1 Quirky and wacky isnt sufficient……

…..so said Milena, Head of future brands origination at Sainsburys at an amazing Table Crowd Dinner I attended last night, where she was giving a talk on how to get a listing with her team

So what WILL get you on the shelves of part of the Future Brands opportunity

1. Differentiated product offer

You really need a point of difference, the USP that everyone talks about.  Sainsburys are looking towards the future brands team to deliver innovation so as a disruptive start up you need to be the “innovation engine” as Milena describes it.  Both at the beginning when you are getting the listing but also once you are on the shelf – you need to keep evolving and have a vision for that evolution

2. Affordability for the consumer

Sainsburys is mass market and so they need a product that is offering good value to their customers – that doesn’t mean it’s the cheapest. For example, Charlie Bighams is a good £1 more than the own label BUT it is in the ballpark.  Double the average price wont get you a listing. The biggest source of failure for a disruptor brand is where the brand doesn’t fit the pricing positioning

3. Affordability for the retailer

There is a broad breadth of margins for different categories which is driven by a number of factors not discussed during this presentation and the buyers should be able to give you some guidance on what you need to hit.

Sainsburys understands that sometimes when you are a start up volumes are low and therefore prices are high but as the brand establishes itself then the margin needs to be there for the retailer.  Sainsburys commodity is space and so your product needs to make more money than the product coming out

4. Exclusivity

Sainsburys want to differentiate their offer from other retailers.  So, to be a future brand, you have to be exclusive from the other mainstream UK grocers and discounters

It doesn’t have to be forever just a time bound exclusivity. In most cases however you have to have sold somewhere before to establish that there is a demand for your product. 

5. Brand standout

When you designed your brand packaging was it to sell online, off a farmers market stall or on the shelf of Sainsburys next to brand leader x??  If you want to be part of the Future brands story, your brand has to have physical standout – the customer has 2 or 3 seconds to make a decision so it needs to jump off the shelf (in a good way)

However you may be bringing something completely new.  Creating new categories is fascinating and something Sainburys are very interested it but as would need to have a whole bay it is not easy to implement but there is a team that is testing propositions eg E.g. lunchtime snacking aisle.  So if you do have a great idea for a cross category shop do get in touch with her – opportunities exist to set up trial in 30 stores.

6. Know how to work with the buyer

It is not easy to get in front of the buyer so you need to be creative – buyers can have or 100 brands so frankly you are not a significant part of their life!! So make every second count – tailor your pitch. Be punchy and keep it as short as possible – the buyer will love you if you schedule an hour and finish in 15 minutes!

And listen to what they say. They are experienced. They know their stuff.

As the brand grows, recognize that data is king!  You may not be able to buy Nielsen data but go and stand at the fixture and ask customers what they think – learn what is working and what isn’t on a store by store basis.  It is invaluable insight to help you keep a listing, identify an issue which might easily be solvable eg packaging not working, wrong outer case size or display unit that is not easily understood by staff and gets thrown away.

7. Timing

Timing is critical. There are two ways to get on the shelf – either as a 1 in 1 out or as part of a full refresh which are held less frequently.  Range reviews have to happen in the whole store estate so the team need to be mindful how often they do that, and not just change for change’s sake

And what do you get in return?  Brands get a great deal in terms of launch and ongoing support, and can include things like Nectar data, branded shelf talkers, feature on sainsburys.co.uk. They also get dedicated Future Brands team point of contact throughout the process, which can help with tailoring the pitch to the buyer, onboarding, etc.

And for how long?  Well there is no hard and fast rule here, and they take that on a case by case brand by brand basis.  They aim for mutual benefit from selling new brands, and are understanding that it takes a while to establish a brand. That is why they provide the support from future brand team

And finally what is working so far?  It is early days for the team but they have a number of successes across categories – restaurant collaborations, innovation in beer, snacking and vegan products not just for veganuary

But, as Milena did say Sainsburys are not the only place to sell your products.  She suggested sometimes a brand is not ready and there are other innovative ways of getting your products into customers hands such as Airbnb, online sales etc.  Your route to market is critical for the successful growth of a brand. This is something I can help you with so get in touch if you want to build your own quirky but successful retail journey!!

Ditch New Years Resolutions Day – or How to stay on track!!

Two weeks ago I wrote the shiny article on how to create an amazing 2019.  I had learnt I need to set boundaries, take on less, work less, be more productive.  I was moving from surviving to thriving!

Within a week, I was back working the weekend, had given away lots of free time and my builder who is helping renovate my house has wriggled out of finishing what he is contracted to do…like the last one!  So I am sitting here thinking about why has it gone a little awry?

I have done great things also – saved a client £14k by spending more wisely and finding different ways to achieve the same results, got two new accounts for one client and created a new and profitable direction for another.  So it’s going ok.

But how can I get it to go better?  Well Rome wasn’t built in a day and neither are good behaviours. Depending on which research you read, it takes roughly 28 days to form a habit – so if you are falling off the wagon at day 17then you haven’t given yourself a chance.  Go back to first principles, read the goals you set in week 1, reinforce the anchors and don’t give yourself a hard time.  Keep going!

Or do what I have done and get a mentor.  My mentor Natalie Sisson is helping me formulate my business goals – she is an awesome motivator and we have already had some great breakthroughs.  But the other thing is…. she is there in my corner!  She is there to support me, give me great advice and tips on how to create and achieve my business goals  and doesn’t judge – when I fall off the wagon and to help me create the success habits of 2019

So maybe you need some help too to stay on track.  You are probably expecting me now to say “And I am the one to help you do it!” 

