Soy Entrepreneur The Buzz


Soy products are experiencing a popularity surge in North America. People are finding that soyfoods are a healthy, and even delicious, addition to their diets. But soy entrepreneurs need to find a soy niche that sells.

Vegetarians have long known the benefits of soy. One of soy's more well-known forms, tofu, is a high-protein, low-fat and no-cholesterol substitute for meat. But tofu has never been considered a very tasty treat. So the average person has generally stuck with meat products and only purchased soy sauce for stir-fry dishes.

Thanks to new and inventive entrepreneurs, soy now comes in a variety of forms. More products mean more choices for today's mainstream, yet savvy, consumer.

Soy cheese, soymilk, soy ice cream, soy flour, soy grits and soy yogurt are just some of the products you'll find on the market today.

The health benefits of soy are its main selling point. Soy product labels can now state that there's a link between consuming soy protein and a reduced risk of heart disease. This claim has been a very effective marketing strategy and may be the reason for the market's extreme growth.

Soy entrepreneurs benefit from the growth in the industry. But they must still deal with a competitive market.

Ian Walker is one of the entrepreneurs behind a company that manufactures and distributes organic and natural foods. Soy nuts (roasted and seasoned soybeans) are one of their main snack items.

Walker had a university business degree and experience in sales when he joined up with Jason Dorland about six years ago. Dorland needed business help selling the peanut butter spreads he had developed. The two then went into the snack food business.

Nearly everyone who tried the peanut butter spreads bought them. But people usually only bought them as an occasional once-a-month treat. Walker says the company needed a higher-turnover product if they wanted to sell in bigger stores.

So Walker and Dorland eventually focused on selling healthier snacks -- the soy nuts that they sell today.

It was a smart move. Shoppers are now buying more soyfood products in supermarkets and other mass-market outlets than in any other place. That's according to Soyatech.

Walker started marketing the products by giving demos in stores. At first, he says, they "needed to get people to know what soy nuts were." Now, their goal is to make people aware of their brand.

Walker points out a specific challenge with selling products in a rapidly growing industry. "There's been so much press [coverage] -- to the point of Oprah -- to increase soy awareness. This increased the market potential, but everyone started making soy products. It's very competitive."

Walker says that he's learned nearly everything through trial and error. "It isn't such a bad thing...I'm astounded at what I've learned in six years."

Walker says that trying to find the right employees, raising money and finding time to do everything are also big challenges.

He mentions that anyone considering starting a business really needs to make a complete commitment. "Make it a full-family decision," he says. "You're often working until 10 at night. If you're not willing to do that, you won't make it."

Steve Demos is also a soyfood entrepreneur. In 1977, he started a soyfood company with $500 in start-up capital. He began by making tofu in a bucket and delivering it to local stores on a small red wagon. Today, his company is one of the largest manufacturers of soyfoods in the U.S. and has revenues reaching $81 million.

Demos made soymilk mainstream by cleverly packaging it in appealing milk cartons to be placed right alongside milk in grocery stores. This method has been quite successful.

Today, Soyatech says that soymilk is experiencing triple-digit growth rates in mass-market outlets.

Demos notes that selling soy products has a specific challenge. "Marketing a product to the American consumer that carries a negative taste stigma to it has to be the most difficult obstacle to overcome," he says.

"This takes enormous patience and perseverance in product development," he continues. But it's worth it. Demos says the greatest perk is knowing that he's partly responsible for people eating healthier. "The world is far better off with [this product] rather than without."

The benefits of soy are not just healthier eating. Nonedible soy products are environmentally friendly. Soy-based industrial products include anything from wood adhesives, resin removers and cleaners to face cream, conditioners and candles. These are also experiencing stronger popularity.

Soy entrepreneurs may compete in a tight market, but the successful ones have stood by their product and have never given up. In fact, soy nuts and soymilk wouldn't even be around if entrepreneurs never took a risk.

"If you truly believe in your product and concept and you know that it has a great benefit for people, don't give up when it gets tough," says Demos. "That's just part of the process, and the process is very long and full of lots of ups and downs."

Links

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