Yamazaki Baking grows bakery sales - and ends Mondelēz partnership

By Vince Bamford

- Last updated on GMT

Japanese consumers remain cost-conscious, says Yamazaki. Photo: iStock - Starcevic
Japanese consumers remain cost-conscious, says Yamazaki. Photo: iStock - Starcevic

Related tags Nabisco

Japanese manufacturer Yamazaki Baking has increased its bread sales in the past year despite the impact of cost-conscious consumers and rising raw material prices.

Sales in the Tokyo-based business’s bread division rose 0.3% year on year in 2015 to ¥92,031m ($808.8m), up from ¥91,714m ($806m) in 2014.

The company said consumers were continuing to watch their spending, and added that revenue had been further squeezed by an increase in the price of imported raw materials due to the weaker yen.

Yamazaki said it had been active in improving quality and new product development in the past year as it looked to grow sales of its core product range. Marketing activity has included promoting the quality and taste of its Royal Bread brand.

Sweet bakery business

Growth was stronger in the company’s sweet bakery business, with sales rising 3.8% year on year to ¥351,708 ($3,090.2m). The business said it has expanded its pastry product range, and added that sales had been boosted by the expansion of its donut range into the convenience store market.

Overall sales of the Yamazaki Baking business, which also produces confectionery and rice products, rose 3.2% in 2015 to ¥1,027,199 ($9,020.4m), with operating income up 29.3% year on year to ¥27,001m ($237m).

The business has forecast 2.3% overall growth in 2016. It is expecting an improvement in performance of its bread division in 2016 – forecast to grow 1.2% year on year in 2016, with a slight slowdown in sweet bakery to 1.9% growth.

Chinese slowdown

Yamazaki said the Japanese economy was continuing to recover, although warned that the impact of the slowdown in the Chinese economy was a concern.

The company added that it expected bakery consumers to continue to be thrifty, but plans to further extend its product range as it looks to grow penetration of the Royal Bread brand and sister brands Super Mellow and Double Soft.

Yamazaki/Mondelēz joint venture ends

Ritz biscuits

Yamazaki Baking has ended its 46-year licensing agreement to produce Nabisco brands including Oreo for the Japanese market

Established as a joint venture in 1970, Yamazaki Nabisco sold Oreo, Ritz, Chips Ahoy and Premium branded products under license.

The deal is to end this August, with the division trading as Yamazaki Biscuit from September 1. Yamazaki said it will look to expand its own biscuits business.

Mondelez Japan will take over marketing of Oreo, Ritz and Premium from September.

It’s an exciting opportunity for us to bring an expanded brand portfolio to delight consumers in Japan with the return of the Nabisco snacks brand, Oreo cookies and Ritz and Premium crackers​,” said Mondelez Japan managing director Heizo Hotori. “I would like to express my sincere appreciation to Yamazaki Nabisco for its great contribution to the growth of these brands over 45 years​."

Founded in 1960, Mondelez Japan produces and sells gum and candy brands including Clorets, Recaldent, Stride, Xylicrystal and Halls.

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