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21 Jun2021

Premier FMCG, Investing in Innovation and Capex

21 Jun2021

Premier FMCG, Investing in Innovation and Capex

In a shrinking economy, Premier FMCG recognises the need to invest in its people, capabilities and brands to deliver growth. “Going beyond employee safety and community upliftment is essential to unlocking growth in our core business to find ways to meet consumer needs better,” says Siobhan O’ Sullivan, Group Strategy, Marketing & HPC Executive.

Premier FMCG has recently acquired Mister Sweet to unlock value through scale and enter adjacent segments in line with business objectives. Premier FMCG has also built a new Lil-Lets pads line in Durban and a Hard-Boiled Candy factory in Johannesburg East within the last year, resulting in cost benefits, employment and new skills development in both regions. These initiatives, together with the launch of Lil-Lets sanitary products and Dove cotton products with organic cotton materials, Pops and Candies innovation, and packaging updates on Lil-lets, Manhattan and Super C Sweets entrenches Premier FMCG’s growth objectives.

“In the future, we will continue to look at opportunities to build Premier FMCG’s portfolio to provide scale through M&A’s as well as invest in our brands and manufacturing capability,” says CEO Kobus Gertenbach.



In line with our growth strategy, Premier FMCG announces the acquisition of the Mister Sweet confectionery business, which is a division of Lodestone Brands. The purchase of well-known brands, including Mister Sweet, Candy Tops, Champion, Rascals, and Frutus, will expand our current Manhattan Sweets and Super C Sweets candy portfolio. This will enable Premier FMCG to enter adjacent categories and unlock value through scale, synergies, and efficiencies. The result will be increased participation in the sugar-based confectionery category with a revenue contribution of over R1 billion and a market share value increase from 7.7% to 13.8% on a 12-month basis.

Kobus Gertenbach, Chief Executive Officer: “The fit between the Mister Sweet and Premier FMCG portfolios will enable the combined entity to add value and grow the category in terms of innovation, brand leverage, and operational efficiencies.”

Going forward, Premier FMCG will operate centres of excellence at its two Sugar-Based Confection manufacturing sites in Gauteng, resulting in efficiencies by aligning production capabilities and seeking opportunities for expansion through our investment in capabilities, brands, and people.


Making a real difference in the lives of women, every day, is our purpose. In South Africa, where social barriers often inhibit open conversation about menstrual hygiene, technology can help educate and empower women whilst embracing their privacy.

Lil-Lets launched the #LilLets Talk Platform www.lil-letstalk.co.za which provides a safe environment where consumers can ask questions and receive answers from trained responders with shared experience, including a gynaecologist.

With topics ranging from first periods, myth busting to menopause has seen 360 thousand positive interactions since the launch last year. With every question asked, a pack of Lil-Lets sanitary pads is donated to those in need as part of the Lil-Lets Making a Difference initiative.



“Doing what’s right for our employees and communities while making sure we continue to operate and supply basic necessities like maize, bread and flour, has been one of the toughest challenges the industry has faced,” says, Tjaart Kruger, CEO of Premier FMCG.

“During this time, we have kept our focus on putting our employees’ wellbeing first. It has been good to know that our investment in Health & Safety, the ongoing review of SOP’s and training, has helped provide a safe working environment for our employees. We quickly realised that safety at work was not enough, which meant that we expanded our safety protocols to include our service providers, transportation and education within the communities where we do business and our employees live, so that each and every one of us could help each other to keep safe.

I would like to thank every one of our employees who come to work every day to keep the wheels of Premier turning. I am proud to say our employees have risen to the challenge, showing dedication, commitment, compassion, and empathy.

Thank you for living the Premier value of “Doing What Is Right”.

 
On the 27th March, South Africa went into level 5 lockdown. Premier, as an essential services business, reacted quickly and effectively with a program that focused on employee wellbeing and food security whilst continuing to run our operations. Stringent health and safety protocols are in place at all our sites, including shutting down plants every 7 days for a deep clean. We have learnt that employee education and awareness is an ongoing effort, both at work and at home, so that we do not become complacent as we move from Level 4 into Level 3. As a provider of maize, flour, bread, mageu and sanitary products, ongoing supply is critical and requires extensive collaboration within the business and throughout the value chain. Food Security will remain an industry priority. For Premier, we will continue to focus on the needs of the community and engage with key stakeholders to ensure access to essential goods.


