Sonoma Brands makes its first investment: 'Dang Foods is a true category disrupter in snacks'

Under the deal, Sonoma Brands​​ will take a minority stake in Dang Foods, but will also provide guidance and practical support to help Dang move into new retail channels, CEO and founder Vincent Kitirattragarn told FoodNavigator-USA.

“Sonoma Brands first reached out to us around two-three months ago and from the first meeting I knew that they were the right partner for us,”​ added Kitirattragarn, who sources, processes and packages his coconut snacks in Thailand and his onion chips in Vietnam, and has thus far relied on his own savings, money from friends and family and a small business loan.

"In addition to the money, and downloading all the knowledge that Jon and his team gained from KRAVE, we're also getting feet on the ground, so they will be helping us execute on a marketing and sales plan, starting on day one."​

Kitirattragarn, who impressed his first major customer (Whole Foods) with his toasted coconut chips via a chance encounter at a trade show in 2011, launched his first products in July 2012, and notched up revenues of $4m in 2014 and $8m in 2015.

Revenues doubled in 2015​

Unlike many food entrepreneurs, who spend years proving themselves in the natural channel before they attract the attention of conventional retailers, Kitirattragarn got his foot in the door of some big names early on, and his wares are now available in 7,000+ stores from Target and Kroger to Safeway, as well as natural chains such as Whole Foods and Sprouts.

The cash injection from Sonoma will help Dang expand its presence in club stores, drugstores and c-stores, added Kitirattragarn.

"We're in around 500 CVS stores right now and some local Walgreens stores, but we hope to be in around 2,000 drugstores by the end of the year. Club can be a tricky channel. They don't even want to deal with you unless you're a certain size and they don't want to be more than 20% of your business."​

The online opportunity is also significant, said Kitirattragarn, who said sales through customers including Thrive Market and Amazon grew more than 100% last year. He added: "It's really off the charts, but there are a lot of marketing programs that you can access through these platforms that we want to look at as well this year."​

COCONUT CHIPS​: Dang Foods slices meat out of mature coconuts then gently toasts them, which brings out the natural sweetness of the coconut meat and turns it from white to a golden brown, creating a “buttery umami flavor​” that founder Vincent Kitirattragarn says is a healthier alternative to fried chips.

Flavors include: Original; Savory Bacon; Lightly Salted; Chili Lime; and Caramel Sea Salt.

ONION CHIPS​: Dang’s crispy caramelized sliced onions are made by slicing onions and putting them in a vacuum fryer with very low pressure that keeps the oil level (non-GMO canola) in the final chips low.

Flavors include: Sea Salt; Salt & Pepper, Chipotle Garlic; and Applewood BBQ.

Consistent instore placement for whole food snacks​

On  the merchandising front, one of the challenges Dang and other better-for-you snack makers face is that of consistent in-store placement, said Kitirattragarn.

“Currently there is no consistent destination for our products; they are sometimes placed in grocery aisles, other times in the produce area. Each retailer has a unique store layout and as a result it can be hard to find our products, even if someone is specifically looking for them. ​

"To solve this problem, we've teamed up with Barnara, Peeled Snacks and Rhythm Superfoods to create a coalition that looks at creating consistent planograms using robust sales data. One thing we've created mock ups of is a wooden display unit that could go in a produce section with our brands - one on each side -  and retailers can take that and say hey there's my healthy snacks section."​

Sonoma Brands: Strong leaders, unique products​

Speaking to FoodNavigator-USA in January, Sonoma Brands boss Jon Sebastiani said that he was looking to partner with entrepreneurial firms in high-velocity categories with "strong leaders and unique products".​

He added: “We have no boundaries or set formulas, but I am only interested in things that are entirely new, that stretch the boundaries of better for you foods, not launching me-too concepts."​

“We couldn’t be more proud that our first investment is in a category that is parallel with our experience and background. ​

Dang Foods is a true category disrupter in the snack industry with a family story and a passion for culinary roots that resonates deeply with our team. We are excited to be a part of the Dang story.​”

Jon Sebastiani, founder, Sonoma Brands​

Read our profile of Dang Foods HERE​.​

Watch our video with Vincent Kitirattragarn at the Winter Fancy Food Show below:

Watch our video with Jon Sebastiani at Sonoma Brands below: