Coffee Republic: Sahar Hashemi
She brought coffee bars to the UK and swore never to do it again - but now she's back
“There's absolutely no way I'll start another business.” That's what Sahar Hashemi, co-founder of coffee shop giant Coffee Republic, used to say.
Convincing a nation of tea drinkers they actually preferred coffee and building a £30m-turnover business was more than enough for Hashemi. After exiting in 2001, she jotted her bestselling business book Anyone Can Do It and was happy enough telling her story on the entrepreneurial speech circuit and with the occasional TV appearance. But guess what? Like a caffeine addict failing to resist the lure of a frothy cappuccino, she's back for a second hit. This time she's out to convince the UK consumer it's okay to eat sweets and cakes, providing they're from her sugar-free Skinny Candy range.
“I honestly didn't plan to do it again and there was no way I was looking for another idea,” insists Hashemi. “But I guess the desire crept up without me realising. I'd written the book and was talking to people everyday about our story and about what it takes to be an entrepreneur and it kept the flame alive.” So when last Christmas an idea came knocking, sub-consciously at least, 37-year-old Hashemi was back in the zone.
By January, she was researching the market. By March she was sourcing suppliers and trying samples. Seven months on, Hashemi is trialling Skinny Candy's first products in Coffee Republic stores and is in talks with the likes of Harvey Nichols and Selfridges about stocking her products before the end of the year. Debt finance is also in place to support roll-out.
“The idea was very simple: I've got a sweet tooth but I'm always trying to manage my weight – and I know a lot of people who are the same,” says Hashemi. “It struck me that while there were companies making sugar-free sweets that you can find in health shops, it was a very fragmented market and no one company was doing it under an attractive brand or making it accessible.” Skinny Candy is targeting the higher end of the mass market through high street stores and will be priced at 99p for a 40g bag.
Despite record levels of obesity the UK consumer has, perversely, never been so interested in diet. While we continue to guzzle gastronomic nasties, programmes such as You Are What You Eat fly high in viewing figures and book charts. Food manufacturers too are more than aware of the need to cater for low-fat, low-carb, low-calorie or low-sugar fad diets. However, with knowledge has come media scrutiny and cynicism of what appears to be good for you and what actually is. There's a growing belief for instance that replacing sugar with chemical substitutes such aspartame has little tangible health benefit, pouring scorn on many ‘sugar-free' labels.
Hashemi is more than aware of the need for Skinny Candy to stand up to nutritionists' high standards. “Sugar is the biggest of all evils and that's the one we've looked to cut out,” she says. “But unlike other products we're not going to just replace it with fat, chemicals or aspartame.” Instead, Skinny Candy products contain Maltitol, a sugar alcohol made by the hydrogenation of maltose, which is obtained from starch and has been better received. While containing carbohydrate, it counts as no ‘net carbs', a massive appeal for low carb as well as low fat dieters – a combination that has the potential to be extremely lucrative.
“The idea is that our products are all-rounders for people who want to manage their weight,” says Hashemi. “For instance, for our muffins we could have just filled them with fat as that's not an issue if you're on Atkins, but we want to appeal to a wider weight-conscious consumer group.”
Developing a product range
Hashemi is just as passionate her goods must taste great – a hurdle many health or diet foods fail to overcome. “There's a belief that anything diet, light or sugar free doesn't taste as good as the real deal and that's my biggest challenge,” she acknowledges. It's an obstacle even the multinationals have struggled with, as proven by Coca-Cola's decision to rebrand its ‘diet' carbonate drinks Lilt and Fanta as ‘Z' for zero sugar.
For Hashemi it's simply a case of getting people to sample the goods. “I'm absolutely confident once people try them they'll like them and that's why we've started trials – it's all about getting the word out.” Hashemi has chosen the slogan ‘Guilt Free' and has boldly selected launch products clearly recognisable as ordinarily healthy no-goes. In addition to chocolate, banana and carrot muffins there are Fruit & Nut, Jelly Gums, Jelly Bears, Cola Bottles and even Smart Ms. Hashemi's confident the names are different enough to keep Cadbury Schweppes and Nestlé's lawyers off her back, but admits she's gambling on her products tasting as good as the Real McCoy.
With Coffee Republic, Hashemi, along with her brother Bobby, famously transferred an idea from the US to UK with startling effect – but despite choosing to enter another market traditionally dictated by the weight-obsessed US, she insists this time she's looked to Europe for inspiration.
“I haven't been to the US for a long time and to be honest there are more companies in Europe producing the types of products we're looking to sell. When it comes to sugar-free, they're a lot more advanced and have products such as jams, and Belgian chocolates that we'll look to introduce,” she says.
Small business mindset
The great success story that it was, Coffee Republic taught Hashemi a lesson she's determined to apply second time round. “Bobby y and I thought that once you reached a certain size then you needed to act like a big business and withdraw entrepreneurial control and let managers run the company – but we were totally wrong,” she says. “We did that and much of the spirit and entrepreneurial belief we'd built was lost.”
Instead, Hashemi says she's determined to build the same mindset of a small business and then keep it. To help stoke those fires she's brought in two of her former backroom team. “I'm deliberately not setting any grand targets,” she adds. “I want osmosis growth where it's steady but there's no limits and everyone can get excited about what might happen.”
The first step in that process is to establish the brand and start spreading the message. It's here Hashemi has to put into practice one of the golden rules she's been preaching to budding entrepreneurs for the past five years: believe in yourself and your product. “I'm back at square one,” she admits. “It's a case of saying ‘this is my product and I might be its first and only customer but I believe in it.'”
She admits her status and reputation has already opened doors, however. “I'm obviously giving it everything I can in PR and handing out sweets and muffins everywhere I go, but why shouldn't I?” she laughs. “After all, you've got to practise what you preach.” And it's working too. Hashemi's presence at London Fashion Week ensured there were Skinny Candy products in the Giorgio Armani goodie bag.
When Hashemi came up with the idea for Coffee Republic she initially questioned whether she had what it takes to start a business. And now she's out to prove she can do it twice. “The same rules apply except that this time I know them, well I hope I know them,” she says.
If you're not convinced by Skinny Candy as a business idea, ask yourself this: what would you have said if a brother and sister team with no entrepreneurial track record had told you 11 years ago that they'd revolutionise the British high street by selling coffee? As Hashemi's dramatic career U-turn proves, it's probably wiser to bite your tongue.