Innovation is everywhere and entrepreneurs can come from all areas of business and life. While the last twenty years or so have been full of innovators from the tech space, there are plenty of people doing impressive things in other areas.
Richard Plimmer is one such entrepreneur, quietly working away on businesses that are making significant waves in the food and beverage space. Ever had a flavoured coffee at your local cafe? How about browsed the bliss ball aisle in your local supermarket? If so, you’ve probably come across one of Richard’s projects. SHOTT Beverages produce a range of coffee syrups and high-quality cordials which are stocked by a huge number of cafes around the country. His current project, Tom & Luke, produces healthy snack foods including protein bars and “Snackaballs” in a range of flavours.
Richard came along to our July edition of Startup Garage to speak about his experience starting, building and scaling businesses in the FMCG space. Here are a few of our key takeaways from the night.
Get your manufacturing sorted
Anyone who has tried their hand at manufacturing foodstuffs at scale will know that it can be difficult. There are many considerations that come into play for food products that are much easier to manage in other industries. Repeatability and quality control is a big one. Software products can be a single user interface and a (hopefully) uniform experience for all users. Comparatively, formulating food products can be much more complex and requires ongoing quality control just to maintain consistency, let alone make improvements.
Richard spoke about one issue they faced as they began to scale his bliss balls operation. The bliss balls are largely comprised of minced, pitted dates. Tom & Luke’s was buying the pitted dates in bulk and feeding through a mincer. However, their supplier was operating on a margin of error which allowed for up to 3 pits in each box of dates they supplied. With no filter in place to catch these pits, his customer’s bliss was being hampered by finding hard pieces when biting into their balls. “We spent about 10 sleepless nights working out a filtering system. Without that, it would have been game over”.
Scalability is another issue which can be difficult to overcome. When Tom & Luke started manufacturing balls, they were hand-rolled by a staff of school kids. They managed to produce around 1000 balls per day, which was not nearly enough to match the demand they were facing making their success a stressful one (a nice problem to have!).
Lacking any existing technology which could produce the balls at scale, Richard had to think outside the box to find a solution. Over the next three years through many different iterations and with the help of a local engineer, the appropriate mechanisms were cobbled together and refined to the point where they could produce 40,000 balls a day – a drastic improvement, but still not enough to meet demand.
Getting manufacturing right is the key to success in any food product business, and the process is far from over for Tom & Luke. As their popularity demands greater volume the business will have to continue to evolve and find ways to produce more product while keeping the quality high.
Now with more paper bags!
Health foods and sustainability go hand in hand from a branding perspective, but the basic requirements of food packaging are not so complimentary. This can be a significant challenge as consumers are increasingly looking for ways to reduce their impact on the planet through their purchase decisions.
Richard faced this dilemma for Tom & Luke when he was approached by some sustainable packing providers. He went through the process of testing the paper based packaging for the smaller snack packs of balls and all was looking good. That is until the company came back to him saying that their packaging failed certification for air and moisture barriers; two crucial qualities that a food product needs to have any chance of making it to consumers in an edible condition.
The need to preserve food products is the biggest concern when looking at packaging options. Plastic does a fantastic job of this while also avoiding contamination of the food’s taste or consistency. Unfortunately, many more sustainable options just aren’t there yet. Brands are left with the complex task of balancing these factors while not isolating their customers. Thus far, this doesn’t appear to be slowing the popularity of the Snackaballs, but it is something that Richard is considering moving forward.
Not-so-fast moving consumer goods
While Tom & Luke sits within the FMCG space, this may be a bit of a misnomer about the industry from a business development perspective. The path to success for Richard has been anything but fast. Just getting manufacturing right has taken years of iterative design and experimentation. This will continue for the life of the brand, as the process is refined and made more efficient to service bigger and better markets.
One of the things that makes the FMCG industry challenging is the conflict between this slow process of research and development and the fickleness of consumer tastes. Food products can go in and out of fashion almost overnight and success can be heavily dependent on wider trends. This is especially the case for brands like Tom & Luke who provide non-staple items: people will probably always need bread but they might stop wanting snack balls at any time. This makes innovation in the product just as important as innovating in the manufacturing process.
Richard shared a sample of their latest innovation on this front with the group – hemp seed-based balls. He noted that hemp seed is a big trend in New Zealand recently due to the relaxing of policy around their import and use. Cautious not to reveal too much, he also hinted that they are working on something new at the moment based on a big trend out of the USA. We will have to watch this space to see what the next big thing in healthy snacks looks like.
Startup Garage is a programme run by Creative HQ, bringing together our startup community in Wellington to share interesting ideas, build connections and encourage innovation wherever it exists. Follow Creative HQ on social media, subscribe to our newsletter or join our MeetUp Group to stay up to date with what’s going on each month.