Fazer Bakery Baltics considers consolidating all production to Ogre in Latvia
Fazer aims to strengthen its positions in all its markets. As a part of its strategy, Fazer is considering consolidating both Baltic bakeries into one production unit in Ogre in Latvia. The investment, including a modern warehouse, new picking processes and renovated production would total EUR 18 million, a significant investment in the Baltic bakery market. Due to this change, Fazer initiates consultations that could lead to the reduction of a maximum of 185 employees in Kaunas.
Fazer Bakery Baltics is considering consolidating all production to one modern bakery in Ogre. Through this transformation Fazer would be able to strengthen its positions in the Baltic markets, ensure competitiveness, widen the product assortment into new categories and be able to further develop export sales. Having one common factory together with an expanded warehouse for frozen and ambient products, new picking processes and modernised production capabilities would also improve Fazer Bakery Baltics´ supply chain efficiency, crucial for all three Baltic markets. The investment would total EUR 18 million, a significant investment in the Baltic bakery market. Today Fazer has bakeries in Kaunas, Lithuania and in Ogre, Latvia.
“Today we have a strong number 2 position on the Lithuanian and Latvian markets and a number 3 position in Estonia and our aim is to strengthen our positions. With one modernised production unit, we will have the opportunity to expand our known brands and product assortments into new categories and to meet different consumer demands even better than before", explains Anne Mere, Managing Director, Bakery Baltics.
The consumption of packed bread products has decreased in the Baltics for several consecutive years and in the last year the bakery market has dropped in volume by 2%*. Consumers have become more price-conscious, and the market is increasingly campaign-driven which has led to price competition and lower margins.
The aim is to strengthen the positions in the Baltics
If the plans were to realise, the transformation of the production would be conducted during the coming autumn-winter period and would be completed by the beginning of 2025.
Fazer Bakery Baltics remains strongly committed to the Lithuanian market. The Lithuanian commercial unit with support functions would continue to operate locally. Partnerships and sales to Lithuanian customers would continue and the company will do its utmost to ensure a smooth transition. All customer deliveries would continue as usual through Lithuanian logistics partners.
Fazer initiates consultations and supports its personnel during the change
These possible changes would have an impact on the personnel. Therefore, Fazer initiates consultations with the work council. The changes would affect a maximum of 185 employees in Kaunas that could lead to the termination of employment. To run new operations in Ogre, Fazer would need to recruit up to 60 additional employees in Latvia.
“If these changes would realise, we would do our utmost to support our employees in Kaunas and help them find new jobs. Vacancies in other Fazer Group units would be offered with priority to those employees whose employment would possibly be terminated. We would collaborate with various partners and local Employment Service” Anne Mere concludes.
* AC Nielsen Jan2024 vs Jan2023 Baltic market volume share data
For further information please contact:
Joséphine Mickwitz, EVP, Communications & Sustainability, Fazer Group, josephine.mickwitz@fazer.com, tel. +358 400 784 889
The Fazer media phone line is open Monday–Friday from 8 am to 4 pm,
media@fazer.com, tel. +358 40 668 2998
Fazer Bakery Baltics
The third biggest bakery in the Baltic market with a strong second positions in Lithuania and in Latvia and third position in Estonian market. Fazer offer consumers a variety of bakery products, such as toasts, rye and wheat based loafs and specialty products as portion breads, burger buns, polar breads, bread snacks and cakes. We are a forerunner in value-added products and investing into our strong brands. Fazer Bakery Baltics is one of Fazer Group's three Bakery business units. In 2023, it employed approximately 600 people and net sales totalled EUR 54 million.
Fazer Group
Fazer, The Food Experience Company, enables people to enjoy the best moments of their day. Our mission, Food with a purpose, builds on our strong more than 130-year heritage, consumer first approach and innovations to create the sustainable food solutions of the future. With our dedicated team of approximately 5,000 professionals, we focus on fast-moving consumer goods and our direct-to-consumer business in Northern Europe, and beyond with exports to more than 40 countries. Fazer’s operations comply with its Code of Conduct that is based on the Group’s values and the UN Global Compact. In 2023, Fazer Group had net sales of 1,200 million euros. Northern Magic. Made Real.
