Boka Food, the fledgling UK firm, offers what it says is the only cereal bar on the market qualifying for a full set of green traffic lights under the country’s front-of-pack nutritional labelling scheme. The company is stocked by Sainsbury’s and is attracting overseas interest. We talk to founder Franco Beer about the rise of the business and his plans for growth.
just-food: What was the spark for Boka Food?
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Franco Beer: I always wanted to produce a cereal bar that was healthy and primarily I wanted to give it to my children. The perception was cereal bars were healthy but they weren’t – and they aren’t, well, most of them aren’t, you’re better off having a KitKat. I went to listen to a talk about Sainsbury’s using front-of-label traffic-light packaging on their grab-and-go products and how they’d noticed a change in the way people shop. That for me was a bit of a light bulb moment.
It took three years to develop the bar, which I did with a friend of mine who used to be a food tech guy at Quaker. After many trials, we developed the first all-green-traffic-light cereal bar in 2016. We launched it quite quickly. We had requirements from foodservice, from hospitals following their CQUIN programme. The first hospital that took us was Blackburn – where we’re still at – and, from that, we grew. Through our distributor, DDC, we went into other hospitals and caught the attention of Bidfood and Brakes. From there we then ended up in schools, universities, colleges.
In 2017, Sainsbury’s came by and they said they’d like stock us but they weren’t keen on the packaging. From June to December ’17, we spent all the time redesigning it. We launched in Sainsbury’s in January ’18. We’ve got quite a full distribution with the multi-packs. They’re priced at GBP2 (US$2.60) for four and we’re talking to a couple of other retailers at the moment.
just-food: Among the UK’s so-called ‘big four’?
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By GlobalDataFranco Beer: Two of the big four. I can’t say too much.
just-food: Was Boka your first saw brand?
Franco Beer: I have got another brand called Slim Sticks, which is a weight management brand and the first brand I ever did. We used an ingredient called konjac glucomannan. I did that with another friend of mine who happened to have done his PhD in konjac glucomannan. We did it at the time when EFSA [The European Food Safety Authority] was asking people to support the claims they were making and konjac glucomannan was the only ingredient the reviewers put on the register themselves for weight loss. It still is the only ingredient that has a weight loss claim. Primarily, now I sell through distribution to the Middle East and America. We’ve just signed a contract for America.
just-food: Does that sit under the Boka Food holding?
Franco Beer: That’s a separate entity. What that did – and I’m not giving any secrets away because it’s on our packaging – we do use glucomannan in our Boka bars and it provides a chewier texture. I learnt a lot from that. In the bars, we use oligofructose, the inulin, we use glucose syrup, low sugar level, and the last ingredient is sucralose to give you that taste. Sucralose is a great product as it behaves like sugar but is a thousand times sweeter. However, because we’re innovative and we do development, we’ve been working the last two years on how can we make this product the best it can actually be and how can we engineer out sucralose and still retain the taste – which we have done. By doing that, we’ve dropped the calories as well by a couple of calories. We’ve also been working with an ingredient called erythritol, which sounds horrendously not natural but comes from corn. The beauty of erythritol is that it’s pretty much zero calories. And the other good thing about it is that it’s not processed, it’s fermented. It’s a great product If you know how to use it.
just-food: Are the Boka bars with the brand new recipe in the market?
Franco Beer: There’ll be filtering through June, that sort of time. They’re going to have a much shorter ingredient deck but also they’re going to be all-natural and vegan. I mean, I hate to use the word all-natural because all-natural is a piece of fruit but they are natural ingredients. We don’t bake anything. They are mixed and formed, so there’s no intense heat process.
just-food: Will you be putting those statements on the packaging or in the marketing?
Franco Beer: Our core message is ‘all green traffic lights’.
just-food: You’re a firm believer traffic-light labels are informing consumer behaviour, that they are prompting shoppers to switch products?
