The Future in Focus

Hello there and welcome back to the Future in Focus Podcast by LRQA or if you’re new here, thank you. In this latest edition, part one of a two part mini-series, we hear LRQA’s Global External Communications Manager, Holly Wild speaking to Jo Fairley, co-founder of Green & Black’s Chocolate on key trends and challenges affecting the food and beverage industry. We’ll cover a brief history of the pioneering Green & Black’s brand and hear how its creation and evolution reflect similar experiences that other companies in the food and beverage industry may be facing as they negotiate the current risk landscape.

So hi Jo, it’s a real pleasure to speak to you today. Could I start by asking you to briefly introduce yourself for our audience and give a summary of your background?

So I am Jo Fairley and I am a serial entrepreneur most notably probably for founding Green & Black’s with my husband back in 1991 as a pioneering fair trade and organic brand, not that we knew that it was going to go on to quite the global success that it has achieved. And I, so I have a lot of experience now despite the fact that I began my career as a journalist, a lot of business experience of weathering the storms both literal and metaphorical of being in business.

I think our audience would be fascinated to hear the story of how you founded Green & Black’s Chocolate. Now I know you’ve written an entire book on the subject, but you could you summarise just part of the journey for us?
I never expected to go into business, I was a journalist, I was very happy being a journalist, I never expected to have something exciting to do myself. But I had had a deep green streak in me ever since I was about 13 and a friend gave me a book called ‘a shoppers guide to saving the planet’. Which there was nothing I could do in Bromley in those days to save the planet, except get my mum to drive lots of gin bottles to the bottle bank and take a bit of direct action by putting bricks in the loo systems at school, which got me accused of vandalism and sent to the headmistress’ study and my green leanings went into dormancy. So I was always organically minded and kind of eco-minded. And then the whole green agenda bubbled up when I was a journalist and at the same time I met Craig, Craig Sams my husband who became my co-funder who, Craig was an amazing, is an amazing wholefoods and natural foods organic pioneer having founded his brand Whole Earth to be no added sugar, organic, whole foods etc. And back in the day the natural food world was tiny, we literally thought we were changing the world through food and we would gather at natural food exhibitions around the world and forged really strong friendships. And there was a very supportive network whereby if you had a contact who couldn’t do something and they would put them in touch with you, and so you know it was very mutually supportive. And it so came to be that Craig had been looking for peanuts for his Whole Earth peanut butter which is obviously the reason I married him was for that, and they failed a quality control test as sometimes happens and the guy said, well I’ve also got cocoa beans. And Craig said I can’t do anything with cocoa beans and I can’t make chocolate under the Whole Earth name because you have to have sugar to make chocolate. So he said but why don’t you get some samples made with the cocoa so that we can see the quality and I’ll put you in touch with a friend of ours in Denmark who I think could do it under her brand. Well I found the bar on Craigs desk, or at least the last two squares that he hadn’t wolfed down. I put them in my mouth and said, oh my god that is the best chocolate I’ve ever eaten, what is it? And he explained it was a sample of the worlds first organic chocolate but also that he couldn’t launch it under the Whole Earth brand for the aforementioned reason. So basically it haunted me that chocolate, and so I really nagged at him and then said, you know, you’ve got to do it, you’ve got do to it and eventually he turned around and said, look if you’re so interested you do it. And what he really meant was that he could take care, his business could take of some of the sales and distribution functions but I had to do the PR and the marketing which obviously is essential for brand building. And the really big catch was I had to finance it, because he didn’t have launching a whole new brand in his budget in the middle of a financial year. So I had a nest egg of £20,000 from selling my flat before we moved in together and literally, I bought two tonnes of chocolate with that £20,000, that was our first consignment. We came up with a name in bed one Saturday night with you know a yellow legal pad and a biro and played with all sorts of names and I promise you I would not be talking to you today if we’d gone with ‘organochoc’ or ‘echochoc’ or ‘biochoc’ or some of the names we came up with. And I had this flash of inspiration that what we needed was something that sounded like a kind of old established British confectionary company. So we were green because we were organic and we were black because we had the darkest chocolate on the market by far and I just wacked an ampersand in the middle, as you know you find in Fortnum & Mason or Charbonnel & Walker. And suddenly, honestly it pushed all the right buttons and I felt that you know we were there and honestly that took ten minutes. So it does completely blow me away to look at the global success of the brand today I can tell you.