But I might not have the right experience, not the right style or be  just too expensive with everything else you need to spend funds on.  Try these:

  • Are you under 30?  Then take a look at Princes Trust – they have some amazing mentors and all for free – https://www.princes-trust.org.uk/help-for-young-people/support-starting-business/your-business-mentor
  • Fancy getting a bit of Richard Branson help? Ok maybe not him – check out Virgin Start up team – https://www.virginstartup.org/mentoring.  I do volunteer work for Virgin and they are great and also offer loans
  • If you are not already a member of the awesome facebook group food hub – get stuck in!!  Also take a look at their mentorship programme – I offer a free session through this process and its great to road you’re your mentor!  https://www.facebook.com/groups/thefoodhubsupport/mentorship_application/
  • Look into getting funding for coaches – a couple of my clients has some funding to pay for my services!!

I hope this has been helpful in giving you some top tips to not fall off the wagon or be part of Ditch New years resolution day!   We are in it for the whole of the year and 2019 WILL be a success – give me a call if you need help getting back on that wagon!

Karen

Manifest 2019 success

I have been having a bit of a reflective break over the festive period and studying some great books including Tony Robbins, Denise Duffield Thomas and Janet Murray to think about how I am going to take my business and those of my clients forward in 2019.

I have already declared that I am moving from surviving to thriving and taking my clients with me.  So, in the planning days before everything goes crazy again, why don’t you take an hour out of your day to think about how to get ready for success in your business.

1. Move on from the past

Has your business been as successful as you would like it to be in 2018?  Maybe it has and you are sitting there with the glass of champagne as you have sold out for mega millions.  But if like most of my clients you are sitting there wondering why you didn’t hit the sales and profit goals you were striving for.  What are the excuses?

Did you not find the manufacturer you needed?

Did it take longer to bring the new products to market (they always take longer!)

Did the retailer presentation not quite meet the market and the retailer said no?

Did the retailer presentation go brilliantly but they never replied?

Are you not hitting the sales on a weekly basis?

Was the weather too hot, too cold, too wet or something else?

Did you not get the investment raise you wanted?

Did you get the raise and you don’t like the investors you have got on board?

Or is the business still a figment of your imagination because you just haven’t got started yet!!

The list is endless but you have to put all that behind you and start with a clean slate – 2019 will be different and so we need to be different in our approach.  So I am not going to go all woowoo on you but make a list of what went well and what didn’t hit the mark and look for any common themes – what might you do differently in 2019?  And then throw the mistakes away and start with a shiny new enthusiastic you – I was exhausted by the end of 2018 – had given more than my all and there was nothing left.  So learning for me – set boundaries, take on less, work less, be more productive – you will have your own list!

2. Be clear on what you want for 2019

Yup that does mean setting goals but make them SMART – specific, measurable, achievable, realistic, timely……. and not going to kill you!!! 

I had smart goals for last year and some I achieved and some I missed but also managed to have high blood pressure, mega migraines and not as much fun as I seem to be having in my Facebook life (as with most people!).  Why?  Because I set the wrong goals – I set financial goals, business targets but totally missed the ones about taking care of my well being, growing as a person and making time for relationships with friends and family.   But also I didn’t work out the way to reach my goals ie just working harder and harder as opposed to smarter. 

So if you want to get that Sainsburys listing – it could be worth £0.5m to you – so think about how you could achieve that effectively – buy the compelling Kantar data, work with a category specialist to build the story, develop the products that are perfect for them

3. Woo Woo ways of creating success

Remember why you first wanted to have this food business or to be the sales director or MD of an amazing food brand?  Were you excited at the prospect of seeing your product on the shelf – it IS truly an amazing feeling and my favourite!

Someone wrote on a post I put on Linked in this week that you need to have relentless passion and love for what you do to carry you through the bad times.  Well he is partly right – we do need to have passion for our why but that can be too broad and we can fall out of love with out business but still need to keep going.  So if you have a passion for each goal it makes it easier as does creating of what NLP people call anchors to keep us going.  Creating an anchor is relatively straightforward.  So for each of your key goals this year, create an anchor of positivity – want to win a retailer account?  Think of how amazing that would be – write down all the reasons why you want to achieve this goal and do an anchoring exercise – try this quick one minute video https://www.youtube.com/watch?v=dBp0ADPAXZY

Then next time you cannot get hold of the buyer, get rejected, get delisted – go back to your anchor for renewed energy.  Bit woowoo?  Try it!

Also don’t sabotage your bigger goal.  One of my goals is to reach an income level as a business mentor – yet I do so much for free. This is effectively sabotaging my income goal by using my only resource – time. Now the marketeers would say, you are giving for free because it will pay back in additional work – it is part of the promotional plan.  But actually a lot of the free stuff I did last year, did not pay back in new business and cost me a lot of money in travelling, time and effort.

So think about your key goals and how you could be sabotaging them by the small stuff. Over the next week, challenge every action you take – is this taking me to my next goal?  IF not then don’t do it!  Whether it is For every action over the next.  Don’t give free samples unless you can see the benefit.  Don’t

4. Make it happen!

So this sounds like the familiar, easy bit, right?   Anyone in business has taken a goal and broken it down into actions.  But what are the actions that push your boundaries?  What have you thought about that will create a bigger better food business but you daren’t do it?  For example take on a full time sales or marketing person?  That scares you financially – you are going to have to find £3-4k per month to pay for them.  But what if they get you that £500k retailer account – which is going to deliver £10k profit a month.  REALITY CHECK – in my experience, the minimum leadtime for getting a retailer listing is 6 months – but allow 18!

