AAK is designed to create customer value through innovation.

AAK, headquartered in Malmö, Sweden, is a multi-oil ingredient supplying company. Their business is about creating value-adding vegetable oil solutions for their customers with main applications in food, feed and cosmetics.

Today the company comprises of more than 3,300 employees, 20 production and customization plants, 25 sales offices and sales activities in 100 countries. With a rich history dating back to 1871, the company set up its Singapore branch in 2014 with the aim of drawing closer to their customers in Asia as this is where their markets are developing. “We started with only 2 people in the Singapore office with a focus on developing the sourcing side first,” says Bo Pedersen, Sourcing and Trading Manager at AAK SG Pte Ltd. Together with his boss, Bo Pedersen was part of setting up the sourcing and trading activities which involves tropical oils such as palm oil and coconut oil, and a sales unit which serves the entire APAC region. These activities were off to a good start and the company expanded by moving to another office and adding a customer innovation centre to its facilities. AAK’s Singapore office are now with 30 employees and are expected to continue growing at this pace.

The Co-Development Company.


The new office in Singapore resembles the same standards as AAK has elsewhere in the world. It is designed to encourage collaboration with customers in order to generate relevant ideas and find the best solutions. This is in line with AAK’s approach to innovation. “We call our company the Co-Development Company for a reason,” explains Pedersen. “For us, creating customer value is always the end objective and we achieve this by applying a systematic approach to innovation.” The Customer Co-Development approach includes five steps: Ideate, Create, Prove, Implement and Launch. Each step is undertaken in collaboration with the customer. As such, the innovation labs of AAK are called customer innovation centres; the door is always open and customers are invited to come in to create products together. The Co-Development approach simplifies AAK’s concept of innovation and has brought the company amongst the top performing companies in terms of customer collaboration and trust as well as quality products.
The company understands that innovation has to take place in each part of the organisation and therefore the office invites employees across functions to interact with each other to accelerate the innovation process. Furthermore, employees receives exposure to innovation through dedicated training programmes.

A new customer innovation centre in Singapore.

The newly established customer innovation centre in Singapore serves as the pillar for innovation in the APAC region. “The investment shows our dedication to Singapore as a strategic location for the expansion of our activities in the region,” mentions Pedersen. The Singapore government has been very supportive in setting up the business here and an additional advantage is that the local workforce is meeting the standards AAK is looking for. Also, the outreach to suppliers is easier from Singapore as they are now in the same time zone. Pedersen continues: “The innovation centre is also our way of giving back to the Singapore government as we are showing local students that food science is an exciting area to study and work in. Our role is to make sure the knowledge does not stay within universities and to show students that job opportunities in our niche area of food science actually do exist.”

Sustainability built into everyday activities.

Apart from innovation, sustainability is embedded in AAK’s daily operations. AAK wants to ensure their customers and shareholders that they are doing the right thing. ‘The House of Sustainability’ was setup to achieve sustainable growth and covers five focus areas: customers, suppliers, planet, people and neighbours. “Building sustainability into our everyday activities helps us achieve our vision of being the first choice in value-adding vegetable oil solutions.”
For AAK, it is essential to continue focusing on their downstream specialism. “We need to keep differentiating ourselves otherwise our products will be commoditised,” explains Pedersen. Furthermore, the company’s growth strategy is focused on Latin America and Asia. AAK is committed to Asia by setting up their plants here so that they can achieve the volumes that they have set forth in their strategy and deliver to share- and stakeholders. The journey does not stop by focusing on existing customers. AAK is also on the lookout for new business opportunities to serve local customers and grow its market presence in Asia. Pedersen: “We do this through engagement with potential customers to explain how our co-develop approach can benefit their business. By working with AAK, their total profitability at the end of the chain should be different from what they have now; that is what we believe in!”