Cane Jovanović, President of the Board of Directors of SPLA: Having an Association is a way to achieve our business goals.

Private labeling is not a new concept, especially in the FMCG sector, but there has been a clear intensification in recent years, so private labeled products today account for 18 to 45% of the food market. For the consumer, a private label product represents a choice and an opportunity to regulary buy quality food products and other items at a lower price comparing to branded products, without waiting for promotional prices and sales.

Many SMEs are able to expand their business by becoming international or local suppliers of large retail chains. Thus, small and medium-sized enterprises produce different products that can be bought under the name of a retail chain that guarantees their quality.

It is crucial for manufacturers to establish communication with the retail sector, which acts as an intermediary between consumers. Although the position of retail chains is stronger, a trend of supporting manufacturers to create quality products and sustainable businesses in this collaboration is notices. The most common set of criteria for manufactueres to join retail chains are: product quality, delivery time, payment method, price, distance, transportation options, rating, assortment, production capacity and reliability.

Becoming a manufacturer of private label for retail chains enables to manufacturer to invest more in its production and create high quality products, securing long-term product placement and sustainable business. The above mentioned can justify why  we notice an increasing number of manufacturers engaging in this mode of business. That is also the reason why the Serbian Private Label Association was established as a platform that connects all actors in this segment, providing an opportunity to connect domestic producers and retail chains.

Association’s President of the Board of Directors, Cane Jovanović, is a producer for private label in the food sector itself.

When and how did you decide to produce for a private label for retail chains? How did it affect your business?

We first produced private label product in 2015 and made the decision based on the offer of a longtime business partner. No significant changes have occurred in our company, but private label production is taking an increasing and more significant share of our production year after year.

What are the conditions for enterprises to engage in this type of production generally in Serbia and in the fruit and vegetable processing sector and does this type of production give a perspective for the development of small and medium-sized enterprises in Serbia?

Conditions depend on specific products in the fruit and vegetable processing sector. For traditional products, such as pasteurized vegetables, the first and main requirement is a satisfactory production capacity. Production for private label certainly gives a perspective for development and growt, but first the cooperation with retail chains must be transparent and foreign retail chains, operating in Serbia, should export products manufactured in Serbia to other markets in which they operate.

You were one of the participants on the project  “Building market capacities of fruit and vegetable processors through production of private label for domestic and international retail chains” and now you are the President of the Board of Directors of the SPLA Association established under the project. What the existence of this Association means for you?

The existence of this Association is, above all, an opportunity for us to connect with retail chains and achieve our goals, which are to increase production volume and continuity in production. Of course, we expect the Association to help small and medium-sized producers to cope with increasingly demanding, especially domestic and export markets.

What is your recommendation for all companies planning to get involved in private label production and potentially becoming SPLA members?

Before deciding on this type of business, all interested companies need to first and foremost analyze their business and goals and then decide in which segment of the business the entry into private label could benefit from.

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