Not even four years old, Innocent Drinks is a rapidly rising star in tune with the times. Mary Carmichael meets the founder
Richard Reed's entrepreneurial streak was apparent at primary school when he found he could buy Smurf stickers for 3p and sell them to classmates for 15p. Wary teachers put a stop to that, but Reed continued to develop his business skills, later setting up a gardening agency in school holidays. He charged clients £2.50 an hour and paid his friends £2 to do the work. By university, he had moved on to organising club nights.
But one venture which left classmates with substandard college caps taught him a lesson. His customers were distinctly disgruntled, and Reed discovered he did not relish his resulting unpopularity. "It made me realise you have to have integrity in business and you have to get the product right," he says. "The profit just wasn't worth the animosity. There isn't enough money in the world to make up for that."
It is probably this combination of dynamism, precocious business acumen and ethics which is behind the accelerating success of Innocent Drinks, the smoothies and juice company Reed founded with two university friends. Still a few months short of its fourth birthday, Innocent's turnover has reached £7.2m, and it supplies more than 2,600 outlets, including the likes of Harvey Nichols and Harrods. Mintel has proclaimed it one of the fastest growing companies in UK food and drink. It has started exporting to countries including Belgium, France and Hong Kong. Its products repeatedly win taste awards and plaudits from food critics.
Yet Innocent's products are probably the most expensive on the market. The smoothies and juices, which are produced by day and shipped overnight and have a seven-day shelf life, are made from 100% fruit sourced from all over the world, and not from juice concentrate. Although the new Thickies range also contains yogurt, absolutely nothing else is added. Reed says this refusal to compromise presented difficulties at first and it was hard to find a producer who would make the drinks their way, but he is proud of the company's main point of difference. "I don't want to contribute to the mass homogenisation of the planet."
It was a case of the right products at the right time for Reed and the aforementioned friends, Jon Wright and Adam Balon Innocent's managing triumvirate. Health consciousness has boomed in recent years, while the legacy of foot and mouth, BSE and GMOs mean their products' 100% natural' positioning has inspired consumer confidence. They've also tapped into the growth in UK café culture, supplying Café Nero and Coffee Republic outlets.
Reed looks younger than his years a factor exaggerated by his habitually informal office wear, together with a nice line in self-deprecation. "On our own, any one of us would make a right pig's ear of running a business," he says, but there is a seriousness underlying this casual veneer and an almost evangelical belief in the company's offerings. "Smoothies and health drinks are not a fad," he insists. "We're trying to do the opposite of dumbing down the nation's palate. We're not going to preach, though. We're about making healthy food practical and easy."
Besides being academically gifted (their university was Cambridge), all three had a grounding in very useful areas of the business world. Reed had been an account director at BMP DDB, while Wright was marketing manager for Virgin Drinks and had worked for McKinsey Consulting. Balon had worked for Bain Consulting. All three had collaborated on clubbing ventures.And while working in London, they launched a jazz festival where Innocent was launched.
Feedback from the public
Its foundation has become company legend. The threesome set up a smoothies stall with a banner asking Do you think we should give up our jobs to do this this full time?' with yes' and no' empty bottle bins on either side. By the end of the weekend, the yes' bin was overflowing. "I think the no' bin had only those put there by our worried parents," says Reed. "We then aimed for the multiples at the same time as independents. But it takes longer to get listed. You have to earn your stripes prove you can get product consistency right and so on."
But these days, Innocent products are on shelf in 200 Sainsburys and the entire Waitrose chain, as well as Safeway, Somerfield and Asda outlets, while Tesco has just joined the list.
The plan now is to grow the workforce to about 60 in the next five years and Reed is looking for annual sales of £50m within the same period. Export is also a focus, with the ultimate aim of becoming "Europe's favourite little juice company."
For Reed, expansion means the company is now big enough to make demands on its suppliers, a process he describes as "innocentification". "I want a company I can be proud of," he says. "It's not just about chasing bucks".
The company already supports a community project in Bangalore, India, for which it has bought cows and planted mango orchards. This year it plans to double support to include funding for a full-time field worker, while one member of the Innocent team has the specific task of visiting all suppliers and signing them up to a guarantee on workers' conditions. "We have to make sure we go further than anyone else," explains Reed.
Despite the worthy tone, Innocent manages to convey a strong sense of humour both internally and externally. Perks for the 27 employees all aged 17 to 32 include snowboarding weekends, sports days complete with egg and spoon races and donkey rides at the company's birthday party.
Delivery vans are decked out to look like cows, complete with udders and a moo' car horn, while sales are measured by a Blue Peter-style drinkometer' in the foyer of its Fruit Towers' headquarters. Consumers are treated to whimsical comments and jokes on packaging, and are encouraged to ring the company on its banana' phone or pop in to say hello.
Even the business cards convey a sense of humour. The financial controller is labelled the Cash Cow' , the marketing manager is Queen Bee' while the commercial director goes under the name Fig Daddy'. "We have a pathological fear of being average," admits Reed. "We'd rather fail than be that."
