Popular brand and greater income increase ice cream sales
Valor Econômico
Antonio Benedito dos Santos was an interurban bus driver in Goiânia. In 1987, he asked to be fired, withdrew the cash from the Employee Severance Indemnity Fund and bought a small ice cream plant. But at a time where Kibon and Yopa (owned by Nestlé) were the only synonyms of ice cream in Brazil, Santos didn't even dream his company could go beyond the limits of the capital of Goiás. But in the 2000s, Creme Mel, as he named his small company, began growing, thanks to the improvement in the purchasing power of the population. He attracted so much attention that his former boss, Odilon Santos, owner of the bus company worked at, got interested in the business and entered into a partnership with the ex-driver. Today, the Creme Mel ice-cream is sold in ten States. The growth reflects a major change in the ice cream market in the country: the growth of the less expensive brands.
"Everyone likes ice cream, but not everyone could buy it", says Eduardo Weisberg, President of Brazilian Association of the Ice Cream Industry (Abis). "But the new brands that are appearing have helped make the product popular", he adds. Driven by those new brands, the per capita consumption of ice creams had an increase of 10.96% last year compared to 2009, going from 5.20 liters per person a year to 5.77 liters according to the Abis. The sales increased 12.26%, from 995 million liters to 1.117 billion liters.
The less expensive brands of ice cream cost up to 30% less than the traditional ones. "The class C with extra money wants to have an ice cream but they find it too expensive to pay R$ 15 (US$ 8.80) for a two-liter box. Ours costs between R$8.90 (US$ 5.20) and R$ 9.90 (US$ 5.80)", says Rodrigo Queiroz Novaes, marketing coordinator of Frutiquello, a manufacturer of Franco da Rocha, in the Metropolitan Region of São Paulo. The company sold 30% more in volume last year, and it produced 3 million popsicles and 1 million liters of ice cream a month. "Access to the product was made difficult because of the price. Now there are quality options and the consumer is taking advantage. He is developing the habit of having ice cream for dessert", says Novaes.
Creme Mel does not reveal its production. But Antonio dos Santos says buying of milk for the manufacture of ice cream went from 15 thousand daily liters in 2009 to 20 thousand in 2010. For this year, the expectation is to stay between 25 thousand and 28 thousand daily liters. "Nowadays, we have the same ease to import machinery as the multinationals do. That made the quality of the products to improve a lot", he says. But the small growing companies have their limitations: distribution. Since it has to be made in refrigerated trucks, it is more expensive. Selling to markets more than 400 kilometers away from the plant is already infeasible. For that reason, Frutiquello, for instance, focuses its sales in São Paulo, in interior and in the capital. "Most of the popular ice cream companies are regional companies, with minor exceptions, such as Creme Mel", says the President of the Abis. The Goiania-based manufacturer, according to Santos, has 60 refrigerated trucks and it has just acquired another five. "Our plans are to enter in Rio de Janeiro", says Santos.
Oggi Sorvetes, founded in São Paulo, moved to Rio de Janeiro and concentrated its distribution in the State and also in Espírito Santo. The region, according to Nielsen, was the one with the highest rise in consumption compared to the rest of the country, getting to 39.9%. The Northeast, for instance, grew 23.5% and the Metropolitan Region of São Paulo, 8.6%. For Oggi, the move worked out, according to Rodrigo Mauad, Director of the company. The company sold 58% more ice cream between 2009 and 2010.