More choices: Aussie plant-based formula brand Sprout Organic on packaging and NPD innovation – CEO interview

01-Sep-2022 - Last updated on 01-Sep-2022 at 02:42 GMT

Chemist Warehouse pharmacist and manager Nana Yaa Donkor (left) and Sprout Organic founder and CEO Selasi Berdie seals the historical partnership. ©Sprout Organic

Australia’s plant-based infant formula brand Sprout Organic aims to introduce new packaging sizes and widen its offerings in the infant formula and supplementary food categories for young children, according to its founder and CEO Selasi Berdie.

176g pouch SPROUT ORGANIC — Sprout introduced the 176g pouch due to tin shortage before this. ©Sprout Organic

The original formula is packaged in tins of 700g, but the brand has also released a 700g pouch. Later this year, the brand will release a 176g pouch for sale in convenience stores.

“We originally released infant formula pouches out of necessity as there was a worldwide tin supply shortage during COVID-19, and we needed to pivot to continue supplying our customers.

“Once the tin supply chains improved and we moved back to our original packaging, we started receiving messages from parents all over the world saying they loved the convenience of the pouches because they were easier to travel with and pack in their nappy bags, so we decided to make them a permanent item,” said Berdie of the 100% recyclable pouches.

The brand is moving towards compostable pouches made from plant-based materials. However, there will be a battery of shelf-life and durability tests to ensure product safety.

These plans were introduced after its announcement on 9 August that the brand would hit the shelves of 500 Chemist Warehouse stores across Australia. According to IBIS World analysts, Chemist Warehouse owns half of Australia’s AU$24bn (US$16.6bn) pharmacy market and is the country’s largest pharmacy retailer.

“Our partnership with Chemist Warehouse is extremely positive due to their positioning as Australia’s largest pharmacy group and their accessibility for Australian families. Australia is a small country by population, but it is large by land mass, which often makes it difficult for our products to be accessed on time by parents in rural regions.

“Chemist Warehouse has done an amazing job by establishing store footprints across all states and even in some of the most remote locations across Australia. This increased distribution for Sprout was the key reason we are delighted by this new partnership,” he said.

While it is still early days with Chemist Warehouse, the firm has seen “a huge uplift” in sales and expects revenue to increase by over 300% in the pharmacy category. Moreover, the category plays an influential role in educating consumers on formula choices as pharmacists remain among the trusted health professionals in the country, he said.

“We are always looking to work with retailers aligned with our brand vision and mission: to provide a plant-based and organic formula option to as many Australian families as possible. We are in early discussions with Terry White Chemist and will be announcing a further partnership with Pharmacy 4 in the upcoming weeks,” said Berdie.

Sprouting shoots

Founded in 2020, Sprout started with plant-based snack bars and mini muffins for children. Its products are available in over 700 retail outlets and on its e-commerce platform.

Around 80% of its sales come from its rice-based infant formula for newborns to infants aged 12 months. The formula retails at AUD$39.95 (USD$29.90) for a 700g can. Conventional dairy-based infant formula costs around AUD$12 (USD$8.99) to AUD$40 (USD 29.95), depending on ingredients and weight.

Sprout uses rice starch as the base and claims to be safe for infants to consume from birth. The formula, produced after seven years of research and development (R&D), features a combination of rice and pea protein, an oil blend of coconut and canola, ARA, DHA from algae, minerals like potassium, calcium and magnesium, and vitamins like vitamin C, niacin, vitamin E, folic acid and vitamin B12.

The ingredients are sourced from local farmers and suppliers, but organic rice is from the Middle East, and manufactured in Melbourne and Gold Coast. The products meet safety requirements stipulated under the Food Standards Australia New Zealand (FSANZ).

Sprout became a member of Australia’s highly regarded Infant Nutrition Council in 2020 and was recently awarded “Best Children’s Product” at the World Food Innovation award in Europe. The brand competed against 272 entries spanning 22 countries.

Germinating growth

During an interview with NutraIngredients-Asia.com in April, Berdie laid out expansion plans in New Zealand, Asia, Europe and the US. At that time, Sprout announced its partnership with retailer Wholelife and Australia’s largest food retail group, Go Vita.

He said the brand is ahead of schedule at this juncture, with distribution starting in New Zealand in May. Other Asia Pacific countries targeted include South Korea, Hong Kong, Vietnam and Singapore. The brand has also started submitting the infant and toddler formula for US approval and has begun formula development for Europe.

“Ultimately, our mission remains the same: to continue to grow the kids’ nutrition category by providing organic and plant-based options for parents. We feel more and more consumers are resonating with our brand message and feel this puts us in a strong position regardless of what competitors are doing,” said Berdie.

Proteins, probiotics and healthy ageing are major focus areas of our upcoming Growth Asia Summit in Singapore from 11 to 13 October. Check out big-name brands, international experts and pioneering start-ups slated to present here.