Yakult to commence US production in 2012

By Shane Starling

- Last updated on GMT

Related tags: Probiotic, United states

Yakult to commence US production in 2012
Japanese probiotics pioneer, Yakult Honsha, will commence manufacturing its little probiotic dairy bottles in the US for the first time in 2012, the company has announced, as it seeks to move into eastern seaboard US states.

Reuters reported senior international operations managing director, Yoshihiro Kawabata, stating the company would build the facility in an as yet undesignated location to cater for forecast growth.

"We are planning to expand our business in the United States, starting sales of our products on the east coast, in the north and in other areas in the near future,"​ Kawabata told Reuters.

Yakult’s probiotic drinks run a distant second to Danone’s DanActive drinkable and Activia spoonable yogurts in the US, but the company has been building a presence principally in west coast states of California, Hawaii and Arizona.

All of its US product is currently imported from a production facility in Mexico which also happens to be one of the company’s strongest markets outside of its Japanese base.

No one at Yakult, which is 20 percent-owned by Dannon parent, the French-based Danone Group, was able to comment on the announcement by the time of publication.

Expansion plans

About half of Yakult’s sales occur in Japan, where the product has been established for more than 50 years, with another quarter coming from the Asia/Oceania area and the rest in the Americas and Europe. Sales have hovered around the 25 million bottles consumed per day level since 2005, according to the company’s 2009 annual report.

Yakult sells products in 30 countries and has stated it wants to expand to 45 countries in the short to medium term.

It has mainstream retail distribution in the markets where it is present and employs hordes of ‘Yakult Ladies’ to deliver personalized sampling at supermarkets and door-to-door.

The company is also expanding its operations in China where it already has two plants and plans to open a third and is set to post its first profit there, albeit modest.

Further Asian expansion in Indonesia and the Philippines, along with the Middle East, is also mooted.

While Yakult outsells Danone in Japan and some Asian markets, it has struggled in the US, as with Europe, against the might of Danone, which was the first to establish itself in both markets.

Danone’s probiotic brands helped drive a rapid expansion of the US and Canadian probiotic foods market that has seen it grow to be worth $1.77bn according to Euromonitor figures.

Euromonitor predicts the North American market for pro- and prebiotic spoonable and drinkable yogurts will grow to$2.78bn by 2013, and it will overtake the Asian market in value in 2012.

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