BRICs: Tyrrells sees long-term opportunity in India, China
UK crisp manufacturer Tyrrells has insisted it believes it can build its fledgling businesses in the emerging markets of India and China.
The company, which operates in around 50 markets outside the UK, does business in each of the BRIC economies, Laurence Bass, head of its international arm, told just-food.
Tyrrells added China to its list of international markets at the start of the year, selling crisps in high-end c-stores and supermarkets in Beijing and Shanghai.
"We launched in China at the beginning of this year with a new distributor. India, the same. We've been there a couple of years. We're in high-end hotels, retail outlets there, doing a good job, seeding the brand ready for a retail explosion in those markets that we can hop on the back of," Bass said.
He acknowledged the retail sector in countries like China and India remained under-developed but hoped Tyrrells early entry into those markets would benefit the business in time.
"Obviously it depends on what happens with those economies, retail infrastructure and everything else, but I think they are long-term. We would like to think we are in there for the long run. If we can build up some brand equity early on, the average Chinese or Indian consumer will recognise and understand Tyrrells, hopefully that will gain traction for us three or four years down the track."
Emerging markets like the BRIC countries remain longer-term projects for Tyrrells. Bass said the company's four focus markets outside the UK were France, Germany, the Netherlands and the US. Across the Atlantic, Tyrrells is targeting the natural and speciality channel, Bass said, as part of the company's second tilt at the market.
"We first dipped our toe over there about four, five years ago but it wasn't in any meaningful way. We did it with UK packaging and we didn't select the right partner over there, so we ended up in a few selected retailers, on shelf at a price of US$5-6 a bag. Surprise, surprise, the product didn't sell through," Bass said.
"We decided last summer to launch properly in the US and Canada, with the right pack, selecting the right partners, with the right programme. Last summer, we started shipping to the US and Canada. So far, so good. We targeted the natural and speciality channel, which is emerging as a pretty big channel by itself. So we're not going after the mainstream and sitting next to Frito-Lay. It sits in the natural set in grocery stores and dedicated natural stores, the likes of Whole Foods Market."
He added: "At the end of July, early August, we're going to hit all 250 Duane Reade stores across Manhattan, which will be a great showcase for the brand there. They've revamped all their stores and we've got high hopes that will really raise the profile in that area."
Tyrrells, which is owned by private-equity firm Langholm Capital, generates annual sales of GBP100m. Bass said the company's business outside the UK accounts for a quarter of revenues. Overseas sales had increased "60% year-on-year for the last three years", he added.
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