Plant-based beverages and dairy to pave the way into Asian market growth for Freedom Foods
Rory Macleod, Managing Director, Freedom Foods Group, told us: “We are seeing clear growing demand for plant-based beverages and foods in Southeast Asia and China, alongside a strong demand for protein through dairy-based beverages and foods.”
“We have also seen that the oat-based cereals and snacks market is growing in these areas, [but] the demand for plant-based beverages and dairy is definitely very strong.”
The company is confident about moving into the Asian market, so much so that is expanding into Vietnam and the Philippines with the establishment of new offices.
“Within six months, we also expect the opening of a new representative office in Indonesia,” said Macleod.
The company already has a regional office headquartered in Singapore.
“Our strategy surrounds both growing our own brand, as well as supporting other customers’ food brands via contract manufacturing,” he added.
“We have a robust UHT capability out of Australia, which enables us to support a number of key customers across different types of formats, primarily around liquid milk but also starting to move into cream like packaged cream, cooking and whipping cream which sees a lot of demand too, especially across Southeast Asia.”
In 2017-2018, Freedom Foods saw their annual net sales increase by 34.5% to US$251m (A$353m). 2019 sales revenue is expected to be in the range of US$ 356m (A$500m) to US$377m (A$530m).
“We continue to experience strong demand across our business activities in China and Southeast Asia [which reflects] demand from customers for [our] expanded operational footprint and increasing brand penetration […] in key channels and categories in these regions,” said Macleod.
Freedom Foods brands in Asia
In Asia, one of Freedom Foods’ most recognised brands is Australia’s Own, which comprises a range of plant-based beverages.
“We’re growing our own brands, primarily surrounding Australia’s Own. That’s the brand we’ll continue to focus on across the region,” said Macleod.
This also applies to the organics market, as Australia’s Own also has an organic range of plant-based beverages.
The company’s MilkLab range comprises milks that are specially developed for coffee and the barista market. In keeping with their focus for Asia, this range also offers plant-based alternatives.
“This brand has seen very strong growth in the food service space in Australia, and is starting to pick up in South East Asia. Takers include brands like Starbucks in Malaysia, and there has also been strong growth into Singapore,” he added.
“Infant formula is performing quite well in Singapore too, so we’re hoping to expand on that for sure. There are also plans to launch this to different markets like Vietnam and Philippines over the next six to 12 months,” said Macleod.
The Australia’s Own infant formula is marketed as the Diamond Pro+ range.
What’s new and upcoming
Adding on to their dairy and plant-based portfolio, Freedom Foods is looking at breaking into the functional food and drinks space next.
“Backed up by our UHT capabilities, we will be launching new products like drinking yoghurt and a2 protein milk products into Southeast Asia soon, under the Australia’s Own brand” revealed Macleod.
“We are looking more now at the functional and value-added products space, and see a lot of new opportunity for this format.”
In terms of production capabilities within the region though, he said that there are no plans for this.
“For us, it will be more about leveraging Australia’s produce for export: It would be for Australia, in Australia, outside of Australia when it comes to production. We want to focus on growing our brand and selling and distribution in Asia instead.”
Indeed, Freedom Foods prides itself on its passion and flexibility to stand out from the pack in a market that is extremely competitive.
“We are very passionate about healthy and nutritional food. We make sure that we are agile and innovative, constantly innovating new products,” said Macleod.
“For example, knowing that some products out of Australia will not be relevant for the Asian market, we will develop ones that are more targeted to it.”
Australia vs Asia
Commenting on the differences between tackling the Australian and Asian markets, Macleod said: “Apart from the obvious differences in size, where Asia is certainly a lot bigger, the consumers are also more fragmented.”
“There is a lot more diversity, given the many different geographies and regulations, and it presents a whole new set of challenges. A bit more patience is required when it comes to developing the market.”
That said, he still sees Asia as a very well-positioned market for growth.
“It’s a very exciting market, there are many changes taking place, for example the growth of the middle-class and incomes. It is certainly well-positioned for a lot of further development.
F&B trends in Asia
Macleod is also positive that the company’s direction within the region is in keeping with upcoming trends.
“The core trends are likely to hold, people will search for more functional products, dairy and plant-based proteins are a very critical part,” he explained.
“Another important trend to note will be about online vs offline distribution. The emergence of online shopping capabilities across Asia is something to watch.”
“Beyond that, there is also a change in the consumers – they now have much more flexibility over what they want to eat, which is why companies need to be clever about their product range.”
“Encourage your consumers to try new things, don’t just base your portfolio on something standard and consistent that has been done for a long time. New products are what consumers today are attracted to,” added Macleod.