Will Brexit affect confectionery?

I’m no economics expert, but it’s a question we’re all asking, whether about the confectionery industry or our own personal circumstances. Brexit is certainly going to have impacts – good and bad – whether we like it or not.

I’ve read that Euromonitor is now predicting that post Brexit, the compound annual growth rate for UK confectionery will decline by -0.2% from 2015 to 2020. Only time will actually tell.

Figures aside, a large proportion of the food industry was in favour of Remain, with 70% of Food & Drink Federation members backing this stance. Indeed, Mars publically backed Remain and Mondelez, post Brexit has stated that it will continue to remain fully committed to the production of confectionery in the UK.

But we have a Brexit situation and not a Remain.

Many raw materials for confectionery are clearly imported, most notably cacao and sugar. Packaging is often made in the Far East. How the pound continues to fair and what trading agreements are set up will most certainly affect the cost of production and the leading manufacturers will be acutely aware of this.

UK confectionery ends up in the hands of many ex-patriot countries and this trade might yet be affected by the political situation over time. Though not all of these destinations are in the EU and so the outcomes might be more fragmented.

So there is definitely going to be a Brexit impact and there’s quite a bit of “wait and see” to happen yet. Rest assured though, the UK is not going to fall out of love with confectionery for anything or anyone – demand will still continue and whilst price sensitive in some areas, we’ll continue to enjoy our sweet treats, come what may.

www.sweetretailing.co.uk

 

Pick and mix your way to extra income

GUEST POST: Brett Sidaway, Marketing Manager of Wrights Plastics GPX

The continued growth in popularity of pick and mix and ‘retro’ confectionery presents a ‘sweet’ opportunity for hard-working entrepreneurs to create some much needed additional revenue. Brett Sidaway, Marketing Manager of Wrights Plastics GPX, a West Midlands-based manufacturer of pick and mix stands, has researched the potential for revenue streams and shares his ideas with us.

Brett sees the potential for confectionery-based businesses to become a staple part of the so-called ‘bedroom businesses’ boom – small scale start-ups characterised by low entry-to-market costs and often begin as part-time enterprises, perhaps designed to fit around activities such as bringing up kids, caring for a relative or friend or ongoing work commitments.

According to StartUp Britain 2015 saw around 600,000 new business launches. Additionally there has been a surge in food related start-ups.

Statistics indicate that women especially are keen to start up small scale businesses that fit around their current lifestyle. On average about 30 per cent of self-employed women work from home.
  
The smell of sweet success

Brett believes a foray into offering sweets for events is a great opportunity for entrepreneurs. Firstly, costs to enter the market are relatively small. “It is a great business to ‘dip your toe’ into as you can begin with small scale orders to cover your first events. Stands and dispensers don’t cost a great deal, and there is often little branding beyond header cards and business cards.

Secondly, initial opportunities combine a chance to make money with socialising activities. There are often chances to make the most of social networks to build business opportunities; and business opportunities can help build social networks too.

As a simple business model, Brett suggests purchasing a complete pick and mix stand. These are easy to store and transport to events. Headers can be branded if required and replacement hoppers purchased in the event of breakages etc.

An obvious opportunity is running pick and mix parties for children. Despite concerns about sugar intake and healthy eating generally, kids love sweets and as a treat and eaten in moderation it seems unlikely that this will change in the near future. So including pick and mix at children’s parties is a great opportunity for a start-up business: it taps into an existing network of parents ensuring marketing costs are minimal but uses the power of the network to build the business. 

The opportunities are not just restricted to birthdays: pick and mix parties are ideal for end-of-term celebrations, exam successes, Christmas parties and even fundraising events at schools.

Charity and fundraising events are another chance to build the business. There are always many local fundraising activities for charities, churches and other groups and having some pick and mix or retro confectionery is an obvious way to add some excitement. You may decide to make a flat donation to the good cause or give a percentage of your sales but most organisers will welcome the chance to add something new to their regular fundraising events.

And there are also plenty of other opportunities to build the business: weddings, sporting events, car boot and table top sales. 

Social media will be a big part of your brand building, and that’s even more good news according to Brett. “With social media, costs are low but you can be really successful just by posting creatively and getting good feedback from your customers.”

www.sweetretailing.co.uk

Can crowdfunding work for confectionery?

Candy Kittens is the latest confectionery company to set up a crowdfunding campaign in a bid to raise £300,000 to pay for an above-the-line marketing campaign, helping it to grow to £2.5million by 2017. Launched in November and running until March, the company is using Seedrs as its online platform. Not a new idea, but a rather interesting idea, Hotel Chocolat is possibly the best know confectionery company to harness the idea of crowdfunding.

But take to one of the 500+ crowdfunding platforms now online and you’ll see a huge collection of campaigns competing for attention. We took a peek at crowdfunder.co.uk and identified 1,144 food and drink projects – many of which related to confectionery. Is this going to become the savvy way to build your business or will it not stand the test of time?

Interestingly, the very first crowdfunding project to make use of the internet was set up by rock band, Marillion in 1997. They could not afford the $60,000 cost of their tour and managed to raise it from lots of willing Americans, prepared to pay their bit online. 19 years later and the creative method to find funds has grown legs and become a significant business in itself.

So if you’re wondering about setting up your own crowdfunding project – perhaps you want to build your confectionery brand or expand your confectionery retail business – how should you go about it? Here’s a few key considerations before you go any further:

1.     Know who your audience might be. Key crowdfunding participants include those aged 24 to 35, men and high income earners. If this fits with your plan, you might be lucky. If it doesn’t, you might be less successful with this route.
 

2.     Know your brand. It might sound silly but many people don’t. What does it stand for? What are its USPs? What is it not? If you need some help to develop this, now would be a good time to do that.

3.     Ensure that you have a good story. People buy into stories, so make sure that you can tell yours well. Again, if you need help with the copywriting, please do so. Get passionate and emotive so that you get your target audience on board.
 
4.     See what others are doing. There are no end of examples to view online, so take some time to see what works for you and what doesn’t. Also understand who you might be competing with in the same time-frame.

5.     Do a pre-launch and get talking early. Don’t simply rely on a crowdfunding platform. Use your own marketing strengths to communicate with your target audience. This might be your customers via email or even in person (if a confectionery shop for example), or perhaps your social media network. Consider PR in your local area.

6.     If it doesn’t work first time, try again. Don’t give up, it might have been bad timing or you might have got the message or target audience a bit out of kilter. Review your results, seek some advice and try again.

So we leave you with (hopefully) a thought provoking idea to raise the funds you might be after. It might not work for everyone, but looking at the growth in the market and the companies giving it a try, perhaps you ought to take a closer look at crowdfunding too?

www.sweetretailing.co.uk