Business area Professional

Increased volumes

Business area Professional offers a wide range of tabletop products, primarily for use within restaurants, hotels and catering. The products are produced as concepts and consist of napkins, table covers and other products in matching colors and designs.

Around 90% of Duni products are sold through wholesalers and cash-and-carries. The number of end customers, comprising restaurants, hotels and catering firms, is estimated at around 200,000. Duni also offers packaging solutions for restaurants, the grocery retail trade, industrial kitchens, the public sector, and catering firms. Both customized and standardized meal packaging solutions are available in different models and sizes for different types of take-away food. Duni also supplies packaging machinery for sealing food boxes within the DuniForm® concept.

Development in 2010

Within Professional, net sales declined by 3.6% to SEK 2 783 (2 885) m. Operating income fell by 4.4%, to SEK 384 (402) m. This entailed an operating margin of 13.8% (13.9%).

During the second half of the year, Duni increased its prices to compensate for sharp increases in raw materials costs. During the year, volumes increased by approximately 3%, with growth being most noticeable during the second half of the year. All of Duni's customer groups recovered compared with 2009. Growth within the fast food and take-away segment continued to outstrip the market as a whole.

The market trend in Central Europe improved somewhat during 2010. The German HoReCa market, however, exhibited a slight decline for the year as a whole, despite the upward trend during the second half of the year. On most of the markets in Central Europe, including Germany, Duni showed a slight increase in sales. Duni's greatest sales successes were achieved on the UK market, thanks to a significant increase in market shares.

A recovery was noted on Duni's markets in Eastern Europe, and this accelerated towards the end of the year. Parallel with the improved economic climate, Duni began to grow again on most of the markets, especially in Russia. Despite the continued uncertain economic situation in Southern Europe, Duni experienced a favorable market trend. Solid growth figures can be noted, not least on the Italian market. However, Duni's growth on the Spanish market remained weak, which is clearly connected to the poor state of the economy in that country.

The trend on the Nordic market improved as a whole during the year, first and foremost in Norway and Sweden. Duni's growth was on par with the market, apart from in Denmark, which experienced weaker growth. Duni's market share within the premium segment increased gradually during the year.

Table top products accounted in total for almost 90% of net sales in the business area, and meal packaging solutions accounted for the remaining just over 10%. Central Europe accounted for SEK 1 660 (1 755) m of net sales, while the Nordic region accounted for SEK 645 (639) m, Southern and Eastern Europe for SEK 451 (467) m, and other markets for SEK 27 (24) m.

 

Events during 2010

In 2010, Duni opened a sales office in Moscow. The opening represents an important stage in the ongoing work to develop a sales and distribution network to ensure that Duni is able to take full advantage of the long-term potential of the Russian market. In the rest of Eastern Europe, work is continuing on expanding the sales network.

On the UK market, increased sales efforts bore fruit and the 2009 agreement with Booker, the UK's largest cash-and-carry chain, explains part of Duni's substantially increased market share.

Duni's sales on its largest market, Germany, rose during the year. With a strong product range and a large sales force, Duni is continuing to gain territory both against competing single-use solutions and against linen. Strong sales increases were achieved within premium products in particular, especially tête-à-tête, Duni Elegance^® and Duniletto^®, which have been introduced in recent years. As a result, Duni's position as the leading supplier of premium concepts has been further strengthened.

In the Middle East, Duni increased its presence on prioritized markets through agreements with local distributors, combined with the recruitment of its own sales force. Sales efforts in the region focused on high margin premium products.

In 2010, sales within packaging solutions for takeaway and fresh ready-prepared food, Duni Foodsolutions, continued to grow. This growth is being driven by changed consumption patterns on the market, which are continuing to benefit solutions for take-away food.

In addition, Duni attaches great importance to offering customized meal packaging solutions to concept-driven restaurant chains. These customized solutions also strengthen the brand of the chain. During the year, Duni signed customized packaging agreements with, among others, Stureplansgruppen's Le Café chain in Sweden and the Wienerwald and MyIndigo chains in Germany and Austria respectively.

Unique sales model

Within the Professional business area, Duni has developed a sales model which is unique in the industry and specifically adapted to the customer structure and the role Duni's products play for customers within the HoReCa segment.

The model is based on the Company having its own large sales organization, which devotes most of its time to presenting the product range to end users. Professional's sales force makes a substantial number of visits annually, with approximately half the visits taking place to customers at restaurants, hotels and catering firms.

The frequent visits build up a strong relationship, while a great deal of time is devoted to presenting new products, concepts and collections which create value for both customers and end customers. By continuously demonstrating new areas of use and ways of combining the products, they can be used in an optimum manner by each customer, which contributes to the customer's own profitability.

The customers place their orders with wholesalers, either directly at the wholesaler or through Duni's sales personnel. This constitutes the basis for a strong partnership with both wholesalers and end customers. Some 90% of sales take place in this way via wholesalers and cash-and-carry stores.

The visits to end users distinguish Duni from its competitors, whose sales are primarily focused on wholesalers and cash-and-carries.

Parallel with the sales work at end customers, visits also take place to wholesalers and cash-and-carries. Wholesalers are increasing in importance and currently account for some 50% of sales. Duni provides sales personnel at wholesalers with training in the sale of tabletop concepts and how Duni's products can be used to the best effect. The sales personnel thereby become knowledgeable and effective ambassadors for Duni's products. Together with wholesalers, visits are also made to major end users.

Within the cash-and-carry segment, customers are served centrally by key account management.

Push/pull-effect

The sales model involves customers being visited by both Duni and by the wholesaler or cash-and-carry, which creates a push/pull effect. The model was introduced in Germany in the 1980s and has spread to other markets, a factor which has strongly contributed to Duni's position.

The end customers are also registered in a database in which sales personnel can see the purchasing patterns and needs of different customers. This helps them to continuously provide suggestions for new solutions and products, and to conduct sales campaigns.

• This is Duni
• The Year in brief
• CEO statement
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  • Professional
  • Retail
  • Tissue
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• Corporate social responsibility
• Financial targets
• The Share

Professional is Duni's largest business area and accounts for approx. 70% of sales.