Baking & Snack - September 2020 - 19

SPECIAL REPORT
Incubators

Forward-thinking startups accelerate the development of new products
as they anticipate better opportunities in the not-too-distant future.

by Dan Malovany

E

Even in the best of times, starting up is hard to do. In
the worst of times, it's almost impossible for incubators
to get their emerging brands to market. That's especially
true in today's Darwinian environment where a lockdown followed by a recession has resulted in clear winners and losers - and everyone else is stuck in between.
Simply put, it's not the best time to sell something
new, but there are always exceptions to the rule.
Fortunately, HighKey got off to a running start since
it launched its keto-friendly cookies in early 2019.
In fact, Joe Ens, co-chief executive officer, noted that
HighKey Mini Cookies has been the No. 1 chocolate
chip cookie on Amazon for 16 consecutive months.
More recently, the Orlando, Fla.-based company rolled
out a Snickerdoodle variety that has become a top-seller
on Amazon as well as Brownie Bites followed by readyto-eat cereal in March. And it's also expanded the brand
into traditional retailers.
Mr. Ens acknowledged that the response to coronavirus (COVID-19) has brought upon a "seismic shift" as
retailers focused on merchandising core items and tightened the spigot for new products and upstart brands. He
added it took a little time for everyone to figure out "how
the new world" works and how to keep the shelves full.
"The biggest change for a startup, and to some degree
big companies, is a slowdown by traditional retailers
in bringing on new businesses because there has been
so much uncertainty in managing the existing stock as
well a shift, albeit short-term, in consumer behavior,"
Mr. Ens said.
As people settled into a new routine, including online shopping for some, HighKey began to reexperience growth.
"Few things change, but one thing hasn't: giving consumers what they want and exceeding their expectations," he said. "That wins pre-pandemic, and that will
win post-pandemic, and actually, that wins in the midst
of a pandemic."

Getting ready for the return
Mr. Ens predicted that within the next 12 months retailers will reopen access to their shelves to emerging
brands and new products.
"Forward-facing retailers are starting to think ahead

to this spring and say, 'Look. I'm going to have a difficult
fall managing through the uncertainty and managing inventory as we did in the initial phase of this pandemic,
but I also recognize that this too shall pass,' and they're
already thinking ahead," he explained.
That's a sentiment shared by Tom Vierhile, vice
president of strategic insights, North America, Innova
Market Insights, who anticipates a pent-up demand
for innovation in 2021 from consumers and packaged
goods companies. Those incubators that survive may see
new opportunities to thrive.
"Consumers are going to tire of the same dinnertime
routine and will hunger for products that can shake
things up," he observed. "Food makers may see new
virgin territory to conquer in supermarkets that have
suddenly been freed of marginal brands that may have
taken up space and delivered little on the sales front."
Linsey Herman, vice president, product development
for Factory LLC, suggested the retail pullback will be
short-lived because innovation is vital to attracting consumers back to stores. The Bethlehem, Pa.-based firm
invests in and helps scale up high-potential food, beverage and pet food brands that have achieved more than
$2 million in sales along with proof of consumer and
retailer traction. Currently, its portfolio includes Honey
Stinger sports nutrition waffles and chews, Mikey's gluten-free and dairy free, English muffins, pockets, and
Pipcorn Heirloom Snacks, among others.
"We remember what it was like in 2008 when large
food companies abandoned new product development,"
she said. "Small, disruptive companies moved in to take
advantage of the gap in new product offerings. People
get bored. And while they will always eat what is familiar
and comfortable, variety-seeking will never go away."
For the immediate future, the pathway to innovation
contains several roadblocks. Mr. Vierhile pointed out
supermarkets are still recovering from the supply-chain
shock from earlier this spring.
"The new product story so far in 2020 is SKU rationalization," he said. " 'Big food' is taking a hatchet to
marginal brands to focus time, energy and resources on
brands that can impact the bottom line."
Mr. Vierhile added that trimming slower-selling
products is a healthy practice that should be done from

Disruptive brands like
Pipcorn rely on innovative
products to differentiate
themselves in today's
competitive market.
Factory LLC

www.bakingbusiness.com / September 2020 Baking & Snack 19


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Baking & Snack - September 2020

