By liquidating the bakery in Kaunas, “Fazer” plans to invest EUR 18 million to develop production in Ogre

The goal of “Fazer” is to strengthen its position in all markets where the company works. As part of the strategy, “Fazer” is considering the possibility of combining the two Baltic bakeries into one production structure in Ogre. The investment in the creation of a modern warehouse, new assembly processes and a renovated production building would be 18 million euros, which is a significant amount in the Baltic bread market. Due to these changes, as a result of which the number of jobs at the company’s production facility in Kaunas could be reduced by 185, “Fazer” has started consultations with employee representatives.

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“Fazer Bakery Baltic” is considering the possibility of concentrating all production in one modern bakery in Ogre. Thanks to these changes, “Fazer” will be able to strengthen its position in the Baltic markets, ensure competitiveness, expand the range of products in new categories and continue to develop exports. One bakery with an expanded warehouse for frozen and fresh products, new assembly processes and modernized production capabilities would improve the efficiency of Fazer Bakery Baltic’s supply chain, which is very important for all three Baltic markets. The amount of the investment is estimated at 18 million euros, which is a significant amount of investment in the Baltic bread market. Currently, “Fazer” bakeries are located in Kaunas and Ogre.

“Currently, we occupy a stable 2nd place in the Lithuanian and Latvian markets and 3rd place in Estonia, and our goal is to strengthen these positions. With one modernized production unit, we will be able to expand our well-known brands and product assortment with new product categories to meet the various needs of customers even better than before,” explains Anne Mere, head of Fazer Bakery Baltic.

The consumption of packaged bread products in the Baltics has decreased for several years in a row, and last year the volume of the bread market decreased by 2%*. Consumers are much more price-conscious, and the market is increasingly affected by campaigns that lead to price competition and lower profit margins.

The goal is to strengthen the position in the Baltics

If the plan goes ahead, the changes will be implemented in the next autumn-winter period and completed by the beginning of 2025.

“Fazer Bakery Baltic” will still remain on the Lithuanian market. The Lithuanian structural unit with sales, marketing and support functions will continue to work locally. The company will continue cooperation with Lithuanian customers and will do everything possible so that the changes do not significantly affect them. All deliveries will continue as usual using the services of Lithuanian logistics partners.

Fazer initiates consultations and supports its staff during the transition

Possible changes will affect the company’s employees in Lithuania, so “Fazer” has started consultations with employee representatives. The changes would affect up to 185 employees in Kaunas, with whom employment relations would be terminated. At the same time, up to 60 employees will be hired in Latvia to ensure additional performance at the Ogre production facility.

“If these changes are approved, we will do everything possible to support our employees in Kaunas and help them find a new job. For employees with whom employment relations would be terminated, we plan to offer vacancies in other Fazer Group structural units as a priority, and we will also cooperate with various partners and the local employment agency,” says Anne Mere.

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