BRF foresees cutting 20 to 30% in the next year's product portfolio

The food company BRF, which includes brands such as Perdigão, Sadia, and Batavo Qualy, predicts 20% reduce to 30% its product portfolio in units (SKUs) over the next year as a way to become more profitable portfolio and thus make room for best-selling products and new items on the shelves. The decrease in the portfolio starts in January and should be localized for the region.
Sergio Fonseca, Chief Executive Officer of the company, Brazil points out that there are several "countries" within Brazil. "What sells well in the Northeast don't necessarily sell well in the South. And what doesn't sell in a region can sell much in another "announced.
"We will not reduce anything meaningful in terms of sales, but we will eliminate significant negative performance in our portfolio and we will end up having revenue gains," he added, without detailing earnings.
Today, the BRF has approximately 4,000 units and 30 branches in the country and was launching a product into units every five days.
To the Vice President of Marketing and innovation of the BRF, Sylvia Leão, the growth is "unmanageable". "We need to work harder and make products less pitches." pointed out. In 2014, the BRF provides launch 150 units of products in Brazil, about one-third of what is released, on average, by the company.
One of the lines that must be diluted is the nuggets, which now has six products per unit, some flavors with less frequent and lower sales volume, "the goal is to manage the portfolio of active form," added Rodolfo Torello, Executive Director of global categories and innovation.
"We're being very pragmatic, doing the obvious, a sense of urgency," said Fonseca, noting that this process was already in the plans of the company, but that there was no such determination to execute it.
Fonseca points out that the company reached the mark in which 20% of portfolio corresponds to 80% of sales. "We will filter the low curve and improve our level of service to deliver more products more sought after by consumers."
Sylvia reported that this process of rationalization of portfolio will be continuous in the company. "Some products will be disabled in some locales, other will definitely the portfolio," he said. Portfolio rationalization should also reach units abroad in a second moment.
In the third quarter, the BRF presented financial results below expectations by analysts. The average of the projections of four houses (BofA Merrill Lynch, Citi Deutsche and Itaú BBA) pointed to a net profit of $ 354 million, 19% difference on the data obtained by the company, of $ 287 million