WATCH: Navigating the COVID-19 rollercoaster with Undercover Snacks

By Elaine Watson contact

- Last updated on GMT

Related tags: Snacks, COVID-19

The last few weeks have been a rollercoaster ride for many small businesses. FoodNavigator-USA caught up with Diana Levy, founder and CEO at Undercover Snacks, which makes chocolate covered quinoa snacks at its own SQF-3 manufacturing facility in New Jersey, to find out how 2020 is shaping up so far.

Initially, as the pandemic hit, orders were down, which Levy speculates may have been because “larger brands were getting priority on the trucks… and retailers and distributors were really focused on center of the store products and necessities.

“We got kind of shifted to the back of the crowd, so it was a little bit scary.”

A week or so later, however, orders from smaller distributors in particular suddenly went up, said Levy, who chatted with us on Zoom last week.

I think it’s possible they were able to fill in the gaps that some of the big distributors were having problems with. They knew we had inventory and we had good relationships with them … and then suddenly our orders increased.”

‘In a lot of stores I am actually picking up shelf space’

She added: “Because we have inventory and a lot of brands don’t, I think that stores are plugging the holes with our products sometimes, and so in a lot of stores I am actually picking up shelf space, especially the ones where I am using smaller distributors… they are going in there and a lot of the distributors, the stores will let them fill the shelf space for them.

“I’ve also had a lot of virtual meetings… more than I’ve ever had. In the time since this all hit we’ve been approved by Kroger and picked up over a thousand stores and we've picked up several hundred CVS stores.

"Two other retailers in the last couple of weeks have also indicated that they are taking on the product," ​added Levy, who currently sells her wares in 3,000+ grocery, specialty and independent food stores nationwide via UNFI, KeHE, Vistar, Associated Buyers, Chex Finer Foods, Nassau Candy and J. Polep.

‘Huge spike’ in e-commerce sales

Like many packaged food brands, Undercover has seen a significant increase in online sales during the pandemic, said Levy, who sells via her own website​ and via Amazon.

“We saw a huge spike in e-commerce orders… it’s leveled off a bit but it’s still much higher ​[than it was pre-covid-19]. We’ve also had online gift companies that have picked up the product and we've done a couple of different marketing programs to tie into that… and while I can’t do traditional sampling, we’ve been shipping out cases of individually wrapped products to emergency rooms around the country, so it’s great to help frontline workers but also it’s a great way to drive trial.

“We’ve also run promotions, and unlike some other companies, we lowered prices because we really want people to try our products,” ​added Levy, who started out making decadent chocolate covered treats for events and gifting in 2013, and later branched out into gluten-free chocolate covered quinoa snacks (adding in some nutrition by stealth... explaining the 'Undercover' moniker).

Manufacturing and social distancing

At Undercover's East Hanover, NJ, manufacturing facility, which can churn out up to 40,000 bags a day, the focus has been on keeping people safe, and away from each other, which is clearly easier when you have a very small team, acknowledged Levy, who said she stocked up on ingredients and packaging early on in case she encountered procurement issues later.

“We really only need at most four people in the back running the line and the packaging and if you do the math on 12,000 sq feet they don’t need to be anywhere near each other and it's a totally hands-free operation.”

The shopping experience

The instore shopping environment might not seem highly conducive to product discovery right now, with demos canceled, shoppers wary of picking up products that they may not want to buy, and stressed customers trying to avoid each other. However, anxiety levels may go down as people see that stores are implementing measures to keep them safe, she predicted.

“As thisbecomes the new normal, I think people are going to adapt their behaviors and spend more time at the store and look for new items.

“Also as people are home and in front of the internet more, there is an opportunity to do facebook ads, do geotargeted ads for people in line waiting to get into the store, so while there are challenges, there are opportunities.”

'The nice thing about being a manufacturer is that you can pivot more quickly'

Going forward, Undercover is planning to bring some more value-oriented products to market and experiment with different pack sizes, said Levy.

"The nice thing about being a manufacturer is that you can pivot more quickly."

All Undercover Snacks' products are school safe, and free from key allergens including wheat, peanuts, tree nuts, eggs, soybeans, fish, shellfish, sesame and poppy seeds.

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