Katy Askew

HOFEX: Taywell looks to China, Gulf for premium ice cream opportunity

By Katy Askew | 9 May 2013

Taywell prepares to take on General Mills, Unilever in the Gulf and China

Taywell prepares to take on General Mills, Unilever in the Gulf and China

Taywell Ice Creams is hoping to cater to affluent consumers in China and the Gulf as it seeks out premium markets for its ice creams.

Speaking to just-food, Taywell managing director Alastair Jessel says the structural weakness of the company's domestic UK market has prompted the high-end ice cream company to increasingly focus on developing its export presence.

"The competition in the UK is so severe that prices are being cut to stupid levels and the quality is being cut as well - I don't want to go down that path," Jessel says. "The importance of exports will be critical to my business and I plan to make exports larger than my domestic sales."

He adds the company plans to ramp up its overseas presence and - despite the higher costs associated with exporting - Jessel expects margins to be higher than could be achieved in the price-sensitive UK market. "Returns targeted are three times the UK turnover. Margins? Better than recent prices offered to me and worse than current ones that I deliver to directly," he explains.

In particular, Taywell has identified a market opportunity in China and the Gulf countries, where there is a rapidly expanding affluent consumer base. "The rich in China and the Gulf are getting richer - they don't want to eat what everybody else eats; they want better quality and they will pay for it," Jessel suggests.

As part of this export drive, Taywell is closing in on a deal to supply 104 hypermarkets across the Gulf. In a bid to win new business in Asia, the firm is exhibiting its ice creams at Hofex, Asia's largest trade show, this week. Taywell hopes to first establish a presence in Hong Kong before moving into mainland China.

While the company has not modified flavours to appeal to local tastes, Jessel suggests he has "made flavours that will resonate with [Taywell's] target market". Along with upmarket versions of the usual suspects - such as chocolate, pistachio and vanilla (royal crown or Madagascar) - the company is spotlighting a number of more unusual flavours that, it is hoped, will appeal to Asian consumers. These range from lychee sorbet and Japanese green tea to black sesame and lemongrass & chilli.

Jessel describes his foray in Hong Kong as a "gamble" - either it will be an "expensive working holiday" or the "start of the next phase of growth".

"I am not going in with my eyes shut. I cannot prepare any more for a product that I do not believe exists in either marketplace and if it hits the right spot, I will be struggling to cope with demand. If it doesn't, I shall lick my wounds... The Gulf, if I win it, will be my entire existing turnover again and Hong Kong could be even larger if they like it too."

However, Jessel emphasises that a number of challenges lie ahead. "The greatest barriers to entry of the markets I have chosen is the paperwork. Our clients require import licences, we require export licences, we have to test each product, send the results to [UK government department] Defra and allow a vet in to examine the produce prior to shipment - a logistical nightmare."

Nevertheless, he also has an upbeat take on these barriers: "My view? The higher the barrier to entry, the fewer the companies there are who wish to jump these hurdles and the less competition I have."

According to Jessel's assessment, Taywell's stiffest competition will come from the multiples - General Mills' Häagen-Dazs and Unilever's Ben and Jerry's brands.

However, he hopes his focus on quality, innovation and provenance will help to set Taywell apart. "NPD is critical to the success of Taywell... I have chosen areas who speak English and have a favourable view of the country. English food is very highly regarded in these zones and I am hoping that the reputation will rub off on Taywell. China has had scares on milk products and I intend to enter as a trusted and reliable British food company with the finest source of milk, cream and eggs that the world has seen. The price may be high but the product will speak for itself on quality."

Sectors: Dairy, Emerging markets, Ice cream

Companies: General Mills, Unilever

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