunquick GOLD, which we launched this year in Malaysia and Sri Lanka in response to demand for a slightly sweeter tasting variant of Sunquick. This is accompanied by a whole new brand universe and has done very well so far.”
Innovation at CO-RO is not just important in order to maintain brand freshness amongst its existing markets and consumers, but is also fundamental in the company’s continued success in a steadily growing market. “Over the last five years we have seen population and GDP growth in the Middle East and Asia, which has led to a natural growth in consumption,” explains Søren. “Because of this, we have experienced some good and steady revenue growth, at about six to eight per cent a year for the last five years.” With this in mind then it is no surprise that CO-RO has focused a lot of investment into developing its global distribution channels including a new warehouse in Malaysia and a new factory in Foshan, China.
Despite strong growth CO-RO remains keenly aware of the types of challenges that could face the company’s performance in many of its markets in the future. “Over all macroeconomic and geopolitical outlook is a concern in the long term,” notes Søren. “For example, China has devalued its currency three times this week and there is a lot of unrest in many parts of the world, including the Middle East, which is a big market for us.”
However, taking this into consideration the company is still confident about the future of its brands around the world, and Søren sees a wealth of opportunity in geographical expansion and more focused innovation. “We definitely have a growth ambition,” he says. “We feel that we have grown well in our history and we think that with these opportunities we have the chance to further expand our business. We have the financial strength to do it, and we believe we have the products, brands and business partners to achieve it. Therefore the main vision going forward is to bring out our great value brands and products to more consumers in more locations. Being owned by a trust fund, and before that being privately-owned, means that we are able to think long-term and we like to establish long-standing working relationships with both our customers and suppliers, and this has been crucial to us being able to survive long-term. So remaining independent and retaining this ability to think long-term will be a key driver to our growth agenda.”