The Review of the market of flour confectionery

The newspaper «Pishchevik / № 4, 2010
     1. What are the main changes or new tendencies in the market of flour products you observe during 2009?

     In my opinion, variety of flour confectionery kinds grows, their quality raises. Small and tiny manufacturers acquire more serious equipment and produce products of better quality, and also in bigger than earlier quantities: bun, biscuit cookies with stuffings and so on.

     2. What is volume of the market in natural and monetary equivalents, who are basic players of the market?
     3. How has changed import – export in the market?

     Talking about production of western manufacturers we should admit that import is almost absent, export has improved in connection with hryvna falling.


     4. What is situation with raw materials for flour confectionery manufacture this year? How did it reflect on results of your company activity in 2009?

     Situation with raw materials for manufacture of flour confectionery differs. If we talk about flour, everything is all right, situation is stable. If we talk about price for sugar it constantly differs. Both of these products are available. Jumps of price for sugar force to rise price for end-product.

     5. Have you reduced or increased manufacture and how was it performed?

     Manufacture increased at the expense of new kinds of production which correspond to modern market meaning for today the market is not ready to buy expensive products, therefore production was expended in cheaper price segment. We produce chewing marshmallow, it is on sale in a segment «average plus» and chocolate-wafer production, emphasis has been placed on the last one. During the year we have let out four novelties the cheap chocolate-wafer sweet sold «by weight» has appeared the most successful. 

     6. What is dynamics (increase/reduction) of your production sales in natural and monetary equivalents in comparison with previous years?

     It is stable. In comparison with previous years sales of our production have decreased in price segment «average plus» from one shop but due to we increases commodity markets (entering markets of Belorussia, Moldova, Azerbaijan, Kazakhstan etc.) sales have increased in general. In cheap price segment sales have grown at the expense of commodity market expansion and increase of demand at such production.
In general sales increased in natural and accordingly in monetary equivalent as profitability did not decrease on enterprise.

     7. What does structure of the cost price of manufacture of flour confectionery consist of and how do its components reflect on final price of goods?

     Structure of goods cost price are raw materials, energy resources, labor expenditures, transport expenses, taxation. Speaking about raw materials we can say the following: situation with flour is stable, price for sugar has grown, transport expenses have increased in connection with fuel prices rise and roads which have been of the same condition in spring 1945 in Ukraine. In general taxation remains the same, the only change is increasing of tax service pressure to fill up the budget.

     8. How did wholesale and retail final prices change for your production in 2008 and 2009? What changes will happen with prices in 2010?

     Wholesale and accordingly retail prices have grown at 5 % for our production in 2009 in comparison with 2008 . In 2010 as they say «everything is possible». It will be more profitable to reduce prices for output product for as as for manufacturers as it increases its competitiveness in the market, increases demand for a product. But unfortunately if prices for raw materials, energy resources etc will continue to grow in 2010 it will be impossible to avoid price rise.

     9. What does affect change of final price of flour confectionery most of all? Whether are there substantiations and necessity for raising of prices? Do you observe displacement of price segments? 

     For today I think, change of raw cost value, energy carriers and logistics affect the most of all. Rising of prices was proved by rising of prices for sugar. We observe displacement of price segments, it moves towards reduction in prices.

     10. How does the consumer of flour confectionery behave in 2009? How did has it change in comparison with 2008 or 2007 (before crisis)?

     Before crisis the consumer wanted to purchase a product in beautifully performed packing, something especial and exquisite, and after crisis the consumer began to behave as like as in «great 90th» – to buy what they have enough money on.

     11. How has directivity/activity of your company changed in view of changes of consumer preferences, financial and economic situation in the country this year?

     Activity of our company has changed in what we reconsidered our plans concerning a new project. Earlier we planned release of a new project in expensive price segment for the market of Ukraine. Change of the market during crisis has forced us to review the plans towards low price segment, it was necessary to conclude delivery contract for other equipment for other product. For getting the same profit it was necessary to be engaged more in export and to speed up work in the market of Russia, Belorussia and other countries where currency hasn’t fallen as like as it has happened in Ukraine.

     12. What are your forecasts in the Ukrainian market of flour confectionery for 2010? What are the plans of your company for development?

     At the end of 2010 we want to start a line of closely related for Ukrainian consumer production but while produced only in Japan, therefore the equipment will be expensive and the product will be cheap. We are assured that this project will be successful.