When it was time to get Breva, a range of alcohol-free malt beverages, out to market in 2014, Gladys Mawoneke knew she would have to find a way to get her foot into the proverbial door.
Despite being a relative newcomer in the highly competitive drinks market she managed to do just that, and got Breva onto the shelves of some of the biggest retailers in the country.
Breva beverages can be found at Woolworths, Pick n Pay, Shoprite, and select Checkers Liquor and Spar Western Cape outlets. The brand has also made inroads in hotels. It is available in select Tsogo Sun four and five star hotels.
Before entering the drinks sector Mawoneke, a former lawyer, was in the produce sector and had prior experience supplying fruit and vegetables to some of the same major retailers.
Market and mission
Mawoneke founded Bumi Hills Group, the holding company in 2009. Breva was launched into retail three years later following years of research and development, she says.
The craft soft beverage is manufactured and bottled in the small town of Wellington, Cape Town and comes in a variety of flavours including passion fruit, apple, peach, and pineapple.
With their beverages Breva is targeting the country’s growing emerging middle class that does not drink alcohol.
“The high number of people who do not drink alcohol and yet are looking for a brand that speaks to their image,” says Mawoneke. This growing market presents growth opportunities both in South Africa and internationally, she adds.
The process was not without its challenges and certainly was not overnight, says Mawoneke, but it is worth getting right, she insists.
Mawoneke shares the biggest lessons she has learnt from selling to big retailers and what other SMEs can learn about building relationships, getting the right retailer product fit and mastering their systems and processes.
The Breva range of alcohol-free malt beverages.
Having a good product is non-negotiable and is very important for retailers
Retailers want a product that will sell. Equally important is the ability of the SME to support the sale of the product once it’s on the shelf. The retailers provide space and the SME must make sure that the product gets from shelf into the consumer’s basket. This is what can make or break a small business.
Breva is a great product. To get it off the shelf we conduct in-store demonstrations and tastings so that the customer interacts with the brand. We also give sample stock to our customers among others so that they can conduct promotions using the free stock.
There will be systems and processes you will have to follow
The big retailers require suppliers to follow specific systems and processes. By way of example, they prescribe the way the product must be delivered, merchandising needs, managing returns and so forth. While all these processes make the supply chain manageable, the processes come at a cost. It is therefore imperative for SMEs to fully comprehend the requirements of the big chains and be able to put in place systems and processes to support these requirements and to ensure that they have the requisite cash flow.
When these systems and processes are in place an SME can enjoy the high volumes that come with selling to big retailers.
Don’t rush the process
The first client secured for Breva was Pick n Pay in 2013. The entire process from meeting with their small supplier development department to eventually signing a terms of agreement took nine months.
Similarly, although the listing at Woolworths took place in 2014, the conversations had started a year before.
Your product needs to fit into a retailer’s overall strategy
The buyers assessed the commercial viability of the brand against their strategy before listing us. They also assess the product against their beverage strategy to determine if it was a fit and assessed the quality of the product.
In all instances we had to negotiate and enter into trading agreements and receive account numbers to complete the listing process.
Getting on retail shelves is not everything
These four retailers (Woolworths, Spar, Pick n Pay, Shoprite/Checkers) do not represent all the shelf space in the country. We are not represented in hotels, restaurants and catering (HORECA) by a long shot.
We struggle to get the audience of several other retailer buyers because some of them are not familiar with the malt category and others because they prefer imported brands.
Focus more on your consumer than your competition
Competition is good because it keeps you on your toes. While it is important for us to keep an eye on competition, it is more important to follow our consumer focused strategy and on achieving our results. Focusing too much on the competition can be distracting and paralysing.
Rather than focusing on what the competitors are doing, we listen to consumers and we become innovative in response to their needs. Our core business is coming up with innovative solutions for the non-alcoholic consumer and these solutions come from the consumer and not from the competitors.
You will have to find balance
For a growing business the challenges we face relate to the delicate balance of growth and available resources. To grow our company faster we need scale, resources and efficiencies. However, our resources are often limited thus restraining our pace of growth.
You will still be vulnerable to market forces
The current weak exchange rate and slow growth make production difficult. We import some of the raw materials and the volatile exchange rate results in high production costs. Often we are not able to pass these costs to the consumers and so we absorb them and end up with low margins. High inflation and slow growth means that our sales are marginally suppressed so a combination of suppressed sales and low margins are real production challenges.