Zetar benefits from targeting market niches

By Karen Willmer

- Last updated on GMT

Related tags Private label Investment Marketing Factory

UK-based group Zetar has benefited from focusing on niche sectors
of the confectionery market, such as organic and nut-free, the
company said today.

The company said turnover for the year ended 30 April 2007 was up 64 per cent to £94.9m (€142m) compared to £57.9m (€82m) the previous financial year. "The decision to invest in our natural and premium snacks division, has proved sound as its products are well placed to meet the increasing consumer demand for healthier food and snacks,"​ Zetar's chief executive Ian Blackburn said today. Total operating profit was up 55 per cent to £7.6m compared to £4.9m in 2006, however the company has plans to invest in new factories across the UK as well as into the European market. Sales for the confectionery division were at £61.4m, compared to £57.1m the previous year, a division that has grown by almost 50 per cent over the last three years, Zetar claimed. "The growth has been achieved against the background of an evolving confectionery industry, for example to address the growing government and consumer concerns over increased levels of obesity,"​ Blackburn said. In October 2006 the company purchased Salamanda, which focuses on the premium confectionery sector by specialising in manufacturing coated nuts and fruits with yoghurt and Fair Trade chocolate. To aid the expansion of the business the company said it has bought a new 20,000sq foot factory in York in order to tripe current production capacity. Zetar expects this to be fully commissioned by the end of September 2007, and it is seeking organic accreditation for the factory. The company's Fakenham factory gained full organic accreditation this year, which it said is a further example of how it has "identified niches within the confectionery market which allow it to differentiate its products". ​ The company said investment throughout the year in the cocoa deli range had opened opportunities in British and export markets, as well as taking advantage of the increase in private label turnover. Other areas of investment include new food and beverage managers to anticipate new product launches within the private label and cocoa deli products as well as improving it's 'character' product brands during the coming year, Zetar said. The natural and premium snacks division now represents 35 per cent of Zetar's business compared to one per cent last year, the company said. Sales were £33.5m, compared to £0.8m in 2006. The division acquired Humdinger in July 2006 and Readifoods in March 2006, in order to expand its premium ready to eat dried fruit and nuts. "The consumption of these core products continues to grow, fuelled by a consumer focus on diet and natural foods and ingredients,"​ the company said. Humdinger also extended its core dried fruit business with the introduction of premium range of preservative free private label products this year. It has now commissioned a further factory in Hull to expand its private label range of fruit-sticks. Humdinger will also be launching a new range of organic biscuits as well as launching its first pan-European private label biscuit range, the company said. "We remain keen to add a European dimension to the group to take advantage of pan-European trading opportunities,"​ the company said. Readifoods expects an increase in 25 per cent of sales in the current year, following the 17 per cent year on year growth, due to a new contracts and further production lines to be installed this summer. The new product lines and factories will involve an investment of £3m during the current year, Zetar said. The company claim to be focussing on cost-saving initiatives as well as the development of new products in order to avoid the pressures of raw material costs.

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