So then dream a bit bigger – look to raise some capital to pay for the sales person and you can add in a marketeer and your business is on its way to great things.  Make your bigger goals happen with bigger actions

5. Reinforce success

When I typed this last point – I started by writing “celebrate success” but actually that is not really how this manifesting goes.  You need to REINFORCE success – use every little achievement and feel good moment to reinforce your anchors from point 3. Capture them in a spreadsheet, on your white board in the office – somewhere you will see them to reinforce how you are heading for your goal. 

And don’t beat yourself up about the bad decisions, the wasted actions and the non goal achieving stuff that got in the way.  Write that down too – and see if there is a pattern – why do you get distracted.  And then forgive yourself and forge on ahead!

So I am off for my first goal achieving meeting of 2019.  If you like the sound of this approach for making a success of the new year, give me a shout and we can see how I can work with you to ensure that in 2019 you thrive not just survive

Happy New Year!

Karen

karen@foodmentor.co.uk

07811 942054

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Alternatives to Dragons Den

I have been speaking to various people who have been lucky enough to get on Dragons Den and the coverage and uplift for the brand has been amazing. But either they have not received an offer of funding OR the % equity requested has been so high that it is not necessarily the best move for the business. So what alternatives are there – have a look at the list below of the 5 top ones around at the moment

 

  1. The Hatchery

I have personally put three clients in touch with The Black Farmer, Wilfred Emmanuel-Jones

His approach is very no nonsense – says what he things but also very insightful. They are looking for early start ups who are still in the ideas stage.

There should be funds available plus mentoring from The Black Farmer and his team who are a formidable lot!

www.theblackfarmer.com/the-hatchery

  1. Grocery Accelerator

I have had some experience with working with Rob and Paddy and the team here and their boardroom sessions are powerful!

They have a strong offer enabling food companies to grow through securing investment but you do need to invest in their programme first to get your company investor ready. They have some awesome skilled people on the team – and also access to VYPR which enables SMEs to research their brands and create strong selling stories by knowing their consumers better.

http://groceryaccelerator.co.uk/

 

  1. Big brands looking for little disruptors

Here we have thre big boys looking for inspiration and speed and flexibility of the little boys.

– PepsiCo are looking for upto 10 foodie start ups (less than £5m turnover) who can offer amazing nutritional products to the pan European space. This year’s program deadline is June 11 2018 but am sure they will run annually

There is a grant on offer of €20,000, usual mentoring but from the might of Pepsico expertise (great for thinking like a big brand) and the winner gets €100,000

http://www.nutritiongreenhouse.com/

– Kraft Heinz

As with Pepsico, you get access to the company’s wealth of expertise and knowledge plus investment and mentoring on how to get additional funding and support

https://www.springboardbrands.com/

– Diageo

Ditto with Diageo although they are looking for alcoholic and non alcoholic brands

www.distillventures.com

 

  1. VBites Ventures

Heather Mills (famous for being previously married to Paul McCartney) has founded Vbites and just bought a factory up in the north east to produce snacks.

She is looking for SMES who produce plant-based products and meat alternatives and will provide investment, scale and manufacturing support from the new factory and her expertise and mentoring

https://vbitesventures.com/

 

  1. Square One Foods

This is a more classic accelerator program run by the guys at Spitz who are an Austrian food producer. Looking for broad breadth of innovative food and drink SMEs, they offer seed capital in return for 15-25% of the company. They also give access to their partnerships with retailers, manufacturing resources (as required) etc etc

https://www.squareonefoods.com/

And finally if you are interested in getting a grant – there are not many of those around! – try applying for the Small Business grant. They offer £5000 per month to businesses with turnover of over £50k. Ollies olives won in April so worth taking a look!

https://britishsmallbusinessgrants.uk/

 

I hope you have found this overview useful and let me know of any other schemes you are aware of to help us all build a recipe for success.

 

2 Do you have mega bucks to burn?

I have just received a quote via a client for design work for £23k – granted it will deliver the logo, packaging design, artwork and a basic website but can it be done more cheaply and just as efficiently for a similar price? Another client is paying £1200 a month for PR which is £14k per year – at a net profit of 5% for the company that PR would need to generate incremental £280k to cover its costs.

So how do we avoid burning cash when researching new products, designing our brands or promoting them? Well here’s my top 5 suggestions for saving money:

  1. Size of market assessment for category reviews

Did you know that the British library holds thousands of reports that you can access for free such as Mintel which covers most food markets and has a myriad of data on the size of market, who is the consumer, competitors etc. You do have to physically go to the library which is next to St Pancras station but do the maths – pay £3500 for a report or buy an off peak train ticket and go do your own!

Here’s the link – https://www.bl.uk

  1. Do your own market testing

Last year, I was asked by a major UK produce company to write a category strategy for Tesco Czech and Slovakia. They were not happy with the research they had already commissioned so we did it ourselves. Wrote the brief, set up the camera and recorded our own focus groups! And it worked really well. I have also done at fixture research asking customers what they thought of products – you do need to get permission from the retailer to do this though!

If you have a bit more money to spare, Tessa Stuart (http://tessastuart.co.uk) will do it for you so worth checking her out. Or for testing prices, brand concepts or consumer reactions with over 30000 UK consumers, VYPR is a great method. They have tied up with Grocery accelerator to offer a great deal on research – hop over to the website – http://groceryaccelerator.co.uk/vypr or give me a ring and I can explain more how it works

  1. Reasonably price design work

I have a client who used 99 designs (https://99designs.co.uk) who did all her design and artwork for £700. It does need a decent design brief to ensure you get what you need – I have a template if you need one so just email me!

