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Jack Link's UK Ltd - The Interview

Jack Link's, the world's leading ready to eat meat snack brand, first launched its Jack Link's Beef Jerky and Jack Link's Beef Steak Nuggets here more than three years ago, followed by the introduction of Jack Link's Steak Bars last autumn. Since then, millions of UK consumers have discovered for themselves that Jack Link's offers a great tasting range of snacking products, designed for today's health conscious lifestyles. The 10-strong Jack Link's portfolio provides a healthier alternative to traditional snacking options such as crisps, sweets and confectionery. It's good news too for retailers - as the UK's traditional snacks market becomes increasingly static, ready to eat meat snacks are the fastest growing category in snacking, and Jack Link's is helping to change the UK population's eating habits by encouraging them to include meat snacks in their repertoire. The Grocery Trader spoke to Michael Reuther, European Sales Director, Jack Link's Europe. The Grocery Trader - How successful has the UK launch been so far? It's been very successful. We're now stocked in various UK multiples: we're listed in Sainsbury's, we're talking to ASDA and Morrison's, we're in Somerfield and NISA, and we've got agreement for a listing in Co-op Food Stores. GT - Which other UK retail outlets are your products currently sold in? We're also listed in Spar, WH Smith, Martin McColl, Whistlestop, Smile (Key Lekkerland), Palmer & Harvey and BP, Esso, Welcome Break, Moto, Texaco and Total forecourts. GT - How important is "snacking on the go" in driving purchase? Snacking on the go is a key factor in driving purchases. Petrol stations and motorway services are the shop window for brand and product awareness, and trigger subsequent repurchase of Jack Link's in grocery outlets. GT - Michael, your title is European Sales Director, Jack Link's Europe. How much time do you personally spend here in the UK? I spend a week to ten days here per month. In addition we also have an office and full time staff servicing the UK. GT - How important is the UK to your overall European sales effort? In your experience, how does the UK opportunity for Jack Link's compare with other countries? The UK is very important to us. Brits eat more snacks per head than other European consumers. The UK is more advanced in terms of beef jerky and biltong adoption, because of its South African connections. GT - Who owns Jack Link's? Jack Link's is a family owned business. Mr Jack Link is the CEO and owner, and his son Troy is President. The Link family has been involved with the meat business for over 100 years. Twenty years ago the company diversified to meat snacks, and decided to streamline their business. The present meat snacks started in 1987 with kippered beef steak bars, and moved from there to beef jerky and the other products we market today. It's still a very family-oriented business, even now. GT - How big is the Jack Link's brand in other countries? Jack Link's has more than a 35% market share of US meat snack sales, which are worth $3bn at retail prices and growing. We're the only "true" global meat snack company: we currently operate in more than 40 countries worldwide and 23 different European countries. We have production and processing facilities on three different continents in order to guarantee supply and top quality products. GT - How big is Jack Link's worldwide? How fast are your worldwide sales growing? We continue to grow annually on a double digit growth rate. GT - Focusing on the UK, how big is the UK market for meat snacks? AC Nielsen values the UK retail market for meat snacks, excluding sausage snacks, at £8-10m and growing 100% annually. We currently supply more than 25% of this. GT - How does the sales growth rate of the meat snacks category in the UK compare with traditional savoury snacks? Why do you think that is? The overall savoury snacks market has been declining 7% annually following growing awareness of health and obesity, while consumers have been discovering meat snacks. Another important factor is that UK retailers are making an increasing effort to raise consumer awareness. Finally, as in other European countries, more retailers are putting healthy products by the checkout where the sweets used to be. GT - Which Beef Jerky, Steak Nugget and Steak Bar products are in your UK range? What retail pack sizes are available of each of these, and what is their recommended selling price (RSP)? Our product range covers Beef Jerky - Original, Peppered, Sweet and Hot and Teriyaki, 25g and 100g; Beef Steak Nuggets - Original, Peppered and Teriyaki, 25g and 100g; and Beef Steak Bars, Peppered, Teriyaki and BBQ, 25g. All our 25g bars are priced £1.19-1.29 and the 100g bags £3.99. When consumers get into our products, they move quickly to the 100g packs - they are resealable, but I haven't ever seen anyone actually reseal them! GT - Which of these products are the biggest sellers in the UK? The top sellers are Beef Jerky Original and Peppered. GT - What's the difference in product format and positioning between your Beef Jerky, Beef Steak Nuggets and Steak Bar? All three are currently positioned as premium treats, but Beef Jerky is fast becoming an everyday snack. It's 'high premium' compared to other savoury snacks: people need to try it first before making the spend, which is the model across Europe. GT - Can you tell us how Jack Link's Beef Jerky, Beef Steak Nuggets and Steak Bar compare nutritionally with traditional savory snacking options such as crisps, snacks and nuts? How do they compare nutritionally with sausage-based snacks? Our 25g bags have a maximum 4g of fat, which is much healthier than crisps. Sausage snacks have a high