By Neil Hellmann, founder of Ella Coffee
Ella Coffee, a blend of espresso and milk, is a South African product that delivers coffee convenience in a capsule. Primarily marketed as a drink that gives consumers an espresso boost (it can be shaken and drunk straight up as a shot), it can also mixed with hot water for a cappuccino, or poured over ice. It has been available on the shelves of South African retailers and online for the last three years.
Over the past year, the company has been working to get the product to the Middle East – a journey that holds lessons for other brands aiming to do the same.
It may sound elementary, but extensive groundwork is key – to understand how your product compares to similar products already being sold there, and to establish how you might have an advantage.
The per capita income in the Middle East is one of the highest in the world, and our research showed us that they are paying one of the highest prices in the world for premium coffee – for example, in Qatar, you can pay US$6.50 for a cappuccino. The fact that our product has a year’s shelf life adds to its convenience. And because it has more than 75% milk in it, it is exempt from sugar tax/excise duty in the Middle East and so it gives us an advantage over other energy drinks who have to pay large excise duties.
But setting up a product for export is a long process, and in Ella’s case made even more onerous because the product contains milk (which is classified as live animal produce, and requires certification). In order to be able to export, we had to have our labels approved, Halaal certification and an export permit from the Department of Veterinary Science. But being FSCC 22000 approved meant that we had many of the procedures in place already, which were augmented with the Halaal certification and the export permit – both of which open the doors to being able to export to the Middle East.
Of course, the export journey is not without its curveballs. There have been many challenges – the biggest one has been the Arabic translations of Ella’s labels, because they are very technical and scientific, and the labels for the Arabic translation required redesigning. This was done via a third party in Dubai. The final approval lies with the Dubai municipality, which also checks the translation and approves the final labelling, as well as the Halaal certification and export permit.
If you’re a brand looking to extend your reach beyond the borders of South Africa, there are two non-negotiables – make sure you have the correct distributor, and ensure that you factor in a potentially lengthy process.
Choosing the right partner to assist with distribution in the Middle East is critical because of the difficulties of getting approvals to get into the market. You have to have the label approved, the samples approved, you have to have the export duties approved. And then getting into the retailers is key, so you need someone who knows what they are doing and can guide you through the process.
Lastly, give yourself time. It can be a long process. It really depends on the product you are taking though – because Ella contains milk and is also in the FMCG category it added to the complexity. The margins can be a lot tighter, and the demands – such as storage and shelf life – can be a lot greater.