From Local to Global: Candy Export Success. A story of a brave Ukrainian sweets producer.

Speaker A: 1, 2, 3, 4. Hi, I'm Dmitro Shwyc, your host at the Start Global Insights, where I interview experts from different countries about local business secrets and international expansion experience. This episode is devoted to the story of a small Ukrainian family company, a candy producer that managed to expand globally. The company chose not the easiest markets for its first steps, such as USA and Japan, and succeeded there. And in my opinion, this success is largely due to the personality of the company's CEO and owner, Olena Tokar, who will share today with us her story and tips on international expansion. Hi Olena, uh, and welcome to the show. Hi, uh, Dmytra, thank you for joining

Speaker B: us and I'm really excited to hear

Speaker A: more about your journey. Could you give a brief introduction of your company and its products and how did it all start? And how did you come up with the idea of selling globally?

Speaker C: Yeah, sure. The company was established in 2013 and it was very, uh, unexpectedly. I worked uh, in a media company for a long period of time and I was um, a co publisher of uh, a magazine that was uh, working with celebrities. So when you want celebrities to come to your event or just to give an interview or whatever, you need to give something interesting to them. Um, and I was always looking for some unique stuff, uh, just to bring to this event. Uh, it was some kind of a trade. I find something interesting, they come to my events. So it was pretty obvious how it works at the time. In 2013, uh, my daughter was uh, almost two years old and I decided that I want more freedom. And I saw that, like my business, it will give me my freedom.

Speaker B: One of the biggest mistakes of the, uh, beginners of entrepreneurship.

Speaker C: Yes. And actually all entrepreneurs, they really think that their own business, uh, will give them freedom. Well, to certain extent it's true. Yeah, I have some kind of, of freedom. But still you work like nonstop. It's 247 when you're an entrepreneur and

Speaker B: it doesn't really matter, then you are starting to have the most evil boss in your life.

Speaker C: Yourself, Yourself. Yeah, it's true. Yeah, it's true. Uh, wow. And I was looking for some business ideas. Me and my husband, we were like searching something, creating some kind of ideas, writing them down, and then sitting and seeing, okay, this idea is okay, but not really what we want. This idea is okay, but we are too dependent to people who will be involved in this idea. So it was pretty much of, uh, um, brainstorming all the time. And one evening I was sitting, searching something for my main, uh, job, uh, for some unique Things for the next event. And I jumped into to YouTube and it was a video there, like, Martha Stewart was, uh, rolling some big candy in the bubble, uh, store in New York. And inside of this huge candy, it was like a heart. And at the end of this video she told like, uh, we made heart here, but actually you can make anything you want, any text, logo, whatever. And it was like, uh, lightning for me was like, oh, my God. This is the idea that I need to bring to Ukraine. I know who going to be my customers because I worked with a lot of like, uh, advertisers and I know the market pretty well. And I was like, oh, my God, this is my idea. I want to make natural candy with lager inside of them. Um, I woke up my husband and told him, I got the idea, we're gonna make candy. And he told me, please go to sleep. I just want you to go to sleep at this particular moment. But I was all for it. I was, no, you need just to wake up and to listen to me. I presented the idea like in some kind of 15 minutes. And he told me. Okay, it sounds pretty.

Speaker B: The first, um, startup pitch was to your husband?

Speaker C: Yeah, the first startup pitch was for my husband. Yeah.

Speaker B: Okay.

Speaker C: And he believed in this idea. Actually, he believed in this idea. And my mom then believed in this idea. And my dad was like, candy, who can buy them? Um, what for? We have Russian, we have Avoca, we have other, like, giant companies.

Speaker B: And what was your, like, idea, uh, of decline? Uh, who should be declining? The normal people or the, uh, B2B, uh, segment.

Speaker A: So you wanted to.

Speaker C: The first idea was that it's going to be B2B, because I knew the market quite a while and I actually saw like. I don't know how to explain it, but I saw the whole way along and I saw my presentation. Whom I gonna pitch this presentation, who going to be my customers, my first clients, what logger types. I will like, put their brand names. I saw everything at that particular moment. And first of all, it was B2B. And then it was some kind of. Okay. And my daughter, she believes this candy because they will be natural and they want to make really good stuff. So. So this is how it all happened.

Speaker B: The quality control was your daughter.

Speaker C: Yeah, the quality control was my daughter. And then was the most interesting part. Okay, I saw this on YouTube video, uh, and it's great. And who gonna teach us to make this candy in Ukraine? So it was a long way. To make the story short, uh, we found a guy in Australia. He came to one month, uh, to Kiev. It was February. From Australia.

