When it comes to exporting food products North America is known for being one of the toughest markets to crack. And when you are a small producer of all-natural beetroot ketchups targeting the U.S., the home of tomato ketchup, the prospect is even more challenging, but it's where one British food startup is achieving success.
Launched three years ago, The Foraging Fox has established a presence in the North American and European markets, and boosted by a recent £700,000 ($891,000) Angel-led investment, is catching the wave of demand for natural, non-GMO (non-genetically modified organisms).
The company was founded by former City-based financier Frankie Fox and Desiree Parker, who had practiced law in the City before started working in investments. Their paths crossed professionally and the pair have remained friends ever since.
In 2014 Fox approached Parker with an idea for a beetroot ketchup product. “It had started out as a kitchen project with my kids to teach them how to cook in a fun way and by finding ways to use our bumper crops of apples and beetroot,” she says.
This led to their decision to team up and build a business that would meet a growing demand for better quality and better tasting condiments. They undertook exhaustive research into the huge ketchup market and spotted an opportunity to disrupt the space using ingredients that were naturally sweeter, and therefore naturally lower in sugar than ‘traditional’ tomato ketchups, as a basis for the ketchup.
The business was officially launched when they attended their first food exhibition and secured 50 pre-orders, 20 export leads, a national wholesaler and a business partner. However, this also presented one of their earliest and biggest challenges; learning to say ‘no’.
“That’s harder than it sounds when you’re faced with your first big order,” says Parker. “It was from an established distributor operating in the United Arab Emirates. The reality was, we just weren’t ready for export. We didn’t even have a manufacturer.”
Their goal for the first 18 months was to create a scaled up product without compromising on the ingredients and taste and to focus on the UK market.
“The challenges were many, from getting our message out there - natural food does not look the same all year round - to getting face time with the buyers we wanted to speak and establishing key relationships across our supply chain, all on a shoestring budget,” says Fox.
For the first two years they self funded the business, which meant no salary, no dividends, just sweat and some sleepless nights. In 2017 they raised a small seed round, which they followed up this year with a £700,000 angel investment. Working with the Department for International Trade they secured grant funding that to cover the cost of trips to key international markets.
The Foraging Fox began exporting to the U.S. last year, securing its first US listing in Whole Foods Market. Their strategy was to enter the U.S. market the same way they had in the UK, primarily exhibiting at key trade shows with their importer and forging strong relationships within the industry.
“I first met our US importer in 2015 and we talked, a lot, for 12 months in fact,” says Parker. “I guess he wanted to be sure, but at the end of it he was clear on the opportunity. It wasn’t always a smooth ride; we had tough calls, tough decisions to make on the route to market we wanted to take, and pricing etc. Having his backing and belief in our products and ourselves was key."
While the categories in which the company operates are highly competitive, the demand for all-natural, organic and non-GMO products has also undergone massive growth. They’ve also benefited from a rise in the number of dedicated non-GMO retailers and larger retailers opening up more shelf space to challenger brands.
“Consumers are leading the charge and there is a big opportunity right now for companies like ours,” adds Fox. “The drivers we are seeing in North America are the same in Europe; people want great tasting food and sauces that are better for them.”
Foraging Fox is on track to achieve over £1 million in sales within the next year, and just under £5 million by 2020. The founders are also eyeing up other new markets, including Austria, Belgium, Denmark, Germany and Holland. They expect to be exporting more than 40% of their product by 2019 and up to 80% by the following year.
“It’s about building the brand and the team; getting our product out there in the right stores and in the right territories, and getting the right people on board,” says Fox. “We’re currently a team of six and plan to double that by 2020. Soon we’ll be looking at having a presence on the ground in North America too.”
Parker adds “There’s a fast growing segment of consumers who want products like ours: better quality ingredients, better taste and better for them. Being recognised for the quality of our product in the U.S., where the market is hugely competitive, is a real coup.”
