Swedish Match's business concept is to be the unique tobacco company, with world-leading brands and niche products in growing markets, that works in line with social and consumer trends.
Swedish Match has six different product categories - snus/snuff, cigars, chewing tobacco, pipe tobacco, matches and lighters. Brand-building and product broadening are cornerstones in the Groups efforts to achieve organic growth.
Swedish Matchs strategies for cigars are to strengthen its market positions in the two main markets the US and Europe, to focus on global growth segments and segments where its presence can be increased. Cigar operations in 2005 were characterized by a number of important events.
Swedish Match is number one in chewing tobacco in the worlds only large market for the product, namely the US, and is one of the worlds largest players in the pipe tobacco segment.
Swedish Match is the worlds largest producer of matches and has a wide geographic spread of lighter sales.
Swedish Matchs main strategies are aimed at achieving solid and sustainably profitable operations that provide satisfaction to consumers and value to shareholders. The Group shall enhance its competitiveness through continuous improvements to productivity, renewal of the brand portfolio and a constant focus on structural measures. Long-term growth will be prioritized. It is intended that growth will primarily be organic, supplemented by selected acquisitions. Brand-building and product broadening are cornerstones in the Groups efforts to achieve organic growth.
The Groups financial position shall be optimized based on balancing the Groups operational and financial needs and the need to create value for shareholders. This will involve working actively to make the balance sheet more efficient, maximize the return on capital employed and generous transfers of surplus funds to shareholders.
Swedish Match shall practice sound risk management based on a high standard of corporate governance.
Snuff has increasingly become an accepted form of tobacco use. The trend is driven by the increasing medical awareness of the health hazards caused by cigarette smoking and the constantly expanding political measures to reduce or eliminate smoking. This means that more and more cigarette smokers in an increasing number of countries will be demanding alternatives to cigarettes. There is a clear link between the decline in cigarette smoking and the growth of snus consumption over many years in Sweden. A number of independent scientific studies have provided documentary evidence that the health risks associated with snus are considerably lower than the risk from cigarette smoking.
Swedish Matchs growth strategy for snuff focuses on attaining leading international market positions. The Group is the largest player in Northern Europe and one of four players in the worlds largest snuff market, the US, where it is well positioned in the rapidly growing value segment. The strategy is aimed at further strengthening these positions and developing snuff as a smokeless alternative in an increasing number of markets.
Swedish Match is among the leading players, holding the number two position in the world in terms of cigar sales and the number one position in the premium segment in the US, the worlds largest cigar market.
Swedish Matchs strategies for cigars are to strengthen its market positions in the two main markets the US and Europe, to focus on global growth segments and segments where its presence can be increased. During the past few years, there has been strong demand for various types of flavored cigars, a trend that Swedish Match has been able to successfully exploit, particularly in the US. The strategy is also aimed at expanding the market for the Groups strong brands in the US premium segment to also cover an increasing number of countries in Europe and Asia.
Chewing tobacco and pipe tobacco
Swedish Match is number one in chewing tobacco in the worlds only large market for the product, namely the US, and is one of the worlds largest players in the pipe tobacco segment. Both of these product areas are characterized by declining demand, with low recruitment of new consumers. The operations show favorable profitability with a strong cash flow and make a positive contribution to the Groups strength. Swedish Match is prioritizing and evaluating new smokeless tobacco alternatives. The strategic focus on product development will continue, in order to broaden the product offering and increase the proportion of new markets.
The strategy involves continuously increasing productivity and strengthening market positions to sustain good profitability.
Official site: http://www.swedishmatch.com/
© Swedish Match AB, Corporate reg no. 556015-0756
Rosenlundsgatan 36, SE-118 85 Stockholm, Tel +46 8 658 02 00.
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