Founded in the 1930s, the chocolate maker ION has been a part of the lives of several generations of Greeks. This emotional link to the brand adds a whole new dimension to the success of a company that managed to sail through the recession without a drop in sales and without laying off workers. Instead, ION has come out stronger by improving its cost-effectiveness and expanding its export network. Vice-President Stathis Loizos explains the secrets of ION’s success, which is based on controlling the entire process from the purchase of cocoa beans to the packaging of the final product
Can you give us an overview of the food industry in Greece and Ion’s position within it?
The food industry is among Greece’s strongest industries, and it contributes significantly to GDP. It has suffered considerably less than other industries from the recession, not only because of strong defense mechanisms but also because of the importance of this industry for thousands of small, medium and large companies, as well as to the agricultural sector. As for ION, it is among the largest food companies in Greece, with a turnover of €110 million and a staff of 900 employees. We have three plants in Greece as well as a subsidiary in Bulgaria. ION is consistently rated as one of the top brands in Greece, and for many years it has been considered a superbrand. In terms of competitiveness, ION is the only company in Greece that covers all the chocolate and cocoa markets, with product brands consistently holding top positions.
How has the company built this reputation over the course of its nearly 90-year history?
ION has earned this position in the hearts and minds of consumers thanks to some key values that are the backbone of our corporate strategy. The first is a focus on top quality: ION is the only company in Greece and among the few internationally that works on the entire process, from the processing of cocoa beans to the packaging of the final product. Another key element is our reliability at all levels: operational, financial, transactional and more. And maintaining ethical standards is very important to us. Generations have grown up with ION, and it is part of everyone’s memories.
What are some of the products that you make?
We produce classic chocolate bars, candy bars, pralines, wafers, cocoa powder, chocolate spread, as well as special products for Christmas and Easter. During the past few years, we launched among other new products, sugar-free chocolate bars and very recently chocolate protein bars. ION also has a leading position in the business-to-business market with its couvertures and chocolate spreads.
Given the company’s history and focus, what do you see as ION’s advantages over the competition?
One of the most essential factors is quality consistency: we buy and process our own beans, unlike many other chocolate companies, which is expensive but gives us a unique ability to control the entire process. Secondly, ION has a deep knowledge of chocolate: even though globally we may be a small player, our people here really know as much as any Swiss or Belgian colleague. All our food technologists, chemical engineers, etc have been with us for many years, and it is a company policy to educate them continuously abroad through seminars, specialized conferences, workshops and visits to exhibitions relative to food and chocolate technology. A third advantage is our state-of-the-art production machinery, which we have invested a lot of money in. Fourth, we have vast production and quality systems in place. And finally, we have a strong sales and distribution system in a market that we know very well, as we have been a part of it for the last 90 years.
What was ION’s experience with the recession?
The first three to four years were very challenging for everyone. Lots of companies went bankrupt and people lost their jobs. ION was hurt at the very beginning, but only a little. Luckily for us, the chocolate industry remained mostly intact: consumers continued to buy as much as they used to. In fact, consumption gradually grew, suggesting that chocolate is “anti-recession.” The second reason was the fact that we had already spent tens of millions of euros to renovate our equipment, and luckily we had completed that process right before the crisis hit. So from a cash flow point of view, we were in a perfect position to be cautious without hurting our operations or laying off workers. We got lucky with the timing.
What opportunities do you identify now that Greece is emerging from the crisis?
The recession played an instrumental role in reinventing ourselves, and we are still in the process of doing so. At first, we were in shock when we realized that the crisis was here to say, around 2013. Then we decided to devise a specific strategy for the future. This strategy had three prongs: focusing on costs by extending controls and streamlining some critical processes; refreshing and extending our product range; launching innovative products such as chocolate sticks, sugar-free chocolate bars, and wafers; and finally expanding our international activities.
Where do you export?
We do this through our company Interion, which is based in Bulgaria and our export department here that ships products to Albania, Cyprus, Egypt, some Arab countries and to Japan, South Korea, and the United States – but this market is very difficult and expensive to enter, so we decided to focus on the Greek communities in Boston, Chicago and New York. The European market is more accessible, but in a way it is also more difficult because of the fierce competition in Western Europe. Brand recognition is everything, and people there are more familiar with global brands. So we have chosen to target the rest of the Balkan countries and the Eastern European market, like Russia and Ukraine, through our company in Bulgaria where we hold a leading position in chocolate spread, which we produce locally, and a significant market share in chocolate bars, which are imported from the mother company in Greece. So essentially the recession made us rethink our business. It forced us to improve ourselves, to become more cost-sensitive and efficient, to understand market needs better, and to become more international.
How has the company performed financially in recent years?
Our financial performance has been very strong, and profits started to grow quite impressively after 2015 as a result of this new strategy that we started to follow. After 2016, the price of raw materials decreased, and that helped a bit too. And 2019 was a very good year as well.
You have declined offers from companies interested in a stake in ION. Why is that?
Even now, there are companies interested in owning part of ION. This is a very emotional thing, and the fact that we are a 100% Greek company is very important to us. We are proud of what we represent, and we know that it makes employees feel safer because the ownership is closer to them. We have always been so. Even so, business is business.
What do you think ION represents to the Greek people?
I feel that, above all, we have shown Greek society what it means to run an ethical company, and I think that this is our biggest contribution apart from the pure economic one. That is why we are admired. Not everyone consumes our products, but everyone has warm feelings about ION, because of our honest, transparent and respectful relationship with our consumers, employees, clients, suppliers, banks, the state itself, and also because of our consistent quality and values, especially regarding family. In fact, we are synonymous with family.
How can ION represent Greece internationally, and help improve its image?
When capital controls were introduced in June 2015, all our big international suppliers backed us up in a very active way. Why is that? Because of our trustworthy behavior throughout the years. In business, if you are reliable and consistent, you create trust. If all those other Greek companies that work like ION – and they are many of them – keep this trustworthy behavior and continue to operate successfully, grow and invest, it will mean that the private sector is robust and that the macroeconomic environment is getting more and more positive. And the final image, if you combine all those companies, will be a positive one. This kind of image would restore confidence in Greece’s business climate.
How competitive is Greece right now in terms of attracting foreign investment?
Generally speaking, I think that the competitiveness of the Greek economy has improved considerably during the years, yet it has to improve further. The companies have to invest more in technology and also develop more aggressive and focused international strategies.
As for the government, in order to attract more foreign investments, it has to continue working on restoring confidence to the Greek economy by making more reforms and shaping a stable and predictable business environment profile. It should also continue promoting the competitive advantages that the Greek economy is offering in various sectors like tourism, logistics, food industry etc, through economic diplomacy, business summits and conventions, publications and ads in foreign media etc.