“One week into lockdown and I am both humbled and proud of the fortitude and commitment every single employee has shown within Premier FMCG to keep operations, factories and distribution running to provide essential services to South Africans”, says Tjaart Kruger, CEO of Premier FMCG.

“Our people and our service partners have worked tirelessly over the past 7 days to ensure employee wellbeing is integrated into business continuity. Our operations are running, our people are able to get to work to deliver much-needed food and feminine hygiene products to our customers and consumers, on a daily basis, without interruption. Our president ‘called on all of us, one and all, to play our part.’ I am proud to be an employee of Premier FMCG where everyone, one and all, is playing their part.”

1st of April 2019 – a day when Zero-VAT came into effect on sanitary pads and pantyliners. Now one year later, we reflect on how this has impacted the feminine hygiene category and benefited women of South Africa.

Women in our country, like many others, face many challenges in gaining access to the right sanitary protection for them, such as education, accessibility or affordability. Through the removal of VAT on sanitary pads and pantyliners, the category has seen volume growth in the past year with more women gaining access to sanitary products for every day of their period. We believe this is only the beginning. Greater access increases school attendance and enables increased participation in the workforce and the economy in the future.

We think that providing women with sanitary protection that they can afford is only part of our responsibility. We strive to ensure women can choose the product that works for her, her lifestyle and her personal needs. Be it be a tampon, a pad, a pantyliner, a maternity pad or an intimate care product - Lil-Lets has the broadest range of feminine hygiene products designed to provide women with a choice.

Bread is one of the most highly penetrated categories and is consumed by 99% of households, playing a pervasive role in the lives of South Africans on a daily basis.

The versatility of bread allows it to be the perfect complement to any meal occasion. As we enter Real Bread Week, we would like to share Blue Ribbon’s journey from wheat to bread. At Blue Ribbon, each employee works hard to make magic happen every day. From morning to night, we combine only the finest ingredients. We mix, proof, roll, bake, pan, cool, slice, package and finally distribute that Mmmm Yum Taste for over 130 years to store every day.

As we enter 2020, Tjaart Kruger talks about being the best that we can be. “2019 was tough year for many South Africa. Global and local macroeconomic factors inhibited performance. The 2020 vision that many of us set in 2010 and 2015, sadly, was not realised. Despite not achieving our targets, Premier has grown from strength to strength since we implemented our strategic intent in 2012. A key part of this is continued investment and an unwavering focus on The Premier Way which is based on collaboration, shared learnings, innovation and efficiency, resulting in a high-performance culture.

As we head into the new decade, Premier is focussed on being the best that we can be. We will continue to do the basics well, focus on executional excellence while driving fewer, bigger innovation projects whilst maintaining our continuous improvement mindset. And despite a tough economic outlook, we will continue to maintain our quality standards, invest in our people and brands, and to ensure that our brands are front and centre to engage the shopper.

In 2020, Premier is focussed on doing what we do well, better than our competitors, and sticking to our strategy. Our facilities, people and brands remain our biggest assets.”
As we enter a new decade filled with possibilities, we constantly challenge ourselves to do things differently, to do better. Our Innovation strategy focuses on driving both topline and bottom line growth through relevant innovation and by increasing our efficiencies throughout the value chain.

Premier FMCG, believes that while new product launches like Lil-Lets Organic, Iwisa Mageu, Manhattan Lollipops and Blue Ribbon Mutli-seed and Oats Squares can improve topline growth, there are numerous innovation levers that can drive value. This includes a focus on sustainable business practice such as solar warehousing and bakery projects, a successful reverse water osmosis initiative in Mozambique as well as continued emphasis on green sustainable packaging solutions. With increased investment in #ThePremierWay since 2012, Premier has also embedded a Six Sigma approach to business efficiencies and continuous improvement which drives business health. For Premier, this is true innovation.

Marshmallows, speckles, sour worms, princess gums, chewy mints and more. The Tunney Sweet Factory churns out millions of sweets every year from Manhattan Marshmallows to Manhattan Chewy Mints to compressed Super C rolls and more.

