The FINANCIAL -- In 2009 the leading food processing company Nikora plans to increase the assortment of products offered by the company. Recently Nikora switched on a self-service system in 14 brand shops. On average such a service increases sales in shop by 20%.

Nikora was named a Golden Brand for the third time. The expectations of the company’s management about sales and other financial data are divided.

“Realistic estimations will get us back close to figures of the year 2007 meanwhile sales are expected to decrease by 20%. According to our optimistic forecasts we expect to keep financial conditions fixed in 2008,” says Mako Jaoshvili, Head of the PR department of JSC Nikora.

JSC Nikora is the leading food processing company in Georgia producing over 400 products under seven brand names (meat products, packaged and fresh fish, half-fabricated products, dairy products, ice cream, soft beverages, pastry and wine).one of the daughter company Intrade imports and distributes several brands of beer, soft beverages and other FMCG products.

The company owns two meat production facilities in Tbilisi and Poti (Western Georgia), as well as a retail chain comprising more than 70 branded convenient style stores: at about 50 in Tbilisi and others in the regions. Apart from that, Nikora carries out distribution to over 2,000 third-party operated retail outlets countrywide.

The benefits of corporate responsibility are following:

• The enhanced image of the company and customers’ loyalty
• The growth in demand of Nikora’s products
• Attraction and retention of quality personnel
• Supply of products free of charge to socially disadvantaged groups

The company’s strategy covers future increase in the production capacity and strengthening of non meat business lines, along with further diversification of product portfolio and retail network expansion.

“Nikora has become a winner of the Golden Brand awards for the third time. The nomination of favourite brand increases our responsibility toward our customers. I’ll shortly discuss the most important milestones that our company achieved in the year 2008 that helped us to reach success. The first project was the re-branding of ‘Okeane’ and ‘Chveni Fermeri’, the enlarging of brand-names and moving self-service equipment in to our brand shops. Nikora started producing premium class sausages. The company bought a pastry factory and started producing wine.

Q. What share of the local Georgian market do you occupy and who is your largest competitor??

A. Nikora meat products occupy 35-40% of the local market. The remaining percents are divided between our competitors who started producing meat products during the last two-three years.  

Holding Nikora has no direct competitor on the local market. Nowadays, you can’t find the similar company presented on the Georgian market with such a wide range of products. Beside of fact, that we face competition from various producers and importers in each brand and type of product.

Q. How started Nikora its business and what were the main priorities since its establishment?

A. The company Nikora was established in 1999 with Georgian capital. The holding’s further development was made by retained profits and credit lines received by banks. The company has developed in an innovative way since its foundation.  Initially, all efforts were directed towards production.  Currently, the company is wholly customer oriented. The development of its overall strategy has taken into consideration local market demands and been based on market analysis broadening both production capacity and its trade distribution chain.



Q. Almost up to 70 special Nikora shops operate throughout Georgia. Starting from the year 2009 you were planning to switch to “self-service” style. What number of shops has already been converted and what are results?

A. As a result of re-branding the brand shops of Nikora are changing to self-service style step by step. The advantage of self service is increasing customer’s satisfaction and enlarging sales. In 2008, our customers have been already offered the mentioned service in 14 of our shops. Another 10 shops are to be switched on to such service. A prominent choice of numerous products makes it easier to select needed goods. Our qualified consultants are always ready to help the customers for making proper choice. After starting self service the amount of shop sales usually increases by 20%. 

Q. Currently Nikora produces Mzareuli, Okeane, Chveni Permeri, Shkhefi, Paloma, Tevani and Intrade brand products. What are you going to add to your product list in 2009? Give us the statistics or rating of the bestseller products by Nikora?

A. The holding of Nikora unites several business directions. According to sales the dominant one is Nikora meat-products. From last year we started to produce new sausages of premium class - Kaizer. All three types from this line gained a fair share of popularity.

The classical products still remain the sausages Iveria, boiled sausages and small sausages. Mzareuli produces more than 70 types of semi-finished products from national and European cuisine. Out of the mentioned semi-finished products the most popular are: Khinkali, Ojakhuri cutlets and pancakes.

During the period of Great Lent we also offer different types of Lenten dishes: pancakes made from rice and tarragon, cutlets from buckwheat, pancakes with cherry and many more. Nikora produces dairy products under the brand name “Chveni fermeri” (Our Farmer). Among them the most demanded products are the butter, ice-cream Paloma andsour cream. Recently demand has increased on fish products produced by brand name “Okeane” (Ocean). It offers a wide range of sea products. The wholesomeness of the fish products increases demand among Georgians. Our customers are fond of fish salads, as well as fresh fish and caviar, produced at our trout-breeding in Ozurgeti (West Georgia).      

Q. Don’t you plan to start producing fresh cheese (not processed cheese, which you already offer to your customers)?

A. In 2009 we do not plan to start producing cheese instead of it the assortment of already existing products under the Chveni Fermeri line will be increased.

Q. Under the trade mark Tevani Nikora produces wines. How many litres of all sorts of wine do you produce per year and what amount did you invest in this direction?

A. One of the most innovative projects of our company is starting the production of wine. Nikora’s made 1.5 million Gel investments in purchasing the vineyards. Napareuli Old Cellar, the subsidiary company of JSC Nikora, currently produces five sorts of wine. One of the most priorities of the company is to make the wine in pitchers by Kahketian technologies. The healthy wine Tevani is naturally filtrated.  Actually Tevani is not produced in huge amounts. This is a small sized business which has occupied its niche on the local wine market. The pitcher made wine Tevani is mostly used as the feast type one. It has its own loyal clients. Besides increasing the scales of production we plan to keep stability in terms of existing demands. 

Q. After the beginning of the economical crisis you stated that a vast majority of your customers have remained loyal to your products. How did you manage to keep your customers?

A. Nikora gained customers’ trust over ten years’ of hard work. The main reason for earning the loyalty of our customers is high qualitative products and a balance of high scaled production according to market demands.

Q. In 2008, the index of sales turnover of Nikora Holding was GEL 82.1 million. What are your expectations for 2009?

A. According to the results of 2008, annual turnover was increased by 27% in comparison with the results of 2007. Last August events and the world economical crisis influenced our business as well. But we did not slow down the speed of our development. For 2009 we don’t plan to make additional investments, but continue stable development of our industry with existing finances. Nikora also plans to widen its trade-distributing chain.  

Q. The recession has forced customers to reduce their expenses on quality food. What kind of prices are you now offering your customers to keep them loyal?

A. I can’t agree with you that the demand for quality food products has decreased. However, we do not expect decrease of sales in premium segment products. Our customers always care about quality and always choose trusted products. The wide range of choice has caused a diversification of demand for our goods.
The prices are fair according to the quality. To gain customers’ satisfaction, the quality of products on offer is permanently checked and monitored. The food tasting and periodical marketing inquiries are made as well. To keep and raise clients’ loyalty we keep quality of our products constant and that’s the basics to earn customer loyalty in a long run.

Q. What is your forecast for the current year?

A. Realistic estimations will get us back to the plural data of the year 2007 meanwhile sales are expected to decrease by about 20% if the situation in the whole country will stay unstable. Anyway, according to our optimistic forecasts we expect to keep the financial conditions fixed in 2008.


Written By Madona Gasanova