By Eric Peterson | Dec 16, 2013
Sustainable foods for import and export
For the husband-and-wife team of David and Debra Jones, the respective CEO and marketing director of Magnolia Trading, it all started with soy milk.
In 2004, Steve Demos, founder of White Wave, approached David to see if he could build the brand's international market. "Steve asked me to come in and see if there was an opportunity internationally for Silk," says David. "They were primarily focused on the U.S."
White Wave outsourced its international operation to the Joneses in 2006 and Magnolia Trading was born.
The Joneses credit the brands with their success. "There is a real cachet for American brands around the world," David notes. "They're known for being safe and their quality."
But Magnolia doesn't just offer services -- it puts its own skin in the game. "We're not a broker," says David. "We actually buy the product and take the risk in distributing it around the world."
Magnolia initially focused exclusively on White Wave and Silk, but took on more brand partners as the model proved scalable. "After a couple of years we realized there was an opportunity to leverage more brands into our distribution partners in the countries we were already in," says David. "It provides our brand partners with a single international partner."
Magnolia's experience adds quite a bit of value for brand partners. "We work with our distributors to make sure the right documentation is going with their products to get it in for import," he explains.
Magnolia has worked with about 80 distributors in more than 60 countries since 2006.
"Our network is one of the top international market for this specific market," says Debra. "David and I have gone to visit almost all of them."
Magnolia vets potential distributors by taking a long look at their track record. "We look at if they've imported brands before and what they've done with them," says David. "We're looking for someone who's taken a product or brand and delivered success."
Magnolia had an exclusive contract to export for White Wave in markets outside of the U.S. and Canada from 2006 to 2012, when the soy milk titan moved it in-house.
Today the company exports products from Rudi's, Seventh Generation, Zevia, Barbara's Bakery, and Kristian Regale.
Asia is Magnolia's largest overall market, but it also does a lot of business in the Middle East, Australia, and Europe -- although many brand partners choose to keep European business in-house.
The top market for Seventh Generation, a manufacturer of environmentally friendly household products, is China. "People don't understand how much the Chinese care about the health and well-being of their families," notes Debra. "It's a huge market for green products."
Saudi Arabia, the United Arab Emirates, and Dubai are currently on the rise for Magnolia, adds David. "Lately, the Middle East is really evolving," he says.
And Zevia, the soft-drink brand naturally sweetened by Stevia (a.k.a. sweet leaf), has caught on quickly in Iceland after a launch in late 2013. "The volumes have been surprising," says David.
Challenges: "As the American economy continues to strengthen, so will the U.S. dollar," says David. The depressed dollar of 2009-10 "was fantastic for exports" but an uptick would make for a headwind for Magnolia.
Opportunities: Exporting gluten-free products. "Gluten-free is huge all over the world," says Debra, highlighting the Middle East and Asia as prime markets.
Needs: The continued support of the U.S. Department of Commerce and other government agencies. "The U.S. government has really supported exports," says Debra, who also commends the World Trade Center Denver for information and advice.