FIFI PETERS: It’s a small manufacturer’s dream to get shelf space at a major retailer, especially the biggest retailer in Africa. That dream came true for a company that is in the business of making canned dhall. It’s called Saikav Foods and its lentil and chickpea cans have become listed in 25 Shoprite and Checkers stores.
We have Pregasan Francis, the co-founder of Saikav Foods, on the Market Update for more. Pregasan, thanks so much for your time. I suppose congratulations are in order. How did you do it?
PREGASAN FRANCIS: Hi, Fifi. It’s started off many years ago where we started with Saikav Foods. The idea was born in the UK and we imported the product into South Africa. Very soon after that we started to manufacture locally. Our partnership with the Shoprite Group took place in January 2021.
FIFI PETERS: What’s interesting is that you say that you had ideally wanted that partnership with Shoprite to begin even sooner, and you tried and you knocked on their doors, and it just didn’t open for you. Can you help us understand exactly why back then Shoprite declined the opportunity?
PREGASAN FRANCIS: Back in 2010 the brand was brand new, and obviously it’s a bit difficult to list an unknown brand. We were told that we needed to ‘go, get into the market, develop the brand and you’ll see from there’. It took us many years to get to the stage that we did, because we had [only] one product for six years, which was the split pea dhall. We started adding to our line only around 2016. By that time the Saikav brand had become a household name in Gauteng and KwaZulu-Natal.
FIFI PETERS: Talk to me about the evolution from this one line, the one product that you had, to adding all the other products under the brand. What motivated this? Is this a result of the reception that you got from the market? Was it ideas coming from some of the ……2:37 clients, existing clients who said, ‘Why don’t you also try this? Why don’t you also try that? What motivated it?’ Just take us through the trial-and-error process of expanding the product line.
PREGASAN FRANCIS: Yeah, we had the split pea dhall, which was a unique product, and I think it was probably first to market in our country. My partner[s], Marvin Naidoo and Rose Naidoo, came up with the idea to expand the dhall range, which was the gram dhall and the moong dhall… We had approached our factory, the producers of the license, first, and we said to them, ‘Look, we want to launch these two new dhall products’. After extensive testing we found that the quality was just as good as our split pea.
From there it was developing the label and getting it into the market.
FIFI PETERS: Which is the best selling product?
PREGASAN FRANCIS: The best selling product at the moment is the Saikav split pea dhall.
FIFI PETERS: And that’s the one that you started out with?
PREGASAN FRANCIS: That’s the one we started out with. The reason it sells so well is that traditionally it takes two to three hours to soak and boil split pea dhall. What we’ve done is we’ve eliminated that process and we’ve made the product conveniently available in the can, without compromising the quality. The quality of the product is excellent. In the can itself it’s 95% yellow split pea dhall.
FIFI PETERS: So you brought efficiencies into the kitchens of many households who do enjoy dhall. But who’s your target market?
PREGASAN FRANCIS: Our target market started off traditionally with the Indian market. But we found that, because the product didn’t require those extra steps in terms of soaking and boiling, when we did a lot of advertising and market videos to show how easy the product was made, many people were starting to buy the product across the South African demographic.
What we did after that, we took it one step further and we decided to do a heat-and-eat range of the split pea dhall. Basically what that means is that we took our recipes and we asked a factory to perfect them and to braise them and get them into a form that’s ready to eat. The customer would find the heat-and-eat dhall, they’d pop the can, they’d put it either on the stove or in the microwave, and within two or three minutes you are having your meal.
FIFI PETERS: I’ve spoken to a few small companies, manufacturers of perishable and non-perishable goods, and many of them have said that in the past that getting shelf space at a major retailer is a game-changer for one’s business. I’m wondering if the same can be said of Saikav Foods.
PREGASAN FRANCIS: Absolutely. When Shoprite took us on, we did grow. We started off, as you said, with 25 stores. We recently got listed in Gauteng. So now we are in 47 stores across KwaZulu-Natal and Gauteng. [That] allowed us to invest in our infrastructure, invest in people, and expand our footprint in the market. So it definitely gives you the competitive edge because your products are now available to a broader base of customers.
FIFI PETERS: It looks like the growth that is being taken, or the expansion, is an incremental one, because you started off in KZN and, as you now say, you’re in Gauteng, But of course Shoprite’s reach is far wider than that, even beyond this country. It goes into the rest of the continent. I’m just wondering if that is also in the plans in the future.
PREGASAN FRANCIS: It is in the plans. One of the challenges for small businesses like ourselves is the distribution and merchandising. So we currently are in talks with a few distributors and merchandisers in terms of taking that giant leap into a national footprint. That’s ultimately our goal.
FIFI PETERS: The canned foods business recently has been spotlighted, I think just as a result of the product recalls of a few brands. One has to wonder how that happens, and it all just shows the complexity in manufacturing canned foods. How have you dealt with this challenge, and has it ever affected you?
PREGASAN FRANCIS: The raw materials, when they come in, go under extensive testing in terms of the actual product itself, the raw material itself. That’s done at the factory.
After we produce the products the products are then further tested, and we retain sample batches. The reason why we retain sample batches is that if ever there is a recall, we can go back and fully investigate what went wrong. What we find is we have very few complaints, but the complaints that we have would be as a result of the can either being bloated, because it was exposed after it was purchased, or the can was dented or compromised in some way – and then the bacteria get in and set in, and the product is then damaged.
FIFI PETERS: What about the price? Let’s particularly hone in on the price of the split-pea dhall. If you had to compare the price of that can today, compared to before the pandemic happened and caused all kinds of disruptions to the supply chain, and caused all kinds of increases in the price of everything, including food – how have you managed the cost pressures that have come as a result of the pandemic, and perhaps now even the war in the Ukraine?
PREGASAN FRANCIS: So we two increases in the last six months, and it wasn’t just Saikav, but I think it was across the board for all canned products. We made a company decision to absorb most of that increase, to ensure that our products are sold to the consumer at an affordable price. So there has been a certain amount of effect that the stretching in Ukraine has had, ands it’s mainly around the transport and distribution and fuel cost and raw materials.
FIFI PETERS: Because I think even the price of aluminium has hit highs that haven’t been seen in a while.
PREGASAN FRANCIS: That was the biggest component of the increase – the price of the cans. The packaging cost I think has actually doubled or tripled in the past year.
FIFI PETERS: If you had to share one element that you think has set you apart as a business – two entrepreneurs who are looking at also securing some shelf space out of Shoprite – what would you say the key lesson from your experience has been?
PREGASAN FRANCIS: The proof is in the pudding. If it’s a canned product you have to get your buyer to taste the product. If your product’s as good as you say it is, you’ve won the first part of getting in, because the quality is really what got us into Shoprite. Funnily enough, most of the buyers took the product home and gave it to their families, and they said, ‘Look try this, it’s someone’s can”. When you get the call to say, “Wow, my mom enjoyed this,” then you know that you’ve won half the battle.
FIFI PETERS: Pregasan, thank you. We’ll leave it there for now. Thanks much for your time and for sharing the story. Best of luck for those growth and expansion plans. Pregasan Francis is the co-founder at Saikav Foods.