Almarai
Encyclopedia
Vertical integration
In microeconomics and management, the term vertical integration describes a style of management control. Vertically integrated companies in a supply chain are united through a common owner. Usually each member of the supply chain produces a different product or service, and the products combine to...
dairy
Dairy
A dairy is a business enterprise established for the harvesting of animal milk—mostly from cows or goats, but also from buffalo, sheep, horses or camels —for human consumption. A dairy is typically located on a dedicated dairy farm or section of a multi-purpose farm that is concerned...
foods company in the middle east. The company was established in the Kingdom of Saudi Arabia in 1976 as a partnership between the Irish agri-foods pioneer Alastair McGuckian and his brother Paddy, and HH Prince Sultan bin Mohammed bin Saud Al Kabeer.
The company is based in Riyadh
Riyadh
Riyadh is the capital and largest city of Saudi Arabia. It is also the capital of Riyadh Province, and belongs to the historical regions of Najd and Al-Yamama. It is situated in the center of the Arabian Peninsula on a large plateau, and is home to 5,254,560 people, and the urban center of a...
.
History
The Almarai story began in 1976, when the Chairman, HH Prince Sultan bin Mohammed bin Saudi Al Kabeer recognised the potential to transform the traditional dairy farming in Saudi Arabia in order to meet the needs of a burgeoning domestic market. Under his patronage, numerous agricultural projects were developed towards achieving this objective, and what began with the processing of fresh milk and laban soon expanded into modern dairy farms and state-of-the-art processing plants.In the early 90’s Almarai entered into a restructuring
Restructuring
Restructuring is the corporate management term for the act of reorganizing the legal, ownership, operational, or other structures of a company for the purpose of making it more profitable, or better organized for its present needs...
phase moving away from a decentralized to a centralized structure. The first Central Processing Plant was commissioned replacing 5 decentralized plants. Almarai also established four large dairy farms in the Central area replacing ten decentralized small farms.
Since then, the Company has continued to invest heavily in technologically advanced production facilities and recruiting the right caliber of people. A second and larger Central Processing Plant, incorporating a new cheese
Cheese
Cheese is a generic term for a diverse group of milk-based food products. Cheese is produced throughout the world in wide-ranging flavors, textures, and forms....
plant, was commissioned in late 2005. Two new "super farms" were commissioned, bringing the total number of farms to seven. Today, Almarai is capable of serving products to more than 43,500 customers within the GCC, on a daily basis.......
In 2005, Almarai moved from being a privately-owned
Privately held company
A privately held company or close corporation is a business company owned either by non-governmental organizations or by a relatively small number of shareholders or company members which does not offer or trade its company stock to the general public on the stock market exchanges, but rather the...
company to a publicly listed company and today has over 90,000 shareholders.
In 2006, Almarai featured in the third position among Top 40 Arab brands list published by Forbes Arabia.
In 2007, with the acquisition of Western Bakeries, based in Jeddah
Jeddah
Jeddah, Jiddah, Jidda, or Jedda is a city located on the coast of the Red Sea and is the major urban center of western Saudi Arabia. It is the largest city in Makkah Province, the largest sea port on the Red Sea, and the second largest city in Saudi Arabia after the capital city, Riyadh. The...
, the product range was expanded to include bakery
Bakery
A bakery is an establishment which produces and sells flour-based food baked in an oven such as bread, cakes, pastries and pies. Some retail bakeries are also cafés, serving coffee and tea to customers who wish to consume the baked goods on the premises.-See also:*Baker*Cake...
products. Since the acquisition, the Company developed its bakery business by the creation of Modern Food Industries, improved distribution, and product innovation. In addition during 2009, Almarai commenced the construction of a new bakery facility in Al Kharj
Al Kharj
Al-Kharj is a city and governorate in central Saudi Arabia. The population of the governorate as a whole was 623,394 according to the 2004 census, 75,716 of whom were non-Saudis. The city is located at around ....
.
2009 saw the commencement of a new phase in the development of Almarai with initiatives for geographic expansion through the establishment of the joint venture with PepsiCo
PepsiCo
PepsiCo Inc. is an American multinational corporation headquartered in Purchase, New York, United States, with interests in the manufacturing, marketing and distribution of grain-based snack foods, beverages, and other products. PepsiCo was formed in 1965 with the merger of the Pepsi-Cola Company...
