Poland has a private label share of 25%, while Germany, Italy, and France are at a level close to 40%, so I assume that Poland will also move in this direction.
If we look at how rapidly sales are growing in discount chains in Poland, which already have a very strong position, we can expect that the situation here will soon resemble that of the German market.
Generally, the growth in food sales in Poland is driven by the largest discount chains such as Biedronka, Dino, and Lidl. Aldi, Kaufland, and Netto are also expanding strongly in our market. All these chains are heavily developing their private labels. Other players such as Auchan and Carrefour are also focusing on developing their private labels.
We are seeing a general trend where chains are far more interested in developing their own brands than in growing branded product sales.
This is certainly due to several factors. A private label belongs to the chain, which has full control over product development, pricing, promotion, and the impact on the chain’s own brand perception. It is easier to manage your own product than to negotiate all promotional and commercial details with a manufacturer.
As a manufacturer of ready-made meals and pasta, we see this impact on our business, which is why we decided that this direction of development is best for us. We have specialized in supplying the desired products through our retail partners. We are one of the leaders in private label in Poland and also have partners in foreign markets.
It used to be a given that brands created new products and that a well-known brand influenced the consumer. Now, of course, this is still a strong trend, but retail chains’ private labels are increasingly setting market trends. Until recently, the situation was such that if a branded product sold well, the chain would request that a private label version of the same product be created for them. Sometimes the brand-name manufacturer would refuse, believing its brand was too valuable to produce the same product under the retailer’s name. Today, it is very often the retailer that initiates collaboration with the manufacturer on new market offerings.
There are benefits to this approach, as the product does not require as much involvement from marketing and sales teams; however, on the other hand, it reduces the manufacturer’s independence, as they become part of the supply chain and are exposed to significant cost pressure.
From an export perspective, collaboration with partners takes place within the context of private label. I don’t think we can create a globally recognized brand in Poland. It requires a lot of effort and enormous costs. If a company wants to expand into international markets, it must be flexible and simply know how to collaborate with retail chains in creating private labels.
PLMA is exactly the place where you can meet potential clients and find the right partners to establish cooperation.
In many food products, such as pasta, customers are paying less and less attention to the brand, but rather to the price and quality of the product. We see this trend, and for many consumers, the brand of such a product doesn’t matter. What counts is price and quality.
Looking at this market as a manufacturer, we see many challenges, but also opportunities for growth. You definitely need to be an extremely flexible company. You need to work in an agile system. The expectations of retail chains are always a huge challenge. Not only do you have to create a high-quality product at a good price, but you also often have to fit into a tight project timeline.
The current quality expectations of the largest players in the market are very demanding, and not every manufacturer is able to meet them. I can say that well-organized companies are capable of collaborating with the largest retail chains.
As Makarony Polskie, a manufacturer of a wide range of pasta and ready-to-eat meals, we made a conscious decision to pursue this direction. Despite the challenges we face, we see significant growth potential. We are able to reach a wide audience with our products and create new market offerings together with our partners. We are also able to support our own brands in the process, because the essence of cooperation with retail chains – beyond producing private labels for them – is the opportunity to place our own brands on store shelves through promotions such as in-store events or permanent listings.
So far, we have been very strong as a pasta producer in this segment, as our two largest customers account for 50% of our sales. On the one hand, this creates a certain dependency, but on the other, it offers the potential for high-volume sales, as only large retail chains provide such opportunities.
As a company, we have three pasta factories and one ready-made meal factory, so to achieve our goals, we must collaborate with retail chains, which generally prefer to sell basic products under their own brands.
As I noted at the outset, the share of private labels in sales in Poland is not yet as large as in other European countries, so we face many challenges and opportunities for growth. I assume that the growth of this segment will be dynamic and that we will soon reach the German level. Of course, we may be surprised by some legal regulation that limits the growth of this segment. There have already been voices suggesting that private labels are already too strong, which allows them to put pressure on manufacturers and influence cost policies. It seems that in Poland we are not yet at the same stage of private label development as in Western European countries, so I assume this growth will be dynamic and the share of total sales will increase.
In summary, there are many challenges, but the prospects for growth are also very strong. We are particularly focused on developing the ready-to-eat category, and we can achieve this through close cooperation with retail chains and by jointly developing private labels. The situation is similar in exports, where we can practically only achieve a sharp increase in sales by collaborating with partners on private labels.
