Sovos Brands to acquire Birch Benders as part of its 'one-of-a-kind brands' strategy

Speaking to FoodNavigator-USA, Sovos Brands' breakfast and snacking segment leader and EVP group general manager, Jason Vieth, explained how bringing Birch Benders​​ into the fold of the company aligns with the firm's history of acquiring distinctive, top-performing brands across multiple CPG categories.

To date, Sovos Brands has acquired three other trailblazing brands -- noosa yoghurt​​; Rao's pasta sauces​​, soups, dry pasta, and frozen entrees; and Michael Angelo's frozen entrees -- giving the firm a foothold in seven different categories, said Vieth. With the Birch Benders acquisition, Sovos' annual retail sales will be above $750m.

"The acquisition of Birch Benders is very exciting for us, because we’re now in seven very large categories. And in each of those cases, we have the most exciting brands in those categories,"​ said Vieth.

Vieth said that Sovos will combine Birch Benders and noosa yogurt into a "breakfast and snacking platform," ​with Vieth working closely with Birch Benders' president and chief operating officer, Rajesh Babu, to successfully integrate the brand into Sovos and drive additional growth.

"Birch Benders will be run for the foreseeable future under its existing team infrastructure,"​ Vieth said. "We don’t have any intention of rapidly changing this brand or this business, except to make it more available by getting to more retail destinations."​

Sovos Brands, the new Amplify Brands?

Sovos Brands is developing an impressive track record of middle-market brand acquisitions that Dr. James F. Richardson, author of Ramping Your Brand​​​, compares to the earlier days of Amplify Snack Brands, before it was acquired by The Hershey Company in 2018 for $1.6bn.

"Anyone who has studied the data on the journey from $100-$500m in food and beverage knows this is where many 'success' stories hit a wall and start declining in unit volumes,"​ Richardson told this publication.

"Sovos is involved in an important experiment. It is the new Amplify Brands; a private organization aggregating lower middle market brands that have scaled and creating an organization focused on growing them according to the needs of CPG brands in this difficult phase. But will they make the bold investments that marketing academia knows will work?"​

The most important being a modern blend of paid and earned media, said Richardson.

"Not investing in the latter is the primary cause of under-performance in this phase of growth, and it is simply crucial to building household penetration in an oversupplied market. Relying on %ACV (all commodity volume) growth and line extensions alone has not proven to work for the majority of brands in the nine-figure range."​

Birch Benders' appeal across dietary micro-segments

Birch Benders has further proved its value to households throughout the pandemic, said Vieth, who noted that consumers are finding new inspiration when it comes to breakfast. 

"First and foremost, people aren’t going out as much to work and other locations, so they’re consuming breakfast more often in the household. And as they’re doing that they’re looking for new foods to bring in so that they’re not eating that same boring meal each day. Pancake mix has really benefited as a result of that,"​ noted Vieth.

Birch Benders' differentiation is that the brand allows consumers to enjoy homemade pancakes and waffles more often with its paleo, keto, and plant protein SKUs while bringing new consumers to category with its distinctive branding, noted Vieth. 

"It’s a fun, imaginative, and whimsical brand that has allowed Birch Benders to micro-segment. They’ve been really able to attract consumers through the power of a really fun and interesting brand that delivers exactly the food that consumers in each one of those dietary preferences are looking for,"​ he said. 

Speaking to Babu of Birch Benders last month​​, he shared how the brand has continued to launch new products this year that further fill consumers' needs, including the launch of microwaveable keto pancake and muffin snack cups and keto toaster waffles, which have 6g net carbs for two waffles (compared to existing options with up to 30g net carbs for two waffles).

“We’re seeing an explosion of growth of people who are new to the category. Food is the first level of comfort. People turn to food especially during times like this, and we’re seeing our role in the household change a lot,”​​ Babu previously told FoodNavigator-USA.

Expanding retail depth

Now in over 19,000 retail locations, Birch Benders has successfully landed in a number of major retailers including Target, Whole Foods, Albertsons/Safeway, Kroger, Sprouts, Walmart, and others. Now, with support from Sovos, the focus will be on expanding the depth of its product assortment in the retailers the brand is currently in and continuing to reach new consumers, said Vieth. 

"We believe the wealth of experience and resources of the team at Sovos will allow us to reach even more consumers with our delicious, innovative, easy-to-make offerings made with nutrient-rich, quality ingredients,"​ commented Matt LaCasse, Birch Benders' founder and CEO.