percentage of fat, some as much as 60%: we're at the other end of the scale. Having said that, the biggest selling sausage snack has a much higher percentage of fat, but that doesn't seem to have hurt their sales yet. Consumers in Germany and Austria are also aware of health and obesity concerns and will probably migrate from crisps to sausages and beef jerky. We're incremental to the meat snacks category - we're not taking sales from sausage snacks yet. GT - There are a lot of meat snacks on the UK market now. What sets your products apart? No one can touch the quality and value we are providing. Jack Link's is the only range of such products backed by a proprietary, global brand. Another point of difference is that we produce and distribute our own product, which is very important to retailers in terms of quality assurance. GT - Which consumers are Jack Link's Beef Jerky, Beef Steak Nuggets and Steak Bar aimed at? Our consumers span 18 to mid 50s, predominantly male but expanding with female. GT - If you can narrow it down, who is the target consumer? The typical consumer is 18-35, male, active, keen on snacking on the move. In Europe, we concentrate on people on the go; very similar to our US focus. In the US the category overall is more advanced; in Europe it didn't exist even five years ago; then, there were only sausage products, but since those days we've convinced buyers of the business case and now we're winning over consumers. GT - Are there any health guidelines on how much Beef Jerky etc children and adults should eat in a given period? There are no guidelines - you stop eating when you've had enough! People have periods of eating beef jerky, then have a break from it. GT - Where are the products made that you sell here? Our Beef Jerky is produced in Brazil, and our Steak Nuggets are made in the US with beef from New Zealand. Our Steak Bars are made in New Zealand. GT - Are there any plans to manufacture these products in Europe? When we hit critical mass, we'll produce them in Europe, but it's not on the horizon yet: the global market for beef production can be very volatile. South America and the Pacific region are historically stable, so it's natural to produce these products there. GT - Where should you merchandise these products in a supermarket or a C-store for best sales? Jack Link's products should go with savoury snacks - nuts and crisps but can be secondary sited with the beers. GT - How big is the potential sales opportunity for Jack Link's in UK multiple grocers? The category could well double in value in the next two to three years at today's prices, with the right merchandising, NPD and so on. GT - Who heads up your UK sales and marketing team? Simon Grinyer is our National Sales Manager. GT - Do you sell direct to UK supermarkets and C-stores, or do you sell through brokers? We sell direct and have a customer support manager, based in Northampton, plus a warehouse in Ipswich. GT - Who handles your supply chain? We've outsourced our logistics, and with BP and other chains we use their approved carriers. GT - Do you work with other non-competing snack companies in order to service impulse sector customers? It is an area we are looking at, currently we have good coverage in the delivered sector but need to offer the totally independent retailer an opportunity to buy via cash & carry. GT - What Jack Link's merchandising and Point Of Sale material is available to UK retailers? We offer clip strips, based on a set of different European designs but tailored for individual accounts. Retailers here are very specific: the UK is more demanding than the rest of Europe, when it comes to overall trading standards. For example, displays can't have sharp edges and must be stable. We have a person dedicated to this area. GT - What new products are you planning for 2007? We're launching various new products, developed here and in Germany, at the beginning of Quarter 4. GT - What advertising and promotion support are you giving Jack Link's in the UK in 2007? What about sampling? We've been running ads and other trade activity, and we've recently moved to consumer advertising. We're currently targeting male consumers with active lifestyles, in running and men's health magazines. We're also carrying out nationwide in store sampling, in various outlets. GT - Do you have a Jack Link's UK consumer web site? There's an English language web site for our consumers in Europe. The URL is www.jacklinks.info. GT - What other retail products does your company sell in other countries? Will you be introducing any here at some point? Our UK range is standard across Europe and in most of the world. In North America, we have over 700 SKUs, including Tendercuts, 'Delis,' small sausages, and Marble & Brown Sugar Beef Jerky. The idea of dried meat being sweet is very strong in Canada. These products could well come to the UK at some point, as the market grows. GT - What external factors do you see affecting UK sales of meat snacks? The main one is concern over health and obesity, as you'd expect, but meat snacking is the new, trendy product category in the US and Europe. GT - Finally, where do you see Jack Link's going from here in the UK? In a word, forwards! As things stand we're the biggest player on the market as a global company. Depending on the competition, we will remain the biggest player here in terms of NPD, marketing investment and category management. In the US we have fought our corner over the last few years and have managed to hold off the competition as the market leader, so I am confident we could repeat that here if we had to. Our biggest advantage moving forward as a company is that we're solely focused on meat snacks, and will remain so. Jack Link's UK Ltd Tel: 01604 499 899 www.jacklinks.info