News | June 2, 1999

New Zealand Dairy Marketing Re-Org for Ingredients, Foodservice

The New Zealand Dairy Board said today that it would reorganize its marketing strategy into two global business units, according to a report from Reuters.

One unit, New Zealand Milk, would handle the board's NZ$3 billion a year consumer and foodservice business while the other, NZMP, would focus on the board's NZ$5 billion a year ingredients business.

Previously the board—which controls New Zealand's dairy export trade—structured its marketing through regional offices which each handled the full range of available products. The board's goal was to be the world leader in the marketing of dairy products, said CEO Warren Larsen.

"The Dairy Board is New Zealand's first truly multi-national food marketing company with 31% of the accessible international market for dairy products," he said in a statement.

"We export to over 100 countries and the branding of our two core business streams will sharpen our business focus and allow us to capture an even larger share of the available market." Larsen said adopting a global strategy for each of its products would allow it to quickly roll-out successful ideas and products around the world.

Dairy is New Zealand's single largest export industry worth just under NZ$4 billion a year, or 18% of total exports. Its major competitors are the large vertically integrated food companies Kraft (part of Philip Morris and Nestle AG). The board's brands include Anchor—which it says is the world's largest butter brand—Fernleaf and Chesdale.

While restructuring its marketing efforts abroad, the New Zealand dairy industry is also undergoing change at home, with proposals currently being considered to merge all production companies into one farmer-owned co-operative.