I also did my current website for £350 – I have to be honest it did take a lot of time investment from me and a very clear vision on what I wanted but I am really pleased with the result – I found my web designer on www.freelancer.com

  1. Cost efficient PR

There are a few ways to get to save money on PR. I have signed up to https://journolink.com which is free for the basic package. You specify the areas you are interested in and then you get emails when a journalist is looking for info on your specific product or topic. You can also try out Smoothie PR from Charlotte Moore who focuses on reactive PR and sends out a list everyday of food specific journo requests and is very proactive in supporting her Smoothies – http://www.smoothiepr.com. She charges £49 a month but worth trying it out and seeing if it works for you

  1. Get help for free or at least subsidised

I often joke if you are looking for help with technical stuff – get a young person! Well at risk of being ageist (ok I was and not all students are young!), many unis are looking for companies to take on their students either for a year’s placement or during the summer. I did it at ichiban and we had Otis for two years and he was amazing, doing all our admin, running social media and helping with exhibitions etc.   Some of the summer interns come for free, are subsidised or you pay the living wage. Its well worth approaching your local uni and seeing what they have to offer.

If they offer food science, they can also help with research, innovation etc

Which leads me to the BONUS point

  1. R&D tax credits

If you have worked on innovation or new product development, you may be entitled to claim all that cash back against tax. Have a look at the government website – https://www.gov.uk/guidance/corporation-tax-research-and-development-rd-relief

This is a complex area and worth finding someone to make the claim for you – most companies do it on a “no win, no fee” basis so doesn’t cost you money up front

So there you have it, some of my top tips for ensuring you don’t spend mega bucks on launching your product, promoting it or doing your category reviews!!

 

2 Top 7 Mistakes Suppliers Make When Selling to UK Retailers

 I was recently asked to give a talk at the Natural and organic product show about what mistakes suppliers make when selling to the retailers – both from my experience as a buyer and also as a seller – what has gone right and what has been a horrible disaster!

So I thought out what are the key mistakes we make?

Mistake 1 – Forgetting the buyer is human!

I am really guilty of this one – I have sent out an email to a buyer and no reply so think, being somewhat paranoid, they are ignoring me. But actually I forget that the buyer is human and busy and has a lot of other things on her plate other than talking to me. Such as:

  • Challenging sales targets (NEVER phone a buyer on a Monday…)
  • Supplier/product problems: quality, logistics, sudden crises, etc.
  • The stores themselves not doing what they are supposed to do!!
  • New launches and promotion challenges
  • Constant pressure from the competition
  • Pressure to find or develop great new products: THAT SELL!

 

Mistake 2 Right product, wrong retailer

You love your brand – you have made it the best in terms of recipe, packaging, pricing is spot on and you have a load of social media follows but…..you might be approaching the wrong retailer – Poundland is not right for Prada and Harrods probably don’t sell white sliced bread for 55p!! Think about your brand strategy and do you fit the retailer you are targeting. Some things to consider are

  • Who is your target customer?
  • What is your price positioning?
  • Do you have the capacity or plans to outsource?
  • Do you/your producer have the right accreditation (e.g. Salsa, BRC)?
  • Can you meet retailer margin expectations & still make a profit?
  • Can you deliver to their depot or store configuration?
  • How much can you afford to invest in trade marketing?

 

Mistake 3 Right product, wrong buyer

I did a talk with Nick Coleman of Snaffling pig recently who make pork scratchings. His business sells bagged snacks so he would go the snacks buyer – right? WRONG!! He does have bags of pork scratchings but they are great for the food to go aisle, yes snacks, but also does kilner jars for gifting and has even launched a joint venture this week on pizza with Papa Johns – so know the right buyer cos if you get the wrong one, your email may just go unanswered

Mistake 4 – Fail to prepare, prepare to fail

It’s a classic adage but it is so true – know your market, your numbers, your product capabilities and …..the buyer. Go through the following checklist

  • Who is the buyer – social media is your friend – build a profile and find some areas of common interest
  • Know the retailer current strategy and have a look at the info they share on websites – see the sites below

www.asdasupplier.com/becoming-a-supplier/introduction

www.about.sainsburys.co.uk/suppliers/becoming-a-supplier

www.tescoplc.com/contacts/suppliers/

www.supply.booths.co.uk

www.co-operativeesourcing.coop

www.morrisons-corporate.com/about-us/meet-our-buyers/#a3

  • Business performance and KPIs – what is the buyers KPI – are they driven by cash profit or margin?
  • Visit the stores and speak to managers – they can be very insightful

 

Mistake 5 – Selling the brand, not the opportunity

Don’t sell the features and benefits of your brand unless you think through how that will help your buyer achieve THEIR targets. Will your brand:

  • Increase consumer footfall (with the right customers?)
  • Revitalise the flagging category and raise average cash profit
  • Create differential from other retail competition

 

Mistake 6 Being afraid to walk away!

You may get the meeting, do everything right and then the buyer asks you for a cost price that is your cost!! Never be afraid to walk away – you might be too expensive maybe due to low volumes, poor purchasing power etc but they may also be negotiating hard and by walking away you will determine if they are really interested. There is no point being a busy fool just to say you are in Tesco (other retailers are available!).

My book Recipe for success has a chapter on Negotiation which is well worth reading – order kindle version now – click here

Mistake 7 Being afraid to walk back!

