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businessinfo.cz: Sowing her oats

Zdroj: businessinfo.cz 27.4.

Sowing her oats

Sowing her oats Czech entrepreneur Klára Dlouhá is bringing a different kind of breakfast experience to China with her hand-mixed muesli. And fellow Czech David Vichra is bringing home-made yoghurt.

Klára Dlouhá has lived and worked in Beijing for seven years. She says she likes China, but found herself increasingly missing one meal item common back home, though largely unheard of in Asia - muesli. In the Czech Republic, this almost staple food of oats, dried fruits and nuts, served with milk, was essential to her breakfast.

Dlouhá discovered that in Beijing, muesli was available only as an expensive import. So together with Chinese friend Anita Chang, she decided to produce it locally, both for herself, and for the benefit of others - and to sell it at an affordable price. Thus the Miss Muesli brand was born. Without the two women knowing it, they had stumbled upon a gaping niche in the market - their Beijing muesli store has become a major local hit, and is even selling goods to other Chinese cities in nearby provinces.

"Initially, I came to this country to learn Chinese," explains Dlouhá. "I worked in teaching, management and administration. But now mixing muesli has become a full-time job for me." For the Czech entrepreneur, her own country's Mixit served as an inspiration. This firm offers customers the ability to blend together a wide range of ingredients to form a custom muesli. "A foodstuff which we at home view as pretty common is something of a luxury in China - and not everyone has been able to afford it. It is only available in foreign import goods stores, and even the cheapest brands are ridiculously overpriced."

The Czech-Chinese entrepreneurial pair decided to locate their muesli store in a hutong, the name for the traditional narrow stone streets in the old part of town - many of which have been demolished in recent years to make way for modern buildings. Not far from the Yonghe Temple monastery of lamas, we find the Miss Muesli store. Here, locals visit to purchase muesli, but the site also serves as a depot for shipping out internet orders across the region. Miss Muesli was launched by Dlouhá and Chang last October.

"Things are going very well," says Dlouhá. "Both of our arms ache from all the slicing and mixing! Initially, we targeted foreigners living in Beijing. I knew from friends that such a product would be relished. All our products were thus marketed only in English. But then on WeChat [the most popular Chinese social network site - Ed.] we gradually discovered that more and more Chinese customers are interested in our products. And so we also set up a Chinese-language website, and the number of these customers is rising. This is something we hadn't expected."

Local magazines in Beijing's hutongs have also been writing favourably about their enterprise. This February, even the English-language China Daily, available, for example, in hotels and on Chinese airlines, wrote an article about Miss Muesli. "We undertook no marketing aimed at Chinese. But the trend for healthy foods is really picking up here. Many young people have travelled abroad and thus discovered muesli. But then when they returned home, they encountered the same problem that we had."
Oats instead of dumplings

Oats mixed with dry fruits, aka muesli, are an invention of Swiss physician and pioneer nutritionist Maximilian Bircher-Benner. One day, while hiking in the Swiss Alps, he was served a dish along the lines of muesli. Impressed, Bircher- Benner fine-tuned the healthy oat mix for feeding to his patients. Thus muesli (or müesli) became the de facto national breakfast of Switzerland. Conversely, traditional Chinese breakfasts are nowhere near as "healthy". Designed to provide energy for the full day, they consist of items such as Dim Sum stuffed buns; deep-fried dough twists called Crullers; Jiaozi dumplings stuffed with meat; noodle soups; or Congee, which is a kind of rice porridge. "The Chinese breakfast is a little alien to foreigners," explains Dlouhá.

But habits are changing in China in this regard. Chinese are increasingly seeking out a healthier morning meal...it seems that we were the first to enter this particular niche. And now we have our hands full." As to how Miss Muesli is able to provide muesli at considerably lower prices than the hitherto Chinese norm:

"The muesli sold in stores here is imported. It is five times more expensive than in a place like Germany. The most basic kind of dry muesli sells in a German Aldi store for around euro 1.50. Here, the same costs around six or seven euro. It isn't hard to make this product cheaper. We use more than 30 ingredients. Some, we source from China, some from abroad. For example, our oats come from Russia. We aren't cheap. But we do have the strongest price-to-quality ratio. Quality Australian or US muesli is extremely expensive here. Our margins are smaller, but so, too, are our costs." Miss Muesli sells a 400g pack of oats and fruits for CNY 35 (around CZK 140), while a 750g pack sells for CNY 58 (CZK 240).

Miss Muesli, and the two women behind it, are decidedly in vogue right now in China. They could easily charge more for their unique products, and likely people would continue to buy them. "It is a hand-made product, sold in a little store - all very fashionable," observes Dlouhá. "Sure, we could sell our product for more money. But then it would lose the very idea behind it, namely to provide a more affordable kind of muesli here."

For now, she is keeping mum over specific sales numbers. But Dlouhá does explain that at the start the pair had dozens of customers per month; now they have hundreds. By summer, they estimate it will be thousands. Assuming further smooth sailing, Dlouhá and Chang are planning to expand into other Chinese cities. "We are just getting a feel for things right now. We have potential customers further afield. But one step at a time. Once we have conquered Beijing, we may try Shanghai," adds Dlouhá.
Now for yoghurt

There is another Czech entrepreneur in Beijing riding the assurgent health food wave. David Vichra is the founder of BeYogurt. And he too has a tale to tell regarding how his product found a market gap in China. Vichra's BeYogurt presents itself as a natural yoghurt made according to a unique recipe taught to the entrepreneur by his grandmother. It was the same yoghurt Vichra ate as a boy in his home village in southern Bohemia. Of course, his yoghurt is ideal for mixing with muesli. And of course Vichra's and Dlouhá's firms cooperate extensively.

Similarly, Vichra is not a businessperson by profession. He started out in the construction industry. His first foray into business was with the establishment of a cafe for expats living in Beijing. In an effort to offer exciting new menu items, Vichra remembered that boyhood yoghurt from grandma: "Presently, we are only selling thousands of units per month, which is still manageable on a by-hand basis. But thanks to huge levels of interest in his product, good contacts, and the opening of doors to several major retail chains, we are now establishing a production facility in the city of Qingdao. Thanks to production line technology, and having already gained the required certification, we may be able to expand to the wider Chinese market this year."

Vichra explained that at present his greatest problem lies in finding investors. "Demand is high thanks to a strong middle class and a growing desire for fresh products. But asides from direct financing, we are also seeking out experienced investors able to offer their assistance with regard to the further expansion of our company," says Vichra.

But while Chinese tastes are evolving relatively slowly, big name players in the country are betting on the growing popularity of healthy lifestyle choices. In 2012, Chinese giant Bright Food bought a 60-percent stake in Weetabix Ltd., the second-largest cereal maker in the UK. This year, the Chinese parent announced it would buy out the remaining share. Bright Food's presence has seen Weetabix expanding into new product lines, catering to Chinese tastes, such as green tea flavoured cereal bars. But a giant such as Bright Food, with its mass produced cereal boxes, is clearly a very different kettle of fish to a small shop selling hand-mixed muesli. According to an article published in the Financial Times last summer, the Chinese ready-made breakfast market is dominated by Swiss firm Nestlé, and US firm General Mills.

Notably, the current Chinese fashion for all things healthy is rooted in far more than merely the influx of Western trends. Countless scandals relating to tainted Chinese-made foods - chiefly a baby milk powder scandal in 2008 in which the adulteration of a product with melamine caused the hospitalisation of tens of thousands of babies - have made the country's people extremely sceptical with regards to trusting the safety of certain types of foods. Milk and milk products are thus largely imported from Australia, New Zealand and Europe.

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