{{ANALYSIS }}
Richard Reed's entrepreneurial streak was apparent at primary school when he found he could buy Smurf stickers for 3p and sell them to classmates for 15p. Wary teachers put a stop to that, but Reed continued to develop his business skills, later setting up a gardening agency in school holidays. He charged clients £2.50 an hour and paid his friends £2 to do the work. By university, he had moved on to organising club nights.
But one venture which left classmates with substandard college caps taught him a lesson. His customers were distinctly disgruntled, and Reed discovered he did not relish his resulting unpopularity. "It made me realise you have to have integrity in business and you have to get the product right," he says. "The profit just wasn't worth the animosity. There isn't enough money in the world to make up for that."
It is probably this combination of dynamism, precocious business acumen and ethics which is behind the accelerating success of Innocent Drinks, the smoothies and juice company Reed founded with two university friends. Still a few months short of its fourth birthday, Innocent's turnover has reached £7.2m, and it supplies more than 2,600 outlets, including the likes of Harvey Nichols and Harrods. Mintel has proclaimed it one of the fastest growing companies in UK food and drink. It has started exporting to countries including Belgium, France and Hong Kong. Its products repeatedly win taste awards and plaudits from food critics.
Yet Innocent's products are probably the most expensive on the market. The smoothies and juices, which are produced by day and shipped overnight and have a seven-day shelf life, are made from 100% fruit sourced from all over the world, and not from juice concentrate. Although the new Thickies range also contains yogurt, absolutely nothing else is added. Reed says this refusal to compromise presented difficulties at first and it was hard to find a producer who would make the drinks their way, but he is proud of the company's main point of difference. "I don't want to contribute to the mass homogenisation of the planet."
It was a case of the right products at the right time for Reed and the aforementioned friends, Jon Wright and Adam Balon Innocent's managing triumvirate. Health consciousness has boomed in recent years, while the legacy of foot and mouth, BSE and GMOs mean their products' 100% natural' positioning has inspired consumer confidence. They've also tapped into the growth in UK café culture, supplying Café Nero and Coffee Republic outlets.
Reed looks younger than his years a factor exaggerated by his habitually informal office wear, together with a nice line in self-deprecation. "On our own, any one of us would make a right pig's ear of running a business," he says, but there is a seriousness underlying this casual veneer and an almost evangelical belief in the company's offerings. "Smoothies and health drinks are not a fad," he insists. "We're trying to do the opposite of dumbing down the nation's palate. We're not going to preach, though. We're about making healthy food practical and easy."
Besides being academically gifted (their university was Cambridge), all three had a grounding in very useful areas of the business world. Reed had been an account director at BMP DDB, while Wright was marketing manager for Virgin Drinks and had worked for McKinsey Consulting. Balon had worked for Bain Consulting. All three had collaborated on clubbing ventures.And while working in London, they launched a jazz festival where Innocent was launched.
Feedback from the public
Its foundation has become company legend. The threesome set up a smoothies stall with a banner asking Do you think we should give up our jobs to do this this full time?' with yes' and no' empty bottle bins on either side. By the end of the weekend, the yes' bin was overflowing. "I think the no' bin had only those put there by our worried parents," says Reed. "We then aimed for the multiples at the same time as independents. But it takes longer to get listed. You have to earn your stripes prove you can get product consistency right and so on."
But these days, Innocent products are on shelf in 200 Sainsburys and the entire Waitrose chain, as well as Safeway, Somerfield and Asda outlets, while Tesco has just joined the list.
The plan now is to grow the workforce to about 60 in the next five years and Reed is looking for annual sales of £50m within the same period. Export is also a focus, with the ultimate aim of becoming "Europe's favourite little juice company."
For Reed, expansion means the company is now big enough to make demands on its suppliers, a process he describes as "innocentification". "I want a company I can be proud of," he says. "It's not just about chasing bucks".
The company already supports a community project in Bangalore, India, for which it has bought cows and planted mango orchards. This year it plans to double support to include funding for a full-time field worker, while one member of the Innocent team has the specific task of visiting all suppliers and signing them up to a guarantee on workers' conditions. "We have to make sure we go further than anyone else," explains Reed.
Despite the worthy tone, Innocent manages to convey a strong sense of humour both internally and externally. Perks for the 27 employees all aged 17 to 32 include snowboarding weekends, sports days complete with egg and spoon races and donkey rides at the company's birthday party.
Delivery vans are decked out to look like cows, complete with udders and a moo' car horn, while sales are measured by a Blue Peter-style drinkometer' in the foyer of its Fruit Towers' headquarters. Consumers are treated to whimsical comments and jokes on packaging, and are encouraged to ring the company on its banana' phone or pop in to say hello.
Even the business cards convey a sense of humour. The financial controller is labelled the Cash Cow' , the marketing manager is Queen Bee' while the commercial director goes under the name Fig Daddy'. "We have a pathological fear of being average," admits Reed. "We'd rather fail than be that."
{{ANALYSIS }}
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