Many people in the food business spend a lot of time looking for the trends of tomorrow, but Adnan Durrani has the gift of finding them.
In the early 1990s, he founded Vermont Pure water, one of the nation's first bottled water companies. Durrani recalls a soft drink company CEO telling him at the time that he was wasting his time and money. After all, consumers buy soda. Today, bottled water is Americans' beverage of choice, with 72% saying it is their preferred nonalcoholic drink, according to a 2018 poll by the International Bottled Water Association. Vermont Pure became part of a larger company that was bought by Cott for $35 million in 2018.
Through Durrani's Condor Ventures, he invested in organic yogurt juggernaut Stonyfield Farms in the mid '90s. At the time, Durrani heard several naysayers telling him Americans would never catch on to yogurt. In 2001, Danone took a 40% stake in the company, and doubled that to 80% in 2004. The brand was sold to Lactalis in 2017 for $875 million.
Durrani's newest company, internationally inspired Saffron Road, is following the same path to success. The brand started 10 years ago. This year, Durrani said, sales are expected to be around $50 million. About 85% of the company's sales are in meals and culinary items — frozen and shelf-stable meals, sides and hors d'oeuvres, simmer sauces and broths — with the rest in snacks — mostly crunchy chickpeas. Saffron Road's products are available nationwide in about 25,000 grocery stores, including 4,300 Walmarts.
Durrani found his inspiration for the venture in the same places he's always seen it: European trends and a keen eye for what U.S. consumers want. He noticed Europe had several high quality natural food brands, which were also certified halal. In the United States, he said, no brands filled that niche. And while there are many providers making artisanal and natural food, the lack of halal certification — which ensures Muslim consumers that food products meet religious standards — was a problem.
"Here I saw a very strong, very wealthy, very educated American Muslim demographic that had zero options for halal," Durrani told Food Dive. "So you have 4 [million] to 8 million Americans in the U.S. that have no dietary options around halal foods. And very educated: over $150 billion in buying power, $30 billion in food alone. So we have tremendous opportunity for demand with zero supply, which is, you know, a marketer's dream. So that's kind of the beginning of how I thought of Saffron Road."
But to say that Saffron Road is just halal food is only one dimension of its appeal. Many of its products are Non-GMO Project Verified, organic, kosher certified and from antibiotic-free animals. The company is dedicated to sustainable livestock and farming. And the ingredients, the products, the flavors are all as authentic as possible.
"Our model was never based just on the halal consumers. It was based around developing values around what halal meant to us in terms of a higher value system around what I call ethical consumerism," Durrani said. "Probably 85% of our consumers are not even halal consumers or American Muslims. They're really natural organic consumers that really are inspired by our halal values around clean label."
During the coronavirus pandemic, Saffron Road's sales have remained strong. According to statistics from the American Frozen Food Institute this week that the company emailed Food Dive, the frozen food segment was the fastest growing in the grocery store during the week of March 29. Sales were up nearly a third in dollar sales and generating nearly $300 million more than the comparable week a year ago.
Durrani told Food Dive if the company continues on its current path, he sees business doubling to $100 million in sales by 2025.
Millennials and authenticity
Durrani said there are many food brands today that are authentically inspired, but aren't necessarily authentic. Saffron Road takes the extra step to be truly authentic, he said.
From its exotic name to its deep sourcing, Saffron Road has taken care to make its brand synonymous with authentic international flavors, Durrani said. The company name was inspired by the ancient trade routes known as the Silk Road, which connected South Asia, China, the Middle East, East Africa and Southern Europe. Of the many items traded along that route, the main spice was saffron — the pricey Asian flavoring and coloring staple.
"I thought, wouldn't it be nice if we created a brand with that kind of real cuisine imagery about this feeling and product? And at the same time, brought in artisans from all over the world that really bridge cultures, bridge faith, bridge ethnicities — sort of bring out the commonality and celebrate the best of all of those cultures," Durrani said. "So that was kind of the metaphysical thinking around Saffron Road."
"Probably 85% of our consumers not even halal consumers or American Muslims. They're really natural organic consumers that really are inspired by our halal values around clean label."
Founder and CEO, Saffron Road
While millennials are a huge consumer force today — slated to represent 30% of all retail sales in the United States, up to about $1.4 trillion a year, according to Accenture — many CPG companies weren't thinking much of the demographic group a decade ago. But Durrani knew that group was the best avenue for his brand's growth, and placed a lot of emphasis on Saffron Road's appeal to millennials.