Table of Contents for the Digital Edition of Baking & Snack - September 2020

editorial - When 'unprecedented' becomes the status quo
newsfront
In brief/people
trends snapshot news
Special report: Incubators -- A brand-new beginning
Operations: Muffin Town -- New rules for schools
Trends: Pretzels -- back in the spotlight
Formulation: Fats & oils -- Dialing into functionality
Formulation: Sourcing & Supply Chain -- Global web of ingredients
Equipment: Pizza tech -- Piling it on
Equipment: Mixing -- Keep your cool
Equipment: Finishing -- Seeking the perfect touch
Operations: Augmented & virtual reality -- Playing pretend
Equipment: Bottlenecks -- Breaking the bottleneck
Events
Innovations
Featured technical expert
Ingredients & formulating
Equipment & packaging
Patents
New on the shelf
New product spotlight -- A change of pace
Baking & Snack - September 2020 - 1
Baking & Snack - September 2020 - 1
Baking & Snack - September 2020 - 2
Baking & Snack - September 2020 - 3
Baking & Snack - September 2020 - 4
Baking & Snack - September 2020 - 5
Baking & Snack - September 2020 - 6
Baking & Snack - September 2020 - 7
Baking & Snack - September 2020 - 8
Baking & Snack - September 2020 - 9
Baking & Snack - September 2020 - editorial - When 'unprecedented' becomes the status quo
Baking & Snack - September 2020 - 11
Baking & Snack - September 2020 - newsfront
Baking & Snack - September 2020 - 13
Baking & Snack - September 2020 - 14
Baking & Snack - September 2020 - 15
Baking & Snack - September 2020 - In brief/people
Baking & Snack - September 2020 - trends snapshot news
Baking & Snack - September 2020 - Special report: Incubators -- A brand-new beginning
Baking & Snack - September 2020 - 19
Baking & Snack - September 2020 - 20
Baking & Snack - September 2020 - 21
Baking & Snack - September 2020 - 22
Baking & Snack - September 2020 - 23
Baking & Snack - September 2020 - Operations: Muffin Town -- New rules for schools
Baking & Snack - September 2020 - 25
Baking & Snack - September 2020 - 26
Baking & Snack - September 2020 - 27
Baking & Snack - September 2020 - 28
Baking & Snack - September 2020 - 29
Baking & Snack - September 2020 - 30
Baking & Snack - September 2020 - 31
Baking & Snack - September 2020 - 32
Baking & Snack - September 2020 - 33
Baking & Snack - September 2020 - 34
Baking & Snack - September 2020 - Trends: Pretzels -- back in the spotlight
Baking & Snack - September 2020 - 36
Baking & Snack - September 2020 - 37
Baking & Snack - September 2020 - 38
Baking & Snack - September 2020 - 39
Baking & Snack - September 2020 - 40
Baking & Snack - September 2020 - 41
Baking & Snack - September 2020 - 42
Baking & Snack - September 2020 - Formulation: Fats & oils -- Dialing into functionality
Baking & Snack - September 2020 - 44
Baking & Snack - September 2020 - 45
Baking & Snack - September 2020 - 46
Baking & Snack - September 2020 - 47
Baking & Snack - September 2020 - 48
Baking & Snack - September 2020 - 49
Baking & Snack - September 2020 - 50
Baking & Snack - September 2020 - Formulation: Sourcing & Supply Chain -- Global web of ingredients
Baking & Snack - September 2020 - 52
Baking & Snack - September 2020 - 53
Baking & Snack - September 2020 - 54
Baking & Snack - September 2020 - 55
Baking & Snack - September 2020 - 56
Baking & Snack - September 2020 - 57
Baking & Snack - September 2020 - 58
Baking & Snack - September 2020 - Equipment: Pizza tech -- Piling it on
Baking & Snack - September 2020 - 60
Baking & Snack - September 2020 - 61
Baking & Snack - September 2020 - 62
Baking & Snack - September 2020 - 63
Baking & Snack - September 2020 - 64
Baking & Snack - September 2020 - 65
Baking & Snack - September 2020 - 66
Baking & Snack - September 2020 - 67
Baking & Snack - September 2020 - 68
Baking & Snack - September 2020 - Equipment: Mixing -- Keep your cool
Baking & Snack - September 2020 - 70
Baking & Snack - September 2020 - 71
Baking & Snack - September 2020 - 72
Baking & Snack - September 2020 - 73
Baking & Snack - September 2020 - 74
Baking & Snack - September 2020 - 75
Baking & Snack - September 2020 - 76
Baking & Snack - September 2020 - 77
Baking & Snack - September 2020 - 78
Baking & Snack - September 2020 - Equipment: Finishing -- Seeking the perfect touch
Baking & Snack - September 2020 - 80
Baking & Snack - September 2020 - 81
Baking & Snack - September 2020 - 82
Baking & Snack - September 2020 - 83
Baking & Snack - September 2020 - 84
Baking & Snack - September 2020 - 85
Baking & Snack - September 2020 - 86
Baking & Snack - September 2020 - Operations: Augmented & virtual reality -- Playing pretend
Baking & Snack - September 2020 - 88
Baking & Snack - September 2020 - 89
Baking & Snack - September 2020 - 90
Baking & Snack - September 2020 - Equipment: Bottlenecks -- Breaking the bottleneck
Baking & Snack - September 2020 - 92
Baking & Snack - September 2020 - 93
Baking & Snack - September 2020 - 94
Baking & Snack - September 2020 - 95
Baking & Snack - September 2020 - Events
Baking & Snack - September 2020 - 97
Baking & Snack - September 2020 - 98
Baking & Snack - September 2020 - Innovations
Baking & Snack - September 2020 - Featured technical expert
Baking & Snack - September 2020 - 101
Baking & Snack - September 2020 - Ingredients & formulating
Baking & Snack - September 2020 - 103
Baking & Snack - September 2020 - Equipment & packaging
Baking & Snack - September 2020 - 105
Baking & Snack - September 2020 - 106
Baking & Snack - September 2020 - 107
Baking & Snack - September 2020 - 108
Baking & Snack - September 2020 - Patents
Baking & Snack - September 2020 - New on the shelf
Baking & Snack - September 2020 - 111
Baking & Snack - September 2020 - 112
Baking & Snack - September 2020 - 113
Baking & Snack - September 2020 - 114
Baking & Snack - September 2020 - 115
Baking & Snack - September 2020 - 116
Baking & Snack - September 2020 - 117
Baking & Snack - September 2020 - 118
Baking & Snack - September 2020 - 119
Baking & Snack - September 2020 - 120
Baking & Snack - September 2020 - 121
Baking & Snack - September 2020 - New product spotlight -- A change of pace
Baking & Snack - September 2020 - 123
Baking & Snack - September 2020 - 124
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