So it sounds then that you will have witnessed a lot of change and evolution within the food and beverage industry over the last 30 years as you’ve developed that brand. Could you tell us some of the main challenges or changes you’ve had to overcome in that time?

Well some of those changes and challenges have been positive in that when we started out for example, it was incredibly hard to source organic ingredients from anywhere. You couldn’t just go to a market trader, you know a commodity trader and buy ten tonnes of sugar, in fact there was no organic sugar when we started and we had to band together with some other manufacturers to put pressure on the sugar industry to supply us with organic sugar. So that has become easier as those organic ingredients have become much, much, much more widely available, and organic has become much more mainstream. But obviously along the way you’ve had much tighter labelling requirements for food, you’ve had you know it’s become and not just since Brexit, but it’s become more and more difficult to export etc. in some cases. And as we grew, we had lots of challenges on that front because you have to put an ingredient list on the back of your package in the language of the country that you’re selling to and so every time we did that, we had to redesign the back of the label, and with the ingredients getting ever smaller etc. So in some ways the situation has become easier with the availability of ingredients but in others it’s just become more challenging and not least because we started out on the high ground as an organic Fairtrade brand but obviously, and in fact we had a really clear run for many years before there was even any other organic chocolate on the market. But as other players come into what started as perhaps a niche, you’ve got to develop your brand, you’ve got to innovate, you’ve got to push it forward in order to keep both the journalists and the customers, and the buyers interested in what you are doing.

And do you think the challenges you experienced will have been similar to other businesses operating in the food and beverage industry? I’m trying to understand what the typical risks affecting the industry are and why it’s so important to meet them head-on.

 I think that what happened to us really typifies the kind of challenge facing the food industry which is security of supply. It’s having a good reliable source of ingredients. I mean I’m someone who kind of thinks that farmers should have a bumper sticker that says ‘we farm so you can stay alive’ because actually that is what it boils down to. But farming is under threat all over the world from farmers who just can’t get the income from growing the crops that their families have probably grown for years and years. And there’s a very real risk that what will happen is as we saw in the industrial revolution in the UK that those farmers and their families will simply move to cities and they will get jobs in tech, or they will get jobs in retail, or they will leave the land unless we nurture those relationships. And so that’s something that the food industry really has to grasp the nettle on I think because ultimately at the end of the day the ultimate challenge is, can I get hold of the ingredients that I need to make my product, that is your number one problem and your number one challenge as a food manufacturer. And it requires a sort of ingenuity that I think that we showed at the beginning, I mean you know, we had a supply of cocoa beans from Togo in West Africa, that’s where it came from in the first place. So there’s a political uprising in Togo and we find that our beans had been blockaded in the port, there’s a dictator in charge they’re rebelling against etc. So we can’t get our beans out of Togo, we discovered ultimately that actually the ports were blockaded but we could fly it out, which obviously wasn’t very eco-friendly. But it did mean that we could get it to the factory and they could make it and we could get it on that lorry and we could get it to the backdoor of Sainsburys for our very tight delivery slot without which if you don’t make it, you’re out on your ear, they’re very strict, so you know that gave both of us a few more grey hairs I think. But at the end of the day what that shows I think is that we then went to farmers in Belize now as I said you couldn’t just go on the open market and buy cacao, buy organic cacao, there was no trading done in it. We had been on holiday in Belize, we had met some cocoa farmers and we thought, I know what let’s get back in touch with them, see what they’re doing with their cacao. As it happens, they had been very badly let down by a big American company who had promised them a $1.25 a pound for their cacao. When it came to harvest, they were offered $0.55 cents and it had really impacted on the farmers, many of them had gone to work in Guatemala just to send money back for their families etc. and that shows you just how fragile I think those farmers existences are which underlines the whole point that I’m making. So our second supply at that point was cocoa from farmers we’d once met on holiday but it proved to me the importance of always having a ‘Plan B’. Many crops these days are grown in countries that are being affected either politically, obviously you’ve got Ukraine and the war and the grain situation, or they are being affected by climate change. I read in the Financial Times that I think it is, it’s Argentina or Uruguay’s wheat crop that is being devastated by the effects of climate change. So I think as a business, as a food business you’ve always got to be thinking about what’s our ‘Plan B’ if we can’t get hold of that particular commodity, that particular ingredient and to have something in your back pocket. Because the last thing you want is to have a production run of whatever size whether you’re a small or a large manufacturer and find that that ingredient simply isn’t available. And there are more and more pressures on the supply of those ingredients whether it is climate change, whether it is people leaving the land and going to live in cities etc., and I think that that’s where nurturing the relationships with the farmers which is something that big business is really getting involved with, whether it’s Nestlé, whether it's Mondelēz who just announced the renewal of their Cocoa Life Programme in West Africa which actually was borne out of what we did with Green & Black’s, but it’s a 600 million dollar investment in those farms and in those farmers. And it’s symbiotic because the farmers get a better quality of life because they’re getting more money, they’re getting training so that they can produce more of whatever it is they grow, and in this case cocoa. But also as a brand, as a customer you get the security of knowing that you’re going to be able to access their ingredients and really for us with Fairtrade, that was incredibly important. You know it’s not just benevolent, it’s not just I mean it’s fantastic that farmers get a higher income and then use that to send their kids to school and put roofs on their houses, put concrete floors in their houses which in the rainforest makes a huge difference let me tell you. But also it works because that five year rolling contract that we gave them worked in our favour too. We knew that hurricanes excepted, we could access those ingredients for the next five years. So I think that that is the biggest challenge and businesses constantly need to readdress the subject and have a ‘Plan B’ and ‘Plan C’ if something becomes unavailable because your brand is founded on those ingredients. It doesn’t matter what the end product is, those raw materials are the most crucial and in a way that’s the most fragile part of the chain I think and becoming ever more so. So risk is something that none of us like but you can’t hide behind the sofa, you know it’s like okay well we’re getting our beans from here but what happens if there’s a hurricane, or there’s a political uprising, where are we going to go next. And maybe a ‘Plan C’ for if that fails because if you haven’t got the ingredients, you haven’t got a product, you haven’t got sales, you haven’t got a brand. It’s a very simple equation.

