Arla UK to battle soft drinks with One Shot milk

By Chris Mercer

- Last updated on GMT

Related tags: Fresh milk, Milk, Arla

Dairy group Arla UK is set to launch Cravendale One Shot milk
drinks this month to compete directly with soft drinks and begin
making use of the firm's record investment in 2005.

Arla UK, subsidiary of Scandinavian dairy firm Arla Foods, will launch the semi-skimmed milk drinks within the next few weeks to target the growing convenience sector.

Arla also plans to launch two flavoured One Shot products in March, called 'One Shot Hint Of…' and modeled on the existing 'Cravendale Hint Of…'.

The moves are part of Arla's plan to reap the benefits from a record £74.7m investment to improve efficiency and create state-of-the-art facilities in 2005.

"Cravendale One Shot will compete with carbonated soft drinks, smoothies, water and fruit juices, and will be available in the sandwich fixtures of major multiples as well as in the dairy cabinet."

Cravendale has already performed well as Arla's fresh milk brand, and has a shelf-life of up 25 days.

One Shot's fresh milk status may help it to prosper ahead of other dairy drinks that generally rely on ultra-high temperature (UHT) pasteurisation. Fresh milk is far more popular than UHT milk in Britain.

The positioning of One Shot marks a further attack by dairy processors on traditional soft drink territory, and is also a sign that the drinks and dairy sectors will continue moving closing together in 2006; spurred on by consumers' demands for healthy, on-the-go products.

Milk is already set to benefit this year from the launch of a new initiative, backed by the Milk Development Council and Food Standards Agency, to get more milk into school vending machines; traditionally a stronghold of soft drink firms.

The scheme, which will begin in Wales early this year, forms part of UK government plans to make sure that the only drinks available in secondary school vending machines will be milk, water and fruit juice.

Arla, with its One Shot product and a flash, new 450m-litre milk processing facility near Leeds, would be well-placed to take advantage of such a scheme.

The dairy processor recorded a 4.6 per cent sales rise to £1.32bn last year and said it had "gained ground on every battlefield in which we are engaged in the dairy category"​.

The firm now supplies more milk to supermarkets than ever before, giving it a 35 per cent share of the UK fresh milk market.

It also has strong-performing brands like Rosenborg Danish blue cheese, as well as Lurpak and Anchor butters - which helped Arla to bag an 89 per cent share of the UK spreadable category in 2005.

High energy and plastics costs, however, still threaten margins and, together with EU CAP reform, are likely to force Britain's farmgate milk prices down this year, the group warned.

Related topics: Arla Foods, Ingredients, Fresh Milk

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