Because there’s so much variety, different areas are allocated to each type of sweet so that the flavours say true and pure. Each area is run efficiently to maximise quality, reduce waste and optimise output. The logistics of running a factory where each type of sweet has its own area, its own process to produce the sweet and a unique curing period, rests on the shoulders of a senior engineering, supply chain and planning team that ensures that everything happens on time, with as little waste as possible. Of course, the people that really make it happen, are the teams on the floor that check each and every sweet to deliver the consistent quality candy flavours we all know and love.

As we enter a new season often associated with growth, Tjaart Kruger, CEO of Premier FMCG, provides inspiration on staying true to personal and organisational leadership values, as the economy continues to contract.

“Doing business in the global and local economy is becoming tougher. This calls on leaders to challenge their thinking, and more importantly, to step up and ensure that everyone in the organisation is doing the right things, quicker and more effectively. As pressure to perform and deliver profits increases, individuals become challenged, stress increases, and poor behaviour can creep into a business. Leaders need to watch out for business and individual stress and ensure that we stay true to our company culture and values. Our ability to ride the waves of change is all in our attitude. How we prepare ourselves and our teams, our ability to remain steady and focus on what we can control, will make us stronger as individuals and as an organisation.”
Snowflake is celebrating 135 years of flop-proof baking and cooking with around the country festivities that pay tribute to this momentous occasion!

Premier employees came together on one special day in 2019 to share their love and passion for this iconic brand that has been a household name for over a century. Registered in 1884, the Snowflake brand has chosen to inspire connections and community by spreading the joy of baking and cooking!

Join Snowflake and all Premier employees in celebrating its birthday this year. Spend time together in the simplest way with friends and loved ones, around the table, to strengthen family bonds and enjoy every moment together. Snowflake, too fresh to flop!
In any economic environment, strategy without action is not effective. Premier has identified executional excellence at a shopper and sales level as a key enabler to unlocking growth. While it’s easy to “talk the talk”, Premier places great emphasis on action versus strategy, as this is often the difference between success or failure.

The current retail environment in South Africa is tough. Consumers are cash strapped and shopping trips are less frequent. This means that winning at the point of purchase, can result in a positive customer experience which directly impacts revenue realisation.

Understanding the retailer’s and trader’s needs is a key enabler. Creating customised channel and customer plans that leverage an understanding of the customer’s profile whilst maximizing availability, visibility, awareness and making the products affordable to shoppers via format and promotional mechanics, can provide sales upside.

In the current retail environment, the ultimate growth drivers of executional excellence come down to two key elements - ‘availability’ and ‘stock pressure’. Making sure this consistently happens with precision in each and every store, can deliver revenue opportunity through the sales and operations value chain.
Have you ever thought about how fresh bread like Blue Ribbon gets delivered to your local store by 6am every morning? The logistics are incredible. Almost 1,000 trucks leave over 25 bakery & depot sites before 4am to deliver freshly baked bread to approximately 30,000 customers every day, 7 days a week. Imagine the infrastructure, processes and logistics that are behind making sure this happens 363 days a year. Now that’s real fast-moving consumer goods!
Swazi Mahewu celebrates six record months in a row with volumes increasing across the board. The launch of flanker brands, Iwisa Mageu and Super Sun Mageu, is expected to further drive volumes and strengthen the overall portfolio.

Based in Matsapha, Eswatini, the business is well placed to unlock growth in the SADC market through its portfolio of brands including Mandla Mahewu, Iwisa Mageu and Super Sun Mageu, as well as producing house brands for Spar and Shoprite. With a quality, shelf stable mageu branded with some of SA’s leading maize brands, one can only imagine the potential of Swazi Mahewu.
During tough economic times, it is sweating the small things that count. Shopper is where it is at. It’s the cold face within store where you can influence decision-making. Getting it right within this space is the difference between winning and losing.

Our Shopper Marketing Executive believes that you need to get the basics right first - availability, visibility, affordability, accessibility. “We have all the models to support this from trackers to price ladders to ensure pricing, distribution and all the key elements are in place. That’s the base tier, you need to get the bedrock right.” With the foundation in place, Premier has been able to build the Shopper pyramid by focusing on brand growth drivers and now on category growth drivers. “That’s the sweet spot, where everyone wins and the brand, as the driver of category growth, shows leadership and an innovation mindset”, says Premier Shopper Marketing Executive.