26.10.2007

Odessa Baby Food Cannery is Going to Bring an Action Against Pepsi-Co.

As it is known, competition can be different – fair and not very fair one. And competitors can be also different. Honest and vice versa. It’s a blessing that Ukraine slowly but steadily comes to civilized forms of competitive activity. One of the methods of fair competition is the implementation of new ideas, technology, and offer of something new to a market which has a remarkable competitive advantage and can really stand out itself among the multitude of other offers. Since there are still hundreds and maybe even thousands unimplemented original ideas, for example, in the industry of non-alcoholic beverages.

Though the aspiration of the Ukrainian companies to follow the example of civilized rules of business conduct to which the Western companies with world-wide name adhere (still the West was and remains the standard of fair competition for the countries of the post soviet area, at least western society is constantly “teaching” former Soviet Republics how to follow the author’s right) isn’t always noticed and appreciated by the same Western companies.

In July of this year rather important event took place in the Ukrainian market of juices, nectars and beverages – purchase of the largest player in the market of juices, nectars and beverages – “Sandora” – by the largest well-known producer of non-alcoholic beverages – the company Pepsi-Co. The reaction to the bargain of the market insiders was different, but generally positive.

Expert opinions coincided with one fact – purchased “Sandora” is now another company with different strategy and priorities. Though, as the Ukrainian experts thought, a new owner – the company Pepsi-Co was known for its innovation and the market was probably to see new interesting products.

Everybody relied on that. But it seems to be that the new owner of the Ukrainian company had its own considerations about that – in the middle of October a new product which had been produced and copied by its appearance from the product produced by another company – Open Joint Stock Company “Odessa Baby Food Cannery” – appeared in the Ukrainian supermarkets. The new product was produced by “Mykolaiv Juice Factory”, which, as it is known, affiliates the company “Sandora”.

What does the jest consist in? There have been some preceding events since the beginning. In 2002 Open Joint Stock Company “Odessa Baby Food Cannery” put the juices of the similar trade mark on the national market, having created thereby a new for the Ukrainian market low-price segment. Owing to the fact that the production was produced from fresh primary products and considerable sums were saved by the producer on the manufacturing of package, the production advanced in popularity among consumers almost at once and became a phenomenon of the national market of juices and nectars. Less than in a year the juices of OBFC occupied more than 10% of the juice market. Currently, this number made up more than 14%.

The success of TM “Juices of OBFC” has become a precondition for the various duplications and cloning of the package of this trade mark by the unfair competitors. “The first swallow” was the juice in white package similar to the degree of confusion of “Sandora”. The shareholders of Open Joint Stock Company “Odessa Baby Food Cannery” addressed the founders of “Sandora” LLC with a claim in the oral form. Then, the representatives of this company recognized their actions, expressed in the duplication of the product, illegal and agreed to change the colour of the package to yellow under the threat of the reference to the court. Verbal arrangements of the two largest Ukrainian companies have been working up to the present day, the founders of “Sandora” LLC, recognizing the singularity of the idea of “OBFC” and having respect for their main competitors, have been following the arrangements to the end.

The next company which had been tempted by the success of the original project was the company “Vinnifruit” that in 2004 produced the juice in white package bearing a strong resemblance by its appearance to the package of juices of Odessa Baby Food Cannery.

After ineffective negotiations of the author of the idea – Open Joint Stock Company “Odessa Baby Food Cannery” with the unfair competitor OBFC was forced to go to the law. According to general director of Open Joint Stock Company “OBFC” V.G. Stanislavsky, the main reason by which OBFC decided to assert its rights in court wasn’t the fact that Open Joint Stock Company “Vinnifruit” could rival OBFC, but the one that most of the consumers were misled by a similar package and the unsuccessful experience of the consumption of “similar” juices could affect the sales, and what is the most important, the prestige of the juices of OBFC.

During three years the courts of all degrees up to the High Economic Court of Ukraine have recognized the rightness of Odessa Baby Food Cannery and prohibited Open Joint Stock Company “Vinnifruit” to use the white package for juices similar to the package of Odessa Plant without the permission of Open Joint Stock Company “OBFC”. Besides, the judicial bodies obligated “Vinnifruit” to destroy the produced packets of white colour.

Currently, the company “Vinnifruit” stopped the production of juices in the package similar to the original white package of OBFC.

By the example of the legal process “OBFC”- “Vinnifruit” we can draw a consolatory conclusion that the state structures of Ukraine still understand in the right way what an unfair competition is. And help the Ukrainian companies that had scored a success in a fair competitive activity to assert their right to the singularity and exclusiveness of the successful projects.

The situation causes at least bewilderment. It’s understandable when small national companies commit such illegal actions to achieve even something like a result, having found nothing better than to duplicate somebody’s successful project. But nobody expected anything like that from an international company with the recognized world-wide name.

It seems to be that the largest producer of non-alcoholic beverages – the company PepsiCo – decided to prove the absurdity of fair competition in Ukraine. It would be interesting to know how to interpret the actions of the new owners of “Sandora” by the other Ukrainian producers who decided to take the road of civilized rules of competitive activity?

Anyway, Odessa Baby Food Canneryis going to assert its rights in court again. This time the actions of the company would be more rigorous – the sum of the claim will make up tens of millions of dollars.

18.10.2007

OBFC Launches New Format of Baby Food in at the Market.

On the 19th of October, 2007, Odessa Baby Food Cannery brings up an absolutely innovative product into Ukrainian market – the juices for the smallest ones under the mark “Chudo-Chado” – to the market.

“Chudo-Chado” is the first juice for baby food in Ukraine in convenient carton package Base.

“Chudo-Chado” juices will be produced with the account of higher demands for the quality of primary products and technology of production, without the application of preservatives, colouring agents, flavors and other synthetic components. The high quality of the product is confirmed by the fact that it’s recommended by the Ministry of Health of Ukraine and Research Institute of nutrition for the consumption by the children from the age of 5 months that is from the moment of the introduction of additional nutrition.

Specialized juices for the smallest ones are currently produced mostly in glass jars. They are expensive and it isn’t very convenient to use a glass package, especially when the family is going to pay a visit or go for a walk. “Ordinary” juices in their turn refer to the category of general nutrition and are recommended for the consumption from 3 years only.

For that very reason the specialists of created a product, which completely meets all the requirements of the reference documentation for the products of the baby food category for its quality and safety, and for the convenience of consumption and price it can be rather compared with the ordinary juices in the unit dose glass package.

Such products exist in the Russian market from 2002 and for 5 years they have become choice №1 for parents of preschoolers, having considerably bunched up both a unit dose size of juices and other products of baby food.

The priority channels of distribution will be groceries and the shops “close to home”, that is why it will be very easy and convenient to buy this product at any time for the main customers who are mothers with children aged from 5 months to 3 years.