Conscious Condiments
Despite always being interested in entrepreneurship, it wasn’t until a trip to a retreat in Thailand that CEO and co-founder Daphne Hedley stumbled upon the right idea and Mekhala Living was born. 1600 stores and 6 countries later, we chat to Daphne about the journey of starting the certified vegan and organic Asian condiment business. We also discuss the process of getting a factory up and off the ground, the brand’s approach to expansion and distribution, their social commitment and some of the biggest challenges in the journey so far.
As a brand, Mekhala stands as a Singaporean / Thai food company focussed on producing certified vegan, organic and gluten-free Asian cooking sauces and condiments; a company that also has a strong social commitment to empowering Burmese Shan women seeking refuge in Northern Thailand. But before diving deeper into the business, like with many of our guests we wanted to understand what personally brought Daphne on to this journey of entrepreneurship?
Daphne: “My father was my inspiration. He was very enterprising and you know, most of my extended family kind of do their own thing as well so I’ve always wanted to start a business.”
Daphne: “The right idea never came along and then my father passed away, so sticking to finance to support my family seemed like the right thing to do.”
Daphne: “But in 2008 the financial crisis hit … then I got married and decided finance wasn’t what it used to be and wanted to make a difference. I met Jang at the retreat, my cofounder, and it was a eureka moment.”
It was then that the pair decided to start the business as a retail store in Singapore, similar to existing chains like Muji with an emphasis on sustainable homeware and some food.
Daphne: “Unfortunately Jang fell ill quite soon after we started the store and we had to pivot because she couldn’t design and get all of that stuff done anymore, so we decided to focus on food.”
Daphne: “We ended up being a food brand after Jang passed away and my sister joined the company, and we’ve been running Mekhala together ever since.”
The brand started out South-East Asian condiments from Thailand, but soon realised that there was more ground they could cover, especially when it came to East Asian flavours.
Daphne: “Being Chinese, cooking Chinese food and having lived in Japan, my sister and I felt that there was definitely an opportunity there as well.”
But for a lot of us who enjoy using Asian condiments, we know just how many options there are. So how is Mekhala different from what’s already on the market, and how do they position themselves relative to other products? The key lies in their certifications.
Daphne: “Asian organic condiments and sauces were unheard of and a lot of Asian condiments have lots of sugar, lots of fillers, so we made sure we didn’t do any of that.”
They also make sure to use fresh ingredients, for example using lime juice instead of citric acid.
Daphne: “So when we pitch to investors and customers, it has to be a combination of things.”
Daphne: “It’s obviously the flavours number one, how clean the ingredients are (getting certified organic was a big thing) and ease of use… plus the fact that we have a strong social angle.”
This social commitment predominantly lies in the empowering of illiterate Burmese Shan women, as well as children through a collaboration with Daphne’s cofounder Jang’s non-profit School of Hope.
Daphne: “In Northern Thailand the Shan are a minority from Burma so they come to Northern Thailand to escape persecution … they’re kind of illegal workers so to speak, but it’s a very common practise that they work.”
Daphne: “When we started looking for factory workers we were turning them away from operational jobs and I came across this article about the Dabbawalas, the Indian tiffin delivery men, and they are illiterate and follow this colours and symbol system and they make these thousands of lunch deliveries. So we thought we would create something similar so that they could follow the symbols and colours.”
Daphne: ”The School of Hope is a school for underprivileged Burmese-Shan children who are usually orphans or from impoverished Shan families.”
Daphne: “The children tend to be older when they come to the school, so they could be 18-20 years by the time they finish high school.”
Daphne realised that the children needed funding for activities that they could do during their breaks between school and classes, but that what they were currently spending time on wasn’t economically viable for them and catered mainly to tourists through art and craft skills.
Daphne: “The Thai government also doesn’t offer work visas for Shan people unless a company is willing to sponsor them, and most companies won’t do it since it’s cheaper and easier to hire them as casual illegal workers. So we decided why don’t we offer them an internship program when they hit the age of 18.”
Daphne: “We’ve already had six cohorts, so we run it twice a year; we get 6-8 of the students and rotate them through all of the different parts of the factory. We’ve hired 2 - Cathy and Moon.”
Daphne: “I love this aspect of it - the social commitment. You see these kids are intelligent, they’re often scarred, they don’t speak much, they don’t socialise outside of their little circle, and it’s great to have them on our team.”