So you’ve summarised some of the main challenges in the food and beverage industry over the last 30 years, what do you think the industry needs to prepare for over the next 30 years?
We’re looking at drought, we’re looking at flooding in areas where crops are produced, but I think also rising up the agenda very quickly is the whole subject of child slavery and child exploitation. And so I think that companies really need to look at the conditions that the people who produce those crops for them are working in and if you’re buying through a secondary supplier, through a trader or a wholesaler or whatever, you need to be able to trace that back and ask them questions. Because customers more, and more, and more are going to be asking difficult questions of food and drink companies about where ingredients came from. And you can’t just go well I don’t know, and we were pioneers in Fairtrade, we had the very first Fairtrade marked product with Maya Gold back in 1994. I think the Fairtrade brand is worth I think it’s about two billion in its own right today in terms of the products that are certified Fairtrade. And that gives us amazing transparency because it does mean that those farms are inspected, certain questions are asked every year to satisfy their criteria for the certification etc. But it is becoming much, much more important to people that the conditions of the people who grow your products, who produce your ingredients, are fair and that there’s a transparency there. Because as people become more aware of it which we are because there’s much, much more press about it, you’ve got to have some answers. It’s not enough now just to say, sorry I don’t have the answer to that, because customers are in particular putting pressure on brands I think where there is a question mark over sourcing, you don’t have to be an activist you just have to care. So we need to have answers to those questions and the supply chain is improving. I think as I said Nestlé have just put a billion in, if you look at the total amount that Mondelēz has put in over the last 11 years it’s a billion in to just ensure Cocoa Life, their project is monitored by the Fairtrade Foundation to know that those conditions are applied to etc. But you’ve also got brands coming up that are really kind of capitalising on the whole antislavery issue, so people like Tony's Chocolonely raising the profile of producers etc., there’s a new antislavery cocoa brand I think just launched called UP-UP-UP which I haven’t seen yet. So the more that those brands and the more that brands like ours talk about the issues, the more other brands in the whole food and drink arena have to clean up their act and make sure that they’ve got the right answers when those consumers start asking questions, because they will.