KEY INTERVIEW: Taura Targets a Trebling of Growth in US on Frutarom Integration


11 Jul 2016 --- Taura Natural Ingredients is eyeing a trebling in US sales, by benefiting from both the new distribution opportunities to come from operating under the Frutarom umbrella and the emerging healthy snacking and permissible indulgence trends. In June 2015, the New Zealand headquartered fruit processing company announced that Israel’s Frutarom was to acquire it for a sum of US$70m.

For Frutarom, the Taura acquisition was one in a long line of strategic purchases that will help the company become a leader in the flavors and fine ingredients industry. Taura is renowned for its Ultra Rapid Concentration (URC) process delivering functional fruit based ingredients, which enable food product developers to create innovative, great tasting, long shelf life snacks . 

Now one year after the acquisition, Belgium-based CEO Peter Dehasque is confident that Taura is already benefiting. “I call it the best of both worlds,” he told FoodIngredientsFirst in a detailed interview. “Firstly we have a safe harbor in Frutarom, which is doing excellent as a company. They have an organic growth rate above market and have very exciting expansion plans in terms of acquisitions, which is added value to the whole portfolio.” 

“Secondly, we can do our thing – we can run our strategy as we have done before. We are fine-tuning it with the help of Frutarom, but in the execution part we get a lot of help through access to their R&D network and innovation efforts. The whole realm of new ingredients that they can offer to us is something that we can use and play with. Think of the health extracts, flavors and colors that we have already started working with.” 

The other big advantage that Frutarom offers Taura is the cross-selling opportunity, as the company becomes part of a very broad network of sales teams around the world. This provides Taura with the opportunity to put much more effort into organic growth. “For example, we started up a cooperation with Frutarom China and Frutarom India recently, as well as with  Frutarom in the US.and with their flavor divisions in Europe. So there is a lot more scope and it will accelerate our geographical growth,” says Dehasque. 

Taura originated in New Zealand, with Asia Pacific now accounting for 35% of the company’s turnover. This year marks the 20th anniversary of the company’s presence in Europe, with EMEA now accounting for about 50% of the company’s sales. The US currently only makes up for 15% of the company’s sales and therefore holds huge potential for growth. “We see global opportunities in all 3 regions, but the US is the biggest potential growth engine for us. We can easily treble there in the next couple of years, although you cannot put an exact timeframe on it in terms of projects coming into fruition,” says Dehasque. Taura currently imports into the US from both Belgium and New Zealand, but could potentially operate from there too in the future.

So why does the US hold such potential for the company? “In the past it was the market scene for big volumes at a low price and labeling regulations were very liberal. But if you look at it now, the polarization has happened completely,” notes Dehasque. “There is a strong growth in health & wellness that goes even further than Europe to some extent. You have labeling requirements around GMO free, organic, gluten free, 100% derived from fruit & veg. All of these things make the US a very exciting market for us to play in,” he adds. 

While some of these platforms are still a niche there, a US niche is much more important than a European one. “You speak about a much more unified consumer market approach, whereas Europe is much more of a patchwork of various cultures, with different tastebuds. Our successes there are pretty prevalent at the moment in the nutritional bars segment, but also in snacking, which puts us in a high value added space. But we see much more opportunity coming our way in that space, especially with the help of Frutarom,” says Dehasque. 

Another market that Taura is targeting is South America, with early successes reported in Brazil, Argentina and Chile. In Asia, the company has set up collaborations in China and India, while the company already has strong positions in Japan, South Korea and Malaysia. “The geographical footprint for us is important and we believe that we are still at the beginning of our growth phase for those markets,” he explains.

