Nestlé intends to invest 8 billion UAH in its operations in Ukraine by 2025, particularly for promoting its products in retail chains. Additionally, 1.5 billion UAH is earmarked for upgrading its factories to enhance product quality.
This was announced by Alessandro Zanelli, the CEO of the company in Ukraine and Southeast Europe, at the "Global Outlook Enduring Change!" event organized by the European Business Association, as reported by Interfax-Ukraine.
"By 2025, the consumer goods category will continue to grow. However, in 2025, there will be significant pressure on margins. We cannot place all the burden on consumers, as inflation is already high in the country. We will need to work to create the right narrative for our business model," he stated.
Zanelli advised entrepreneurs to identify the driving forces of their businesses, understand what creates consumer capability, and focus on improving efficiency.
Discussing Nestlé in Ukraine, he pointed out that the company aims to expand its presence in Ukraine, planning to invest around 8 billion UAH in promoting consumer goods in retail chains. Additionally, approximately 1.5 billion UAH will be invested in enhancing the condition of the company's factories.
The CEO of Nestlé in Ukraine added that the company has been delaying the launch of a new factory in the Volyn region for six months due to ongoing air threats, a shortage of builders, and workforce, but plans to implement its launch in March 2025.
Considering the energy supply issues, Zanelli warned of a potential electricity shortage in the summer, which will force consumers to adjust their purchasing behaviors, particularly resulting in significantly smaller purchasing batches. Businesses should take this into account.
Zanelli noted that currently, about 50-55% of purchasing operations in Ukraine occur at promotional prices due to inflation. As a result, many retail chains are encouraging manufacturers to conduct more advertising campaigns to generate foot traffic. For this reason, Nestlé in Ukraine has budgeted for these expenses in 2025.
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Reminder:
In 2023, the National Agency for Prevention of Corruption (NAPC) included the Swiss corporation Nestlé on the list of international sponsors of the war due to its continued operations in Russia, supplying goods, and expanding its production base in the country.
Nestlé is one of the world's largest food and beverage companies, operating in 187 countries, offering a wide range of products and services for families and pets. It boasts over 2000 brands.