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“We export to countries where we are not slowed by protectionism”

In the heart of the Grisons mountains, at over 1,400 meters above sea level, Reto Schmid produces what is probably the smallest Bündner Nusstorte (Grisons hazelnut pie) in the world – and with success! Since launching in 2014, La Conditoria has already exported to various countries, including Germany, the USA, South Korea, Russia and Japan. In the following interview, owner Reto Schmid tells us how the small company deals with protectionism and what the export business’s recipe for success is.

 

Opportunities of globalization: Reto Schmid produces small Bündner Nusstorten (Grisons hazelnut pies) for the world market
Opportunities of globalization: Reto Schmid produces small Bündner Nusstorten (Grisons hazelnut pies) for the world market

Reto Schmid, your company has recently begun to operate internationally. How difficult is it for you to export, to grow internationally?
International growth has been very successful so far. We’ve already exported to around ten markets since we started producing the small tartlets in 2014.
We also know that our product is good, and promises success. The challenge for us is that it’s not like anyone in the world is sitting around waiting for our small tartlets. We must carefully consider out strategy on how to approach individual markets and how we can enter these. An added difficulty is that we have reached our production limit; we’ve already had to turn some customers away. This year, however, we want to build a new production center where 20,000 tartlets can be produced per hour. Our capacity now is 20,000 to 50,000 cakes per day.

What challenges do legal clarifications pose when exporting?
As a small company, the legal requirements in the various export markets have already become a major challenge for us. These range from product registration in South Korea, to special ingredient regulations in Japan to the Food and Drug Administration in the US. For example, text on products in the US must be written with a particular font size; in Germany, we’re not allowed declare tree nuts as an ingredient, but have to use the term ‘walnuts’. It takes time to get the labeling right and for the authorities to approve the product. I was ready to throw in the towel on several occasions, what with all the different regulations we had to deal with. But my vision is clear: everyone on the planet should have the opportunity to eat a Bündner Nusstorte. So I look at my map of the world on which each country to which we export is marked with a small flag, and I say to myself: I can do this!

Are you experiencing protectionist measures with your export projects?
No, we have not encountered protectionism so far. We concentrate on the positive aspects of globalization. This is what all companies working in export must do.

Have you ever decided against approaching a new market because the trade barriers seemed insurmountable?
If it became clear that the barriers to entry in a particular country were very high and hard to manage, we would postpone this export project for the time being. We still have enough countries that we can open up beforehand.

Everyone on the planet should have the opportunity to eat a Bündner Nusstorte.

Which countries do you consider to present more challenges when it comes to market entry formalities and other local regulations?
It took a lot of effort on our part to export to the USA. Dealing with the Food and Drug Administration there is very time-consuming. We discussed everything with the testing center in detail and still received more than 100 pages of feedback from the first inspection; we hadn’t expected this. To give you one example, we had depicted a gentian on our packaging as a symbol of the Grisons mountains. This was not allowed in the US, however, because the flower is not part of the food product. The nutritional information also had to be worked out in much more detail for the US. Fortunately, we have an experienced export manager who supports us. 

How do you as a company go about tackling a new market or taking the next growth step in this market? What is the first thing to clarify?
For the German market, for example, we worked together with Switzerland Global Enterprise. We traveled to Zurich and discussed how to approach the project with the consultants. We cooperated to find the right business partners for sale of the product in Germany.
In other export markets, we’re mostly waiting for potential customers to approach us, due to our manpower and financial situation. To this end, we present ourselves at international trade fairs; ISM and Anuga, to be precise. At each event, we are part of the SWISS Pavilion and benefit from the umbrella brand of Switzerland. We’re convinced that we will draw the attention of potential customers via the Swiss stand. The rest takes care of itself. However, it's always important to me that my gut feeling is right, whatever the strategy might be.

What would be your main tips for SMEs – who typically have fewer resources for foreign projects – when it comes to growing internationally?
In my opinion, it’s quality that determines the chances of success; that’s the most important thing. We often hear from foreign customers that good quality is no longer easy to find, even if other countries are also producing good products. For export to be successful, the quality of a product has to be just right, be it on a technical or taste level.

About La Conditoria Sedrun

In 1965, Marcel Schmid founded a small bakery with a shop in Sedrun at the age of 18. Schmid's philosophy has always been “quality over quantity”. Back then, he employed one baker and a shop assistant. In 2004, the business was handed over to the second generation. Son Reto Schmid, a trained baker, patisserie chef and confectioner, has also undergone training in the commercial sector. In the fall of 2014, Reto Schmid launched the new food label “La Conditoria, SEDRUN-Switzerland®” and produces probably the smallest Bündner Nusstorte in the world. By producing in Sedrun, the company wants to contribute to the creation and maintenance of jobs in the mountainous region.

Aussenwirtschaftsforum 2018

Treffen Sie Reto Schmid und andere interessante Referenten am Aussenwirtschaftsforum am 26. April in der Messe Zürich. Holen Sie sich Tipps, wie Schweizer KMU im Spannungsfeld zwischen Globalisierung und Protektionismus wachsen können und tauschen Sie sich mit anderen Unternehmen aus.      

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