The F&B entrepreneurs making 'huge savings' fast-tracking their UAE start-ups

Besides coaching and mentorship, Spinneys’ initiative removes upfront fees for listing and registration that can be a barrier to mainstream sales for fledgling food producers

DUBAI, UNITED ARAB EMIRATES. 23 SEPTEMBER 2020. Laura Manning is the founder and MD of BRW Society, a homegrown healthy tea brand. (Photo: Antonie Robertson/The National) Journalist: David Dunn. Section: Business.
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Homegrown food and beverage brands can often spring from a labour of love, kitchen worktop experimentation and aspirations of feeding the masses beyond family and friends.

Demand may grow organically through social media or pop-up markets, but — at a potential cost of at least Dh100,000 — scaling to mainstream supermarkets can prove elusive for an emerging brand juggling the cash pressures of company licences and distribution, alongside domestic bills.

Laura Manning, from Wales, launched BRW Society in July 2019, selling speciality teas from a dedicated website, gifting sites, marketplaces such as Noon and some hospitality outlets. Then the coronavirus pandemic began.

“BRW Society started to explore retail channels, which were thriving during the pandemic,” Ms Manning, who lives at Arabian Ranches in Dubai, says.

“This change in strategy was difficult for the brand, still largely unknown in the local market … to get the attention of large UAE retailers, particularly as the tea category was seen as congested.”

Then, in mid-2020, supermarket chain Spinneys launched a Local Business Incubator programme to fast-track F&B start-up products into its stores.

The aim of the scheme is to help to “identify and support entrepreneurial ambitions” and develop innovative businesses within the country’s fast-moving consumer goods sector, Spinneys says.

Ms Manning registered by submitting a company presentation online, detailing customer need, her tea blends, business plan and “the person behind the business”.

Following a Dragon’s Den-style face-to-face presentation at Spinneys’ headquarters, her brand was accepted and, by October, was in 25 stores.

Ms Manning, 41, says she saved “a huge amount of money” by entering the market this way and was able to bootstrap the launch thanks to the “generous” contract Spinneys provided.

“This included a guaranteed listing for 12 months, plus Spinneys did not charge account opening fees, product listing fees or other upfront fees that can be a barrier to entry … Spinneys also paid quickly to help with cash flow,” she says.

“Entering a major retail store transformed BRW Society. The first order was 20 times what the business turned over the previous year [and] turnover in year two increased by 455 per cent, providing additional revenue to invest in developing product range.”

Tom Harvey, commercial manager at Spinneys, says the Local Business Incubator programme was launched at a time when many people were losing jobs and reassessing career choices. Photo: Spinneys

The incubator programme was launched at a time when many people were losing jobs, questioning their purpose and reassessing career choices, Tom Harvey, commercial manager at Spinneys, says.

“This was a great time to step in and offer a lifeline to people who had ideas or concepts we could help support,” he says.

“The programme removes 100 per cent of the costs associated with signing up to a retailer … it also provides a safe space to learn with the support of Spinneys’ executive leadership to guide and coach through the first six months on sale.”

The chain will open round three of the programme to entries on July 1.

What the main criteria the incubator panel looks for, Mr Harvey says, is “relevance of the concept for our customers, the financial viability and the sustainability of the concept”.

“The number of entries we have received over two years of the programme has certainly surprised us … there is no shortage of innovative ideas or aspiring entrepreneurs in the UAE,” he says.

Total sales from the first 14 incubator brands reached more than Dh3 million ($816,882) — among them was kimri from Sara Saleh.

Inspired by her half-European, half-Arab heritage, the Downtown Dubai food fan began developing her brand in 2018, reinventing dates as gourmet treats with ingredients such as nuts and chocolate.

Joining the incubator programme brought key savings for Sara Saleh, founder of dates brand Kimri. Photo: Pawan Singh / The National

“I always aspired to manage a business of my own [and] starting in the F&B sector felt the most natural,” she says.

“Once I had my business plan and developed the full brand from A-Z, I left my job in February 2019 to pitch the concept and products to companies.”

Despite a background in retail operations, marketing and branding across companies such as Azadea and Adidas EMEA, the pandemic challenged Ms Saleh’s mainstream ambitions.

In May 2020, she spotted a LinkedIn post about Spinneys’ initiative, applied, pitched, was accepted and had kimri on shelves by mid-January 2021.

“I worked hard for many years saving funds to be able to start kimri,” says Ms Saleh, 29. “Building the brand, manufacturing products, packaging, deliveries, all the operations behind it, was self-funded.”