Speaker B: Okay.

Speaker C: From Australia.

Speaker B: Okay.

Speaker C: Yeah, it was like he was from Australia and he came here, like, in February. Uh, and for us, it was some kind of, um. Um, I don't know how to explain it when, um, you are so desperate that you have one sheet document, um, like the agreement. It was one sheet agreement, and you transfer all money and you just wait that this guy will come to Ukraine because it was like all the money that you had. We also took bank loan for every, uh, family member of my family. Uh, it was so risky.

Speaker B: It's all in. All in. Like in K all in?

Speaker C: Yeah, like, it was all in. It was all in.

Speaker B: So he taught you how to make candy syrup?

Speaker C: Yeah, he taught us how to make it.

Speaker B: So you actually began your business with international story at once?

Speaker C: Yeah, he came like, he taught us how to make candy and only hard candy. And then we developed marshmallows, jellies, caramels, lollipops. Because I understood that no, um, business client will return for the same type of candy. You always need to have something else.

Speaker B: And when you decided to go internationally, globally, uh, how did it happen? And, uh, what was your first market?

Speaker C: Um, actually, it was from the very beginning when we launched the company, I had an intention that it would be like international company because the naming lol and pop is not common for Ukraine. It's not easy for Ukrainians to pronounce it. Yeah. So for me, it was obvious that I want to be international from the very beginning. Um, but in 2014, we decided that we're going to expand with, uh, franchising model, and we launched our own franchise. Uh, and, um, I would say that it was successful experience, uh, because we had our own subsidiary in Ukraine and Poland. In Ukraine, uh, we also had franchising subsidiary in Zaporizhzhia, uh, and, um, abroad we had our franchising subsidiaries in, uh, Bulgaria and in Israel.

Speaker B: M. So from. From the start to this, uh, little network abroad, it took you kind of two years.

Speaker A: Yeah.

Speaker C: So, uh, quite quick, A little less. It was year and a half.

Speaker B: Pretty quick.

Speaker C: Yeah. Yeah. Uh, but as we were like young entrepreneurs, I think that here we made a mistake with the franchising because we gave them the whole process how to make candy. It was better just to make not the production, but the product.

Speaker B: What was the downside of this approach?

Speaker C: Downside is the main downside that you can't fully control, uh, what ingredients your franchisee gonna buy. So they bought some part of natural ingredients, and then they decided to buy another stuff. And for us, like, keeping it natural, safe. It was our top priority. It's our main value, and it was unacceptable. So we decided to close the franchising subsidiaries in 2017, uh, and uh, focused on exporting. I took a lot of, um, uh, classes, I would say, in exporting because, uh, we had export promotion office, uh, at that time. And they give a lot of trainings, uh, a lot of experts who were telling about export, how to export, certification, logistics and all this thing that you need to know about exporting. We also took part in a lot of trade missions to Sweden, to Israel, uh, to Germany, uh, to Canada as well. And uh, for us it was really very important. So from 2017 till 2020, I was just trying to get all the information that I need to get about exporting. And um, at that period of time, you know, you make a lot of attempts, but you have no results. And it, it's. It might m. Be really very hard. Like, uh, and for me it was like, oh my God, like what I'm doing wrong? What's, what's the matter with it?

Speaker B: Like, especially taking into account how quick you. You managed to launch your franchising network. So you, you just. Different expectations.

Speaker C: Yeah, different expectations. Expectations. For me it was very interesting in that period of time. But on the other hand, it was like m. Some kind of disappointment, you know. And I was thinking, okay, okay, let it be. So, uh, still, um, it's my experience, I know a lot about exporting now. And I will find my clients a uh, lot of distributors. They want to work with big volumes. And um, I work with quality, but my volumes are not as big as like Russian Aveca and other big companies. Companies. And in, um, terms of corporation now I understand that there are different distributors working with different retail chains. So all that we did was right, but the target audience was like, not the ones that we needed.

Speaker B: So you spent time of contacting not the right client and that's why the time was, uh, a bit longer than you expected.

Speaker C: Yeah, it was a bit longer than I expected. But after every trade mission, I got some contacts, I got some experience. I heard what uh, they told me about the products, the packaging, the labeling, and we made rebranding. We made a lot of things that uh, was really necessary, uh, for us. And um, we became stronger on our local market because of that. And it was more just a matter of time. So at that period of time, I was building my confidence. I m would call it like this and I will find my clients. I Was pretty much sure about this.

