The frozen food market - Italy

• Barilla, the world's pasta giant, is entering a new market in France, that of snacks, with Harrys, its French sandwich bread brand, acquired in 2007.
• In France, the group, with sales of 4.7 billion euros, is best known for its pasta products
• In Italy, it is at the head of Mulino Bianco cookies (1.2 billion euros), Italy's leading food brand
• Pasta and sauces account for 60% of sales, and bakery products for 40%.
• 60% of sales are generated outside Italy
• Pasta Group present in over 100 countries
• Sales in France in 2023: 1.7 billion euros.
• Private labels will account for 50% of pasta sales and 40% of sandwich loaf sales in 2023
• 4 Harrys plants, in Châteauroux, Plaine de l'Ain, Vendée and Valenciennes
• The manufacturer's objective is to capture 5% of the French industrial bakery market within three years
• France is the Italian giant's 3rd largest market (15% of sales), after its own country and the United States.

• Start of case: June 2023 - Barilla asks the Court of Brescia to prohibit the sale of nine types of Tedesco and Sapori Artigianali cookies on the grounds of excessive similarity with its own products.
• First degree of judgment: February 2024 - The court partially grants Barilla's requests, prohibiting the sale of certain products and the use of certain packaging due to their similarity to Mulino Bianco's products and packaging.
• Second level of judgment: March 18, 2024 - The Brescia Court dismisses Barilla's complaint and accepts the claims of Tedesco and Sapori Artigianali.
• Arguments in favor of setting aside the judgment:
  • Volgarization of shape marks: The shape of the cookies in question is now considered so common that it is no longer distinctive of a particular manufacturer.
  • Packaging challenge: Despite the similarity, Tedesco's packaging is not considered likely to create undue confusion or associations with Barilla's due to the prevalence of common elements in the industry.
  • Urgency of proceedings: The court rejects Barilla's requested urgency for intervention, noting that Barilla was aware of the sale of the "similar" products as early as 2016.
• Implications for the industry: This case highlights the importance of distinctiveness and originality in product and packaging design in a crowded market. It also shows the legal and commercial challenges of protecting these aspects in competitive environments.

• Research and development period: 6 years, starting in 2018.
• Production site: Melfi, Basilicata.
• Investment: More than 30 million euros over the last three years in the Melfi plant, with investments dedicated to both sustainability and innovation, including the creation of production lines for Pancakes and Fisarmoniche.
• Sugar content: Accordions contain -35% sugar compared to the average of the best-selling snacks.
• Calorie content: 120 kcal/piece.
• Factory production capacity: Maximum capacity 83,000 tons/year.
• Number of employees in Melfi: Over 350.
• Quality controls: Over 5,000 checks on finished products and 200 on raw materials per day.
• Environmental savings over the last 10 years: 40% water savings and 27% reduction in CO2 emissions.
• Total number of Mulino Bianco references: Over 130, including cookies, snacks and breads.
• Italian dippingpreference: 6 out of 10 Italians like to dip snacks or cookies for breakfast.
• Ingredients: No colorants, preservatives or palm oil. Contains 4% fiber.
• Plant size: 202,000 m^2.

• Barilla sales in 2021: 4.7 billion euros (+6.5% growth)
• Private labels capture over 50% of the pasta market and 40% of the sandwich bread market. Pasta prices up by more than 11%.
• Barilla sales in France: 630 million euros (+7%), but volumes down 3%.

• World leader in pasta and pesto
• sales of 4.7 billion euros in 2023, up 6.5%, including 630 million euros in France.
• Volumes down 3% in 2023 across the French perimeter.
• Stronger advertising and promotional support for its Barilla and Harrys brands, in the face of private labels which now exceed 50% by volume for pasta and 40% for sandwich loaves.

Price reduction by Barilla: 7% to 13%.

• Products concerned: Spaghetti n° 5, most of the pasta assortment, Mulino Bianco products (cookies, snacks, rusks, breads) and certain Pavesi products (such as Gocciole)
• Promotion duration: until December 31, 2024
• Justification: extraordinary operation to reduce transfer prices to direct customers and distributors, by lowering contract prices for a large number of products
• Other Barilla strategic initiatives: investments along its supply chains, in production sites, focus on research and development of new technologies, innovation with the launch of new products, communication campaigns, ongoing collaboration with partners operating in the distribution sector