Freedom and Theland, a brand distributor with sales capabilities in more than 25 Chinese provinces, will setup a China-based JV to develop the Arnold’s Farm range of cereals and snacks across a wider capability of formats to cater for increasing Western tastes.
The Arnold’s Farm brand is one of the top three oat cereals on Alibaba’s Tmall International and is also sold in more than 4,000 outlets across China.
Under the agreement, Freedom will remain as the exclusive long-term manufacturer, while Theland will become the exclusive distributor of the brand in China. This will include both online and offline channels, and will in particular, leverage the integration between online and the ‘new retail’ strategy being developed by Alibaba.
The JV will own the Chinese language trademark for Arnold’s Farm and be responsible for sales and marketing of the range in China.
Increasing demand for Western products
According to Rory Macleod, Freedom Foods Group MD and CEO, the company has been selling into China for over five years.
In 2015, a similar JV was set up between Freedom and Shenzhen JiaLiLe Food Company (JLL) – the group behind one of the largest selling ready-to-drink beverages in China – to distribute Australia’s Own Kids Milk brand on the continent.
“We have a good footprint here in China and it is strategic long term partnerships like this with Theland that will help us continue our strong trajectory for driving our brands and products into China, supported by our unique supply sources and scaled manufacturing capabilities in Australia,” he said.
“There remains significant growth opportunity into the Cereal & Snacks categories in China.
“What we’re seeing is changing preferences and tastes from Chinese consumers who are increasingly looking to healthy Western breakfast and snacks formats as provided through Freedom Foods’s Arnold’s Farm range.”
Theland is majority owned by the Alibaba Group including Shanghai Yunfeng Xinchuang Investment Management Ltd, backed by Alibaba’s founder and Chairman Jack Ma, and Alibaba China Network Technology Co. The rest of the company is owned by management and the Pengxin Group.