Strategy
Duni is the best known brand in the industry, with a unique sales model which creates strong customer loyalty.
Market leader and a leading brand
Duni estimates the market share in Europe for the main products, napkins and table covers, to more than 20%. The Group’s position has been strengthened in recent years and is particularly strong in the Nordic region and Central Europe. There are few large companies on the market and Duni’s sales are more than twice those of the nearest competitor in the napkins and single-use table cover segments. In contrast to its major competitors, Duni enjoys a unique position within the premium products segment, where prices and margins are higher. Duni is by far the best known brand on the market and the brand is particularly strong among Duni’s most important customers, namely restaurants and hotels. The breadth and variation in the product range also distinguish Duni from its competitors.
Unique sales model
Duni has the largest sales force on the market. The model facilitates a continuous dialogue with customers concerning the selection and use of Duni’s products. It creates strong customer loyalty and is an important reason for Duni’s high market penetration. The close relationship with customers is one of the reasons why Duni quickly receives signals and can adapt its range to new trends and changes in demand. Duni’s high market share and broad range, combined with the strong brand, also contribute to Duni’s ability to maintain high margins.
Leader in product development, design and materials
Duni’s development of the colors, designs and qualities in its product range is an important component of the business model. Duni’s product range is regularly evaluated based on sales, profitability, and inventory turnover rate criteria. New and existing products are evaluated using the same criteria. In recent years, Duni has placed great importance on developing product concept work within the Company. A product concept development process has been implemented in which employees, customers and suppliers co-operate in order to create and evaluate product concepts. This increases the likelihood that they will be successful and that resources are focused on those products with the greatest potential on the market.
Duni’s design department constantly monitors trends by attending various trade fairs and shows on fashion, design and current trends in Europe and the United States, as well as with the assistance of external trend scouts. Market surveys and focus groups also provide information about trends and feedback regarding products. Duni’s sales force participates in the development work by passing on customers’ wishes and views. The graphic design is carried out largely by Duni’s own design department.
High renewal rate in the product range
Duni endeavors to have the highest product range renewal rate on the market. Approximately 25% of the collection is renewed every year. Examples of current product launches include the Elegance Lily napkin, the Amuse-bouche concept for appetizers, Dunilin® with a touch of brilliance, and a carton meal packaging solution in the Duni ecoecho™ range, for which a patent application has been filed. Over the years, Duni has also developed several unique tissue and airlaid materials for table top products. Materials development within the table top products category takes place in close co-operation between the marketing department, product developers and production managers.
Control over value chain and logistics
Duni is an integrated company, i.e. apart from raw materials, the Company controls the entire value chain for its most important products, napkins and table covers. Other products are purchased from external suppliers. Control of the value chain reduces price risks, increases on-time deliveries and provides possibilities to plan for renewal of design and materials. Approximately 70% of Duni’s products are paper-based, and these products are generally produced within the Group. The manufacture of tissue and airlaid takes place in Sweden, while converting to finished table top products takes place in Germany and Poland. Duni’s paper mills are specialized in the production and deep dyeing of short runs of high-quality tissue and airlaid, and consequently table top products can be offered in many colors and shades, with color matching between different materials.
Specialization in short runs means that Duni can quickly adapt the collections to the customers’ wishes. The majority of Duni’s production is made for stock. Duni’s central warehouses in Germany and a number of distribution centers handle distribution to customers.
Expansion on growth markets
Duni is established on a number of markets which offer good opportunities for organic growth. In Southern and Eastern Europe, Duni’s most profitable segment — premium products — accounts for approximately only one third of the total market, as compared with Northern Europe where the premium products account for approximately two thirds of sales. Southern Europe is the largest market region and growth in premium products is expected to outstrip the market in general. Premium products are also to be the fastest growing products in Eastern Europe. Total market growth is expected to exceed GDP growth.
Premium products constitute a growth market, particularly due to the trend whereby table linen is being replaced by single-use high quality products. Duni is driving this trend by continuing to invest in product development and thereby increasing the quality of core products such as napkins, placemats and table covers. Customers appreciate the design, variation and table setting simplicity offered by Duni’s products, which leads many of them to replace linen with Duni's products.
The geographic expansion is taking place primarily in Eastern Europe and the Middle East. In 2010, among other things Duni opened a sales office in Moscow, and intensive work is taking place to develop a sales and distribution network.
The development of take-away packaging solutions is another growth area in which Duni is investing. An increasing number of restaurant chains with clear concepts are springing up in response to the fast food trend whereby consumers are demanding higher quality than previously. The trend has moved away from "fast food" to "good food fast". Duni is focusing on meeting this demand by - in close cooperation with expanding restaurant chains - producing customized, quality takeaway packaging which strengthens the customers’ brands. Thus, Duni offers not only packaging, but also strengthens the restaurants’ brands when their visitors take a bit of the restaurant home with them. During the year, Duni signed customized packaging agreements with, among others, Stureplangruppen’s Le Café chain in Sweden and the Wienerwald and MyIndigo chains in Germany and Austria respectively.
Acquisition opportunities
Duni is the only major European company focusing primarily on the table top concept market. Competitors consist of relatively small, local companies, as well as a number of larger paper and pulp companies. In addition, there are a number of players with similar concepts and product ranges which are focused on the HoReCa market. Accordingly, acquisition opportunities may arise.
Business mission
Duni shall enhance atmosphere and bring convenience to any eating and drinking occasion by providing inspiring and innovative products and concepts.
Vision
Duni shall be Europe’s leading supplier of premium table top concepts and packaging solutions for take-away.
Core values
Duni has four core values which permeate the entire Company and its operations:
- Ownership
- Open Mind
- Added Value
- Will to Win
For more information, see our core values and operating principles.
Strategy
Duni has a growth target of 5% over a business cycle. The strategic focus for growth in each business area is, in brief, as follows:
Professional
- Leader within the premium segment.
- Increased market shares in Southern and Eastern Europe as well as the UK.
- Take advantage of new trends on the HoReCa market, such as increased demand within take-away.
Retail
- Create increased profitability by focusing on the brand and, together with the grocery retail trade, optimizing the category from a customer and consumer perspective.
- Offer private labels as a profitable complement to Duni’s own brands.
Tissue
- Focus on new premium qualities, primarily for further development of table top products.
- Improved balance in the customer portfolio.
Growth strategies within HoReCa
During the year, Duni began to increase investments to promote organic growth aimed at achieving growth targets. Growth will increase by means of structured work involving several initiatives as regards concept expansion, market penetration and platform expansion within the core HoReCa area. The starting point is Duni’s strong product and concept offering combined with new geographic possibilities.
| Core geography | New geography | |
| New HoReCa- concepts | Concept expansion | |
| Table top | Market penetration | Platform expansion |
Within the area of concept expansion in core geography, Duni's offering will be adapted to the parts of the market that are growing fastest, e.g. fast food and concept restaurants. New business opportunities will be created by offering new concepts within areas such as customized takeaway solutions, meal packaging and serving solutions.
Increased market penetration in core geography constitutes another example. Within this area, leadership within product development is of great importance. As previously communicated, during the year Duni decided to invest SEK 65 m to further strengthen our position as the leader within the area of premium table top products. Increased market penetration can also take place by developing existing and new sales channels.
Growth can also be created through platform expansion in new geography. Potential within this area lies primarily in Eastern Europe and the Middle East. Duni is also increasing its efforts to accelerate organic growth in Southern Europe and the UK.
Duni is the pre-eminent brand in the industry.
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