Many suppliers once they have been turned down, cross their target retailer off the list. But no doesn’t mean no forever……things change. And here are some reasons to go back:

  • Your timing may have been wrong – time for a range review, time for change
  • Your offer may have improved – costs come down with more volumes or developed a stunning new marketing strategy
  • The buyer has changed – this is a classic one – a new buyer may have a different view on where she wants the category to go so fresh new opportunity

 

So go forth and get those retail listings and if you are unsure, contact me for an informal chat about how I can help you – karen@foodmentor.co.uk

Plus I have written a bonus FREE Ultimate Guide to Category Strategy so click on picture to get yours now

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The 5 steps to Exhibition Success

You have chosen the best position for your stand, invested the money for the biggest one you can afford and then been shocked by all the additional costs – who knew electricity points cost so much?!!! So how do you now get the best return on that investment? Here’s the top 5 steps to success:

  1. Know your why – I am stealing from Simon Sinek’s great book title but it is important. Why are you attending – some reasons could be:

– to make some sales

– to get at least 50 qualified leads from independents

– to meet the big boys whether that is buyers from grocery multiple buyers, food service or travel industry

– to find business partners such as wholesalers, outsourcing or designers

Set an objective for the event just like you would any other marketing activity and then plan your approach based on this. Designing your stand to find a distributor will need different messages to how you design it to attract independent delis

  1. Fail to prepare, prepare to fail – make sure you have thought through every eventuality of the stand.

– how are you going to capture contact data? – are you relying on the exhibition data capture system – I suggest you also have a sheet for people to fill in – include a column for your personal notes of who they were and why you are keen to meet them – by the end of three days – you will have met so many people and not have a clue who they all were!

– make a list of everything you need – are you giving out samples? Do you have plates, spoons, allergen listings…….and always take refuse sacs and a bin!! And pens – you can never have enough pens!

– pre invite people – let everyone know you are going on social media and invite them to your stand number. Also if you have specific buyers you are wanting to meet – send them an invite via linked in

  1. On the day – get there early to set up so that you are ready when the doors open,

– brief your team (make sure you have enough cover) with the objectives, product knowledge and how to sell to people

– ensure everyone knows who the key buyers are so that if they come on the stand, they can pass them to you or free you up if you are tied up in a different conversation

– ensure everyone is dressed to fit the brand and are wearing comfortable shoes

– ban mobile phone use and eating on the stand – looks unprofessional

– plan in plenty of breaks for the team to keep them fresh and also to go see the competition!

  1. Afterwards – manage your expectations, I went to an exhibition last year and got 30 qualified leads – I followed them up diligently and not one turned into a sale. But it had raised my profile and new clients did follow – but there was a time lag. The picture at the top gives some great statistics on sales success – use them to feel reassured!!

– follow up as soon as possible but be patient – remember that show visitors will be inundated with follow up calls

– email first and then try phone calls

– don’t be a stalker – try and add value to your messages with information that your potential client may be interested in

  1. Next year – the last thing you may be thinking about is investing another load of money but IF the event is a success, now is the time to rebook – you will have a better idea of positioning for the ideal stand for you and a good chance of getting it.

Read now FREE chapter from Recipe for Success

Stress, distress and success of running a food business

Success is not final; failure is not fatal: it is the courage to continue that counts.

Winston Churchill

Over the past thirty-five years that I have been in retail, the world has changed greatly. The retailers dominate the retail landscape. Tesco has 28% market share of UK grocery but no brand has more than 1% — power is in their hands. £1 out of every £8 spent in the UK is spent in Tesco!!!

The consumer has changed greatly over the years. He/ she is now a shopper in charge of the decision-making process far more than ever. Brands do not hold the same dominant position that they once did — so what’s changed?

Massive proliferation:
• Number of products on offer — there are so many

more leading brands, challenger brands and own label. Coconut water started out as new in 2004 launched by Vitacoco — closely followed by a number of challenger brands; and then the big boys such as Innocent and retailer brands had offered variations. Indeed, the Innocent brand itself wrote the definitive book (in reality it’s great — A Book About Innocent) on how to launch a smoothie brand and it dominated the market until the own-label boys developed alternatives. And then, challenger brands such as Savse, found niches within the category that Innocent had effectively created — nipping away at Innocent’s dominant position creating a £10m brand of their own.

  • Number of ways of shopping — when I began my career at Tesco in 1986, we had about 350 stores. Now there are over 3,500 in the UK alone, not to mention overseas — and these are subdivided into Superstores, Express, Metro, online, etc. As I write, they are also in the process of bidding for Booker which will add further complexity to the offer. And this is just classic retail — there is also the growth of Amazon, home delivery, meal kits such as Hello Fresh, etc., etc. Just Eat turned over £370m in 2017 purely from delivering other outlets’ takeaways.
  • Ways of promoting — when I was young, there was only TV in the afternoon and evening and only three channels — BBC1, BBC2 and ITV. Now I believe there are over a thousand on my free sat box. As a brand manager, there were four ways we would promote a product — TV advertising, press advertising, PR and in-store promotions. Now, of course, there is the development of social media, and the ability to reach the customer with your message, becomes infinitely more complex. Once, we would just advertise on mass media and hope someone read it. John Wanamaker said “I know half my advertising works but I don’t know which half!”. But now you have the ability to target your message to one specific person, or ten or twenty.
  • Growth of private label — there are some markets that reign supreme on brand and we will look more at this in Chapter 5. But suffice to say that over 50% grocery is private label although the growth has reversed over the last couple of years.
  • Paradox of choice — the change in buyer behaviour. When I was at university, I did a whole module on the psychology of how people buy and how to make it more effective. There are more and more books written on this subject and also the paradox of choice and information overload. The consumer is in charge. She doesn’t have to rely on the advice of the local shopkeeper — which was just that: local and biased! Remember the BBC’s Open All Hours programme where Ronnie Barker’s fabulous Arkwright was always coming up with creative schemes to sell more products? Now there are online reviews to discover the best products, mysupermarket.com to find the best price and numerous other ways to inform and enable the customer. There is a wealth of information to turn the buyer into a true shopper — informed and able — and yet so overwhelmed by all that knowledge and the paradox of choice. I think this is why John Lewis so successful — other than its inspirational Christmas adverts about penguins and trampolining dogs, of course. You can still go and shop there safe in the knowledge that their staff are well trained to help you find the best product and “Never knowingly undersold” means you don’t need to worry about the price — an easy shop.

