How the largest Ukrainian petfood company works amid devastation in its homeland
Kormotech’s turnover in 2021 reached $ 110 million (an increase of 35% by 2020). The company achieved this figure by selling products in 37 countries around the world. The volume of the cat and dog food market in Ukraine amounted to 120,000 tons and was considered one of the fastest-growing in the world.
Since the beginning of the full-scale Russian invasion, sales in some parts of Ukraine have fallen significantly, but there is a big support.
“Demand for Ukrainian products has grown. Supermarket and pet shop chains have expressed a desire to expand the shelves of products made in Ukraine and ban Russian origin. At the same time, foreign partners confirmed their readiness to order a wide range. Moreover, some even offered to work on prepayment. Partners from the Baltic States and the United States are especially loyal. The export team applied for 5 tenders in Europe.” - said Rostyslav Vovk.
The only market Kormotech has left is Belarus. At all other destinations company`s brands (Optimeal and Club 4 Paws) as well as products under private labels are available. To meet the needs, not only the Ukrainian but also the Lithuanian Kormotech factory is working at full capacity. Production of products on the European sites of partners is also expanding. In 2021, the volume of the so-called outsourced product in sales was no more than 15%. In 2022, it is planned to expand to provide for external and internal contracts. The R&D team's nutrition team is working on developing new recipes, and the supply department is working on finding alternative suppliers and ingredients.
At the end of March, a new line of super-premium product Optimeal Beauty and a social initiative were presented at the American Global Pet Expo in Orlando. At the end of April, Kormotech became one of the sponsors of the Global Pets Forum in Amsterdam. This is a leading event for pet care companies from around the world. At the company stand, the Optimeal Beauty line of premium food and CLUB 4 PAWS Selection premium products were presented. Kormotech also continued highlighting the needs of four-legged victims of the war with its initiative Save Pets of Ukraine. The team received many words of support. Ahead - the largest European exhibition InterZoo will take place in late May in Nuremberg, Germany. We are preparing. Optimeal and CLUB 4 PAWS brands are keys to conquering the pet food market in the world. And the social initiative is a tool to talk about the war in their field and to involve the world community in aid.
Kormotech has also joined the Ukrainian Pet Alliance with other pet exporting companies. The project is funded by the United States Agency for International Development (USAID). The launch was planned for April, but in March, the association was presented at the American exhibition Global Pet Expo. The main goal is to support Ukrainian brands in the global arena. Among the participants are the animal registration platform Animal ID, ammunition manufacturer Collar, Harley, and Cho accessories, etc. Kormotech has a mentoring role as one of the successful exporters.
This is the fourth crisis from which the family-owned company plans to emerge stronger. The key success factors are the ability to regroup quickly, a global approach to doing business (high-quality standards and presence in several markets), and a "long game" with partners and employees. Currently, the whole team receives salaries (although some are currently out of work), and taxes are paid.
In 2022, they planned to expand their own production in Ukraine and Lithuania (with a 91 million euros investment for three years). These enlargements are planned for 2023. Also this year Kormotech registered TM in the Chinese market and plans to develop there. Development in export markets largely determines a company’s strategy.
About the company:
Kormotech LLC. is a family-owned Ukrainian manufacturer of cat and dog food. The company's facilities include two dry and wet pet food plants in the Lviv region, Ukraine and one plant in Kėdainiai, Lithuania.
Petfood Industry ranks Kormotech among the top 70 pet industry manufacturers in the world. We successfully export our brands Optimeal, CLUB 4 PAWS, Gav, Meow, and our private label partners to 37 countries including the United States, the United Kingdom, Germany, France, Finland, Sweden, the Netherlands, Spain, Italy, Poland, Turkey and Chile, etc.
Kormotech has plants not only in Ukraine but also in Lithuania with a capacity of over 80,000 tons and two European distribution centers with unified delivery. Kormotech's range included 650 items under its own brands and private label brands in peacetime.