Issue Issue 1 2008
Danish company Toms Group is developing ist product range for the international market
Originating from several brands, the Toms Group has a long and rich history in the field of fine chocolate production. The oldest brand in the organisation’s roster dates back to 1872, and Toms’ export brand started life in 1884. The Group was formulated in 1924, with many of its component brands purchased shortly after the Second World War. Following the development of a foundation by the original owner, the company came under the control of its current owner in the 1970s. Nowadays, Toms has three production facilities: two in Denmark, and one in Sweden, with a small office located in North America.
Jesper Møller, CEO of the Group, explains the products and areas in which the company operates: “Toms has a broad portfolio of products, with around 1200 different units. In Denmark, our strongest market area, we have a wide variety of products, including chocolate, wine gums, liquorice, and other sweets. We are the leading supplier, so the main food retailers and major multiples are our largest customers. Sweden is our second largest market area, but we have a much smaller market share in this area in comparison to Denmark. The market share is around 26 per cent in Denmark, and around three per cent in Sweden. However, we are gradually expanding this figure in Sweden, especially through the sale of chocolates.
“The product portfolio is very wide, so we have no desire to add to this at this time, but we are definitely looking to export more of our existing products, with the focus on high quality chocolate under the Anthon Berg brand,” Jesper states. “In Denmark, we still sell a lot under the Toms brand, and we also have a range of what we call mouth refreshment products like chewing gum and small liquorice pastilles, under the brand name Ga-Jol. This name is really the abbreviation of our last brand in the line, called Galle & Jessen.”
To keep ahead of market demands, Toms spends a great deal of time and money in developing new products. Jesper outlines the approach: “We have an organised research and development team continually working on new products, and much of the focus is on high-end chocolate goods at this time. We are currently working on some very interesting projects, looking into the best way of enhancing the flavour through working with cocoa beans. We produce our own chocolate, which makes us unique, as not many other chocolate manufacturers do this anymore. We import the cocoa beans and process them locally. Quality is an important factor, but with natural raw materials like cocoa beans, you have to deal with brokers. Toms works very closely with a small number of select brokers.”
This hands-on relationship with suppliers has encouraged Toms to address the ethicality of its procedures, as Jesper describes: “We have introduced a number of labelled Fair Trade products, which is one way of assuring conscious production. We are also involved in Ghana, and we buy almost all our cocoa from Ghanaian sources. Toms has also become involved in some social products in this country, such as launching a project in September, where we are supporting the schooling of around 15,000 children in Ghana. Partners train the teachers and upgrade school materials, as well as providing a number of other supportive services. This is a recent development, but like many other producers within this industry, we are members of the World Cocoa Foundation (WCF), which is supporting projects in West Africa, like Ghana and the Ivory Coast.
“Moving in this way is not something we have to do, but consumers in the Nordic markets that we cater for are conscious of these issues, and like seeing companies do something to address them,” Jesper points out. “It gives us a good feeling in the sense that it promotes direct contact, and myself and members of the management team have been down to Ghana to see the effects first hand. Buying raw materials from this area, it feels right to take an interest and try to understand the issues. It’s not enough to rely on desk research and what other people are telling you.”
Ethically farmed cocoa will be used in a new range of products, as Jesper explains: “The total confectionary market is not expanding at this moment, but high-end chocolate products are developing rapidly. There was one international product launch under the Anthon Berg brand recently, which is called ‘Chocolate Therapy’, as part of the wellness trend within the market. We have introduced three different products, all of which have 72 per cent cocoa content, as well as natural ingredients to give different flavours. All of these ingredients are supposed to aid and encourage a person’s well being and body. One is called ‘Focus’, and aims at sharpening the mind; another is called ‘Wellness’, and the last one is named ‘Drive’. These products were launched in autumn 2007, and have been well received by consumers.”
Encouraging wellness for its consumers is one way of meeting the political challenges faced by the food industry at this time, as Jesper states: “Press from the UK and Canada indicates that there is a large political interest into the issue of obesity. Our industry is seen as one of the major contributors, and of course I would argue that point to some extent, as there are many other factors like lack of exercise or generally poor diet patterns. More consumers will be reluctant to indulge in large quantities of chocolate bars going forward, but there will always be room at the most sophisticated end of the market, as well as gift giving. There have also been many scientific reports about the healthy aspects of chocolate, most notably the high levels of anti-oxidants.”
In regards to future progress, Jesper is very positive: “We plan to invest further, after developing production equipment this year. Part of this is to rationalise the production process, and the other area is to expand our product range, of which we have many ideas in the pipeline. Being in a high wage environment means we need to invest in rationalisation and high quality innovation. We certainly hope to see growth in turnover, but we are always concerned with increasing profitability in parallel. We made a plan last year to increase the business roughly by 50 per cent by 2012, and this is something we are well on track to achieve,” he concludes.