So, what does that mean to you working in food businesses, trying to make a success and make your profitable way through?

YOU NEED HELP!! And here it is, in the form of my book — Recipe for success. I have written this book for you.

Before we get into the detail of the book, I want you to think about the three possible outcomes for your business which form the title of this first chapter — stress, distress or success?

Which one do you want to choose for your business?? I have lived through all three with different clients over the years and want to ensure that once you have finished reading this book you have the plan for only one — success — hence the name of the book — Recipe for Success. But let’s think about the other two first!

Stress

The definition of stress is “a state of mental or emotional strain or tension resulting from adverse or demanding circumstances” English Oxford Living Dictionary. I often use the definition that it is the feeling of not being in control — pressure is great and stimulating but when it overwhelms then it becomes harmful.

It is likely you are reading this and nodding your head at this point and saying that IS the food industry. By its very nature of being fast and dynamic, there are going to be high pressure moments and these can be stimulating and rewarding. Many people in the food industry love the adrenalin rush, the need to solve problems and the high of success (myself included!).

But real stress is when you can’t cope with the rain of pressure and then it becomes a medically bad thing.

Everyone knows when they are stressed — can’t sleep, always tired, more headaches than normal (certainly true in my case). Maybe you dream about the particular situation. Sometimes you extrapolate and lose all sight of reality — I know I certainly have on several occasions in my life where I am not in control of the situation and a retailer is threatening to delist, we have a product recall or total inability to supply.

And what are the things we worry about?

  • Losing business
  • Falling out with key customers (and the potential of lost business)
  • Product recalls
  • Bad press coverage
  • Business going into distress (see next section!)
  • Personal impact — maybe getting sidelined from promotion or worse, getting sacked!

All of these are caused by fear of failure and often a lack of structure in the business to cope with the challenges that life throws at us. When I worked at ichiban, the MD had a catch- all for when things went wrong — and called it the “f***-up fairy”. I absolutely loved the description because it was said with a degree of sarcasm and cynicism, i.e. he meant how has this particular situation occurred without our being in control of the situation. Had some magical fairy come down and just created havoc or actually was it the fault of the managers who had missed some critical control point or understanding of the situation that had meant a disaster had ensued? After a few months working with the business, implementing new systems, putting in the right people to run them, the fairy did not visit so often — but she is definitely very stressful and in Chapter 11, we look at how you can protect against her!

Distress

When I started writing this book, I had never heard of the phrase “distress” being an actual term for a company that is struggling and in danger of bankruptcy. BegbiesTraynorspecialises in helping distressed companies and publish quarterly numbers for various industries including food. In Q4 2016, UK’s food and beverage manufacturing industry, which supplies the major UK supermarkets, showed a 13% increase in “significant” distress over the past year, with 5,986 businesses now struggling, compared to 5,312 at the same stage last year. The research indicates that small suppliers have been most affected, with SMEs making up 94% of companies in distress within the sector. That’s a lot of people like you and me sitting at their desk worrying about what is going to happen to their business.

The key indicators of distress are as follows:

  • Decreased profits — common in the current climate of inflation, Brexit, increased living wage and other financial pressures
  • Falling sales volumes and losing market share — possibly losing to other more nimble brands/suppliers and/or trading in a declining market
  • Pay cuts and freezes — apart from, of course, the ever- increasing living wage
  • Loss of regular customers
  • Cash flow difficulties — suppliers insisting on proforma
  • This can be a difficult situation not just for businesses in distress but also start-ups — both of whom may have poor credit ratings
  • Redundancies and loss of key personnel as people realise that the business is not doing well
  • Factoring invoices to try and support cash flow — many small businesses use factoring to enable them to overcome cash-flow difficulties but when the average food company net profit % is about 5% then giving away 2–3% is a significant amount to give away unless you need that cash flow
  • Borrowing to pay off existing debt

CASE STUDY

The company— I was working with a frozen food company in the North-East who had previously been in administration and had been given a new lease of life with new owners. The workforce worked tirelessly on their factory, rebuilding it from the ashes literally as it had suffered a fire. They developed new products, sold them into both retailers and brand owners and had a factory that achieved a positive audit on its first attempt. We had a great management team and quality products.

The problem— there were two issues surrounding profitability and consequential cash flow. The products had not been costed properly and the customer agreements had very long notice periods. Disaster struck as the two key ingredients — wheat and beef, the two key components of this company’s production — went through the roof in terms of inflation. I tried to override the customer agreements and negotiate through price increases but they were rejected.

Slowly the focus of the management team changed — we were managing supply, not on orders, but on what raw materials we had available. Some suppliers continued to be supportive but others moved on to proformas. We factored invoices to try and improve cash flow and spent our focus prioritising payment.

The solution— sadly, our first case study of the book does not end happily. The situation did not improve and the company went into administration, leaving many workers out of a job and many creditors out of pocket (including myself).