He notes how the company focuses on six core target segments: the first four of which are in nutritional/healthy snacking and the final two are in so-called permissible indulgence:
1. Fruit Snacking
2. Nutritional Bars
3. Baked Snacks e.g. healthy breakfast biscuits
4. Ready-to-Eat Cereals
5. High Added Value Bakery
6. Premiumization of Chocolate

“Not all of these six platforms are strong everywhere,” says Taura’s CEO. “But these are the 6 areas where we are really putting a core focus on by offering innovation, better solution building and also innovation support services, alongside the products, in order to help people to innovate and understand trends, markets and new concepts. Doing that better in those segments, will give us strong organic growth.” 

From a strategy point of view, within those 6 core segments, Dehasque notes that Taura carefully selects the right players in order to bring the sector forward, whether they are early adopters or ultimately multi-nationals. “What has made us very successful is finding the right combination of the early adopters or  the disruptive innovators and the bigger  multi-nationals,” he notes. 

For Dehasque, it is about finding the right combination of the innovators and the big players who take longer to develop, but give you bigger volume opportunities. “It’s also important to note that more of these big players are buying these disruptive innovators too, so starting with disruptive innovators leads you to bigger companies later on. The advantage of the bigger multi-nationals is that they drag you into other markets as well,” he adds.

One challenge that the company is not alone in facing is the impact of the UK’s exit from the EU. The UK was the first market in Europe to really adopt healthy snacking and has been the innovation powerhouse in this field for many years. 

Dehasque therefore accepts that Brexit is of concern to the whole food industry and that the weak pound and a potential return of tariffs will likely lead to price increases for exports into the UK. “Obviously it is still early days, but there are the first signs of the pound losing a lot of value, which puts us under pressure. Certainly from margin delivery of entering into the UK, it might force us into price increases, which are never fun. A recession might loom around  the edge as well, which will not help the British food industry, nor exporters like us,” he notes. 

Taura’s CEO adds that consumer confidence as a whole is impacted and will have an impact on business development. “For the UK food industry, rising input costs are looming. So all in all it is not good, neither for the European food industry, and certainly not for the UK food industry. It’s really a pity that this has happened, as the Leave camp did not have a plan in mind. No analyst knows where this is going to go, which is making the food industry and others nervous,” adds Dehasque. 

And finally what about innovation and the opportunities that the Frutarom portfolio can provide and vice versa? “We definitely remain focused on our core URC delivery system, which is where we feel that we can be best at. So it is about perfecting that system, about  optimizing taste, texture, shape and form with an exciting clean and clear label. We are working with a lot of new flavor systems there, which is where Frutarom can help,” says Dehasque. 

He notes that vegetable based products,  fruit & veg combinations, contrasting textures and ancient grains are all development platforms. “For example, we have created a very exciting URC system that contains chia seeds or either ancient grains like spelt and quinoa. These are used either directly as a snack, or at a pretty high inclusion rate in trail mixes, chocolate etc. It is about perfecting our delivery system to more exciting shapes and forms. Also it is about string formats, large flakes. It is about making products more exciting, both as an ingredient, but also as a finished snack,” he notes.

But Frutarom also offers many nutritional ingredients that can be incorporated into healthy lifestyle snack concepts. One example he pointed out was in the field of vitamins and mineral addition to their products, such as iron fortification. Health claims have been secured for those and Taura can now help Frutarom in developing a specific carrier system. “We have a delivery system which is very exciting, which has very exciting opportunities in the pharma food segment. It is moving away from tablets or gelatin type products. We can do it on 100% fruit derived products, which we can supplement,” he concludes. 

These types of new nutritional concepts will hold strong future potential, as consumers look to novel delivery methods with a natural point of differentiation.

By Robin Wyers

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Taura Natural Ingredients


Taura Natural Ingredients is a global manufacturer of fruit pieces, flakes and pastes for cereal, bakery, snack bars and confectionery.  URC fruit ingredients are made using a unique Ultra Rapid Concentration process and are designed to deliver bake stability, low water activity, great flavor and color. URC fruit ingredients are a simple and delicious way to add real fruit goodness to your product innovations. Talk to us about a customised solution today.

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