Speaker B: I think this is uh, one of the um, main points in uh, entrepreneurship in general. But also especially if it is a global scale entrepreneurship, this confidence um, in yourself and belief that yes that you will make it. Uh, because the journey is long and you need this energy that will push you forward.

Speaker C: Um, actually I love the quote that when we are talking about exporting, uh, it's uh, not a sprint, it's a marathon. And you need to be ready for this. And you need to be ready for this in terms of your investments because trade fairs, um, like taking part in trade fairs, exhibitions, trade missions, uh, sending samples, uh, like it all takes time and money and you need to be sure that you want this because sometimes companies are not ready um for exporting at all. So they think that they will write a few emails and will get contract. Maybe if you're like producing something really very unique, special and you're like the one producer in the world, maybe this will work. But in general, no it's, it doesn't work like this.

Speaker B: Yeah, this is, this is what I hear now. Uh, especially uh, because um, there is uh now kind of a boom of um, interest towards exports from Ukraine because we are losing our sales inside of the country. And many companies think that it will be like quick solution uh to get another source of um, income and just uh, expand their sales from Ukraine to abroad. And then when they hear what is the journey ahead and they are like changing very often they are changing their minds uh because it will take too much of their forces to just start doing that, not even getting the income and start sales. Um, and after having this um, let's, let's call it international markets, mba but not in the university, but in like real life mba, have um, you, when you, when you were already like choosing the markets, uh, have you chosen the markets according to some criteria where it was uh, uh also intuitively, um. And what was your like first market when you managed to sell?

Speaker C: Oh well our first market was United States. But uh, to be honest, um, I'm not uh, a good example I would say because I'm more of an example at breaking the rules than the example that following the rules, how it should be. I heard from everyone that United States or like North America, uh just couldn't be your first export market. It's just impossible. Just impossible. You can't do like this.

Speaker B: And that was the trigger word for you? Yes, the word impossible was the trigger word to do that.

Speaker C: Well yeah, I like that. Impossible is nothing actually. And all the Limits are in our head. Um, uh, and for me it worked like this. Our first export market was during the COVID and it was United States.

Speaker B: So uh, tougher you could not, uh, find. Maybe China would be tougher at that time.

Speaker C: Oh yeah, definitely here at least the

Speaker B: language was uh, closer to what you can speak.

Speaker C: Yeah, it was uh, familiar and uh, due to uh, our experience, uh, working with um, like Trade mission to Canada and we took part in the trade fair, Seattle Monroe in 20, uh, 18. So we had all the labels adapted to the United States market. So we made a lot of homework before that contract without expectations that we would have it. So sometimes you just do things without any expectations and then it helps you a lot because at that particular time when uh, this client came to us, we had a lot of things. We were like prepared for this and uh, he asked us, do you have this? Yes. And this? Yes. And this? Yes. So we didn't have uh, like we didn't have FDA at that period of time. But uh, we had all the labelings, uh, all the nutritions that we need to have. Uh, we had uh, labeling in like, in English and we could also sell to Canada because we had it in English and in French. So uh, we had a lot of things prepared for. Mhm. This particular client that we didn't expect.

Speaker B: How did you find the client in us?

Speaker C: Uh, he found us.

Speaker B: Uh, it's a kind of magic. Yeah. Just through the Internet or how did it, um.

Speaker C: No, it was really very interesting situation because it was um, a friend of um. My. Not even a friend, but acquaintance that I had um, a few years before that. And she just wrote me like it's pandemic. It's July. It's like the most awful time that you can imagine. Everything is closed, like for the candy. Summer is not the best time in ordinary periods of life. And now it was Covid. So it was not okay. And she wrote me. My husband decided to open, uh, a new store in the United States. And they're looking for precious, uh, suppliers. Yeah, they're looking for suppliers. Um, do you want to sell your candy in the United States? It was like this. It was like this. And I was like, oh, really? It's some kind of weird question, but yeah, of course I want. Let's. Let's talk. And it was like the starting point. And it was 1st of July. And um, on 19th of September, uh, we um, shipped six or seven pallets to the United States. We had uh, more than 140 SKUs in this order. And for us it was challenging because actually the time that we had for production was so, so tight that we were working all days, almost all nights without any weekends. Um, but for us it was some kind of um, a big milestone, but a big challenge as well. And uh, our first palettes, they looked awfully really, because we had no clue. What does it mean, like to make a palette? We had no clue. We had different boxes of different sizes. So it was, it looked awful. Really, it looked awful. Thanks God. Like this partner that we had, uh, he was empathetic, let's call it like this. Uh, he was okay with this. But we saw all the mistakes that we had in this uh, first delivery and uh, our second delivery. It was smooth. We had really very decent pallets. Uh, we bought uh, this zebra printer. We had all the labelings, uh, correct. Uh, and we were like, like stars really.