Marcin Zieliński
Sales and Business Development Director
Makarony Polskie S.A.
If we look at how rapidly sales are growing in discount chains in Poland, which already have a very strong position, we can expect that the situation here will soon resemble that of the German market.
Generally, the growth in food sales in Poland is driven by the largest discount chains such as Biedronka, Dino, and Lidl. Aldi, Kaufland, and Netto are also expanding strongly in our market. All these chains are heavily developing their private labels. Other players such as Auchan and Carrefour are also focusing on developing their private labels.
We are seeing a general trend where chains are far more interested in developing their own brands than in growing branded product sales.
This is certainly due to several factors. A private label belongs to the chain, which has full control over product development, pricing, promotion, and the impact on the chain’s own brand perception. It is easier to manage your own product than to negotiate all promotional and commercial details with a manufacturer.
As a manufacturer of ready-made meals and pasta, we see this impact on our business, which is why we decided that this direction of development is best for us. We have specialized in supplying the desired products through our retail partners. We are one of the leaders in private label in Poland and also have partners in foreign markets.
It used to be a given that brands created new products and that a well-known brand influenced the consumer. Now, of course, this is still a strong trend, but retail chains’ private labels are increasingly setting market trends. Until recently, the situation was such that if a branded product sold well, the chain would request that a private label version of the same product be created for them. Sometimes the brand-name manufacturer would refuse, believing its brand was too valuable to produce the same product under the retailer’s name. Today, it is very often the retailer that initiates collaboration with the manufacturer on new market offerings.
There are benefits to this approach, as the product does not require as much involvement from marketing and sales teams; however, on the other hand, it reduces the manufacturer’s independence, as they become part of the supply chain and are exposed to significant cost pressure.
From an export perspective, collaboration with partners takes place within the context of private label. I don’t think we can create a globally recognized brand in Poland. It requires a lot of effort and enormous costs. If a company wants to expand into international markets, it must be flexible and simply know how to collaborate with retail chains in creating private labels.
PLMA is exactly the place where you can meet potential clients and find the right partners to establish cooperation.
In many food products, such as pasta, customers are paying less and less attention to the brand, but rather to the price and quality of the product. We see this trend, and for many consumers, the brand of such a product doesn’t matter. What counts is price and quality.
Looking at this market as a manufacturer, we see many challenges, but also opportunities for growth. You definitely need to be an extremely flexible company. You need to work in an agile system. The expectations of retail chains are always a huge challenge. Not only do you have to create a high-quality product at a good price, but you also often have to fit into a tight project timeline.
The current quality expectations of the largest players in the market are very demanding, and not every manufacturer is able to meet them. I can say that well-organized companies are capable of collaborating with the largest retail chains.
As Makarony Polskie, a manufacturer of a wide range of pasta and ready-to-eat meals, we made a conscious decision to pursue this direction. Despite the challenges we face, we see significant growth potential. We are able to reach a wide audience with our products and create new market offerings together with our partners. We are also able to support our own brands in the process, because the essence of cooperation with retail chains – beyond producing private labels for them – is the opportunity to place our own brands on store shelves through promotions such as in-store events or permanent listings.
So far, we have been very strong as a pasta producer in this segment, as our two largest customers account for 50% of our sales. On the one hand, this creates a certain dependency, but on the other, it offers the potential for high-volume sales, as only large retail chains provide such opportunities.
As a company, we have three pasta factories and one ready-made meal factory, so to achieve our goals, we must collaborate with retail chains, which generally prefer to sell basic products under their own brands.
As I noted at the outset, the share of private labels in sales in Poland is not yet as large as in other European countries, so we face many challenges and opportunities for growth. I assume that the growth of this segment will be dynamic and that we will soon reach the German level. Of course, we may be surprised by some legal regulation that limits the growth of this segment. There have already been voices suggesting that private labels are already too strong, which allows them to put pressure on manufacturers and influence cost policies. It seems that in Poland we are not yet at the same stage of private label development as in Western European countries, so I assume this growth will be dynamic and the share of total sales will increase.
In summary, there are many challenges, but the prospects for growth are also very strong. We are particularly focused on developing the ready-to-eat category, and we can achieve this through close cooperation with retail chains and by jointly developing private labels. The situation is similar in exports, where we can practically only achieve a sharp increase in sales by collaborating with partners on private labels.
Marcin Zieliński
Sales and Business Development Director
Makarony Polskie S.A.