Franco Beer: Absolutely. The thing I wrestle with is I have a couple of companies who come to me – big companies – who want to white label our bars. I would actually like to see more green traffic-light products out there but, at the same time, at the moment, I’ve got to build my brand. There will come a time when I will be happy to do it because I genuinely believe in traffic lights. Even if you don’t understand them, people know green is good, red is bad.
just-food: What’s the company’s annual turnover?
Franco Beer: This financial year, which runs to the end of June, will be GBP1m. This calendar year, for ’19, we’re probably expecting GBP2.6m. For the financial year ending June 2020, we are forecasting we will be at GBP3.6m. That, in part, would be because of our Nickelodeon adverts, because of the potential listings we’ve got. We’ve done a deal where we’ll be advertising on Nickelodeon children’s TV [in the UK]. We’ve got a two-year agreement. I think we’d probably be the only sweet-snack product that’s allowed to advertise on children’s television because of the green traffic lights.
And I think GBP3.6m is a conservative estimate. I’d like to have more than that. We’ve got some significant contracts and looking at the export we have – because, obviously, our bars are very good if you’ve got diabetes – we’ve just started in the Middle East, in Jordan and that’s going very well. And we have huge interest in China. That potential could be very big. If that comes off, it could be GBP7m next year.
just-food: Say you do reach GBP7m, what proportion of your turnover would be still in the UK?
Franco Beer: Well over half. Our focus is the UK. These are people coming to us, not the other way around. We’re small.
just-food: Is the business profitable yet?
Franco Beer: Not yet.
just-food: Since the UK’s referendum on EU membership, how has the fall in sterling, any general uncertainty, affected the business?
Franco Beer: I was talking to a German distributor and that went by the wayside. Other than that, because we are focused on the UK, it hasn’t, apart from maybe some raw materials that we get in from Belgium, which of course would be in euro. That did make a difference. And at some point, if that had carried on, I would have had to put prices up. But it’s a moot question because actually the interest I’ve had very recently is from the Middle East. In business, you just have to adapt and get on with it. I don’t like it but what can you do?
just-food: With regard to China, when could that business go live?
Franco Beer: Probably third quarter.
just-food: Is that in a particular city?
Franco Beer: We’ll be dealing with a company that operates in 28 provinces and has around 400 sales people. Decent size. They’ve approached us. I’m just looking at trademarks first. Whilst it’s not my nature to be cautious, I am going to be cautious.
just-food: Your shareholding in the business is still over a majority. Would you be willing to take on further investment to help fuel further growth?
Franco Beer: With the right partner, yes. I’m always looking for cash but I’d rather it be a partner that could add something – and we’ve got lots of holes.
just-food: And the kind of partner you would consider teaming up with, would they be a larger food manufacturer necessarily?
Franco Beer: Probably, yeah. I think that would fit, someone who maybe have the same kind of values in terms of health. You can have a healthy product that tastes really good. That would help accelerate us and then I can concentrate on maybe bringing a couple of other products.
just-food: Is product development where you feel most enthused?
Franco Beer: I think it is. We’re careful to make sure we get these right. We have another two flavours ready to go. We’ve got other ideas as well. I’m at the moment working on the first potentially all-green-traffic-light fruit bar, which could be huge.
just-food: There is growing competition. I know having all green traffic lights is the USP but there is competition from companies with a lot of muscle.
Franco Beer: Absolutely. And that’s why, really, we need to, in an ideal world, team up with somebody like that. We can offer something … we can fast-track whatever they may have in mind.
just-food: When you say team up, do you mean accept investment from them or manufacture for them?
Franco Beer: It would have to be investment, wouldn’t it? How else could it work? In the ideal world, I’d love to build the brand and just sell it off outright but I suspect that won’t work that way.
just-food: You’re not out there putting feelers out?
Franco Beer: We’re too little. We’ve got to be realistic about it. I would wait for someone to approach us, if we fit whatever they’re doing. If not, we carry on and try and grow the business.
