For entrepreneurs, expanding your business internationally can present you with a great opportunity to sell your products and services in a broader market. We spoke to Dean Hristov of Yogoo! Natural Frozen Yogurt – producers of pure, low-fat frozen yogurt with live yogurt culture inside – and found out why he views going global as a chance to future-proof his business and bring good practices back to the UK.
I’m Dean and I am the co-founder and director of Yogoo! Natural Frozen Yogurt. I am an ex-Global Talent Research Analyst and have a PhD in Leadership Networks, but as a vivid foodie I decided to take a break from academia and team up with my brother, Kiril Hristov, in order to turn my passion for yogurt and desserts into a business. This is how Yogoo! Natural Frozen Yogurt was born.
Yogoo! Natural Frozen Yogurt is a premium natural frozen yogurt brand that provides a range of high-quality, low-fat frozen yogurt products through a growing network of shopping mall kiosks. One of our distinctive and most popular products is YogFru – a fusion of Yogoo!’s natural frozen yogurt with three layers of freshly-chopped fruit toppings, healthy crunches and a range of sauces, including dark chocolate.
We have been operating in the UK for the last six months and we dare to say that people absolutely love our products. A significant proportion – around 45% – of our customers are of either Asian or Middle Eastern origin, which led to us launching our first kiosk in the UK as an opportunity to explore what Asian and Middle Eastern communities think about the unique taste of Yogoo! This is how we decided to go global.
We have had amazing support from Virgin StartUp in the form of mentoring, access to a range of events and webinars, and more. And while doing business in the UK is great and we are currently franchising out our business to other entrepreneurs in the UK, we felt that we also have an amazing opportunity to scale up and take Yogoo! global.
The primary reason behind this decision was the fantastic feedback that we had from Asian and Middle Eastern customers in the UK. This, coupled with the perceived seasonality of businesses like ours in the UK, as well as the uncertainty around Brexit and slow growth in the retail sector on which we depend heavily, served as a wake-up call for us to think how we can future-proof our business by taking it global.
Following our successful summer 2018 launch, we are currently working on expanding our operations beyond the UK and opening up further outlets in Asia and the Middle East by next year. The first two locations have been confirmed as India and Oman. I suppose we realised that if we want to scale our business and move upward, we would need to be bold and move outward!
We are currently working on establishing our first kiosk in New Delhi, India – the fastest growing economy in the world and a home to over 1.4 billion people. India is a land of foodies and, despite the fierce competition in the food sector, they have a craving for premium and healthy frozen yogurt – something I discovered during my recent trip to New Delhi and Mumbai.
At the time of writing this blog post, we are in advance negotiations with our partners to launch Yogoo! Oman. We have also had serious interest from entrepreneurs in Hong Kong and Macau, so exciting times lie ahead!
Why go global?
There are a number of reasons why one might decide to scale their business by taking it global. Let me briefly cover some of the key motivational factors that led to us taking this bold step – these may well be applicable to your business too, particularly if you are foodpreneur.
- Growing middle classes – We want to tap into emerging markets with rising middle classes. We have found that countries such as Oman, Macau, China, India and Vietnam are the perfect match for us. I have been working and living in most of these countries, so I have a fair understanding of emerging consumer trends. These indicate if people have access to growing disposable incomes.
- Increased demand for healthy food – Not only significant proportions of the population in Asia and the Middle East have seen their disposable income grow, but they are now also more health conscious when it comes to selecting their food. This is coupled with generally warm weather and an increased demand for healthy alternatives to ice cream and other popular desserts.
- Booming retail industry – While traditional retail is going downhill in the UK due to more and more people shopping online, mushrooming shopping malls are a growing trend in Asia and the Middle East. Retail goes hand in hand with food, which is seen through food courts that become an essential element of every successful shopping mall.
- Affordable trading spaces and lower business expenses – Unlike the UK, where a shopping mall space can cost you as much as £4,000 per month, in Asia and the Middle East one may find plenty of affordable spaces in which to test products internationally. Workforce costs in these two regions are also relatively low when compared with Europe and North America, for example.
- Influence of Brand Britain abroad – the positive influence of Brand Britain in the rest of the world is undeniable – people in Asia and the Middle East are increasingly looking for high-quality, premium products and services, and they recognise the ‘Made in the UK’ tag which can give you a competitive advantage over other similar local products.
How should foodpreneurs go global?
- Identify international markets with growing middle classes and purchasing power – Prominent examples in Asia include India, Bangladesh and Vietnam, among others – all craving for high-quality food and drink options. In the Middle East that’s Saudi Arabia, Oman and Jordan. Start by exploring the resources provided by the Department for International Trade and see their ‘how to export’ guides for different countries, which are extremely useful.
- Explore legal entities available to you and select a simple business model – Establishing a private limited company as a fully owned subsidiary is by far the most popular option, but this varies across countries. You also need to carry out thorough research on the regulatory framework in the country you are planning to set up your operations in, including legislation around food and drink businesses.
- Spend quality time to explore the retail sector in your selected country – On my last trip to India, I had to visit over 20 shopping malls and I spoke to a number of managers there to understand their policies and how we can come in as traders. This is essential – you need to know the retail approval process inside out, understand all costs involved and be able to appreciate key timescales.
- Partner with other investors and entrepreneurs within the country – Opening up an international branch of your business, while being exciting, may end up as a costly exercise. For this reason some entrepreneurs go on to establish partnerships that provide fresh funding in exchange for shares or company equity.
Making your business global is an opportunity to diversify your business model and pitch it to different international markets and people. This will future-proof your business and allow you to bring some good practice and ideas back to the UK. One such example from Yogoo! is the famous Hong Kong bubble waffle, which I had the opportunity to try during my last visit to Hong Kong and subsequently took back to the UK through our Bubble YogWaffle – made with natural frozen yogurt. Good luck!
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