We also spoke to Daphne about what the process was like for getting a factory up and off the ground. Located in Chiangmai the team started in a small facility, however when they began expanding to the US market had to scale.
Daphne: “We’ve moved to a much bigger facility; it’s still not a multi-million dollar complex, but it’s a proper production space with FSSC certifications.”
Daphne: “There are a lot challenges of course, but we had to do it because nobody was producing certified organic and so when we first started we either had to do it ourselves or we couldn’t get certified.”
I was curious to learn more about the process of certification. Now ‘organic’ seems to be a booming category, with new products on shelves left, right and centre; what was Daphne’s experience of getting accredited, and did she have any words of warning for founders wanting to do it?
Daphne: “We are certified by European, US and Canadian standards - they have a national organic oversight vs Australia where it’s private agencies that certify companies … our suppliers have to be certified as well so they follow a strict set of rules about what chemicals can be used in the growing and processing of materials, how long the land has to lay fallow if chemicals have been used prior to them going organic etc … the whole process is audited so agencies come to the factory once a year to make sure we’re doing it right.”
Daphne: “There’s so much detail involved, but I think once you get it in place … you’ll be okay.”
The fact that different countries have different rules and regulations around organic practices, coupled with the fact that Mekhala is an international brand then raised the question of food regulations more broadly and whether or not they are a challenge to navigate.
Daphne: “I think it is challenging; when you think about scaling up I guess tech companies don’t face the same physical barriers and real-life barriers which is good for us I guess once we’ve established ourselves, but every country has their own regulations.”
Daphne: “Being vegan has obviously been a plus because in terms of food safety we don’t use eggs or meat which tend to have stricter regulations so that helps us.”
Daphne: “We have to make sure our labels meet the local regulations in terms of organic; there’s also different types of standards. For example we have had a lot of interest in China, but China doesn’t accept organic standards from anywhere except China.”
Daphne: “You just need to figure out which markets are the easiest to access and the most ready for your product - that’s how we make our decision.”
Daphne mentioned how she’s also had interest from distributors in both Korea and the Maldives about stocking Mekhala’s products - however the market there is small and the company just wasn’t ready for it.
But in the markets that the brand is ready for, what’s the approach to getting stocked? Is it finding small retailers, or going for larger, more well-known and established chains?
Daphne: “We generally don’t try to start with a big chain, mostly because they don’t really give you much time of day if you’re new and also they usually ask a lot of listing fees and you have to have the distribution.”
Daphne: “For example when I decided that the US would be the market for us to enter by 2017 we started on Amazon; we basically put our products up there to see if customers would buy it, get reviews and ratings and then we started with really small accounts.”
Daphne: “Then the buyer for Whole Foods found us, and they contacted us and she said she was interested, so that was unbelievable.”
Daphne: “Usually from that point you end up with a big distributor and it gives you access to other different chains and regions, but it’s still pretty much about getting the right people on the ground who have relationships to help you present your brand.”
Daphne: “It would be great if we could do it ourselves … obviously in the last year and a half we haven’t been able to.”
Towards the end of our conversation we also covered some of the larger challenges that Daphne has faced on her journey so far.
Daphne: “When we started I had no idea how to run a food business, or any business to be honest … so little challenges became huge challenges.”
Daphne: “Jang got cancer and that was one of the biggest challenges for us I suppose, and then she passed away so I lost my business partner, my friend, and having the right person to build a business with is crucial and just deciding if we would continue.”
Daphne: “Ever since then every challenge is seen as a part of running a business and you just take it as it comes.”
And understandably after having to go through a set of difficult, emotionally challenging years, the strength to keep going has resulted in ripples made in Daphne’s philosophical approach to future expansion.
Daphne: “I have big ambitions - we didn’t start the business of ‘oh we’ll have one store and then we’ll see how we go’, it was never about that. But I’m aware of the category we’re in - it’s not a high velocity product. I’m also not the type of person who believes if you throw money at something, you’ll get results - so I’m cautiously ambitious.”
Daphne: “I think we can be the biggest brand in our category - we’re planning to branch out into something new but still similar to what we’re doing that if that works then we can scale and grow a lot quicker.”
The reveal came at a perfect time as Daphne mentioned that her and the rest of the team at Mekhala have been working on a line of new meat alternative products.
Daphne: “It will combine our vegan and organic sauces and pastes, with these plant-based meats so people can cook these delicious high-protein, meatless Asian dishes at home.”
To learn more you can head to Mekhala’s website here, or follow them on social media.