How detailed market research made Pride Valley Foods’ products a success

Hossain Rezaei explans why marketing is about knowing your customers

Pride Valley Foods was founded in 1990 by Hossain Rezaei. The firm supplies speciality breads to some of the biggest suppliers in the country including Tesco and Marks & Spencer. Based in Seaham, County Durham, the business now employs 250 staff and has, on average, doubled in size every year. Pride Valley is expected to turnover £20 million this year.

Rezaei attributes his success to research and planning. Before he launched the business, Rezaei researched the market and made sure that his product would be a hit with customers.

Rather than making the product and then selling it to retailers, Rezaei went to the customers to find out breads they would buy. “People think that marketing is selling. It isn’t. It is finding out what the customer wants and selling it to them,” he said.

Rather than finding out what the supermarkets wanted to buy, Rezaei went straight to the customers and carried out detailed research on what they expected from a naan bread. Armed with detailed market research, Pride Valley was in a position to go to the major retailers and say this is what your customers want. If you have the research to back it up, they can’t not put it on the shelves, said Rezaei.

This research is all about marketing your product, he says. “It is finding out what the consumer wants, making it and then they are bound to pick it up.” You can’t sell a luxury item to someone who doesn’t want to pay for it. There is no point in trying to sell a cappucino for £3-00 to someone who wants a plastic cup and a coffee for 25 pence, he added.

While Rezaei had the financial clout to carry out some extensive research, it doesn’t need to cost a lot. It may simply be a case of adding a couple of weeks to your start and having some friends or family standing in the high street observing what is selling and what is not.

“It is the cheapest thing to do and it is the most important thing to do,” he added.The cost of setting up a business can run to thousands of pounds and if it is going to be the main source of your income, how can you afford to start without having done the research.

Once he was certain of that the product would find favour with the customers, Rezaei then started to plan the company’s growth. To do that, he used a tick tree.

Starting from the first branch on the tree, Rezaei borrowed a small amount and built the business gradually. Each of the steps must be completed on time and within budget. He illustrated his approach with a household example. If you want to decorate a room in your house, you plan a timetable outlining each of the steps. The first step is to remove the furniture. Then have another person to help move the furniture and a place to move it to. You may need to budget for removal costs, for example – £50 to hire a van and the time it will take to move the furniture. Only then can you move on to the next stage.

With Rezaei’s business, the figures are larger but the principle is the same. “You have to borrow £10,000 and then deliver what you said you would do. When you have done that you can back and borrow more. A lot of people fail because they go straight to step two or three and they haven’t got the track record, the experience or the market knowledge,” he says.

This careful planning also ensured that when Pride Valley’s factory was destroyed by fire and insurers initially refused to pay out on the policy, Rezaei kept the business on track. While keeping sight of his original plan, Rezaei moved back to old premises, handed customers over to competitors and went back to his backers with an emergency plan. Within six months, his business was back on track because Rezaei planned a series of steps to get back to his original plan.

Rezaei believes that any business will succeed or fail on the basis of the three C’s – capital, character and capability.

What he didn’t add to the list was careful planning – but this was undoubtedly the key to the success of Pride Valley Foods.

You can’t sell a luxury item to someone who doesn’t want to pay for it. There is no point in trying to sell a cappucino for £3-00 to someone who wants a plastic cup and a coffee for 25 pence.

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