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When you’re a niche product in a niche market, you must see the bigger global picture right from the outset. Organic baby food brand Green Monkey did just that, and its products are now winning fans all over the world. By Glenn Baker.

Green Monkey is a ‘super premium’ organic baby food brand based on traditional home made recipes and using locally ‘born’ ingredients that are 100 percent certified organic. If that’s not niche enough – the baby food is also free from additives, preservatives, sugar, salt, dairy and egg, gluten, wheat and soy. And then there’s the real innovation twist; Green Monkey has developed a unique pouch system for superior flavour and freshness, which also makes the product shelf-stable for up to 12 months. All of this, not surprisingly, elevates the product into the ‘super premium’ category – it is the Rolls-Royce of baby foods.

As ‘business arkitect’ Andy Macbeth points out, Green Monkey truly is a niche within a niche – and that’s why, from day one, even though all testing was carried out within the domestic market, they have always targeted world markets.

But the world is coming to them it seems. The pouch product was launched in October 2008 via the Green Monkey website, exported within the first three months, and enquiries from all over the world began flooding in right from the start. Search ‘organic baby food’ on Google and guess who heads the list? Macbeth says people immediately liked what they saw and the category has exploded as a result.

Sisters Charlotte Rebbeck and Lizzy Dyer are the original founders of Green Monkey, and the brains behind the pouch idea – which is all about convenience. Macbeth came on board initially as a consultant and mentor, and later as half-share partner.

A successful entrepreneur, and former CEO of Cookie Time, Macbeth brought a lot of marketing and business management skills to the table – and after a 12-month collaboration period to see how they’d get on, now describes his relationship with the other business partners as a “match made in heaven”. He says the pouch system wasn’t patentable because it borrowed from existing technology – but a lot of effort has gone into locking in trademark and brand protection – absolutely vital when securing overseas markets.

Despite there being around 35,000 babies born in New Zealand each year, with Green Monkey products only catering for the five to 10 percent super premium market the volume was never going to be there. So the strategy forward has always been export focused, and beyond Australia. Macbeth, Rebbeck and Dyer have their eyes set firmly on the US and are anticipating rapid sales growth. Already more than 50 percent of production (which, incidentally, is handled by partner company Kaweka Foods of Hastings) goes offshore, and within the next 12 months, Macbeth sees that figure climbing to around 90 percent.

Key partners
Getting Green Monkey off the ground quickly would not have been possible without the right support partners. Macbeth acknowledges the support of NZTE, particularly in the US, plus the vital product feedback from US natural and organic food giant Whole Foods Market.

Feedback obtained from potential buyers at a Queenstown Food Fair in 2007 who saw the prototype of the pouch, also helped give the Green Monkey founders the confidence that they had a winning product.

There have been some important lessons too, says Macbeth, especially around accessing the US market, which he describes as a ‘maze’. “Often with the Americans it’s a case of it’s a deal until it’s not. Things can change very quickly. We thought we had a deal that would have seen us shipping 20,000 pouches to the US a week, but the deal fell through at the last minute. Luckily we were smart enough to extricate ourselves without too much damage – because as you’ll appreciate, we have to work months in advance with our suppliers.”

The export game can be extremely volatile, says Macbeth. “There’s the risk of whether something will come off or not, which has a major impact on your planning and stock levels. You’re kept on tender hooks much of the time.”

Success factors
Macbeth attributes the success of Green Monkey to a number of factors – not least of which is their ‘never cut corners’ attitude. Sure they have a great product, and the ‘advanced thermal processing’ gives their product an official shelf-life of 12 months. Plus they deliver a highly traceable product – they pretty much know which paddock their ingredients come from. And just as importantly their baby food is 100 percent organic certified – not 95 percent like other US brands. “That five percent difference between 95 and 100 percent is the same as chalk and cheese,” says Macbeth.

But Green Monkey’s true success comes from seeing themselves as “a brand, marketing company and innovator – not a manufacturer,” says Macbeth. Their business model is based on partnership arrangements, which means no employees, no direct overheads. All production and services is contracted out to third parties, which frees up capital, and allows them to scale up production quickly if needed.

Exporting is no walk in the park, admits Macbeth, and the US is complicated.

“NZTE helped us to a certain degree, acting as facilitators and making the introductions – but beyond this, it’s up to us as exporters to solve the more practical issues.

“Who you latch onto, customer or intermediary is vital. In Australia, for example, it took three attempts to find the right distributor. Even the greatest of products can fail dismally from a poor distribution strategy.”

Meanwhile interest continues to fly in from all over the world. Macbeth reports that a Danish delegation is on its way to New Zealand to check out the product’s suitability – that’s right, a potential customer flying here to talk export. Such is the pulling power of a great product.

The challenge, when exporting, says Macbeth, is dealing with that lag between initial enquiry and actual sale – the cogs can move incredibly slowly. “We endeavour to be very professional in our initial dealings, over-deliver when it comes to supplying information, and always be customer-centric – we think that makes the difference.

“And although we may feel like we’re moving at a snail’s pace, we have to remind ourselves that we’ve actually moved quite quickly, especially when you consider that the world has just gone through a major economic meltdown.”

There’s also the not-so-small matter of the exchange rate squeezing margins, which Macbeth admits does make life difficult. “Fortunately we operate in the super premium space, which means the market is happy to pay the price asked. Plus we operate outside the more exposed commodities market – and I did my original costings when the dollar was high anyway, which has given us a buffer.”

Where to from here?
Green Monkey has made considerable progress in just a short time – with sales to Australia, the US, Dubai, Hong Kong and Vietnam and a number of food and packaging awards to their credit.

When asked where they see themselves in three to five years Macbeth says they’re planning on a goal of several million dollars in turnover. “It’s a bit of a crystal ball, but we’d like to have a solid stronghold in the Australian market by then – as well as pockets of the US.

“Packaging issues have delayed our entry into the European market – but we plan to embark on a European push in the latter part of 2010.”

However, despite their global focus, and entrusting their packaging to a leading edge Japanese company, it is Green Monkey’s intention to retain all production in New Zealand, close to the source of ingredients.

The Green Monkey Guide to Exporting

Don’t bite off more than you can chew.
Engage in capacity planning so you’re delivering the right amount of product and coping well with lead times.
Accept that foreign exchange volatility can be a nightmare and seek help.
Progress will always be slower than planned and costs higher.
Find the most cost effective way to reach target customers and maintain your margin.
Manage debtor risk – ship goods FOB (free on board) and insist on payment in cash up front.
Make sure goods reach shelves at a price the market can pay. (Macbeth says managing margins in the US retail market when dealing through distributors, requires special skill and knowledge.)

Please remember if you have any questions be sure to email us at info@greenmonkey.co.nz

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The Green Monkey Team

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