The Russian market is regarded as one of high potential for the food industry, as earnings are going up and an emerging middle class has more to spend on novel goods. Income in Russia soared from an average of US$1185 per capita in 2001 to US$4803 per capita in 2007.
Indeed Symrise has been present in Russia for a number of years, and indicates that it has seen “disproportionately high growth” from there recently. Indeed the growth rate for Russia across all business units in 2007 was 7.5 per cent, against an average for emerging markets of 7 per cent.
The value of the flavour and fragrance’s firm’s latest investment has not been disclosed, but it terms of floor space it adds to 500 square metres to the set up in the Russian capital.
The development laboratories are geared towards Symrise’s sweet, savoury and beverage business units. The company will now be able to deal with all its customer enquiries on site; it can also accommodate them at its facilities, which can help speed up the time it takes to get the finished products to market.
According to the company, the Russian confectionery market is considered in the industry to be “one of the most important in the world”. Indeed Nestle has said it is aiming to accelerate growth in Central and Eastern Europe from 10 per cent to over 15 per cent, and last November announced the purchase of Ruzskaya Confectionery Factory - and with it the popular, premium Comilfo and Ruzanna brands.
Unilever has also been getting in on the action, acquiring Russian ice-cream brand Inmarko.
Consumer tastes differ wildly, and Russian preferences will be unfamiliar to many. There is said to be a rising swell of demand for more detailed information on what Russian consumers want to eat.
President of flavour and nutrition for EAME, Heiner Schaper, added that Russian consumers like trying new products. “Western European products are highly sought after here.”
As for Symrise, its sweet flavours unit will be focusing on sweets and chocolate.
Dairy is also seen as high potential in Russia; Symrise says it can now conduct on-site applications technology studies.
The focus of the savoury unit is on culinary products and snacks, while in beverages it is involved in alcoholic, non-alcoholic and instant drinks.