It's worked well, since millennials make up more than half of its consumer base, Durrani said. Millennials tend to spend more of their income on natural and organic products. Despite what is often said about their demographic, millennials are very brand loyal — as long as brands know where and how to speak to them. Durrani said Saffron Road indexes higher with millennials than any other frozen ethnic food brand. And to show it, he described some internal Whole Foods findings about millennial consumers he'd received. Four out of five consider quality a top factor in deciding what to buy, and more than two-thirds will pay more for them.
Durrani said that being part of food tribes — uniting consumers through adventure, dietary needs, multicultural flavors and sustainability — is important to millennials. This group of consumers finds deep emotional connections with brands that share their values.
"Today, smaller brands like us are being very disruptive because of this tribal affinity — especially among millennials — and the social identity that tribal affinity creates," Durrani said.
Saffron Road goes to great lengths to bring that adventure and global culturalism to consumers. The brand's Indian meals — including all components in them, like basmati rice and chickpeas — actually come from India. Its Thai products have curries made in Thailand and noodles from Singapore. The Mexican entrees were designed by Gabbi Patrick of Gabbi's Mexican Kitchen in California, and Durrani said trace their origin to the more traditional cuisine of the country.
"It certainly means that the production cost is a lot higher for us, but that's part of what we think our calling is: to really bring that authenticity," Durrani said.
Durrani told Food Dive in an email that authenticity may cause supply problems as the global pandemic continues. The company ramped up its supply earlier in the year, increasing inventory by 50%. But potential port and factory closures around the world could put the squeeze on more of the imported components on which the company depends.
Some facilities in India are being shut down as the entire nation is in the midst of a lockdown. Durrani said there are delays at many ports. On the West Coast, it currently takes an additional four to five weeks for imported goods to be processed. The supply chain team, Durrani wrote, is working to get some of the more premium special ingredients prioritized for import — a vital step because of the "artisanal nature of our epicurean entrees."
Ethical food and future growth
Getting certifications that resonate with ethical consumers has been important to Saffron Road from the beginning.
Durrani said when the brand started in Whole Foods stores 10 years ago, the natural grocery chain had no other frozen entrees with antibiotic-free meat. In 2013, Saffron Road introduced the first Non-GMO Project Verified frozen entree in the United States.
But the halal certification was a big one for the brand to get, considering the opening Durrani saw in the market. For meat products, halal certification mostly has to do with humane animal treatment and slaughtering practices, and is very similar to kosher certification.
"It's done in a very mindful way," he said. "It's hand harvested. There has to be a blessing when the slaughter occurs of the animal. So it's all done in a very slow, mindful process. In other words, we never do any factory farming. Everything is done by hand."
While it was challenging at the beginning to find suppliers, Saffron Road's emphasis on humane, clean and sustainable food made it easy to work on converting some to producing halal food, Durrani said. The company was only looking for humanely and ethically raised livestock. Some suppliers — including Amish chicken farmers — only needed to make minor changes to what they were doing in order to meet halal certification requirements.
In the decade since Saffron Road started, several other food manufacturers have started to pursue halal certification, Durrani said. This makes sense, since the global halal food market was worth $1.4 trillion in 2017 and expected to grow to $2.6 trillion by 2023, according to Statista. But, he stressed, the brand isn't competing with small niche halal brands. Saffron Road's competition in frozen food is Big Food-owned titans that don't have halal certifications, including Nestlé's Lean Cuisine and Conagra's Healthy Choice.
"Today, smaller brands like us are being very disruptive because of this tribal affinity — especially among millennials — and the social identity that tribal affinity creates."
Founder and CEO, Saffron Road
The brand is definitely winning over consumers at retail. According to statistics the company provided to Food Dive that came from SPINS and IRI, in the last three months of 2019, Saffron Road's growth rate at regular grocery stores was 42.3%, dwarfing the 0.9% growth rate in the overall frozen entree segment in the same time period. Its growth in 2019 outpaced top independent and Big Food-owned frozen brands.
Given the success and important niche that Saffron Road occupies, Durrani said there has been interest from larger companies that want to make it a Big Food brand. While he said he listens to that interest, he's not looking to make an exit from this brand until it gets to $100 million in annual sales.
In the frozen segment, Saffron Road has had its challenges, but Durrani said they were mostly because when the company started, there had been very little innovation in frozen food. Today, with frozen food being hot and authentic global tastes winning over consumers, Durrani said the way forward is clear.
"At the present time, we're pretty happy on the path that we're on," Durrani said. "And obviously, if we partner with a CPG, we could accelerate that growth to $100 million very quickly. But at the same time, our team is very inspired with what we're doing and the success that we're seeing, especially this last six months. And I think we're going to see much stronger success this year and next year."