Speaker B: I think this is very important to highlight. Yes. This is not only for the expert in activities but also for any type of entrepreneurship. Um, to do mistakes is okay. Yeah. But the main point here is to analyze the mistakes and uh, come back with this new knowledge. Because I have seen a lot of companies or entrepreneurs, uh, entrepreneurs, sorry, that uh, just hit their head against the wall the same, and they made the same mistake all the time. Not um, making their homework, analyzing the mistakes. Because in fact what you are talking about, what you are telling me is that you have been learning all this time on your mistakes and on uh, all your steps that you have uh, made. And then the next step was much, much better than the previous one. So it was kind of ah, um, it was almost like Kanban, uh, perfection. Yes. You made ah, each next um, better than the previous one.

Speaker C: Well, it's a part of the journey you like. You can't make it without mistakes.

Speaker B: Um, apart from this lucky uh, case in us, did you consider to choose your markets? Uh, not according to your friends or acquaintances, but according to some analytics, uh, or any other data. And what were the next markets? Uh, uh, after years, the next markets,

Speaker C: uh, the next market that we wanted to enter were uh, uh, Lithuania. Because uh, we made like an expert plan. After that we were so confident. Uh, so we have all this analysis of the. Also we had the Sweden market, uh, we had Lithuanian market and German market. So for us it was three main target markets that we wanted to enter. We made like a lot of analytics. Uh, I also went to um, another expert program where uh, we need to prepare our expert plan. And like it was really very interesting program before the war. But what happened? Nothing really happened because we tried to reach this market. Um, and uh, all that we had in our plan for us, it didn't work. I don't know why. Maybe because uh, it was um, because of this. A full scale invasion. Because we are a high risky producer. Yeah. So we can say that nothing's changed, but no, it's changed a lot for the rest of the world. We are really very high risky companies here in Ukraine. Like the more the main risk is that you will order something, pay money and you're going to never receive it.

Speaker B: Yeah. Not because of the partner, but because of the missile hit, the production.

Speaker C: Yes, yes. So it's the reality that we live in.

Speaker B: But m coming back to uh, Sweden, Lithuania and Germany. Uh, what, what happened after you realized that this is not your market?

Speaker C: Um, I, to be honest, I wouldn't say that um, I don't think that these are our markets. I still think that we have potential on this market and for us these markets are still interesting. Um, but um, we received another contract from the country.

Speaker B: Okay, I will stop here for a second because I think that this is uh, just a destiny. So you have a company that is uh, uh doomed to succeed in international markets as Ukraine is doomed to be the greatest country on the continent. The same is with your company. But I just want to stop and highlight this uh, thing, this, this notion of potential um, markets um, for those listeners that are listening us in Sweden, Lithuania and Germany.

Speaker A: Yeah.

Speaker B: So, and according to statistics of uh my podcast there, there are real listeners from these countries and I think that not only Ukrainians that are living there, uh, so for you pay attention uh, and remember the company name is Lol and pop in Ukraine. And I think that uh, uh if I remember correct the URL is uh, lowland Pop ua.

Speaker C: Yeah.

Speaker B: Uh, so you can go there, find there um, uh a place uh, for international partners and just uh, start conversation with Olena. And I think that you should definitely find this potential mutual and earn together with uh, very um, tasty and high quality candies from Ukraine. And now for the miracle.

Speaker C: Yeah, thanks. Now before the miracle I would say that we have a special link expert and you will find our expert presentation.

Speaker B: You can send me that afterwards and I will put it in the uh, description of uh, the podcast.

Speaker C: Great, great. I will do this.

Speaker A: This is the end of the first part of the interview with Olena Tolkarn, the owner and CEO of uh, the candy producer LOL and pop from Ukraine.

Speaker B: And uh, we have discussed with Olena

Speaker A: so many interesting um, information about her journey further to Japan.

Speaker B: So I decided not to cut out,

Speaker A: um, the, um, valuable parts, but to make it in the, uh, second part. So in the next, uh, part of the interview, you will get, uh, more information about the journey of Lollipop to Japan.

Speaker B: How did they find.

Speaker A: Find, uh, the, um, clients there. And also several more tips from Olen about global expansion for your business. And don't forget to subscribe not to miss next episode.