Published in Food/Agribusiness
International sales skyrocket for Grand Rapids-area healthy sweets maker COURTESY PHOTO

International sales skyrocket for Grand Rapids-area healthy sweets maker

BY Sunday, December 05, 2021 05:30pm

PLAINFIELD TWP. — Mike McDonald helped fuel an international expansion of his company’s all natural, sugar-free candy and treats by simply answering a few emails instead of jet setting to a vast network of global clients.

“I was interested in the emails and inquiries we would get through our website — I simply started calling back and emailing back the international clients. Maybe a couple a month, nothing big,” said McDonald, who is majority owner, president and CEO of Sugar Free Specialties LLC, which does business as Dr. John’s Healthy Sweets.

“I was just letting them know we would be interested in doing business in their country but I needed to know more about their business. I did some due diligence that anybody would do,” he said.

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In a couple of years, Dr. John’s has seen explosive growth in its international sales, which surprisingly were relatively unhindered by the COVID-19 pandemic that has consumed the world for nearly two years now.

The company’s success with its international segment netted Dr. John’s the President’s “E” Award for Export Service last month from the U.S. Department of Commerce. The award is given to companies that play a role in expanding U.S. exports. Dr. John’s was one of three Michigan companies — and among 70 across the country — to earn the honor.

Dr. John’s started to emphasize international business in 2018, growing its global sales from $360,000 that year to $4 million in 2020. McDonald expects continued growth this year as Dr. John’s now reaches more than 10 different countries.

McDonald kicked off the initial expansion in 2018 by embarking on a four-week trip to Japan, South Korea, China, Hong Kong and Taiwan to forge the necessary relationships.

“I appointed an exclusive distributor for a year or a two-year contract in those countries and we just started working with them,” he said. “Initially, we thought it would be a slow build, but in some cases, the build was pretty (fast).”

Dr. John’s also crept into the European market by selling through Amazon UK.

McDonald attributes some of his company’s international success to cultural differences in which other countries and their populations see detriments to sugar-filled food and treats. Dr. John’s products, which range from hard candy and lollipops to chocolates and gum, are sweetened with xylitol and erythritol.

With little competition in those markets, McDonald says international clients have embraced the high-end healthy candy.

“Customers virtually anywhere outside of the U.S. are much more attuned to the benefits of a no-sugar product and the kinds of detriments of sugar products,” McDonald said. “American consumers are usually the first in innovation. … We’ve been exposed to trends like fat-free or Keto-friendly or sugar-free — we get exposed to it in the U.S. and in many cases it’s not an acceptable product.”

While the pandemic didn’t decimate international sales, it did introduce some hiccups. McDonald said shipping costs to Europe, the Middle East and Asia have skyrocketed by 400 percent.

With a price-sensitive commodity like candy, McDonald has had to pass on those added costs to the consumers, who were already paying around $15 for a 3-ounce bag in Shanghai.

Still, the combination of a high-end clientele and very little competition in those markets have kept sales growing.

“When COVID hit, keep in mind, it hit at different times. When you’re selling around the world, it helps,” McDonald said. “At no point in time was everything completely shut down. It hit China first. Initially, China and Japan were talking about COVID before we had any ramifications here. By the time we were in it, they were getting out of it.”

Home sweet home

Dr. John’s — initially founded in 1995 and acquired by McDonald and his wife, Patty, in 2017 — has been making strides at home, too.

The company operates from a 22,000-square-foot facility at 5320 W. River Drive NE in Plainfield Township, which opened in 2019 and produces 50 million pieces of artisanal candy per year. To satisfy the artisan criteria, all candy is hand-made in 80-pound batches.

The company’s sales are mostly direct-to-consumer, with Amazon standing as its largest domestic client. Dr. John’s generates roughly $50,000 in weekly sales through Amazon. This year’s sales through the e-commerce juggernaut have spiked 101 percent over last year.

Dr. John’s also sells directly through its website and works through medical distributors, which deliver products to clients that include dental offices, hospitals and endocrinologists.

This includes Robinson Dental, which has locations in Wayland and Coopersville. Robinson has stocked Dr. John’s products for more than five years and has teamed up with the brand on oral health outreach efforts in area schools.

“What we found in the last three years working directly with Mike and Patty is just how involved they are in the community in getting this healthy treat idea to the public,” said Dr. Scott Robinson, co-owner of Robinson Dental. “And, of course with our patients, who wants to be the dentist that hands out toothbrushes at Halloween? Just to be able to hand them something that is healthy and is also a treat, that helps set us apart from other offices that maybe haven’t caught on to this yet.” 

Read 1974 times Last modified on Friday, 03 December 2021 14:02