BOSTON — What essentially began as a startup has turned into a thriving new business for Flowers Foods, Inc. Since the national rollout of Dave’s Killer Bread snack bars earlier this year Flowers Foods has exceeded its projected target for points of distribution and generated sales in line with some of the bar category’s leading competitors.
“Overall, we’re really pleased about (the snack bars launch), and we’re really excited about … what is essentially a new business for us,” A. Ryals McMullian, chairman and chief executive officer of Thomasville, Ga.-based Flowers Foods, said during a Sept. 7 presentation at the Barclays Global Consumer Staples Conference in Boston.
The company originally projected distribution to reach 12,000 stores by the end of 2023, but with that number already surpassed, it now expects placement in more than 13,000 outlets, a testament to the product’s acceptance from consumers. Mr. McMullian said the snack bars are all warehouse delivered and all co-manufactured, and as such the rollout phase has provided some learning experiences that Flowers Foods intends to use in future new product rollouts.
“We’re really pleased with the trajectory,” he said. “We’ve got velocities that are already in the top 10, and that’s even taking into account that we dilute that so much because we’re still increasing ACV (all commodity volume). So retailer excitement about it is really good.”
Asked by an analyst whether DKB bars is a lifestyle brand play, Mr. McMullian responded, “Well, what we’re seeing are two things. No. 1, DKB fans are pretty rabid. We did some market research recently and what came out of that — and I just love this line — is that people don’t buy Dave’s Killer Bread, they join Dave’s Killer Bread. Almost like joining a club, right?
“But DKB bread buyers are highly likely to gravitate to this product. It’s incremental to them. It’s something that’s probably already in their household pantry. But … given the household penetration for Dave’s today, there’s a lot of people that don’t know about Dave’s Killer Bread. They may not even eat bread. But I bet they eat nutrition bars, right? And so we’re doing a lot of cross couponing. We’re doing DKB combination bread and bar displays. So we’re bringing those current Dave’s consumers over to the bars, and then we’re bringing new people to the brand.”
Introduced last year, DKB Organic Snack Bars are available in three varieties: Cocoa Brownie Blitz, Trail Mix Crumble and Oat-Rageous Honey Almond. The organic snack bars contain between 16 and 22 grams of whole grains per 1.75-oz bar. More recently, though, the company has expanded the DKB bar pipeline with DKB Amped-Up Protein Bars, which are in test markets with a nationwide launch planned for 2024. The Amped-Up Protein Bars are available in three varieties: peanut butter chocolate chunk, double chocolate coconut and blueberry almond butter. Each 1.9-oz bar contains 10 grams of protein and between 6 and 8 grams of whole grains.
Mr. McMullian said the DKB Amped-Up Protein Bars are doing “extremely well,” but even more exciting for Flowers Foods is the fact they are proving to be incremental to the current set of DKB Organic Snack Bars.
“So we’re clearly tapping into different consumer segments with these varied attributes,” he said.
The company also has DKB Crunchy Snack Bites in test markets.
“The Crunchy Snack Bites, I think, are particularly exciting,” Mr. McMullian said. “There are six SKUs (stock-keeping units), three are sweet and three are savory. And I would argue that we have had even more retailer excitement about those than DKB bars.”
DKB Crunchy Snack Bites are available in Super Cinna Roll, Peanut Butter Choco Bliss, Heavenly Honey Nut, Epic Everything, Toasted Garlic and Bold Buffalo varieties. The snack bites are available in 7.2-oz packages and contain between 10 and 12 grams of whole grains per serving.