03 October 2017
Healthy investment helps The Tofoo Co grow
The North Yorkshire tofu manufacturer has gone on to supply thousands of stores across the UK after securing funding from Let’s Grow.
The Tofoo Co, which manufactures chilled tofu from its factory in Malton, is looking to scale up its business after securing a £25,000 grant from the Let’s Grow initiative.
The company has been based in North Yorkshire for over 30 years however, up until it was bought out in January 2016, it had only ever supplied a few healthy food retailers.
Today, the company supplies the likes of Tesco, the Co-op and Ocado and has ambitious plans for the future as it looks to capitalise on the growing global appetite for healthy foods.
Director David Knibbs told BQ: “Myself and my wife have worked in the food industry for many years, myself with Mars, Bulmers, Grampian and Symingtons and my wife Lydia with Arla and Symingtons.
“We both left Symingtons determined to find a new opportunity that we could apply the experience we had gained over our careers. We were both interested in finding a business we could scale and preferably a healthy product as we both believed it was an opportunity for significant growth.
“The search for something that could meet our criteria (and afford) was a challenge until one day Lydia decided to search on the internet and came across a small chilled tofu business based in Malton.
“It had been run by the previous owner for 30 years since he founded it and he had developed a great product that was a real success in health food shops like Planet Organic and Whole Foods but he had never developed a business outside of those customers.
“The business had grown organically at 5-10% per annum but as the owner got closer to thinking about retirement he had not tried to develop the brand and business any further.”
The pair soon packed their bags and headed up to Malton to meet with the owners and were given a tour of the factory. They knew straight away that it was the perfect business for their new venture.
He continued: “On visiting the factory we found an engaged workforce and a fantastic product that we felt was ripe to grow and we really felt that consumers in places like Tesco and Sainsbury would engage with a new tofu brand. It was a bit like walking into a house and knowing immediately you wanted to buy it.”
Taking over the business in January 2016, the husband and wife duo, alongside their investors, decided to launch a new brand to coincide with the Clear Spot products that the company was already selling to the likes of Planet Organic and Whole Foods.
Using their experience and after a long time spent on the drawing board, they came up with the idea to launch Tofoo, a new healthy tofu product, as David explains: “We developed The Tofoo Co as our new brand and set about selling the dream of a champion for the tofu category to the major retailers.
“We believed that consumers would love the tofu produced in Malton as it tasted great, didn’t have the spongy texture of other commercial tofu’s, and would fit with a younger consumers desire to eat less meat.”
The brave decision to bring a brand-new product to market paid off and before long, the pair secured their first major supermarket listing with Tesco, which saw them supply 2,000 stores across the UK. From there, the brand started to see demand soar.
David said: “It’s fair to say the business has grown very quickly in the past year, we launched The Tofoo Co brand into 2,000 Tesco stores as well as Ocado in October 2016, in January we went into London Co-op stores and in June the brand was listed in 400 Sainsbury Supermarkets.
“In the coming months, the brand will also roll out in another major supermarket. This has allowed us to raise our staffing levels considerably over the first 18 months from eight members of full time staff to 17.”
However, this growth didn’t come without its challenges. With demand for Tofoo growing rapidly, the company had to find a way to upscale production. Having already invested £250,000 themselves, the firm was now running at full capacity and sought external finance. This led them to Let’s Grow.
David adds: “In the spring it became clear that, with sales growing at a rapid rate, we did not have enough processing capacity and through our accountants Ian Walker & Co in York we came across the Let’s Grow scheme.
“We had developed a capital plan that needed a further £250,000 of investment but unfortunately we didn’t have all the funds to be able to do the plan and needed support from the fund to help us meet the demand we were seeing from our customers.
“Having developed the plan, we worked together with the Let’s Grow team to refine a proposal to gain support, myself and Lydia made a presentation to the grant panel and our application was successful, this has allowed us to make the investment to double capacity at site and add further staff to our payroll.
“It has given us twice the capacity which is amazing. However, sales are now growing so rapidly that it looks like we may already have filled all that capacity!”
So, what’s next for the company? David concluded: “With another major supermarket listing the brand in October, the launch of new products and with potential business outside the UK, there are lots of opportunities for growth.
“Consumers have really engaged with the brand (even writing us Tofoo songs!) and seem to love our Tofoo, we are developing recipes and tips to help people understand how to use Tofoo in everyday cooking and make tasty meat free meals.
“It looks likely that we will have to look to double capacity again to keep up with sales! Without Let’s Grow supporting the application we would have been left with lots of consumers wanting our brand and no way of making it for them!”
Mike Baker, senior business and investment adviser at BE Group, which administers Let’s Grow in partnership with Clive Owen LLP, said: “It is excellent that the Let’s Grow scheme has enabled The Tofoo Co to purchase additional machinery, increasing its production capacity to meet significant increases in demand. David and Lydia are keen to continue to grow the business and I wish them every success with their ambitious plans.”
The York, North Yorkshire & East Riding Enterprise Partnership (LEP), helped set up the Let’s Grow initiative in Yorkshire. David Kerfoot, deputy chair of the LEP, said: “This is a perfect example of a thriving business scaling up in our area that we are supporting here at our Growth Hub How’s Business.
“One of our roles here at the Growth Hub is to help businesses access support like Let’s Grow funding, and with food manufacturing being a particular strength in our area, it is a sector we are keen to encourage here.”