, International Dairy and Juice(IDJ), and investments in new product categories, Poultry through the acquisition of HADCO and Infant Formula
Infant formula
Infant formula is a manufactured food designed and marketed for feeding to babies and infants under 12 months of age, usually prepared for bottle-feeding or cup-feeding from powder or liquid . The U.S...
.
Almarai achieved record sales of SAR 5,868.8 million generating a profit of SAR 1,096.7 million, a significant increase of 16.7% and 20.5% respectively over the previous year’s figures.
In March 2010, Almarai entered into a joint venture with Mead Johnson Nutrition, one of the world’s leading infant nutrition companies to produce, market and distribute infant nutrition products in the GCC.
Product Categories
Dairy Liquids
Almarai enjoys leadership status in the fresh milk and LabanLaban
Laban may refer to:* Laban , a character in the Book of Genesis.* Laban , a character in The Book of Mormon.* Laban , a 1980s Eurodance duo....
categories across the GCC (Gulf Cooperation Council) countries . The dairy liquid portfolio offers a wide range of milk and Laban products, all made from 100% fresh cow's milk and available in a variety of delicious flavors and different sizes.
Cheese
Almarai's home snacks category offers a variety of cheese snacks that include jars, slices, cheddar, and cheese portions.Culinary
The range of culinary products include butter, butter ghee, tin cheese, tomato paste, feta cheese, mozzarella cheese, whipping cream and halloumi.Kids
The kids' products includes cheese triangles, flavored milk, set yoghurt and dairy based snacks.Yoghurt and Desserts
Fresh zabadi is the number one selling yoghurt in the GCC.Other ready-to-eat desserts include the Bonsweet family, which comes in four flavors: vanilla custard, chocolate custard, chocolate custard with cream, and creme caramel.
The traditional fresh cream (gishta) is made from fresh milk.
Bakery Products
Almarai's brand, L'Usine, includes a range of products such as breads, buns, cakes, croissants, puffs and many more baked goods.L'Usine produces 35 different products divided into five categories: bread, pastries, cakes, mamoul and sambosa.
Chicken Products
Almarai's subsidiary, "Alyoum", caters different chicken products which include fresh whole chicken meat, mixed parts, legs, gizzard, and eggs. Alyoum was previously known as HADCO which is based in Hail, Saudi Arabia.Community services
Almarai has been proactively engaged in the communityCommunity
The term community has two distinct meanings:*a group of interacting people, possibly living in close proximity, and often refers to a group that shares some common values, and is attributed with social cohesion within a shared geographical location, generally in social units larger than a household...
through direct charitable donations and vital sponsorships of events supporting social causes.
In conjunction with the Arab Bureau of Education at the Gulf Cooperation Council, Almarai took part in organizing the Scholastic Excellence Award for Public Education students]].. The award was inducted in the United Arab Emirates, where Almarai recognized 42 students from all levels of public education throughout the Gulf region for their academic achievements.
In addition, an Award for Scientific Creativity was launched in partnership with the King Abdulaziz City for Science and Technology with the aim of encouraging scientific research which will eventually benefit society as a whole.
Moreover, Almarai supported Bin Baz Charitable Project to Assist Young Men in Marriage and facilitated the biggest group-marriage that ever took place in Saudi Arabia. The event helped in increasing access to marriage
Marriage
Marriage is a social union or legal contract between people that creates kinship. It is an institution in which interpersonal relationships, usually intimate and sexual, are acknowledged in a variety of ways, depending on the culture or subculture in which it is found...
for men with limited means.
Some of the nonprofit organization supported by Almarai includes the orphan welfare Society (Ensan), Down Syndrome Charitable Association (DSCA) and Saudi Autism Organization and the Saudi Breast Cancer Society (Zahra).
Awards
Almarai is the first dairy farm in the worldWorld
World is a common name for the whole of human civilization, specifically human experience, history, or the human condition in general, worldwide, i.e. anywhere on Earth....
to have been accredited with ISO 9002. Almarai also received the ISO 9001-2000 award, across all its operating divisions
Division (business)
A division of a business entity is a portion of that business that operates under a different name. It is the equivalent of a corporation or limited liability company obtaining a fictitious name or "doing business as" certificate and operating a business under that fictitious name...
, including farms, procurement
Procurement
Procurement is the acquisition of goods or services. It is favourable that the goods/services are appropriate and that they are procured at the best possible cost to meet the needs of the purchaser in terms of quality and quantity, time, and location...
, processing, technical research and development, distribution and supply chain
Supply chain
A supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to...
.