Ukrainian pet food firm enters South Korean market
Kormotech, a prominent Ukrainian pet food company, has kicked off sales on the South Korean market. Trade dynamics show that exports play an increasingly important role for the company, though the domestic market swiftly bounced back from the first shock.
As the company revealed in its statement, since June 17, Kormotech’s Optimeal and Club 4 Paws brands have been presented on 12 Korean specialised Internet sites.
South Korean market unique
South Korea’s pet food market ranks third among East Asian countries, after China and Japan in East Asia. In monetary terms, it is 3 times larger than the Ukrainian market. The share of sales of specialised food for cats and dogs is 50% to 50%.
“The South Korean market is unique in that 67% of pet food sales are made through online channels,” Eduard Babenko, Head of Strategic Business Unit Ukraine, Moldova and Southeast Asia at Kormotech, stated. “This is the highest figure in the world, according to Euromonitor reports. Therefore, one of the challenges in cooperation with South Korea is to gain experience in building and developing online sales in the premium and super-premium market.”
Future plans
By the end of 2024, the company also targets to strengthen its position in the offline segment.
“By the end of this year, we want to start cooperation with pet stores and veterinary clinics so that customers can look at the product, inspect it, and feel it,” said Vladyslav Mazurkevych, Kormotech’s Asia Export Market Development Manager.
2023 turnover
In 2023, Kormotech’s turnover surged by 22.5% to $152 million from $124 million in 2022. This significant growth in turnover, with foreign sales now contributing 31% of revenue, up from 28% in the previous year, paints a promising picture for Kormotech’s future.
Domestic sales outperform expectations
Kormotech doubles down on exports, even though the domestic pet food market shows surprising resilience. Despite the ongoing hostilities, Ukrainian sales of pet care products climbed by 27.3% last year from UAH 28.03 billion ($695 million) to UAH 35.7 billion ($885 million), Suziria Group, a local pet products company, recently estimated.
The pet food market, the largest product category in the pet care segment, has also experienced a substantial rise in sales, even exceeding the pre-war level, the analysts reported.
In 2024, the market is set for another 15% growth, a figure that Kormotech describes as ‘minimal growth’ in the context of the previous years’ dynamics.
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