Arla Foods launches new subsidiary in Vietnam

First China, then Algeria. Now Arla Foods is moving into yet another growth market - Vietnam. In October, Arla Foods will launch milk powder products under the Milex® brand in the South East Asian country.

Vietnam, with its 84 million inhabitants, is probably Asia's fastest growing market right now with the major cities having seen significant growth over recent years. Sales of dairy products been particularly high.

"Many of our competítors are already active in the market. But in view of the enormous growth, we believe that Vietnam continues to offer great potential. In the first year, for instance, we expect to achieve sales of around USD 10.5 million," says Frede Juulsen, head of Arla Foods' milk powder business.

The new company, Arla Foods Vietnam, was approved by, and registered, with the Vietnamese authorities on May 21 and Arla Foods has also signed an agreement with a local distributor, Asian Dragon.
"There is no doubt that Vietnam has great potential for us. Sales of milk powder increased by around 30 pct. in the fourth quarter of last year and even if this level cannot be sustained, we expect to see a positive development for a long time," says Frede Juulsen.

Prior to the October launch, the new company, headed by Claus Pedersen, currently Marketing Manager for milk powder at Global Ingredients, will be established. Based in Ho Chi Minh City, Arla Foods Vietnam will employ a staff of approximately eight people. At the same time, Asian Dragon, Arla Foods' partner, will build an organisation of around 50 people dedicated to the partnership.

Facts

The initiative in Vietnam is part of the effort to expand the branded consumer business within the milk powder category. Arla Foods Vietnam will market milk powder products from Scandinavia under the Milex® brand. The range and the concept will be identical to that of neighbouring China. The target group will primarily be families with children.