Mary Rogers from Stateside Solutions joins us along with guest Cyril Walsh from St. Patrick’s Distillery to talk about selling food produce into the USA. Learn about Co-opetition, mistakes companies make when presenting to buyers and the importance of choosing the right distributer or importer.
Inc60™ sat down with Mary Rogers, CEO, Stateside Solutions and Cyril Walsh, General Manager of St Patrick’s Distillery at the Bank of Ireland start-ups Workbench in Galway, Ireland. Stateside Solutions specializes in U.S. market entry strategy and execution for foreign owned SMEs, while St. Patrick’s Distillery expects to enter the U.S. market in 2016.
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The conversation largely focuses on how food and beverage companies should go about expanding into the United States. Cyril’s first question relates to funding. Europe, and specifically Germany, will be St. Patrick’s distillery’s first export destination. He feels that even though the cost of going to the U.S. may not be enormous, there is no cost to get into the EU. Mary quotes Bord Bia’s view that making a successful move into the U.S. market takes “Time, Focus and Money.” Mary suggests a period of between 3-7 years as a typical time frame to be successful in the U.S. with a beverage.
“3-7 years to be successful in the U.S. with a beverage”
Mary notes the current optimism among Irish food producers. More than two thirds of Irish exports to the U.S. are food and beverage related. Cyril asks Mary about how to position a company’s brand in the United States and target a specific region. Among Mary’s key tips is the need to manage and monitor contracts with importers and distributors.
Mary cites an example of a whiskey distillery based in Wales that partnered with a major U.S. importer. On a retail tour, they discovered that their product was not featuring on the shelves of pre-agreed stores. Alternatively, smaller importers can provide a better, more dedicated service.
Distributors effectively own their clients’ labels through the principle of exclusivity. It is important to get contracts right because companies can lose control of their brand and lock themselves out of the market.
Another option is to ditch your brand and label your product according to the wishes of your customer.
Mary supports the view of the Irish government agency, Bord Bia, that companies should wait until they are ready in order to carry the move through. Mary feels that companies must be willing to commit money and time, while accepting that their first sales will be loss leaders.
“a lot of companies are coming together and pooling their items and shipping them together….it’s called co-opetition”
She suggests a co-opetition option whereby companies in the same space create a package to share initial costs. Each can hope that their product will make a mark and lead to further sales. For example, craft brewers could come together to sell 6-packs with 6 different brands.
To be successful it’s important to be back and forth across the Atlantic monitoring proceedings. Hiring a target orientated professional salesperson with corporate and sales training is also required.
Attending trade fairs is important too. Mary took 13 Irish food companies to the Fancy Food Show in New York in June 2015, where they met customers and distributors. Several got their products into U.S. stores within six months of the event.
Mary tells us that Irish companies are known for quality, Irish people are seen as hardworking and Irish prices are deemed to be fair and of good value. Consequently, many American companies are looking for a reason to say yes.
One fault Mary has come across is that in the past some Irish companies never asked for anything. Instead they need be specific about what they are seeking. Also, it’s important not to over promise. If things go wrong do not let them drift. Instead, keep your customers in the U.S. informed.
Mary says that companies that are successful in the United States have shown a commitment to the market, realism and perseverance. In terms of costs, the east coast is expensive relative to other parts. Middle America is cheaper but access from Ireland is more difficult.
Mary encourages businesses to connect with Irish organisations such as the New York Digital Irish and the Irish International Business Network. Irish-Americans will be eager to refer others but Mary warns her clients not to get stuck going from one coffee meeting to another following well-meaning but non-essential referrals.
Cyril agrees that St. Patrick’s Distillery will eventually have to make a judgement call as to how big they need to be before making the move with their vodkas, gins and whiskeys.
Mary sees a U.S. economy that’s picking up with companies are hiring. Mary encourages businesses – particularly those looking at manufacturing or providing services from the United States – to examine government supports such as employment grants that are available. Lastly, Mary touches on the benefits of setting up a corporate entity in the United States.
Featuring Cyril Walsh from St. Patrick’s Distillery in Co. Cork, Ireland.