It was a horrible experience and I learnt many things about contract negotiation, product design and resilience at pushing through inflation — the sad thing is that the retailer who would not put up their cost prices for us, was forced to move to another supplier and in less than two months their retail prices went up by 30%.

One of the book’s key purposes is to help you avoid ever getting into the situation of distress and if you do get into trouble, as risks need to be taken, you will know how to find your way out again. Which leads us on to the happy place of success…

Success

So how do you avoid the stress and distress of the failing business and experience the joy of success of an evolving, profitable one?

Knowing it is running like clockwork with profitable products flying off the shelf and happy retailers and consumers alike! I developed the POWER model of success:

PProduct

The most important element of your business. Your business needs to sell great food that meets the needs of your consumer. Those needs may change but if you have an amazing product then retailers will want to stock you and customers will want to eat it. It is not always that simple, of course, as the needs of consumers change, competitors come and steal from your category, products come in and out of fashion and your once cheap commodity that you made it with becomes unbearably expensive. However, if you can take charge of your product offering, you are halfway home to taking charge of your business — we talk a lot about this in Chapters 5 and 6 and then the challenge of evolving to meet the market needs in Chapter 13.

CASE STUDY

The company— one product that I believe is pretty unique and has stood the test of time is Marmite. I talk a lot about Marmite in this book as I believe it is, in some ways, the perfect brand that has stood the test of time. It evolved as a by-product of the brewing industry being launched in Burton-on-Trent where there were a number of brewers and a lot of brewer’s yeast! It has a unique packaging shape and a name that references the pot and not the actual product. Maybe if it had been assessed in research, it would not have come to market as it is so polarising, yet they have used the “love it or hate it” theme in the advertising for over ten years.

The problem— how to keep evolving. The product is named after the shape of the packaging and let’s be honest, there is only one Marmite recipe!! No one has yet developed smoked BBQ Marmite or an avocado version!!

The solution— innovation around the edges!! The parent packaging has remained unchanged but there have been a number of customer-orientated changes e.g. squeezy bottles and little pots for the catering market (both Marmite shaped) or a variety of licensing opportunities — from crisps to chocolate.

So, they haven’t changed the product, just accepted its uniqueness and the phrase “something/someone is like Marmite” is now widely used. And due to this uniqueness, it commands a high price despite Marmite-gate, when Tesco and Unilever fell out over inflationary increases. It actually breaks some of the rules/suggestions that we make later in the book that you should meet customer needs — it is exceptionally high in salt but perceived as high in B vitamins so it is almost a health food, plus half the population hates it! Find another Marmite and to my mind, you have found product nirvana.

OOrganisation

When a business first starts up, there is usually an entrepreneur who has an idea and begins making it in their shop or on the kitchen table. They do all the work and then slowly begin to evolve, bringing in help. From there, the organisation will grow to meet the needs of the business organically until sometimes you have a complex structure that is unwieldy and complicated. The business targets may not all be aligned and people may have forgotten the point of what they are trying to achieve.

Similarly, the type of people a business needs will change and grow as the direction and strategy of the business evolve. So, taking the recipe for success of your food business means making sure your organisation is well structured, focused and well led which we will examine in Chapter 10. The people need to be well chosen to meet the needs of today and be invested in to enable them to evolve for the needs of tomorrow.

WWell-being

Well-being is a strange one to suddenly introduce in amongst all this management speak but it is one for me that has been key to my success and survival during the tough days of f***-up fairies and difficult retailer conversations when the stress is high and joy is low.

It is critical to think about how you look after yourself as an individual — knowing yourself and how to take care of your well-being is paramount to success. There are many studies that show that people perform better when they are well rested, well nourished, fit and healthy. It is kind of obvious but not always thought about in the business context. And similarly, not just your personal well-being but also that of your staff. It is no coincidence that larger companies offer gyms on site, free gym membership and yoga classes in the lunch break. A team at the peak of its health and fitness will take much better charge than one that is exhausted surviving on little sleep and rubbish food.

EEvolution

As discussed in the beginning of this section, we will focus on how to keep a business evolving in Chapter 13. It is a critical part of any business to keep understanding the changing needs of the customer and adapting product offer accordingly.

But not just the product… the organisation, marketing, even legislation, etc. The world is so fast moving you have to keep up and your business needs to evolve with it.

RResults

I have talked about the need for a well-aligned team with focus on the same end game and nothing is more important to get results. Chapter 11 talks about what type of targets you need to set and how to monitor them. How can you know if you are doing well if you don’t have a detailed breakdown of your profit margin by product possibly by day or at least by month?

Some products don’t have a variable cost — the line is set up and it runs off a batch and that is that. However, if you take sushi as an example, the profit can vary by day and by season due to the volume variations — more sales on a Monday as people are being healthy and more in the height of summer and the lowest ebb at Christmas. The cost of the product doesn’t really change in terms of raw materials but the labour costs vary as the efficiency of the lines changes with less product made per shift.

It is important to understand the drivers of your products’ costs and potential risks — currency/inflation, etc. But it doesn’t just have to be financial numbers — quality, supply and even staff absence can all be measured and quantified.
You need systems in place to do the measuring and

people who are brought into the targets so that they know why they are working with them and how they are going to help make their life easier.

So, in summary, this book sets out to find the recipe for success and how to avoid the stress and distress of running a food business and to give some insights into how to create success and enjoy being part of an amazing, stimulating industry.

Exercise

Divide a piece of paper into two (or use two PowerPoint slides or Pinterest boards or whatever is your thing) and list out in words, draw pictures or use photos and build your model of:

– what success looks, sounds and feels like
— what stress and distress look, sound and feel like

for you. It is good to have something that you want to go towards and something you definitely want to work away from to help motivate you when times get tough and the f***-up fairy comes.