Joining the incubator programme brought key savings, namely on registration and marketing fees, as well as funds for marketing kimri, and fired her business into numerous Spinneys and Waitrose shopping baskets, she says.

Initial orders that came to fill store shelves across the UAE and Oman allowed her to kick-start the brand and keep kimri’s operational chain running, Ms Saleh says.

“I had previously worked on building capital to allocate into different aspects of kimri.

Quote
There is no shortage of innovative ideas or aspiring entrepreneurs in the UAE
Tom Harvey, commercial manager, Spinneys

“Because of this opportunity, I had the privilege to use these allocations further than initially planned … this gave me more leeway in other aspects of my life, such as travelling.

“I have been able to gain inspiration and knowledge of the F&B market in other countries, allowing me to benchmark kimri against competitors and giving me confidence to expand kimri out of the UAE.”

Spinneys says its initiative supports local food production and “stimulates economic growth in the sector”.

Successful applicants have products listed for 12 months and, besides skipping various fees, also feature in online/social media marketing content, a gondola promotion every three months and one weekend of in-store sampling. Coaching sessions with senior commercial and marketing management are also available.

Conditions include brands selling exclusively — with regard to retailers — in Spinneys for six months, after which they can approach other chains.

Melody Mok created Curious Elephant after losing her hospitality job during the April 2020 movement restrictions — and will shortly supply Spinneys shelves after her authentic Asian “soulful” sauces brand became one of five incubator winners in October 2021, from 125-plus entrants.

The initiative enabled a route to her target supermarket without upfront investment in fees “which can … tie up so much cash flow”, she says.

“Additionally, the programme provides extensive marketing and mentoring support which, as an SME, is invaluable … gaining access to such industry expertise that otherwise would incur significant time and cost,” says Ms Mok, 34.

Dubai, United Arab Emirates - Reporter: David Dunn. Business. Money and Me. Portrait of Melody Beale. Sunday, October 25th, 2020. Dubai. Chris Whiteoak / The National

Her research suggested the initial cash outlay to register as a supplier with supermarkets could be upwards of Dh100,000 for a handful of products, a significant amount for a small business.

“This doesn’t even consider supplementary activities such as in-store launches and e-commerce promotion, which incur further costs.

“In total, we estimated the potential combined costs of all these activities for year one could be more than Dh250,000 for multiple products launched into multiple stores, and this is potentially before you’ve sold a single item to a customer … quite daunting numbers when thinking about how this kind of cost can be recuperated while maintaining a liquid cash flow position.”

Ms Mok, who also lives in Downtown Dubai, is now forecasting a significant rise in sales and revenue on reaching her extended customer audience.

“As the programme has alleviated most of the upfront costs, it has allowed us to use these funds elsewhere,” says Ms Mok, who is keeping personal expenses separate from the business.

“We have been able to reinvest into the business and focus on things such as developing our next product line … we have managed to push forward by reinvesting money that would have otherwise been used on registration and listing fees et cetera.”

Having the seal of approval from “the leading premium supermarket group in the region” continues to be an important factor for many brands as it “opens many doors to other opportunities across the world”, Mr Harvey says.

Ms Saleh concurs. Since launching in stores in January 2021, her brand has expanded to all Spinneys and Waitrose outlets in the UAE, plus Carrefour and Choithrams chains, and into Oman and Bahrain.

“Joining the programme provided me with further knowledge and insight into the operational aspect of retail chains in the UAE,” she says.

“This built my path of further introducing kimri to other retailers and expanding collaborations.”

Kimri is also entering divisions such as corporate, universities, hotels, hospitals and banks with other product ranges.

The incubator allowed BRW Society to begin becoming a “household name” in a very congested UAE tea market where it might otherwise have struggled, Ms Manning says.

“The future looks very bright … the business has confirmed listings in many UAE retailers in 2022 such as Carrefour, Grandiose, Geant, Kibsons and continues to introduce new products to Spinneys, has several new innovations coming out, and is setting its sights on export,” she says.

Australia-born Ms Mok is looking forward to taking her sauces and more lines to a “much wider global audience” beyond her primary sales channels such as the Curious Elephant website and boutique retailers and markets.

“Although we have built an amazing, loyal customer base, being listed in Spinneys and being physically in front of customers when they do their shopping will take us to the next level and give us the additional customer reach we haven’t been able to target up until now,” she says.

“By the end of 2022, we want to be exporting our existing range, certainly to other countries in the GCC, hopefully beyond as well.”

Updated: June 23, 2022, 5:00 AM
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