Digitalisation trends in the Dairy Industry with Hoogwegt Cheese
What does the digital transformation mean for Hoogwegt and how is the company adapting to this new stage?
Digitalization is an irreversible process and it’s interesting to see if multiple trading platforms and webshops can live next to each other in the EU dairy industry. We as Hoogwegt Cheese have a strong preference and will support for 1 overarching eBay type of multi-buyer multi-seller platform since only that will give strong liquidity in the EU dairy market. We need this liquidity to swiftly change our position of physical product in times of increasing price volatility.
It’s a fact that all the market players are talking with each other and price is always a crucial element of the contract negotiation. We often use independent, preferably real-time, transparent benchmarks of the market prices to inform and gain trust among our customers that they are paying a fair price.
What opportunities do you see for Hoogwegt in using the DAO.EU marketplace?
We notice that large volumes of physical dairy product is traded on the DAO.EU reference prices. We also forward screenshots of the DAO.EU market depth and market trades towards our customers. It’s a convenient and easy to use tool for position trading and it’s an excellent tool to test the market. With submitting a bid/ask spread we can generate some guidance and liquidity to the market and it’s forcing us to connect with the market on a daily business.
What is necessary to create (double-digit) growth in online dairy trading?
The current member base on DAO.EU is growing, but it would be good for the general liquidity when more end-users will sign-up. Another important topic is awareness about the old business saying: 20% of your customers produce 80% of your sales. In general people are underestimating how much time they spend on tasks that are not profitable and to please all customers instead of focusing on the most lucrative ones. When you focus 80% of your time on your key-customers and the other 20% of your time on the remaining customers via tools like DAO.EU the overall business result will improve.