Primola set to bank on coffee

Jihad Jabra, who owns, together with his brother Johnny Jabra, the biggest domestic business on the chocolate market, Supreme Group, says he will rely on coffee in terms of this year’s exports.

Coffee processing, the first business Jabra brothers developed in Romania in the early nineties, a business almost entirely sold to Kraft Foods in 2001, now brings them the opportunity of boosting revenues. While until 2001 Supreme owners banked on brands, this year export revenues will be generated by private label coffee products. “We’ve recently started coffee exports in the region, in four countries, among which the Czech Republic, Poland and Hungary, through a partnership with a large store network for the delivery of private label coffee. Now, half of the coffee we process at the Bucharest plant goes abroad,” says Jihad Jabra. In 2001, Supreme stopped operating on the coffee market with its own brands, but is still the processor of Nova Brasilia coffee for Kraft. In 2007, Supreme Imex, the coffee processor for Kraft, reported turnover worth 14.4m RON (4.3m euros). However, the biggest revenues are generated by chocolate sales. Jabra also says the partnership with the foreign retailer may bring opportunities to boost the production capacity of the Bucharest Supreme plant and to create new jobs, in the context where the group has frozen hiring in the current difficult context. Less than a year after dropping the coffee brands and after acquiring a chocolate plant in Bucharest, Supreme owners launched Primola chocolate on the market. In the past seven years, Primola has gained a market foothold, despite strong competition. Supreme estimates its 2007 chocolate market share at around 12-14%, with the three brands in the portfolio: Primola, Anidor and Novatini. In 2008, Supreme posted a 15% sales increase from 2007, below the 25% growth projection. For 2009, Jabra says it is almost impossible to make forecasts at this moment as he is waiting some trends on the domestic market to take shape first. “The biggest pressures are related to RON decline, the rising raw material prices and to consumption behaviour changes,” he explains. Even as the economic environment has been deteriorating and forecasts are ever more difficult to fulfil, Supreme owners are not planning any restructuring moves.