There has been a lot of talk about Australia becoming the “food bowl” of Asia over the last few years and the trade statistics indicate Australia’s trade with the rest of the world in food products continues to increase. Take for example, wine sales, which increased in value by 11% in 2016, reflecting increasing demand for premium Australian wines in most key markets around the world, particularly Northeast Asia and North America.
But what does this mean for the small end of the market? Are there opportunities for micro-medium sized local companies that only sell domestically? And if there are, how do you access them?
The great news is that if you’re an Australian food producer, the blue-sky opportunities are pretty much all overseas. Whereas the major supermarket chains will only ever pay producers the very lowest price that they can get away with, international markets are screaming for Australian food and willing to pay top dollar for it. Here are three quick case studies which demonstrate that.
Melinda Mackay started Sugar Free Solutions in 2005 because she wanted to make sure her son, newly diagnosed with Type 1 diabetes, could have cake at his next birthday.
“We found it very difficult to offer him the normal “treats”, since very limited sugar free products were available in Australia”, says Melinda.
“This created a drive and passion to provide our son and other diabetics, as well as those who wish to eradicate sugar from their diets, a variety of quality sugar-free baking mix products”.
Melinda began experimenting with sugar-free cakes, and using a natural plant-based sweetener. When word of her creations began to spread, she realised the scope of the market for them. It was not long before she began exploring exporting her sugar-free mixes to countries with a high level of diabetes.
Today, Sugar Free Solutions is exporting sugar-free cake and muffin mixes to the Middle East and Asia.
In June 2006, Gary Katos, a chef, fast food business operator and consultant, opened Cone Heads restaurant in Melbourne. His concept was simple: offer healthier versions of classic take-away food, especially hot chips and gourmet burgers. Fast forward to 2014 when Katos franchised the concept and opened his first international store … in Lahore, Pakistan’s cultural and food capital. Not your usual first international market for a food business.
Cone Heads Pakistan prides itself on being different to the big US fast food brands; a premium product that is suitable for all ages and easy to eat on the go. The company has built a strong business in Australia by perfecting its recipes and creating efficient store operations. It has taken this same approach in Pakistan.
To establish its presence in Pakistan, Cone Heads made some cultural adjustments to its menu to suit the local palate, such as providing spicier sauces made from local ingredients, using more chicken than beef, and extending the range of burgers from the five it offers in Australia to about 20 in Pakistan. The company also modified its store model to include a staff prayer area and to appeal more directly to locals, since there is little tourist trade in Pakistan.
The Cone Heads concept has been a resounding success in Pakistan. A second Cone Heads store is opening in Lahore, with a third has already opened in Islamabad and plans to open another 30 outlets in Pakistan — as the market grows — in the pipeline.
Carolyn Creswell, the founder of muesli product manufacturer Carman’s Fine Foods, believes that self-belief is key to export success for small businesses. When Creswell started out 18 years ago, working from her kitchen bench, she never imagined her products would be in supermarkets across the US and Europe.
Creswell’s career as a food manufacturer began during university, when she was working part-time for a small muesli-maker who supplied some cafes in Melbourne.
When the owners told her she might lose her job because the business was going to get sold, she teamed up with a colleague to buy it, offering $1000 each. The sellers originally laughed at them, but eventually caved in when no-one else would buy the company. Spending the money she had earned as a ”checkout chick” at Coles, Creswell became a business owner at age 18.
It has been a 20-year journey, but Carman’s now exports to more than 30 offshore markets, to chains such as Sainsbury’s in Britain and Whole Foods in the US.
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Cynthia Dearin is the managing director of Dearin & Associates, an international business consultancy that helps clients to access opportunities in fast-growing international markets, and the International Business Accelerator. She is the author of Business Beyond Borders: Take Your Company Global and Camels, Sheikhs Billionaires: Your Guide to Business Culture in the Middle East and North Africa.
