FrieslandCampina, The Netherlands, announced a comprehensive reorientation in the German market, moving commercial activities from Düsseldorf to the North Rhine-Westphalia (NRW) area and closing its Gütersloh plant. These efforts are projected to restore profitability within three years.

“The German market for dairy products is fragmented and characterized by fierce competition due to overcapacities,” says Jan Kruise, managing director of FrieslandCampina Germany. “We are convinced we will be able to master these challenges by focusing on our strong brands and through strictly consumer-oriented management of our product portfolio. We are the only company with a substantial presence in all dairy categories and channels, and we will benefit from this competitive advantage by proving ourselves a preferred partner in the market in accordance with our strategy. In order to achieve our ambitious goals, we will invest in our business, and we will not shy away from difficult decisions that will open up the path to a successful future for the long term. We are here to stay.”

Many member farmers are based in the NRW region, which is also home to the Tuffi brand. I

“By relocating and consolidating commercial functions to the Düsseldorf area, we expect FrieslandCampina to benefit from the strong talent base in the area and to drive the Germany strategy more effectively,” says Kruise.

The transfer is scheduled for the second quarter of 2018 and will impact 74 employees.

The closing of the Gütersloh site is a consequence of overcapacities and of years of loss production of private label desserts. This category will be discontinued, while other product lines will be transferred to the plants in Cologne, Heilbronn and Maasdam in the Netherlands. Gütersloh processes German milk.

The impact of the closing of the site on the available processing capacity of FrieslandCampina will be negligible. The planned closure of production in Gütersloh is scheduled for March 2019 and will affect 231 employees.

“This was a tough decision to make, but previous attempts to fix the problems have failed, and after careful consideration of alternative solutions, the continued loss-making situation, unfortunately, has left us no other choice,” says Kruise. “We will of course very shortly enter into consultation with the employee representatives, and we will do everything that is within our power to help the affected employees find new jobs elsewhere.”