Premium snacks maker Eat Natural has maintained double-digit growth this year despite the economic downturn and is now worth almost £30M at retail level.
It is also outperforming the cereal bar category as a whole, which is growing at around 5-6%, said co-founder Praveen Vijh. He was speaking to Food Manufacture following the launch of a yogurt-coated cherry and almond bar; a 70% dark chocolate, brazil nut and apricot bar; and a yogurt-coated cranberry bar.
However, growth had slowed down compared to the previous year, admitted Vijh, as some customers felt their “focus should be more on price than on health” in the current economic climate.
The UK cereal bar category has become more competitive than it was when the company debuted in the late 1990s, said Vijh. But he said there were still only a limited number of players at the top end of the market. And he said there were many opportunities to increase distribution to new retail customers and leisure outlets and encourage existing customers to stock a broader range of products. However, further diversification into other product categories was unlikely in the immediate future, he added. “If anything, we are likely to rationalise the range.”
Separately, export markets represented a serious growth opportunity. “We have performed very strongly in France and Holland this year; but weak sterling has also made our products more competitive in export markets generally.
“On the down side, it has hit us on raw materials because we buy a lot of our ingredients in other currencies - particularly dollars for things like almonds and brazil nuts. However, we have been trying to buy more sensibly by switching some suppliers and building more direct relationships with others.” An indirect effect of that had been greater control over supplies and lower stockholding, he added.
A fruit and nut cleaning and sorting facility near its Halstead factory dubbed the ‘spa’ had also enabled the firm to assume greater control over its supply chain. It had helped cut out the middlemen and integrate and co-ordinate purchasing and manufacturing operations, giving bosses greater control over the quality and consistency of ingredients, he said.
With margins under pressure due to rising costs, there was also a renewed focus on enhancing the business, which had grown very rapidly in the early years, he said. “It’s a case of always trying to catch up and put systems in place.”
Eat Natural was founded in 1997 with £30,000 of start-up funding by Preet Grewal, Vijh and Bill Porter, who began making bars in Vijh’s kitchen.