Impossible Foods eyes retail sales for further growth in Singapore

Singapore

IMPOSSIBLE Foods, the maker of the realistic-tasting plant-based beef patty, is gunning for retail sales in Singapore to accelerate its growth.

The Temasek-backed company has yet to launch in grocery stores in Asia but in the United States, its retail footprint has grown more than 50 times in less than six months.

Impossible Foods intends to partner large supermarket chains in Singapore, said Nick Halla, the company's first employee and its current senior vice-president of international.

He declined to say whether the company is approaching a deal with any of the chains here.

"Most places in Singapore align with this - you have a pretty even mix between food-service consumption and retail consumption. We started in the food-service world, with the strategy being that we know tasting is believing, so we worked with a lot of outlets to help get that initial trial going," Mr Halla said.

Once consumers understand Impossible and its products, a retail launch is the next natural step.

Mr Halla said: "Retail will be one of the biggest growth levers for Impossible in Singapore. We foresee that to be a very large channel opportunity."

Impossible Foods' flagship product derives its authentic meaty taste from an iron-containing molecule called heme, which occurs naturally in plants.

Globally, the company's product is now in over 17,000 restaurants, including close to 1,000 in its Asian markets of Singapore, Hong Kong and Macau. Sales in Asia, where Impossible expanded to in 2018, were up six times last year.

According to Mr Halla, the region is an important focus for Impossible Foods' growth strategy.

"Asia's meat consumption makes up 44 per cent of the world's demand and is growing the fastest with a rate of 70 per cent over the next couple of decades. In terms of market penetration, I strongly believe that we can make an enormous impact in Asia, and specifically mainland China," he added.

In Singapore, the product was launched in March last year in eight select restaurants through food importer and distributor Classic Fine Foods.

The number of restaurants serving the Impossible meat grew from close to 300 at the end of last year to over 500 as of July 2020.

Impossible Foods is doubling down on the retail sector at a time when consumer demand for plant-based meat is growing amid the virus outbreak.

In the US, disruption in the meat production industry may have given a boost to plant-based substitutes, The New York Times reported in May.

According to Nielsen data, sales from April 12 to May 9 were 35 per cent higher than in the four weeks ending Jan 18, before the first coronavirus case was reported in the US.

Nasdaq-listed Beyond Meat posted record sales of US$113.3 million in the second quarter on the back of a 192 per cent increase in retail sales both in the US and internationally.

In Asia, plant-based meat makers are seeing soaring demand as consumers look for safer alternatives during the virus outbreak, the Nikkei Asian Review reported in July. Experts noted a heightened awareness of food safety and environmental sustainability.

Although Impossible Foods has yet to launch in grocery stores in Singapore, some consumers have already gotten the chance to cook the meat in their own homes.

The company launched a limited-time collaboration with food and beverage (F&B) partners in May to allow them to resell inventory directly to their customers; each 2.27kg brick was priced at S$88.90 before tax.

The initiative provided the F&B players with some added revenue as they adjusted to the impact of Covid-19.

Participating restaurant partners, which include Fatboy's and Park Bench Deli, saw total sales grow an average of 88 per cent within the first month of the launch. Just over half of the increase was a result of reselling Impossible inventory, said Mr Halla.

While the toll of the pandemic has caused Impossible Foods to lose some customers in Singapore, the company remains confident of further growth on the back of constant product improvement and a consumer movement towards sustainability.

A December 2019 study from Kantar, commissioned by the company, showed that about one in two Singaporeans are conscious about the environmental impact of their food consumption.

A nuanced strategy will be key to Impossible Food's growth. For its launch in Singapore, the handful of restaurants were selected based on how much credibility it could lend the product.

As it expanded, Impossible Foods then targeted F&B operators, such as top-end hotels, that serve a wide diversity of cuisines and could demonstrate the product's versatility.

Most recently, the company struck up partnerships with large chains such as Starbucks, BreadTalk and MOS Burger. The idea was to show that the product can also work at an affordable price point for consumers.

Why focus on a market as small as Singapore? Mr Halla said the company wanted to start in places in Asia that could serve as testbeds.

"Hong Kong was our first launch and Singapore shortly after. These are markets where we can put teams in place and really test, adapting our products to the local consumers. We did learn a lot," he noted.