Musgrave and Enterprise Ireland are helping new firms reach supermarkets, says Gabrielle Monaghan

Musgrave Group, owner of the SuperValu and Centra franchises, is helping Irish food entrepreneurs make their first foray into the grocery market by linking up with Enterprise Ireland to show start-up food companies how to get their products on to supermarket shelves.

Up to 20 new jobs and about €3 million in extra sales have been generated since the three-month First Sale programme was piloted last year. The programme was so successful that Bord Bia is taking part in this year's course, which began this week, and supports the production of three-year marketing plans for the companies.

"Big business accounts for a lot of sales at Musgrave. However, there are ways and means in which you can differentiate your offering, and working with Irish suppliers is the best way," says Conor Shalloe, a category manager at Musgrave SuperValu-Centra (MSVC), the group's retail division, whose team worked with one of the companies last year.

Trading experts from Musgrave advised five small companies, chosen from hundreds, last year on the best way to present their products to retail food buyers. Two of the five companies now have supply contracts with MSVC, namely Sunshine Juice and Dunhill Cuisine.

Sunshine Juice partnered with Centra and SuperValu to roll out juice bars in the two grocery chains and is also in talks to do the same at Budgens, Musgrave's retail business in the UK. Waterford-based Dunhill Cuisine is supplying Bia Kid children's ready meals and delicatessen products such as quiche and kebabs for both Centra and SuperValu. Java Republic also moved into the retail sector during the programme.

"From marketing and brand design to basic trade knowledge, we learned a huge amount," says Seán Francis, Java Republic's financial controller. "It is absolutely no coincidence that we achieved our launch into retail during this course."

L'Artisan, meanwhile, has had a range of its speciality breads listed with Musgrave Food services and is moving into a new factory to help meet increased demand for its products. "These people were generally entrepreneurs with a good idea, but they needed a sound business plan and marketing strategy to realise the potential of their product," says Dermot O'Connell, a trading manager at Musgrave Food services.

He worked on business plans with the participating companies on the programme to ensure their products were ready to be marketed to restaurants, hotels and food service firms.

The five companies selected by Enterprise Ireland for this year's programme are Broadway Bagels, a Co Waterford frozen bagel maker, plant micropropagation firm Fitzgerald Nurseries, and ready meal companies Lemongrass Fine Foods, Kohinoor Ltd, and FreshCut Food Services.

"We work with innovative, growth-focused new companies that have the potential to serve export markets," says John Magill, senior development advisor at Enterprise Ireland. "The target is to have a turnover of at least €1 million and employ 10 people after two years."

The First Sale programme trains the start-up companies on product development, market research and food safety. It also advises them on pricing, promotion, packaging, distribution, production volumes and the lead times required by large retailers.

John Hickey & Associates works with Enterprise Ireland on giving the companies sales, marketing and company structure advice. For small food companies, making the move to doing business with a large retailer is a steep learning curve, Hickey says.

"To grow your business and production capability, you need to know your manufacturing capability and understand the necessity of investing ahead of sales," he says. "Our job is to bridge the gap, helping companies understand how multiples work and the quality standards required to supply them."

Many of the companies that approach Musgrave with a product do not have the expertise to drive it to the next stage, according to Kevin Toth, a trading manager at MSVC who supported last year's programme.

MSVC helps companies address category management, or where their product will fit in, its unique selling point, and why it merits shelf space. It also advises them on product strategy, showing the companies where the market gaps are and how to fill those gaps.

Customised Food Industry Training Ltd brings the companies through the technical food safety and training issues that are essential in food production. It helps each company meet Musgrave's food safety and quality assurance standards and the BRC Global Food Standard.

"The retail multiple requirements for food safety are, by necessity, very high," says Dr Catherine Halbert from Customised Food Industry Training. "A food safety system must be constantly updated and improved in response to changes in legislation or regulatory requirements, consumer demands, customer requirements and the ongoing business changes around suppliers, personnel, equipment, the factory environment, or new product lines.

"Some of the companies in the programme did not realise the input required by a food safety manager and had to provide resources for a full-time person, at least," she adds.

Fostering small food companies gives Musgrave the chance to meet rising demand from shoppers for locally made, high quality products, says Musgrave's Shalloe. Three quarters of the goods sold at SuperValu come from the Republic, and have a retail value of €2.1 billion.

"When we work with Irish suppliers, the quality of product is very good and the service level is high," he says. "We've realised that Irish consumers are not only looking for good value but great products."