Hain Hurting in the UK

I bet one could go the entire day eating only Hain Celestial Group foods and still eat a well-balanced diet. Hain, as I’m sure you know, owns more than 40 natural brands. One could start the day with Celestial Seasoning tea, Breadshop cereal and Rice Dream Milk. For lunch, a sandwich made from Arrowhead Mills bread and MaraNatha Almond Butter, and an Imagine Foods soup as a side dish. An afternoon snack of Garden of Eatin' chips or Boston’s kettle-popped popcorn may help a consumer make it through the workday, so he can sit down to a frozen pasta dinner from Rosetto.

With so many brands, I always thought Hain was a big-business machine making a ton of money. While I’ve never heard anyone say Hain Celestial too closely mirrors conventional companies with their power and influence, I wouldn’t flinch at that argument

It seems to be doing so well to me (especially when I personally buy a lot of its products), so I was startled to see an article in just-food by Dean Best that discussed how Hain Celestial is struggling in the UK. The U.S.-based company has never made a profit there, but still it isn’t giving up. I found it interesting to be given the inside scoop on the interworkings of Hain’s business ventures.

In a move to expand the business overseas in 2006, Hain Celestial bought food business from Heinz, the Linda McCartney brand and Haldane Foods, all of which are U.K.-based companies. However, four years later, the article said it still has not made a profit across the Atlantic. The article noted Hain lost its private-label contract with Marks and Spencer, as well as a co-packing deal with Heinz. This year, it was forced to close its sandwich supplier Daily Bread production site in London, and move it to Luton.

However, Best said Hain’s board still feels it will see UK profits next year, and just recently acquired Churchill’s, a UK food-to-go business.

Best spoke with Peter McPhillips, executive chairman for Hain Celestial Europe, who joined the company in the summer of 2008. McPhillips told Best Churchill’s will add to its consumer base, and perhaps make up for the Marks and Spencer loss. Churchill’s, like Marks and Spencer, is a private-label sandwich supplier, so the article noted the Daily Bread business should be able to transfer to the new contract.

McPhillips said in time, Churchill’s should supply not only private-label sandwiches to retailers and the foodservice sector, but also offer finished, branded products. Tesco stores in London already sell bagels and other bread items under the Daily Bread line, so the article said McPhillips expects more growth in this area.  Besides, he noted, staple products are still selling well, and people still want to eat sandwiches for lunch.

Other areas McPhillips said he sees potential for UK growth are the Linda McCartney meat-free brand and private-label frozen desserts. He also predicted the acquisition of several brands, all of them organic, natural, healthy foods or personal care areas.

I like Hain products, so I wish it well it its UK endeavors. And maybe, next time, I won’t assume a company is successful everywhere just because I see them all over my grocery store.