Kägi CEO: "The biggest problem is exports" (cross-border guide)

Context

In short - Kägi faces difficulties in exporting. - High costs of raw materials and US duties. - Demand for foreign products is falling in China. - What: Export difficulties for Kägi. - When: Since 2024. - Where: Switzerland. - Who: Cédric El-Idrissi, CEO of Kägi. - Amount: 10% US duties from February 2026. Cédric El-Idrissi, CEO of Kägi, a Swiss company best known for its chocolate wafers, says the company is going through a difficult time. My work focuses on multimedia content. I produce videos and photos for the various online channels of SWI swissinfo.ch and work as an image editor. I obtained a degree in Media Production and completed an apprenticeship as a media scientist. # ## Export Challenges Over the past 18 months, El-Idrissi has had to juggle a complex environment, characterized by rising commodity prices and tariffs on exports to the United States, one of its main markets. Swissinfo met him at the headquarters and production plant of Kägi in Lichtensteig, in the canton of St. Gallen, in north-eastern Switzerland, to understand why "Swiss made" entails additional costs and how the Olympic experience has helped him learn to manage a company. # ## The main difficulties Swissinfo: You have been driving Kägi since August 2024. What were the main problems it has Cédric El-Idrissi is aware of the challenges Kägi faces, but he is also confident in the company's ability to overcome them. “We are a resilient company with a long history of innovation and adaptation,” he said. "I firmly believe that, with the right strategies and a constant commitment, we can continue to grow and thrive, despite the current difficulties." ARTICLE TITLE: CEO of Kägi: "The biggest problem is exports"

Operational details

The practical implications The difficulties faced by Kägi have significant implications for the Swiss economy. Rising commodity prices and export duties can affect the cost of Swiss products abroad, making them less competitive. This could lead to a reduction in exports and a negative impact on the turnover of Swiss companies. For example, a 10% increase in duties could result in an increase in export costs of around CHF 5 million for a company with an export turnover of CHF 50 million. # ## Comparison with the previous situation Before the recent changes in US trade policy, Kägi's products were not subject to tariffs in the United States. This change represents a significant challenge for the company, which will have to find ways to mitigate the impact of the new tariffs. Rising commodity prices and declining demand in key markets such as China add further pressure. For example, the increase in copper prices, a crucial material for Kägi's production, has gone from $6,000 per ton to $9,000 per ton over the past six months. # ## Future scenarios To address these challenges, Kägi may need to review its export strategy and look for new markets for its products. The company may also need to negotiate with suppliers to obtain - Explore alternative raw materials. - Review export strategy : - Diversify export channels. - Invest in marketing and promotion in new markets. - Constantly monitor changes in business policy. # ## Conclusion Swiss companies need to be proactive in managing the challenges related to changes in trade policy and commodity prices. Diversifying export markets and negotiating with suppliers are crucial steps to mitigate risks and ensure long-term sustainability.

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Key points

Concrete action

To meet the challenges of exports, Kägi may need to review its export strategy and look for new markets for its products. The company may also need to negotiate with suppliers to obtain more favorable prices for raw materials or explore cheaper alternatives. For example, the company may consider expanding its operations to emerging markets such as India or Brazil, where demand for Swiss products is growing. Additionally, Kägi may negotiate long-term contracts with suppliers to ensure stable and predictable prices.

Step-by-step procedure

1. Market assessment: Analyze potential new markets to expand exports. This includes finding markets with low trade barriers and strong demand for Kägi's products. For example, the European market could offer opportunities thanks to the free trade agreement between Switzerland and the EU. 2. Negotiation with suppliers: Seek to obtain more favorable prices for raw materials. Kägi may consider diversifying its suppliers, including those located in regions with lower production costs, such as Eastern Europe. 3. Review your export strategy: Adapt your strategy to mitigate the impact of the new tariffs. This could include reducing transportation costs through optimizing shipping routes or using Swiss ports such as Basel or Geneva.

Useful tools

To learn more about the practical implications of exports, you can use the tax calculator available on our website. This tool can help you better understand the impact of duties and raw material costs on exports. For example, the calculator can show how a 10% increase in duties can affect Kägi's profit margin.

Final CTA

For more information and to use the tax calculator, please visit the calcolatore section of our website.

Source: swissinfo.ch