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April 9, 2021updated 11 May 2021 5:43pm

Allergen-free foods firm Kirsty’s sets out plans to triple revenues

By Simon Harvey

Kirsty’s, an allergen-free ready-meals and desserts business in the UK, aims to triple revenues over the next few years now its own factory has come on-stream and relieved the capacity constraints from the use of a contract manufacturer.

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  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
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The company, which also produces allergen-free frozen pizza and desserts under retail own-label, opened its fully-owned facility last July in the town of Harrogate, North Yorkshire, which was built in six months with an investment of GBP12m (US$16.4m today).

Managing director and founder Kirsty Henshaw told just-food the firm’s revenues in the current financial year, which started in October, should reach GBP8m, rising to GBP11m the year after and GBP22m in the following 12 months, with new product launches also in the pipeline.

Sales had been GBP11m in the 2019/2020 financial year before the onslaught of Covid-19, which pushed Kirsty’s only out-of-home customer to the side lines – a UK restaurant chain the company has not supplied its gluten- and dairy-free ready meals to since March last year. Henshaw said the co-packing set-up Kirsty’s had been using was also a burden in terms of meeting consumer demand because the contract manufacturer it was using until last summer did not have the capacity to meet orders.

Kirsty's was partially shielded by the fact 95% of the business is in branded products, which are free-from 14 major allergens and are sold into Tesco, Sainsbury, Morrisons and Asda, as well as online at Ocado and in the Co-op. It also has one private-label account.

"We didn't suffer but we didn't benefit," she said in terms of the business implications related to the pandemic and the production constraints. "We didn't have the strongest performance as we were still outsourcing the product. We hadn't started our own production, so, like everyone using a co-manufacturer, we were still producing the same volume because the factory we were using was at full capacity."

Henshaw came up with the idea to start her own company in 2009 as a young mother with a child with food allergies. In 2010, she convinced two investors on the Dragon's Den TV series to commit GBP65,000. Three years later, Kirsty bought out presenters Peter Jones and Duncan Bannatyne and now holds two-thirds of the company, with the rest in the hands of her business partner.

Last year, Kirsty's had said it planned to expand the portfolio into soups, pies and sauces but that has been put on hold for the time being, while a new "luxury" takeaway range is due to launch in retail in September.

"Our factory has the capability for soups, pies and sauces but we are concentrating on getting our own range expanded before we move into another area. It's definitely in the plan, we have all the kit," she said.

Henshaw added the strategy going forward is to "build the factory to capacity, grow our brand into a couple of different areas that we are already touching on in luxury ready meals and takeaway, and expand our frozen offering".

The company employs 42 people.

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What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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