DMK releases mission statement to 2030
The DMK Group reported a stable financial year in 2018, and Germany’s largest dairy company has released a Vision 2030 for the future. CEO Ingo Müller said sales in 2018 were €5.6 billion, versus 2017’s €5.8bn, almost at the previous year’s level, with the the results improving slightly to €30.6 million (2017: €29.6 million).
Müller said: “Dietary trends are changing – faster than expected. Issues such as sustainability in animal welfare and environmental protection, trends, regionality or convenience are buzz words these days when it comes to food. In order to speed up such developments in the future, Deutsche Milchkontor (DMK) is planning a long-term ‘Vision 2030’ for its six business segments. The restructuring of the company, which started in 2017, is to be continued.
“Time is a key factor in change. We know that the DMK has often strained the suffering of its farmers in the past. Nevertheless, we know that such a fundamental transformation as we are doing today does not happen overnight. In addition to the basic organisational measures of one of the largest German food manufacturers, the realignment is above all a massive change in the corporate culture. With both factors we have an ambitious plan, which we must also implement with due care in order to develop the full performance of the DMK. The first phase, which was also characterised by investment in the future, is almost complete. Now it’s about bringing in the effects in a targeted way.”
The changes to the company are in six areas, he said.
1. “Focusing on the consumer, thinking of his wishes and needs, that’s our top priority. Accordingly, we have formulated our new mission statement. In the future, we will deepen our understanding of the consumer even more and target individual generations. In every phase of life and to every need we already have an offer in our assortment for almost everyone. We will continue to expand this to our essential strength and work on it purposefully. Our new vision 2030 slogan is ‘The first choice, for a lifetime.’ This perfectly sums up for us what we plan to offer in the future with our product range.
2. “We are increasingly focusing our product range by withdrawing from selected business areas and defining clear roles for each business area. Where do we invest, where can we grow. Where do we have to design the business with clear measures in such a way that we can earn money even where there is no market growth per se? This leads to the motto, ‘Value creation before growth.’
3. “The DMK Group changes its positioning from being a pure volume player in the dairy industry to the supplier ‘for selected products of natural origin.’ In the process, milk will continue to be our number one raw material by far.
4. “In addition, we want to sharpen international activities, and here the organisational restructuring of recent years has not gone far enough. We see Europe as our home market and need to concentrate our expertise here in the right business units in the future. The brand in Europe takes place in the Brands business unit (BU), and the trademark on European soil is organised by the Private Label BU. With the new line-up, DMK can act as a competent partner here.
5. “Beyond the borders of Europe, the international BU now has the capacity to clearly structure the processing of non-European business. Outside Europe, we will set clear priorities. Regional bases in Russia, China or Nigeria with local teams are more effective for us than pure exports from Germany. A classic export makes sense in selected countries in which we also travel with appropriate volumes. We cannot buy any of this if we only count the number of export markets.
6. “Nutritional trends are changing – faster than expected. What about adjacent attractive beverage and food segments, which can be a future mainstay in addition to dairy products? What about plant-based alternatives? For a traditional company like the DMK, that must not be a no-go in the future. If you look at the global developments, you quickly realise two things. On the one hand, milk alone will no longer be enough to feed the growing population; on the other hand, consumers are already looking for alternatives for a variety of reasons. That would be negligent. We will take a targeted approach here – within the Brand BU, colleagues will look very closely at where and how we set up in this field in the coming months.”
In related news, Dr. Frank Claassen is the new chief financial officer at the DMK Group. He succeeds Volkmar Taucher, who will hand over his post as part of a planned succession 1 July 2019. He comes from Beiersdorf, where he most recently served as vice president Finance Europe.