DTC’s Daily Digest brings you the latest news on the world’s fastest growing direct-to-consumer brands. In today’s edition: The British Snack Co. goes into overfunding; 2Pure looks to DTC as expansion avenue; and Airbnb hurting in India.
The British Snack Co. goes into overfunding
The British Snack Co. is fundraising on Seedrs, and has already achieved 155% of its initial £200,000 target. The company, which sells products under the names Awfully Posh, British Crisp Co., British Popcorn Co., and Create A Crisp, had a pre-money valuation of just under £5m.
The company will look to spend 50% of the raise on PR and marketing, a third on new staff, and 12.5% on new product development. The British Snack Co. are also looking to conduct an extensive trade marketing campaign to promote our redesigned snack range. The three key channels for this will be trade exhibitions, advertising (with an aim on being featured in trade publications such as The Grocer), and ad-hoc consumer marketing.
At present, the business has four key revenue streams. Supermarkets and retailers, food service, on-trade independents (such as Fuller’s pubs), and exports. By trying to cut down on artificial ingredients included in traditional snack brands, The British Snack Co. is seeking to disrupt the a £3.2bn UK snacks market, and create new products which capitalise on current trends.
2Pure looks to DTC as expansion avenue
2Pure, a Scottish active lifestyle distribution business is looking at international expansion and developing a ‘direct to consumer’ channel after securing a £2.75 million re-financing package.
Edinburgh-based 2Pure employs 35 staff and distributes branded products in the running, cycling and outdoor sectors.
The company’s managing director George Bowie said the funding from HSBC would provide some breathing space around the Brexit deadline on 31 January.
Beyond that the firm would be looking to international growth and selling direct to consumers, a market which is expected to grow sharply, particularly for manufacturers who are looking to bypass traditional channels, including wholesalers, distributors and retailers.
Mr Bowie said: “The current consumer retail and political environments are more volatile now than ever.”
He said the latest financial support would allow the the firm to plan strategically, consolidate recent growth and make considered plans for 2020 and beyond.
“We have ambitious plans to grow the business internationally and through new retail channels, as well as offer the option of selling directly to consumers.”
Airbnb hurting in India
Amid increasing competition from companies like MakeMyTrip, US-based multinational hospitality company Airbnb’s Indian arm has witnessed a slight drop in its revenues for the financial year 2019.
Airbnb India Private Limited, has reported a 7% drop in its revenue from INR 34.76 Cr in FY18 to INR 32.36 Cr during FY19. Moreover, the profit for the company also saw a dip of 15.45% from FY18 and stood at INR 1.75 Cr. Notably, the Airbnb last year had reported a profit of INR 2.07 Cr.
Though the number for revenues and profits for Airbnb were hurt, the company was able to lower down its expenses in FY19 as compared to last year. While in FY18, Airbnb’s expenses stood at INR 31.8 Cr, the company was able to bring them down at INR 29.4 Cr.
The reported numbers suggested that Airbnb stayed itself away from any experiments in India, which recently Airbnb’s global policy head Chris Lehane confirmed is one of its biggest markets. It is also evident that Airbnb is planning to play cautiously ahead of its Initial Public Offering (IPO) launch, which is expected to come in 2020.
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