How low sugar confectionery business Funday scored Chemist Warehouse as a stockist mere months after launching

Daniel Kitay has always really liked lollies. But like a lot of Australian kids growing up in the 90s, he wasn’t exactly bombarded with ‘good-for-you’ sweet alternatives or low-sugar confectionery in the market.

With the only options being full-sugar lollies, Kitay’s incessant sweet tooth saw him spend most of his childhood and schooling life being “pretty overweight”, he tells SmartCompany Plus. Kitay decided to make a change after graduating high school; a change that meant going cold turkey on his kryptonite: lollies and chocolate.

And while the change saw Kitay lose 25 kilograms, he also says it was “pretty depressing, because you just don’t get to enjoy anything”.

Years down the track, it was this experience that put Kitay on the quest to “create Australia’s first good-for-you lolly”.

And Funday Sweets was born.

Only one year since launching, Funday now has four different flavours, a growing social media presence with influencers and ambassadors, and is stocked in around 1800 retail stores around the country — including major players Chemist Warehouse and Woolworths.

Key takeaways

1. Getting stockists sometimes involves going straight to the source and knocking on their doors — literally.

2. When pitching to a new stockist, make sure you have a ‘point-of-difference’ to show them. They want innovative products.

3. Cracking the market with a new product is the hard part, but getting the process right can set you up for many more opportunities

The proof is in the (low sugar) pudding

Getting a new, niche product into Australia’s largest pharmacy chain is no easy feat — but Kitay says doing so was actually very simple.

“They’re looking for innovative products,” he acknowledges. “And Funday was one of those products.”

Kitay is being modest, because Funday isn’t just an innovative product — it’s also delicious.

But Kitay wasn’t going into Chemist Warehouse with no idea of how Australia’s pharmaceutical industry operates, either.

Throughout his two-decade tenure in the corporate world, Kitay spent some time working in the vitamin supplement industry, where he worked with a number of retailers with products like vitamin gummies.

“On one occasion, I saw a product overseas do really well, and I thought ‘there’s really got to be another kind of option in Australia for a ‘better for you’ confectionery brand’.”

Kitay himself had tried these diet, sugar-free confectionery products while trying to lose weight, and found they “always had repercussions”.

While he didn’t have a “huge amount of experience” in the development of these products himself, he set out on ordering gummy moulds and ingredients online to start testing formulations.

After 12 months of testing, Funday’s formula was complete: a lolly with 90% less sugar that people can actually enjoy.

Success breeds success

Kitay says when talking to potential stockists, he was able to show that he was providing them with something unique — and something that was going to differentiate their confectionery category against their competitors and “enable them to stand out”.

That’s what it’s all about, he says.

“As a new brand, it can be tough to crack the market but persistence and continued investment in marketing, as well as demonstrating commitment to the brand, is essential.

“Like with all meetings that one attends, you should go in prepared with a comprehensive analysis of the market that you will be playing in.

“With Funday, we were very prepared and understood that we were going to be playing in a multi-billion-dollar market dominated by the multinational confectionery brands.

“For us this meant we needed to take a different approach and remain focused on our core unique selling points and build a loyal customer base who rallied around us and believed in what we were doing.”

This loyal customer base includes a 13,000-strong Instagram following, which has influencers and customers alike sharing the brand and promoting products.

Funday in a local milk bar. Source: supplied

“The proof is in the pudding,” Kitay adds, “because six weeks after we launched [in Chemist Warehouse], it pretty much sold out in 450 of its pharmacy chains.”

This success of Chemist Warehouse was pivotal to Funday also being stocked in major supermarket chain Woolworths, which was looking to grow its confectionery category and had the Funday products on shelf only five months later.

“With Chemist Warehouse and most of the retailers we’ve secured, I have (literally) knocked on doors or been lucky enough to receive emails from buyers asking for the range,” Kitay explains.

“It was actually only two months after being stocked in Chemist Warehouse that we had the conversation with Woolies.”

The personal touch

Kitay says when he left the corporate world, he wasn’t actually intending on creating a confectionery brand — he just wanted to leave the corporate world to make something of his own.

As it turns out, choosing to go down the path of creating a product that solved not just a problem, but a problem personal to his own experience, has paid off.

Funday as a business has grown from a one-man show to a team of six, and a team with ambitious growth plans at that.

By the end of the year, Kitay wants to see the products stocked in 3000 stores, and he is also working with a team of strategic advisors to crack into the international market — including southeast Asia, the US and Europe.

“I think we’ve really got two key goals,” he summarises. “One is really rooting ourselves here in Australia as the firm player in the market, and then finding the right players overseas to help drive growth in strategic international markets.”

As for whether the future of Funday involves new flavours and products, Kitay says we’ll just have to wait and see.