Love Taste Co. has grown exponentially since the business launched in 2005. In the early days, founder Richard Canterbury tells FoodNavigator, the group was expanding at a pace of 100-200% each year. Today, the company’s growth trajectory has settled at a more “manageable” 40%.
“We expect this revenue trend to continue. Our forecast for the next three years is higher than 40%. What we found in the past is when you start getting to 50% growth per annum the business has the potential to creak a little bit because you're putting a lot of weight on it.”
Over the past decade, Canterbury has seen improved awareness of smoothies - and its best-selling vegetable smoothies in particular.
“When I told my Dad I was going to start a smoothie company he said: ‘Well that sounds fantastic, what is it?’ Loads of people didn’t know,” he explained. “We first produced green smoothies about eight years ago. We worked with a spar chain called Champneys who asked us to develop some vegetable smoothies. If you are wondering around in a dressing gown in a spar you accept drinking a green, pond-like concoction because you think it is doing you some good. But we struggled to sell that to the mass market at the time.
“In the last two-to-three years, the vegetable smoothie segment has absolutely exploded and is now our largest selling range of smoothies. It is out-performing expectations.”
Heath, flavour and sugar
Awareness of health and wellness is propelling demand. However, Love Taste walks a tightrope to also maintain a flavour profile that appeals to mainstream consumers.
“People are much more aware of a combination of sugar content in fruit and also wanting to get nutrients from vegetables. But there’s a balance. If you just have a 100% pure vegetable smoothie it doesn't taste good, particularly if you're using ingredients like beetroot, kale and broccoli. It needs a little fruit to make it palatable. We find a combination of vegetables with a little bit of fruit is the right taste profile.”
The reputation of fruit smoothies as a health-focused product has gone through the media ringer in recent years. Canterbury partially attributed this to the fact that there isn’t a legal definition of “a smoothie”.
“Part of the problem is some people make smoothies and pack them with ingredients that aren't actually very healthy. There's definitely been a bit of a backlash against [sugar in] smoothies.”
Love Taste does not add any sugar to its products and, while the company’s smoothies do contain naturally occurring fruit sugars, Canterbury insists this is “not the same” as processed sugars.
“It's a bit headline grabbing when you see an Innocent smoothie, for example, on the front page of a newspaper has the same sugar as a can of Coke. It's not comparable. They put it in so many more nutrients…. [But] I think this is why we're seeing more and more consumers interested in i vegetable smoothies, or at least the combination of fruit and vegetables.”
Growing demand has led to a bump in competition in the sector. Canterbury views this as “a good thing” because it drives innovation and excitement.
“There are definitely a lot of smoothie brands out there. It forces you to come up with new products and new ideas… Innovation is vital, the lifeblood of our company,” Canterbury stressed.
Future trends: Flavour and function
The biggest flavour and ingredients trends he is witnessing right now include the inclusion of “new” or “rediscovered” fruits such as dragon fruit and jackfruit. “How popular they are going to be going forward, I am not sure, but they photograph well and they look great.”
Canterbury also believes functionality is becoming more important: “Adaptogens and boosters, natural anti-stress and fatigue fighters are becoming more widespread. As life gets busier and more stressful people are increasingly looking for energy in a natural way.
“Another big trend is a high fibre low sugar smoothie. And high protein as well. We do some protein smoothies already. Protein has really moved from the gym into everyday life. We used to do whey protein but now we are doing hemp and pea protein.”
While sustainability is a “slight concern” for those seeking out alternative proteins, Canterbury suggested that the primary driver for him was that non-dairy proteins have a wider appeal to people who are dairy intolerant.
Growth drivers: Retail and international
The need to deliver functional products is something that Love Taste Co. has witnessed as it works to expand its presence in retail channels. The company’s primary customers are in the foodservice sector. However, a good reception in smaller UK retailers such as Ocado has prompted the group to work on gaining more significant listings with the multiples.
“We would like to do more retail in 2018. We're in discussions with a few of [the retail multiples] at the moment,” Canterbury revealed. “Retail customers, in-home consumers, want a slightly different product… At home, people want variety, protein, things like flax seeds, chia seeds, something to give them energy and get them going in the morning. This is slightly different from our best-selling smoothies in cafes. So we've adapted our existing range to reflect this.”
Love Taste also hopes to use its capabilities to expand in adjacent categories such as soup, where it can utilise its expertise, Canterbury confirmed. “It's something that we're looking at this very moment… We are finalising that and hope to be going and talking to customers in the next month. We will talk to some of the retailers but also foodservice customers.”
Another growth area for Love Taste will be its international operations. “Currently we are we're mainly in Europe: Spain, Portugal, France, Italy, Switzerland. We are also in Scandinavia and the Middle East, which is a really interesting market for us. We are looking to expand into some of the other countries. We've recently launched in Australia, which is fantastic. It's a bit like taking coal to Newcastle. They obviously are ahead of us in terms of smoothies but there's nobody out there doing what we're doing, which is frozen sachets of fruit and vegetables. The Middle East it's a market that we're working pretty hard on.”
The depreciation of the sterling – a result of the Brexit vote - has given Love Taste’s overseas operations something of a lift because it has pushed the price of the company’s products down. However, with 75% of the group’s business based in the UK, this has not offset the rising cost of ingredients sourced abroad.
“Prices have gone up by between 20-30% virtually overnight because of the currency exchange. That’s caused huge problems,” Canterbury revealed.
In order to try and recover some margin, Love Taste is working to take costs out of the business – but ultimately the group has also been forced to push price rises through, something Canterbury said “we never like to do”.
Even as the company navigates the choppy post-Brexit waters, Canterbury remains confident that Love Taste’s on-trend healthy, functional and flavour-forward products will win through thanks to their broadening consumer appeal.