So, now you have your vision and what’s going to feel good; we had better find out where you are now — in Chapter 2 which is available for order on Amazon — https://goo.gl/cCY7qC

The risks of being a retail buyer (or how to get a listing!)

Imagine you are the buyer of a major retailer – you get upto 200 emails a week from people wanting to list their products. You have a great range already – its not doing badly – why take the risk of launching another product??

Then out of the blue, something different and interesting – you have seen it out in the trade – you are interested. But there’s a big risk of change – so how does the supplier alleviate that fear and make it easy for the buyer to have the confidence to take the plunge?

Risk no 1 – it won’t sell and I will have lost sales for the space for something else

The biggest challenge for a buyer is choosing a product that is going to grow the category and provide exciting new opportunities for his/her customers. And as they don’t have elastic shelves, to sell more than the product that is already on the shelf. So how do you alleviate their fears and reassure them that this is the product for them?

  • Show how your product has a unique difference to anything else on their shelves which is relevant and important to the retailers customers
  • Demonstrate with examples from other retailers, online sales, markets how your products are selling well and how they have grown the overall category
  • Build their confidence with your social media following that you have dedicated and loyal customers who will come in their direction
  • Offer them a strong (but profitable) commercial deal with investment in marketing that will build success for the product

However please do NOT offer them sale or return or to pay for any waste. I have clients who do this but it is potentially signing an open cheque. The buyer needs to have the confidence that the product will succeed. The only time I have agreed to pay for waste is when I had a short dated product that would be unsaleable unless I moved it through retail quickly

Risk no 2 – it does sell and they can’t keep up with demand

Success brings with it its own challenges. I remember the Brewdog guys talking about the problems that their listing in 400 Tesco stores gave them in terms of production and cashflow. So it important to work out what the business will mean:

  • Capacity – can you meet the increased demand in your factory. Would you need to put on another shift, bring in additional people and even in some cases build another factory (it does happen!)
  • Cashflow – retailers are a lot better at paying invoices and shortening settlement terms but lets just do the maths. You sell a product for £1 into 400 stores and it sells 20 per store per week – that that’s £8000 per week they owe you. Your first order will be big as well as you need to fill the shelves so assume additional 8 per store. With 30 days terms, you will supply 3200 for shelf fill plus 32000 units to restock. Assuming it costs you 50p to make you are looking at £17600 investment.

So know your business and its capabilities before you go to your retailer meeting – you may want to just take a few stores to enable you to understand their systems, minimize YOUR risk and to ensure that your listing is a long and happy one. Not one that just crashes and burns after a few weeks.

If you need help with planning your retailer route to market, please feel free to contact me at karen@foodmentor.co.uk.

Five things customers REALLY want from their food

The consumer is no longer a simple animal. There is the paradox of choice that renders most people incapable of change. 85% of our food purchases never change. Most people eat the same sandwich for lunch every day. Online ordering from Ocado, Just Eat etc reminds us what we bought last time and, despite all the interrupters in the world, the majority of people get the same stuff

So what’s the secret to getting people to buy more food – what do they REALLY want?

  1. To save money – I talk to a lot of food start ups who are all creating premium brands. There are niches for these but the majority of people have little money so think about ways you can save the customer money and yet create value and profit at the same time – Aldi and Lidl have managed it!
  2. To eat really tasty food – it is important that food tastes good – it seems obvious but how many people have bought a snack bar that tastes like ground up shoes? Or had a sandwich that is bland, soggy and uninteresting? People want to enjoy their food! So many worthy brands do not deliver on taste – yet the successful ones do – making it yummy and scrummy is the key so long as you observe the next point…..
  3. To stay healthy –not everyone is obsessed with health but many consumers want to know that the manufacturer has thought it through – kept the salt low, not put in dodgy fats, high sugar or other additives.  So many premium own label ready meals, such as Finest and Taste the difference, are high in fat or salt or both – it does make it tasty but there needs to be a balance
  4. To treat themselves and add joy to their lives – most people view treats as unhealthy – wine, cheese or chocolate. But it provides a short term fix of joy. The only product I have found that is a healthy treat is sushi – which does actually research as both.  People use food to help them feel better eg when something bad happens, breaking up the monotony of the day with a great lunch sandwich or demonstrating how foodie they are by having the latest recipe or ingredient. So create amazing happy products both in their recipes and marketing
  5. To add joy to others – as we approach Christmas, this is the backbone of the retailer adverts. Creating amazing food to share, impress and please others. To make life easy when entertaining, to demonstrate our cleverness at finding such interesting products or just showing the love by feeding others

And what is missing from that list? Actually to provide the body with nourishment and fuel for the day – the real purpose of eating!! But somehow that has become a given – I did some research on diet foods recently and we got 20 reasons why people eat before we actually got to “to stay alive”

So when designing your products, creating marketing stories or choosing positioning, it is important to think about which of these basic needs are you fulfilling. Try this 3 point plan to draw up what your customer really wants

  1. Who are your buyers? Use your social media or sales data to get a feel for the demographics).
  2. What do they really want – what is their key goal from the 5 – are they living to eat or eating to live?
  3. How do they think? Are they cautious people or spontaneous? Innovators or laggards – if they don’t like change – can you force it upon them or do you just get them to buy more

What is their decision tree for buying products and how can you catch them through marketing, packaging design or merchandising as they shop

If you would like more detail on this subject, chapter 3 of my book Recipe for success – ingredients of a profitable food company is a good place to start. Click here to order on Amazon