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Pieter van der Velden

The Brand That Hungarians Love More Than Facebook

D&T
October 4, 2019

The Netherland’s FrieslandCampina, one of the most prominent dairy companies in Hungary, is the producer of the nation’s favorite dairy dessert. The company manufactures a chocolate-covered sweet curd snack that has been a household name in Hungary since 1968. In addition to manufacturing operations, the company also operates a service center in the capital.

Ask any Hungarian if they would like a Pöttyös Túró Rudi and the answer will almost certainly be an enthusiastic ’Yes!’ The chocolate-covered sweet curd snack has been in circulation since 1968. The name comes from the Hungarian word 'rúd', meaning rod or bar but is also a nickname for the name Rudolf. Dutch dairy company FrieslandCampina is the owner of the Pöttyös brand, which initially produced this national favorite. “Pöttyös Túró Rudi is among the products with the highest penetration in Hungary and according to research by Milward Brown carried out in 2013 and 2015, Pöttyös is the most beloved Hungarian brand, ahead of Coca-Cola, Facebook or Milka,” says Péter Szautner, Managing Director at FrieslandCampina Hungária Zrt.

Unique ownership structure

FrieslandCampina, one of the world’s largest dairy cooperatives, is fully owned by the Zuivelcoöperatie FrieslandCampina cooperative, which has 18,261 member dairy farmers in the Netherlands, Germany and Belgium. All member dairy farmers are independent entrepreneurs. The company has branch offices in 34 countries, employs more than 23,000 people and its products find their way to more than 100 countries. “Being owned by the farmers who deliver the milk to us really defines the purpose of our company. The company is an extension of the farms of our members, for them it’s not about next month’s results, they are in it for the long term,” says Pieter van der Velden, Director of FrieslandCampina Service Center EMEA. The farmers occasionally visit Budapest in small groups to familiarize themselves with the company’s premises and work processes. “As one of our employees said last year: Here, I work for real owners with a purpose and people that I can talk to. This is very different from working for the second Ferrari of anonymous shareholders of a listed company.’ Our ownership structure makes us very unique,” Van der Velden notes.

Revenue jump

Despite dynamically growing wages and a pressing shortage of skilled labor, FrieslandCampina Hungária’s business performance is outstanding. “The sales turnover of the company has grown more than 30% over the last five years. Based on the dairy market and consumption trends, we forecast a similar organic growth rate for 2019 and the next years,” Szautner says, adding that high pressure on the Hungarian labor market is the biggest challenge for the company. FrieslandCampina has recently completed an investment at its factory in Mátészalka, as part of its 5-year investment plan, as it seeks to increase of the capacity of the factory by at least 30% by raising the level of automation and improving overall production efficiency. “These investments will result in increased capacity and improved capabilities also in terms of innovation, launch of new product categories, which is key to be able to further grow and develop the domestic market and the possible export markets, as well,” according to the director. FrieslandCampina’s portfolio includes close to 200 products, 90% of which are sold domestically, with some exports of finished goods sold in Romania and Slovakia. “In the coming years we would like to expand our export activities in the central European region, and we are also working on the roll-out of dairy snacks into other markets,” Szautner adds. The dairy sector is a highly competitive industry globally and fast-changing dietary trends keep the industry on its toes, pushing players to constantly innovate their product offering. “Our Milli lactose free krémtúró (sweetened curd cream) was the first available lactose free product in Hungary within the dairy dessert category. In the last three years, we launched a lactose free range of our market-leader spoonable dessert, the lactose free range of Landliebe yogurts and the lactose free Pöttyös Túró Rudi. Last year we introduced the Pöttyös 'Fitt' range with 30% reduced sugar content for consumers looking for a reduced sugar intake,” says the director.

COMMITTED TO HUNGARY

As proof of the company’s commitment to Hungary, FrieslandCampina opened a service center in the capital, the company’s third in addition to the ones in the Netherlands and Kuala Lumpur. The center covers the EMEA region and the U.S., offering finance processes such as general accounting, accounts receivable, accounts payable, and procurement activities, says Pieter van der Velden, Director at FrieslandCampina Service Center EMEA. “The concept was to start with the basics at first and prove to ourselves and our stakeholders that we can do this successfully, which we are proving every day. I expect we will move toward a global business services offering in the future, expanding our scope. These are infancy years, but we are growing up very quickly,” he notes. The headcount at the center is 230, made up of 16 nationalities, who cover 11 different languages. FrieslandCampina looked at several cities in Central and Eastern Europe before deciding on the location of the center and the main reason for choosing Budapest was the availability of talent, especially with respect to languages. “Looking back at the last two years, we have always been able to find the right kind of people in time even though we do feel that it’s a tight labor market. The fame of our products, like Túró Rudi as well as our unique company structure and culture were also a big help in the recruiting process.” The executive also notes that finding skilled employees can be a challenge for business centers as “everybody is fishing in the same pond and whenever a new center opens people are approached and some move to new jobs. On the flipside, however, as more and more centers open, the allure of Budapest is also on the rise and people from abroad start to take up employment here.”

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