The Oatly company was the first to create oat milk in Sweden in the 1990s. Since then, the organization has turned into the world`s leader in the production of the beverage. In Sweden, analysis results reveal that Oatly has a 53% market share in the total alternative dairy category. The company`s success in Sweden has been its goal for future international expansions.
Oatly Company succeeds in the United States
Just recently, the company launched in the United States in its pursuit to take the dairy world by storm. After the launch, the Oatly company now provides its products in more than 7,500 retail stores and about 10,000 coffee shops across the U.S.
The continued growth of the Oatly business led to it selling $421.4 million worth of products in 20 countries worldwide last year. A preliminary F-1 filed with the United States Securities and Exchange Commission revealed the Swedish oat milk titan made a 106% increase in sales in 2020 compared to 2019. Further analysis revealed that the United States was Oatly`s second-largest market, responsible for $100 million of the sales made in 2020. Additionally, the United States was responsible for 71% of Oatly`s total gross profits from retail sales in 2020.
Room for growth despite Slow Supply
The Oatly company believes there is still a lot of room for growth in the United States. The titan has so far seen phenomenal growth last year, becoming the second most popular type of alternative dairy in the U.S. But despite the companies’ success, Oatly still operates at a loss. According to the same filing results from last year, the company`s total loss for 2020 stood at $60.4 million, just about doubling up the $35.6 million shortfalls of 2019. The company, however, states it cannot become profitable as it increases its production capacity and continues to expand globally.
The Oatly manufacturing history and expansion plans reveal that the demand has always outpaced supply. Last year some products started to be in short supply in the United States, leading to the loss. The company only made the equivalent of 301 million liters of oat base to be used in the company`s oat milk, spreads, desserts, and yogurts. But this year, Oatly expects the production capacity to be 600 million liters. As expansion continues, the company expects to make 1.4 billion liters by 2023.
The future of Oatly
Oatly currently has four operational plants worldwide, with each one in Sweden, New Jersey, Utah, and the Netherlands. The company has five global factories under construction and nearing completion, which will provide a lot more manufacturing capacity. One factory under construction is in the U.S, with the others in the U.K, China and another in Southeast Asia, and one in Singapore. The company also plans on expanding three of its current factories planned to be completed by 2022, including in Sweden, New Jersey, and the Netherlands.
Oatly believes it has achieved immense success because it’s dedicated to the environment. The company states its main aim is to transform the food industry to help humanity face great challenges across the climate, health, and environment. Oatly believes it has been leading the charge to change the global dairy market. The company has ensured sustainability is at the core of the business and is actionable in the products.
A liter of Oatly product utilized in place of cow`s milk results in around 80% less greenhouse gas emissions. Additionally, the production of Oatly products uses 79% less land and 60% less energy compared to the cow`s milk production. Oatly products make it simple for people to turn what they eat and drink into memorable moments of healthy joy. The company manages to do this without extremely taxing the planet`s resources in the process. Sustainability at Oatly is a mindset that helps the company navigate business choices. Also, the tactic helps build a singularly fixated culture on pushing the boundaries of the plant-based movement.