Developing markets bring new gains for flavour firms

- Last updated on GMT

Related tags: Middle east, Flavor

Reflecting the benefits for ingredients and additive players that
look east to unsaturated markets to boost the bottom line, Aromco,
a small flavour house in the UK, sees a 77 per cent growth in
earnings over the past three years.

During this period, the Hertfordshire-based firm, just awarded with the Queen's Award for Enterprise: International Trade 2005, drove into eight new markets including China, India, Iran and Australia, while developing existing markets, that include Russia and Saudi Arabia. Faced with sluggish growth in the competitive markets of western Europe, the best prospects for flavours are to be found in eastern Europe, the Middle East and Africa, say market analysts IAL Consultants. They estimate the global market for flavours and fragrances hit $11.6 billion (€8.6bn) in 2003, working in the $1.4 trillion global packaged food business. Particularly strong on liquid sweet fruit flavourings, Aromco's marketing manager Antony Gore says 80 per cent of the firm's business is overseas. "We offer strong quality assurance combined with a good service," he explains to Big flavour houses, such as Switzerland's Givaudan or the US' IFF, tend to work with the global brands, leaving space for smaller operations to target the tier below. The UK firm has formed a string of partnerships across the world to gain access into local markets. Some of the firms may already have an ingredients portfolio, but take on board our flavours to expand their offerings, says Gore. Prices have to be competitive to fit into the market. As with all flavour houses, large or small, the company must develop the flavours in line with the price constraints linked to raw material prices. Currently, the firm brings the raw material into the UK to transform into nature, nature-identical or artificial flavours sold on to range of clients, including ingredients players and finished food firms.

Related topics: Market Trends

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