Statistics show that on average only 20 per cent of companies in a particular country are able to export to distant markets. Polish Manufaktura Doti proves that even a smaller family firm can be an exception. What counts is creativity, persistence and hard work.
Emerging Europe spoke to Dorota Mroczkowska, owner and CEO of Manufaktura Doti, about how the company she set up with her husband made its way to the United States.
Manufaktura Doti is going to celebrate an anniversary next year. How did it start?
Yes, Manufaktura Doti has been on the market for almost 25 years. My husband Mariusz and I opened the company in 1991 in Smolec, on the outskirts of Wrocław, in Lower Silesia. We are both the founders and the first generation in the business.
In the sweet business, we should add, shouldn’t we?
Yes, our products — chocolate-covered fruits and nuts — are made manually from quality chocolate and nuts, candied and dried fruits and nuts. Apart from those more traditional nuts and cranberries we also use mangos, blackcurrants and rhubarb and cover them with chocolate.
They are more premium brands, not available in mass sale. You can buy them in prestigious locations like Julius Meinl’s Delicatessen in Vienna, Demmers’ Tea Shop chain, Schubeck’s Delicatessen in Munich, at airports, chocolate shops and confiseries across Europe. That premium brand is called Berry Allure. Doti Natural is our new line of bio and organic products. Corporate gifts are also an important market for us. In general, we send our products to most European countries.
We have received international and Polish awards which together with our clients’ satisfaction prove that what we do is appreciated.
And how did you start your US adventure?
Our daughter Magdalena, who has worked with us since she was a child, got married and moved to the US in 2011. Together, we began thinking how we could start selling across the Atlantic. We decided to repeat the same model we had used in Europe, and approached specialist shops and independent retailers. By taking part in fairs, making phone calls and visiting shops, my daughter acquired about a hundred direct partners. As a result, we set up a daughter company in the United States and sent to pallets of sweets. Magdalena rented some space in a warehouse, collected orders and dispatched parcels with our products.
I must say that, when I was in the States, I often sent those parcels with Fedex. Thanks to these operations, our chocolates were available in a coffee lounge in New York City, in a gift shop in Kansas City and a tourist shop in the state of Georgia. Then we started having seasonal orders from the specialist shop chain Crate & Barrel.
I must say that only having had our own group of partners were we able to convince our current importer to work with us. The distributor sells our products mainly in the northern states. Recently, during an international fair in the US my daughter was approached by the owner of a small Belgian producer who asked her how we managed to enter the US market.
I would say that secret is creativity, hard work, commitment, persistence and trust that you need to build constantly. It’s not easy for small companies.
Having that experience now how do you look at the American market and its potential for Polish companies?
I think there are many misconceptions and fallacies about the American market and the potential it offers. The main one is about the size of the market and that everyone can sell there, that everybody can find their niche there. That is a big misconception. The American market is the most saturated, mature and competitive market in the world. Someone has to be kicked out of that market so a new company can enter. On top of that, entering that market requires large expenditures. We are a small family business so our funds are quite limited. But we have a great product.
The perception of Polish products in the US was another barrier. Polish products do not have a solid brand linked to excellent quality. An average American consumer is familiar with pierogi and kiełbasa (sausages) and this is all they know about Polish cuisine and specialties.
When entering the US we not only had to compete with American manufacturers but also with producers from across Europe who also seek to sell in the US. Americans love quality products from Europe, especially from France but also from from Italy and Germany. Fortunately, some consumers refer to Polish products as European and that is already an achievement.
In the future, I believe we stand a chance of getting a bigger share of that specialist market. Right now we are in talks with a new potential partner whom we met via a chocolate boutique. I hope we’ll reach an agreement as he has great clients.
Now, when it comes to procedures and legal aspects when exporting to the US, what obstacles do you need to overcome?
We have an importer or a distributor, if you will, and it’s all very comfortable. They organise a consolidated transport in temperature-controlled containers. The first delivery was sent to the US by plane as we couldn’t transport it in a temperature-controlled container. In sea transport facilities small temperature-controlled containers are hardly available. Those with 20 degrees centigrades would be ideal for us.
Sometimes we have trouble with small deliveries which are not managed by our distributor. There are lots of small shops which would like to order directly from us but they do not have the status of an importer or FDA registration (US Food and Drug Administration).
Labelling is not standardised and that means that each time we sell to the US we need to put additional labels according to FDA requirements, for example, we need to stick a note giving declared weight of the product in ounces, in the right-lower corner of each package, hence we can’t have the same package for all markets. There are different certification procedures and ways of declaring organic products.
The funny thing is when we ask our small clients to make a bank transfer when paying for our products. They’re stunned they cannot pay by credit card as it is not possible between Poland and the US.
Do you think the Transatlantic Trade and Investment Partnership will help to overcome all these challenges?
For us it is important to be able to deliver our products quickly, safely and with as few complicated procedures as possible. In our case the tariff is six per cent. If that could be done away with our final price would be more competitive. It is also very important to standardise the labelling requirements. I only hope this will not be detrimental to European food products which I believe are more delicious.
I would also expect logistics offered to small companies. Trade amongst small companies from both sides of the Atlantic will definitely go up when the markets are fully open.
Click here to read about the firm and the products Manufaktura Doti offers.
(All photos — courtesy of Manufaktura Doti)