New Zealand’s largest independent cider producer is about to make major inroads into China. Catherine Beard reveals their modus operandi.
When I spoke to Josh Townsend, CEO of Zeffer – winner of the world’s best cider title – he was in the middle of playing host to two leading Chinese craft beer brands: Nbeer and Glass Hammer. What’s that all about?
Their presence is part of a significant milestone in Zeffer’s international growth. I discovered that New Zealand’s largest independent cider producer is about to make huge inroads into the Chinese market through collaboration.
“We’re making two collaboration ciders to launch in the Chinese market co-branded under the Zeffer name,” explains Josh. “I was in China last year talking to these brands about how we could integrate more closely with the Chinese consumer from a cider perspective. I suggested they come to New Zealand and we make a collaboration cider to launch on tap in their brew-and-craft beer bars throughout China.
“The idea was really well received, and earlier this week we had a leading craft brewer from Shenzhen over to make a collaboration cider.”
While China is obviously Zeffer’s focus at the moment, Josh says they’re conscious of how quickly the market can move and it is a risky place to do business. So they plan to build up two more export markets over the next 12 to 18 months – quite likely Australia and the US, but it’s not been decided yet, they are still learning and researching.
Josh says every experience is feeding what they do, and he has learnt from a young exporter perspective that before you send any product to a market, you need to immerse yourself in that market. “You need to do in-market visits to explore what’s happening in the market, the distribution options, potential consumers and customers. For Zeffer that was the bars.
“Do not rely on the feedback from a distributor about where the opportunities are. You need to go and find out for yourself,” says Josh. “Find out if there’s an opportunity, and then if that distributor is the best partner to help you capitalise on that opportunity.”
Timing is everything
Zeffer first spoke to their current distributor about market entry more than four years ago and were advised it was too early. Then about two years ago, an MBA team did a project on Zeffer’s path to market into Shanghai. At the same time, the distributor called to say “We think the time is now right for cider in China.”
Josh then went to China six times last year to make sure they had the right people on the ground; to get the pricing strategy right, and to get a real feel for the market – especially when he was operating from New Zealand.
Zeffer has now employed a market manager in China to be permanently on the ground there, and give the market the time and attention it needs. They chose a Kiwi with strong business development experience, who’s fluent in Mandarin, and integrated in the Chinese culture having lived there a long time.
“It’s a nice weight off my shoulders,” laughs Josh.
Belief pays dividends
How did Zeffer get to where they are now, from selling their first batch at Matakana Farmers Market just a few years ago?
“Grit,” admits Josh. “We’re still relatively small and have a long way to go. Like any small business we’ve had challenging times and could have given up at several points. But belief in our product, determination and hard work is paying off. Next we want export – to grow from 20 percent to 30 percent by 2021 – and we see China being 20 percent of our total sales by then,” he adds. “We’re currently conducting a capital raise through Snowball Effect to allow further focus on our Chinese market opportunity.”
Catherine Beard is executive director of ExportNZ. Visit www.exportnz.org.nz
Photo: “Zeffer’s head cider maker Jody Scott (third from left) with Zeffer’s Beijing sales rep (left) and the Nbeer team”.
