Fifteen people-strong cereal company Blue Frog was founded to liven up the supermarket breakfast cereal aisles, company founder Scott Baragwanath explains.
What does your business do?
Blue Frog Breakfast is a small food business trying to make a difference in the world of breakfast. We started because we looked at the breakfast category and it looked incredibly boring and transactional, we thought there was an opportunity to bring some excitement and wonderful food and flavour queues to breakfast time. We make 12 different products, which span from kids cereals, granolas, grain-free cereals and porridge.
We're East Tamaki-based and launched in April 2015, and conceptually a year before that when it all started to bubble to the surface, and we started to work on the business proposal. We manufacture 30,000 units of product each month, about 10,000 a week.
What was the motivation for starting it?
I've had 20 years in the fast moving consumer goods sector, which I loved, but I had quite a creative element that wasn't really being addressed in big corporate. At the same time I became a dad, I've got four young kids, and breakfast was one of the times we love and are passionate about. It sounds cliche but once the kids came along we started to look at breakfast with a slightly different lens and went 'look, there's so many poor products in the marketplace'. I'm a passionate foodie, been cooking ever since I was a young child. We're all in this phase of MasterChef and everyone is becoming a foodie and really aware of great ingredients, and we saw a really good opportunity to take all of that and transfer it into a breakfast offering.
How big is the team?
We now have a team of 15. We did have a team of five and that's grown to 15 in the last 12 months which has been really exciting. In last 12 months we have gone fully nationwide in the major supermarket chains.
What are your long term plans for Blue Frog?
We believe we're just getting started. Our long term plan is to build a really strong market base in New Zealand, but we do have large aspirations. We're currently in Australia in almost 500 stores, and our plan is to launch much more broadly there and then further field internationally. We're on Amazon USA and we're just about to extend that range in the next two months. We have our eyes set on becoming a global brand, that's our vision, and I think we have a really wonderful New Zealand story to take to the world.
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Did going nationwide significantly impact the manufacturing side of the business?
Yes, we've only just gone nationwide at Countdown in the past six weeks, which has meant additional recruitment and additional capital equipment, and all of these things have had to be done quite quickly, but we are small and nimble, so we are able to do things quickly and be flexible, which is a towering strength of a small company versus a bigger corporate.
What other markets has Blue Frog earmarked for international expansion?
Australia really is the next focus for us, and then US. We'll use Amazon but at some stage we may go into bricks and mortar there. After that the UK market is showing promise. We're really conscious that with New Zealand and Australia we've got some much work to do here first, and that's the challenge for us; not going too broad too quick. We're probably three years away from entering those markets, it may come sooner, but at least the next two years is getting everything right at home first.
How many products does Blue Frog have in the pipeline?
Oodles, there's no problem with the number of ideas, it's just refining them down so that they meet the consumer need. We pride ourselves on bringing an element of surprise.
We'd love to bring toy surprises in the cereal box. It's so fun and playful and again adds that element of surprise. With our recently launched kids cereal Coco Munch we will look to do some things like that, really go old school. We currently have simple games on our cereal boxes, and we're getting great feedback from parents on. There's been a significant movement away from not marketing to children, which is why toys are no longer used as a drawcard by many brands.
How hard is it to stay at the front of the shelf?
There is ridiculous competition, it is so fierce. There's the big Sanitarium, Kellogg's and Hubbard's, and the cereal category is becoming even more fragmented than it used to be. Across the total category, breakfast is not growing, it's flat. There are pockets that are in decline and pockets that are in growth; granola is experiencing strong growth - which is where everybody is suddenly launching new products. I would have to say that breakfast is probably one of the most competitive categories in the supermarket at the moment.
What advice do you give to others who want to start their own business?
Follow your passion and don't listen to the people who say that you can't do it. I know it's cliche but it is so true. Surround yourself with amazing people to help keep you on track because it is very easy to dilute your vision to be like everyone else in the marketplace.