GraceKennedy targets US Hispanic market with ‘new look’ La Fe
“From a strategic point of view, we want to break out to be the number two brand under Goya in the US,” GraceKennedy CEO Don Wehby told shareholders at the company’s annual general meeting last Wednesday.
In a bid to tap into the US$7 billion US Hispanic market, GraceKennedy said it is re-launching its La Fe brand of food products.
The re-launch under GK Foods (USA) will include a brand refresh campaign, new logo and packaging, as well as a focus on engaging retail partners and consumers, GraceKennedy CEO Don Wehby said.
“From a strategic point of view, we want to break out to be the number two brand under Goya in the US,” he told shareholders at the company’s annual general meeting last Wednesday.
He added, “Putting it in context, the Caribbean food market is about $500 million. So when you are doing that, it’s extremely important if you are setting out on a journey to be number two, that you have to be very scientific, you have to be very focused and how you will approach that.”
The La Fe re-launch is among a number initiatives Grace has planned to turn around underperforming segments of its international business.
It includes the UK segment which in 2017 suffered from low sales of the market’s flagship product, Nurishment. Against this background, Wehby said the company introduced a no sugar variant and a vitamin-enriched variant of the product as part of a broader strategic plan to boost sales.
“We have seen no further declines in the first quarter and I expect Nurishment to rebound based on the marketing plans and the strategic distribution plans that we have in place,” Wehby added.
Over in Africa, Wehby said the company will assign a third party distributor for its Ghana operation, following slower than expected returns in that market.
GraceKennedy had previously set up its own company in the West African market in 2014, but that has not borne fruit.
“When you’re on a strategic journey you must not be ashamed to look back and do an assessment, and say listen we could have done better. And we are at that point now; all indications are showing that the more efficient, more profitable way for GK to really carry out our strategic intent for Ghana is through a third party distributor, and that is the direction in which we are heading,” Wehby told shareholders last week.
Concurrently, GraceKennedy said it will capitalize on the trend towards healthy lifestyles in a bid to grow in the international and local food markets.
“I expect that in terms of segment growth for the GraceKennedy group, keep your eyes on it, it’s going to be huge, whether we do it by acquisition or creating new variants to our products, it’s going to happen,” Wehby said.
The CEO indicated that 2018 is expected to be a very successful year and has set for itself an aggressive target of achieving a record-breaking $100 billion in revenues by year end.
GraceKennedy has also engaged the services of London Consulting Group to help optimise the group structure and find ways to achieve improved productivity and maximize efficiencies.
“As I stand here in front of the owners of the company, I know we must review the organisational design of GraceKennedy to see how we can improve productivity and increase efficiencies. You have our commitment that this great company of yours will be even better when we celebrate our 100-year Anniversary in 2022,” Wehby said.
GraceKennedy posted $92.48 billion in revenue in 2017, up by 4.8 per cent or $4.21 billion over 2016.
Net profit after tax was $4.77 billion for 2017, an increase of 5.2 per cent over the prior year.