While food giants such as P&G, Nestle and Unilever have long operated with a global footprint, it’s only recently that small- to mid-sized companies have been able to effectively tackle these markets. U.S. processed food exports have been growing steadily for several years, and are set to keep expanding as the world’s population migrates to urban areas and its dependence on processed food escalates.
One of those food retail pioneers is Kontos Foods, a mid-sized New Jersey-based manufacturer and distributor of traditional artisan breads and Mediterranean specialty foods. A little over three years ago Kontos began a vigorous overseas expansion program, and now ships its products globally, to a wide range of locations, including Singapore, Indonesia, the Caribbean, Panama, Bahrain, Saudi Arabia, and Dubai.
Just how did Kontos do it? Total Food Service sat down with Warren Stoll, Marketing Director at Kontos Foods, to share six tips for how the Kontos team developed and led a successful export strategy.
1. Create a Strategic Global Plan
In 2013 Kontos Foods owner and co-founder Steve Kontos decided that he wanted to expand the company’s export business. Our team hand-picked high-impact regions such as Asia, Europe, Canada, South America and the Caribbean to start our international sales initiative. In choosing these countries and regions, we took into consideration a range of factors, including local tastes, eating customs, income levels, demographics and population trends.
2. Make Sure Exports Are a Right Fit for Your Company
It takes time to conduct market research to test whether your product is right for a particular region; you’ll also need to find creative ways to network with local distributors and buyers.
First, you’ll want to figure out if your food item will ship well. With the current high demand for fresh food, there’s more pressure than ever to produce food that tastes fresh-baked that day. Freezer shipping containers are a highly effective way of transporting certain types of foods long distances. Kontos is fortunate to have a product that’s ideal for shipping frozen. Kontos’ flatbreads are created with proofed dough balls that rise and contain air pockets, and then are coated with olive oil before baked to lock in moisture. Once defrosted after shipping, flatbreads can be warmed up on the grill or in the oven, tasting as if they’ve just come fresh out of the oven.
3. Experience Counts
There are many cultural marketing nuances and other factors to consider when entering foreign markets; it really helps to have management with experience. You’ll be facing everything from tariffs to different languages and food laws, to labeling and Customs requirements – a lot to consider.
Before Kontos, I worked at Unilever and my colleague, Kontos Foods’ Global Sales Director Doug Werts, is formerly of Nestle. Combined, we’ve lived and worked in different markets around the world, including the Netherlands, Brazil, and the U.K.
At Unilever, for instance, I spent significant time and resources building market share in Europe and South America. Those experiences, along with our current Kontos research about consumer shopping habits, provided us with the deep consumer insight we needed to target the right products and packaging to shoppers.
4. Leveraging Export Programs
Before we launched our overseas initiative, I did the obvious market research about consumer shopping habits from afar, but we needed to visit those countries to truly gauge potential for strong consumer demand. We wanted to learn about the retail markets first-hand, network with potential customers and showcase our products at the key food retailing shows.
The problem, however, is that overseas research isn’t cheap: Attending one trade show could cost upwards of $15,000-$20,000. There are nonprofit and government programs to help assist with companies as a means of trying to boost overseas trade. We found FoodExport NorthEast, a non-profit organization that supports international commerce. The organization is designed to help American food and beverage manufacturers attend
foreign trade shows, connect with potential customers and learn about consumer trends.
Over the past two years, Kontos has participated in several market missions and trade shows with regional focus, in such locations as Japan, Dubai, Germany, China, Hong Kong, and Canada.
5. Look, Listen and Learn
With the assistance of FoodExport, we started hitting the global trade-show circuit. They provide exploratory tours to help retailers discover whether a particular market is right for them. These tours offer crucial learning time, where retailers, manufacturers and distributors can quickly learn which regions are worth pursuing. When you’re on one of these tours, I recommend maximizing every minute of your research gathering.
For instance, while in Shanghai for a trade show tour, I learned that people in Northern China prefer bread much more so than their southern countrymen. This helped steer Kontos’ sales efforts to the correct part of the country, saving time and money.
6. Don’t Make Cultural Assumptions
Just because a country isn’t currently consuming your product doesn’t mean they can’t learn to love it. In Japan, Mediterranean flatbreads aren’t the standard fare. But after touring several cities, taking copious notes about demographics, and working with a local chef, I added my observations: I saw long lines of people on the street at the crepe stands, and decided the Japanese on-the-go culture is a perfect fit for Kontos flatbread meals. This led me to steer our efforts to Japan.
The international export business is on an upward trajectory. If you plan to join in on an overseas expansion program, gather an experienced team, do your homework and get your passport ready. People are now enjoying Kontos flatbread in Bahrain, Singapore, South Korea, Saudi Arabia and Dubai. Who would have dreamed that three years ago?
Warren Stoll is Marketing and Business Development Director at Kontos Foods, a manufacturer and distributor of traditional Greek and Mediterranean foods in Paterson, NJ. Contact at WarrenS@Kontos.com.