Tiffany Loh & Jenna Hanson: Why did you set up Bondi Chai?
Martin Buggy: We wanted to escape the “hours for dollars” scenario typical of consultancy work. Over several years, we had mapped out in some detail our “ideal lifestyle” which included lots of travel, living where we chose to live, working together and from home, and funding our lifestyle from income that didn’t rely on our full-time input.
We felt that we needed a business with low-risk/low-cost entry that was based on a product or service that met a deep-seated need across a wide demographic, had strong competitive advantages and with an uncomplicated, systematic supply chain.
After three years’ experience as the Oceania agent for a US brand at a time when chai latte was virtually unheard of in Australia, we began to see that chai latte could tick all the boxes.
TL & JH: Why did you decide to go into supermarkets instead of staying boutique?
Martin: We’ve never seen Bondi Chai as a boutique product. Indeed, from the outset we wanted Bondi Chai to become a product with strong national and international presence, which is one of the key reasons we chose the globally famous name, Bondi.
We began our ‘supermarket project’ after five years of concentrating almost entirely on food service, and in the days immediately before our launch into supermarkets someone was ordering a Bondi Chai Latte in a café somewhere in Australia every four seconds.
Having established a strong food service base, increased brand awareness became our next focus. We knew that creating increased brand awareness would create increased demand for home-consumption of our product, so making retail product readily available was important and supermarkets offered the best solution. With 20 million customers a week, presence in supermarkets also significantly added to our brand awareness efforts.
We had then, and still have, a philosophy of working with anyone who wants to work with us.
TL & JH: How has this move changed your business?
Martin: Firstly, it made us much more worldly-wise in the food industry. We’ve learned a lot – about the machinery of the supermarket industry, about those who drive it, and about supermarket shoppers.
Secondly, giving consumers easy access to our product as we began to lift its profile gave us the platform on which to build brand awareness. A Danish would-be distributor contacted us to negotiate distribution in northern Europe only after ringing a friend in Australia to ask what she knew about Bondi Chai. The response she got was all she needed to hear: “Bondi Chai? That’s the most famous chai latte in Australia!”
TL & JH: What sets your business apart from its competitors and how do you do this?
Martin: The milk-soluble formula and premium quality ingredients of our product have seen it become the most awarded product of its kind in Australia. For café owners in particular, Bondi Chai is the lowest cost-per-serve product of its ilk, is quick and easy to prepare, almost sells itself, and achieves incredible customer loyalty.
TL & JH: When you started, what were the first big goals you set yourself and did you achieve them?
Martin: Our first big goals were to sell one tonne of our product a month and get some export business established. We achieved the first goal within two years by simply calling on food and beverage distributors who were willing to listen to us. We had then, and still have, a philosophy of working with anyone who wants to work with us.
We achieved the second goal in the same period by getting an award-winning graphic design company to build a great website and ensuring that the site was Google-friendly. Our website brought us inquiries from all over the world – and still does.
TL & JH: What keeps you passionate about your business?
Martin: We’re excited by the seemingly endless opportunities – both to expand the market for our existing product and to develop new products and formats. After 14 years of involvement with chai latte, we are still amazed at how many people still ask us: “what’s chai latte”? That excites us; it shows there’s still so much opportunity to grow.