Kormotech, a well-known Ukrainian pet food company, has started selling in the South Korean market. Trade dynamics show that exports are playing an increasingly important role for the company, even though the domestic market quickly recovered from the initial shock.
As the company announced in its statement, since June 17, Kormotech’s Optimeal and Club 4 Paws brands have been featured on 12 Korean specialized Internet sites.
The South Korean market is 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 special 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,” said Eduard Babenko, Head of Strategic Business Unit Ukraine, Moldova and Southeast Asia at Kormotech. “This is the highest number in the world, according to Euromonitor reports. Therefore, one of the challenges in cooperation with South Korea is to gain experience in developing and developing online sales in the premium and super-premium market .
Future plans
By the end of 2024, the company is also targeting to strengthen its position in the offline segment.
“By the end of this year, we want to start working with pet stores and veterinary clinics so that customers can look at the product, inspect it, and feel it,” said Vladyslav Mazurkevych, Asia Export Market Development Manager of Kormotech.
2023 turnover
In 2023, Kormotech’s turnover increased 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% last year, shows a good picture for the future of Kormotech.
Domestic sales are exceeding expectations
Kormotech is doubling exports, even as the domestic pet food market shows surprising resilience. Despite the ongoing conflict, Ukrainian sales of pet care products increased by 27.3% last year from UAH 28.03 billion ($695 million) to UAH 35.7 billion ($885 million), Suziria Group, a local pet product company, recently estimated.
The pet food market, the largest product category in the pet care segment, also experienced a significant increase in sales, even surpassing pre-war levels, analysts reported.
In 2024, the market is set for another 15% growth, a figure that Kormotech describes as ‘minimal growth’ in the context of previous years’ dynamics.
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