UKTI CASE STUDY – Grace Foods
Expert advice from UKTI Trade & Investment (UKTI) has helped Welwyn Garden City food manufacturer Grace Foods UK to increase its export activity by more than 50 per cent over the last three years.
Established in 2007 following the acquisition of WT Foods, Grace Foods UK is the UK’s leading Caribbean Food supplier, while also leading the Nutritional Milk and Chilli Sauce categories with its and ‘Nurishment’ and ‘Encona’ brands. From its 120,000 sq ft UK headquarters and associated production site Grace Foods UK supplies major multiples, wholesalers, convenience stores and independent outlets with owned and third-party brand products.
Although export markets are now an integral and fast-growing part of the company’s focus, this hasn’t always been the case.
“In 2011 we began to get more serious about exporting from the UK as part of a strategy to significantly increase exposure of our brands in overseas markets,” explains George Phillips, Business Development Director at Grace Foods UK.
“Up to that point we had been selling overseas more on an opportunistic rather than a strategic basis. We realised that there was real scope to stretch the company by expanding our overseas sales, so we took the decision to set up a separate business unit for Europe and other markets; this enabled us to focus more attention on developing the tailored marketing and promotional support that would help us to build brand awareness overseas. We also started to work more closely with UKTI International Trade Adviser Simon Crosland.”
George first met Simon at one of UKTI’s regular Explore Export ‘Meet the Buyer’ events in Duxford, which enable interested companies to meet with UKTI commercial officers from several different markets, quickly and efficiently, in one day. This led to a one-to-one meeting with Simon, where they discussed the company’s export strategy, covering markets in which Grace Foods UK was already active as well as potential markets that the company wished to target.
Following Simon’s advice, Grace Foods UK commissioned a UKTI Overseas Market Introduction Service (OMIS) report for Russia, their newest market. “The report was extremely detailed,” observes George. “I’d go so far as to say that it was one of the best such reports I’ve ever seen. For the price I expected an overview of the Russian market, but the OMIS even included a detailed breakdown of our competitors’ products and their pricing.”
The results of the OMIS gave the company sufficient confidence to take a stand at World Food Moscow 2012, where they ended up meeting the distributor with whom they are now working.
“At this point I advised George to consider using a management company as well as a distributor,” says Simon. “In many countries it’s appropriate to work directly with a distributor, but in Russia it can be more productive to employ a management company with people on the ground who can represent your interests more effectively – for example, by navigating the country’s legal minefield on your behalf.”
He continues: “I introduced Grace Foods UK to a particular intermediary and suggested that they work with them on a short-term basis to see if this approach suited the company, which it did.”
A different strategy was needed when Grace Foods UK decided to tackle the German market, which is dominated by experienced retailers and choosy distributors. Difficult to penetrate from outside, Germany is significantly less receptive to new brands than Russia.
“We didn’t need an OMIS for Germany because we already knew the market well,” explains George. “However, we did ask Simon for a contact list of national retailers, distributors and wholesalers, and have since secured a useful distributor on the back of this. Ideally we would like to sign up a large national distributor: this remains an ongoing challenge for us because they are invariably already linked with established brands, but UKTI has been able to broker productive meetings on our behalf.”
UKTI continues to provide bespoke advice and support as Grace Foods UK targets other markets, including Spain, the Balkans, Africa and the Far East.
“Three years ago exports made up 3-4 per cent of our business. That figure now stands at 15 per cent,” says George. “UKTI support has helped us to achieve 50-60 per cent of our year-on-year growth.”
He continues, “UKTI has supplied a lot of the groundwork that is difficult to do from a distance, and we’ve found it to be well-tailored to our specific business needs. Simon, our Trade Adviser, is very proactive - he has helped us to get on to the right path and has supported us in fixing problems along the way.”To find out more about UK Trade & Investment services in the East of England contact your local International Trade team: Telephone 01707 398398, email info [at] uktieast.org.uk or visit www.gov.uk/ukti
• PHOTOGRAPH SHOWS: George Phillips, Business Development Director at Grace Foods