Financial Times

Ceylon Biscuits in Rs 1 bln expansion project
By Iromi Perera
Ceylon Biscuits Limited's Munchee brand a household name, has invested a billion rupees in a new plant in Ranala to increase production capacity and expand its product range.

The company, which recently acquired a big biscuit plant in India, intends to widen its product range to bakery items, such as cakes, and expand the Ritzbury chocolate range, which is number two in the local market.

The company is well known for products such as Marie, Lemon Puff and Super Cream Cracker and has been responsible for novel products such as Tiffin and Chocolate Puff.

Nandana A. Wickramage, Director of Marketing and Sales, told The Sunday Times FT in an interview that modern machines have been imported from USA and Italy for the new plant.

Ceylon Biscuits is the largest Sri Lankan exporter of biscuits, chocolates and soy products and its Munchee brand has a 48 percent share of the local market. The firm has one of the largest distribution networks that covers the entire island.

Last year the company had a turnover of $2 million from their exports which are expected to rise this year. The company produces 2,500 metric tonnes of biscuits everyday and has a workforce of around 1,500.

It currently exports to 35 destinations around the world, including the US, Canada, and Europe. Its newest markets are African countries such as Ghana and Botswana.

Australia is the biggest market for the chocolate covered biscuits and savory biscuits. Ceylon Biscuits also does manufacturing for around 10 private brands in Australia, Hong Kong and New Zealand and supplies supermarket chains such as Walmart and Kmart. Ceylon Biscuits exports soy products under the brand Lanka Soy and products under the Cecil brand which include dehydrated fruits, fruit juices, fruit pulps, desiccated coconut, cashew and spices.

The company promotes its products by participating in international food fairs. Ceylon Biscuits has an understanding with the Ferrero group to manufacture one of its fast selling brands, "Tic Tac", and to distribute the famous Roche Ferrero. Its main products in the local market are Marie biscuits, Lemon Puff, Super Cream Cracker and Chocolate Puff.

The Chocolate Puff range was launched recently and has already equaled the demand for Lemon Puff without sales dropping in any of the products. Other products such as Tiffin, Hawaiian Cookies and Ginger Biscuits are increasing in demand and the company sees positive trends in biscuits, chocolate and soy products. The company acquired Soy Foods Lanka in 2000 and introduced new flavours in its soy products.

Ceylon Biscuits has a manufacturing plant and marketing operation in Chennai, India and recently bought India's third biggest biscuit company, Bakeman's. With the acquisition of Bakeman's it hopes to expand operations in India and new international markets.

The company started in 1968 producing a protein-enriched biscuit for the government and C.A.R.E International. "From there, with the excess capacity we went into the market," said Wickramage. "We changed from traditional biscuits and went into things like Hawaiian cookies and milk short cakes that showed us that there is potential in this market to produce and market products that are different to the other biscuits." Ceylon Biscuits concentrated on product innovation and the company believes that consumers appreciate new and innovative products rather than the traditional biscuits.

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