Case study - UAB GELD BALTIC Super Garden

Freeze-dried berries, veggies, and ice cream entering the Japanese market

UAB Geld Baltic – Super Garden (https://www.supergarden.lt/en) is a young Lithuanian company created in 2016 by Laura Kaziukonienė. It specializes in the manufacture and commercialization of freeze-dried products; a technique initially developed by NASA. The desire to offer healthier snacks with a considerable duration, but especially delicious, encouraged Ms. Kaziukonienė to launch her own brand based on this technology. Today, the company offers more than 300 stock-keeping unit (SKU) spanning over 15 different categories of products such as: non-melting ice cream, cheeses, berries, fruits, vegetables, snacks, smoothies, milkshakes, and others, while exporting to over 20 countries.

With more than 30 employees, the company works closely with various researchers, and has recently developed a 3D printer for printing patented BITES snacks. The company is therefore experiencing rapid development and has become one of the leading SME companies in the food industry.

WHY JAPAN

The interest in Japan began when the company was informed by the Lithuanian Chamber of Commerce about the free trade agreement signed between the EU and Japan that entered into force in 2019. In parallel, Geld Baltic was informed about the Get Ready For Japan training (GRFJ) (https://www.eu-japan.eu/events/get-ready-for-japan-training-programme), a 2-week programme from the EU-Japan Centre aiming to train EU executives about Japanese business culture. Ms. Kaziukonienė applied to the programme and was selected with other 13 participants to attend the training in Japan. This programme was a very rewarding experience because it allowed her to learn and understand the Japanese business culture. “In two weeks, Japan not only became a little clearer, but a warm feeling was born” said Ms. Kaziukonienė.

The programme provided both theoretical and practical learning, while the staff at the EU-Japan Centre was supportive during all training. “They were providing us with advice after the lessons and during meetings with potential Japanese partners - commenting on what was good, what was bad, providing not only theoretical, but also practical lessons”.

Before the training, Super Garden had no contact with Japan, it was just a “dream”. Being selected for the programme was therefore the first step for the company to approach the Japanese market since the “country's market - both culturally and logistically - was very difficult”.

CURRENT – NEXT STEPS

In 2020, the company was impacted by the COVID-19 crisis, thus slowing down the plan to go to Japan. Despite the situation, the company was able to find a first client, Como Co., Ltd., with whom it had its first commercial agreement. Geld Baltic’s products were incorporated in some breads and cakes especially created for the 80th anniversary of “Visa for Life”, a commemoration of the Japanese diplomat Chiune Sugihara (1900-1986), who served as vice-consul in Lithuania and helped many Jews flee Europe during WWII. The baked goods served, containing the company's freeze-dried fruit and vegetables, were made by Como Co., Ltd. in Aichi Prefecture and sold by the Gifu Chamber of Commerce and Industry.

During the GRFJ training, the company had also the chance to initiate partnerships with other participants of the training. For example, with an Estonian honey producer that is now making honey mixes with Geld Baltic’s freeze-dried powder.

Geld Baltic has also received another support from the EU through a specific programme for Lithuanian food exporters named “Europe share” (https://europeshares.eu/) and managed by the Lithuanian organisation Baltic Gastronomy Leaders and the Bulgarian Winemaking & Export Association. This programme gave the company the opportunity to participate in FOODEX, Japan’s largest food exhibition, (https://www.jma.or.jp/foodex/). Due to the COVID-19 pandemic, Geld Baltic staff could not personally be in Japan. However, it was able to work with a local agent who allowed it to maintain a connection with the market and thus find potential partners. In April 2022, Geld Baltic representatives were able to travel to Japan and had a very successful trip as they met these new Japanese partners. The company does not currently have agreements yet, but is in the negotiation phase with its agent and with the new contacts made.

Geld Baltic has been step by step developing its strategy to access the Japanese market during the past 2 years.

COMPETITIVE ADVANTAGE

The company has become more competitive in the Japanese market by benefiting from preferential duties tariffs on its products thanks to the EU-Japan EPA agreement, making them more cost-effective and creating a good trading environment to access the Japanese market.

On the other hand, it enjoys an advantageous position since there are no companies on the Japanese market that offer this type of product: freeze-dried snacks made of berries and vegetables; freeze-dried ice cream; and even freeze-dried cheese-based products. This makes the Japanese market more exploitable - offering multiple opportunities for this start-up by allowing it to be well-positioned in relation to competitors.   

CHALLENGES

The main challenge for Geld Baltic was cultural differences. However, thanks to the GRFJ training and its Japanese agent, the company was able to better understand the Japanese mindset. “It is like a translation between our cultural differences because I think this is the main challenge: to understand how a different mindset works.” said Ms. Kaziukonienė.

The second major challenge was the COVID-19 pandemic, which paralyzed all economic activity. During the pandemic, the company nevertheless could benefit from the EU funded programme “Europe share”, allowing it to participate twice in the FOODEX fair and to fund agents, specialists, degustation events, and samples.

FUTURE EXPECTATIONS

For the coming years, the main goal of Geld Baltic is to be a clean and reliable company through research conducted in Lithuania, thus being ready for the Japanese market.

The company also plans to participate in the Innovation Leaders’ Summit (https://ils.tokyo/) and recently became member of the EU-Japan Business Round Table. Created in 1999, the EU-Japan BRT is made up of 76 CEOs and senior executives from leading EU and Japanese firms and business organisations, primarily representing large companies, but also representing 15 SMEs and 11 business federations, chambers of commerce or other organisations. (https://www.eu-japan.eu/eu-japan-business-round-table).

As its freeze-dried product is a relatively new and innovative category, Geld Baltic has other new projects ready for the Japanese market. It would like to position itself in relation to competitors with its ice cream that does not melt, or its freeze-dried cheese. Another approach of the company would be to produce its snacks locally with the help of Japanese partners to emphasis the “made in” aspect and to attract new consumers. The company also plans to find investors interested in developing its 3D food printer for vegetables and berries.

Finally, since the company is not known in this market, the forthcoming strategy is to plan a campaign using social media to promote and educate customers about its new freeze-dried products.

Super Garden has big expectations and wants to quickly expand in Japan since it is a very promising market with huge potential for development.

ADVICE FOR OTHER COMPANIES

According to the company, the EU-Japan Centre provided a wide fan of support services, and the staff has always been available in case of questions, even long time after the initial training. “The EU-Japan Centre is amazing, and I am so happy to have met the Centre's staff. The “Get Ready for Japan” was amazing for me, but it was only a preparatory programme. Each time I contacted the EU-Japan Centre after the programme, I felt very pleased by the support I received”.

Ms. Kaziukonienė advises future exporters to prepare themselves for trading with Japan, as it is a very different culture, and one must be willing to understand their different way of thinking. “You should be ready for a marathon, not for short run. It is a long trip, a long journey to access the Japanese market, and you must be prepared in terms of time and money to invest. You must understand that in Japan people think in a different way, which sometimes is a good thing, and other times not so much, but in general you have to be open for this different mindset and the details”.

Text based on an interview with Ms. Lura Kaziukonienė, CEO, and Mr. Rokas Jašinskas, Head of Business Development, UAB Geld Baltic – Super Garden, https://www.supergarden.lt/en (May 2022)