Coca-Cola Femsa is planning to enter the dairy market in Brazil

The largest bottler of Coca-Cola in the world, the Mexican Femsa, plans to start selling dairy products in Brazil. The company studies acquire a dairy in the country, maybe in Minas Gerais. The intention is to market products with higher added value, like yogurt and dairy drinks. The Femsa group are already experiencing this market in Panama and Mexico. In the first, acquired the Blue Star brand and, in the second, in partnership with Coca-Cola, bought the Santa Clara. In such markets, the Femsa included in its portfolio yogurts, cheeses, UHT milk, ice cream and more.
"In Brazil, we are evaluating is to buy a dairy," said José Ramón Martínez, President of Coca-Cola Femsa Brazil, Valor Econômico newspaper. He attended the launch party of the company's factory in Itabirito, Minas Gerais. According to him, the preference is for a dairy that has production lines of yogurts, cheeses, ice creams. Enter the business of fresh milk is not the focus of the company. Martínez did not reveal if there are ongoing negotiations, but said Coca-Cola Femsa "is in permanent process of assessment" for the purchase of a dairy. "You can be Mine because it's a State prominently milkman. The logic would be this. But we're not necessarily restricting [the search] to Minas Gerais. But given the strength of the dairy in the State presence it would be logical to be a mining company ", said the Mexican Executive.
"What we're trying to do is increase our presence in the market of drinks. Where it would be possible to do this? Milk, dairy products, "said Martinez. Is a category that fits the product line whose image is more linked to health and well-being than soft drinks. In the United States, coke is now also testing consumer interest by a milky drink brand, recently launched: is a high nutritional content, milk with enhanced level of proteins, said John Santa María, CEO of Coca-Cola Femsa, during a quick mention of the topic in a news conference yesterday in Itabirito. According to him, the Coca-Cola enters this dairy market. The value, Martínez then added: "If eventually we find an opportunity to get involved in the dairy segment in Brazil, we have the experience to do this because we already operates a factory in Panama and Mexico". The Executive said that is not defined in the Brazil the option would be to launch a brand, or keep the name of a ' player ' that will be purchased. "It depends on. At the moment we don't have a definition of what will be the way. "
Asked if the company expected to close a deal in the dairy area later this year, Martínez made thriller, saying that there is still a lot. "But we're going to surprise you." Martinez has held since January 2013 the Presidency of Coca-Cola Femsa Brazil. In the "Coca-Cola", 29 years.
Factory $ $ 135 million
The new bottler of Femsa in Minas Gerais is the ninth of the company in Brazil. Investments in construction of the factory, which went from zero, were $ 135 million. In 2014, Coca-Cola Femsa had a revenue of R $ 8 billion this year, if all goes as expected direction, will register an increase of 5% to 7%, according to Martinez.
The decision of the enterprise was taken five years ago, at a time quite different from today. "I was starting the first year of the [President] Dilma [Rousseff]. The economic and political moment of Brazil was quite different, "said Martinez. "The Brazil began a recession in the second half of last year. But our policy on Coca-Cola Femsa is always looking at the medium and long terms. This year will be difficult and probably the next one will also be a difficult year, but the plan is for the next 20 or 25 years, "said the Mexican Executive. He tried to show optimism regarding the economic framework. "We are very sure the Brazil is coming back, and coming back stronger. The time to innovate is now. " And he added: "In time of crisis, the simplest would be not in moving targets. But, no. It is precisely the time to not stop investments, to restructure our cost structure and it is time to innovate. " The new plant will have capacity to produce 2.1 billion liters of soft drinks a year. For now, opera with half of its capacity.