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Financial Adviser: 5 Ways This OFW Couple Grew BLK 513 to Become the Fastest-Growing Frozen Yogurt Startup in PH

With 10 outlets, BLK 513 is one of the country's most recognized homegrown brands for healthy frozen yogurt.
IMAGE BLK 513
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There is a saying that success happens when preparation meets opportunity.

Sweethearts Kim Sy and Abi Fernandez had been planning to put up their own business long before they decided to come home from Singapore, where they spent five years as OFWs.

Sy, who was working with a multinational fast-food company, wanted to venture into the food business but did not know where to start.

During that time, Fernandez, who worked in marketing for a fashion company, observed that the food trends were already introducing healthier alternatives to the market.

Despite increasing demand for healthy food products—from juice cleanse diet to vegetarian food—the couple noted that no one had yet introduced something sweet that had health benefits.

So in 2015, the couple started to explore producing an honest-to-goodness frozen yogurt as an alternative healthy dessert product for the growing health-conscious market.

During their study, the couple discovered that they can improve the quality of their frozen yogurt by infusing an extra ingredient called activated charcoal.

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Activated charcoal, once considered a universal antidote, helps relieve the body of unwanted toxins. It also facilitates a variety of benefits, including lowering of cholesterol, whitening teeth and curing hangovers.

When the couple finally returned to the Philippines a year later, they immediately launched their frozen yogurt startup at SM Megamall and called it BLK 513, which they named after a place in Singapore.

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Luckily, the first outlet proved to be a highly successful venture which encouraged the couple to expand more outlets in the following year.  

Today, BLK 513 has become one of the most recognized homegrown brands for healthy frozen yogurts in a short period of time, with 10 outlets.

Sy and Fernandez got married in 2018 and have developed another healthy product called FRNK, a milk bar drink, which has five operating outlets already.

How did Kim and Abi grow their startup business to be the fastest-growing yogurt brand with 10 outlets in just three years? How did the couple manage and get ahead of the competition?

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Photo by BLK 513.

Here are the five business lessons every startup can learn from the founders of BLK 513:

1| Know how to differentiate by innovation

One way to stand out from competition is by introducing new features in a product that will differentiate it from others in the market. By focusing on the value that the product offers, a differentiating strategy can help enforce branding and word of mouth promotion.

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“During our research, we found out that not all people are aware what Greek yogurt is,” Fernandez says. “Many are not familiar yet and some even have a negative reaction toward Greek yogurt, saying that the taste is too sour. It wasn’t enough to sell Greek yogurt. I didn’t want the market to categorize us as another frozen yogurt brand. I needed to make it more unique.

“We know that yogurt is supposed to be good for digestion,” she adds. “It cleanses your digestive tract with probiotics. So to distinguish it, we thought of doubling the benefits by adding activated charcoal, which helps flush out toxins. It was the hardest part because it was so hard to infuse the activated charcoal to make it edible. We had to make a certain way of processing it to smoothen the yogurt and at the same time, making it safe.”

2| Know how to validate a business idea before scaling up

It is much easier to create a business around a demand than to build a demand on an already existing product. Validating your assumptions first before expanding by testing the market can lower your risks and costs.

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“During our first month, it was during December, the malls were busy and we didn’t expect so many people would notice us,” Fernandez says. “But to our surprise, our first month of operation exceeded our expectations by more than three times.

“So we thought maybe it was because it was Christmas but when the first quarter came the following year, our sales were even stronger. That was the time when we asked ourselves if we needed to expand or not, like do we need to stay at Megamall? Do we really need to scale?

“We thought that if we didn’t expand now, someone will just copy our concept tomorrow. A lot of people told me that if you click in Megamall, you will click everywhere else. So when we decided to expand, we had to expand our backend as well. We had to look for people to work for us.”

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3| Know how to continuously improve the product

Improving the quality of a product continuously by making meaningful changes can help expand the customer base, as well as build loyalty and retention.

“When we started our operation, there were a lot of hiccups in our product,” Sy says. “For example, our frozen yogurt in the beginning had a grainy texture. We were able to improve it and make it soft and creamy.

“We also maintain a certain consistency in our production process,” Fernandez adds. “We don’t add preservatives or any additives to make our products last longer. So what happened over the years is we collaborated with chefs and bakers to make the quality of our products consistent

“We also invest a lot in product development,” she adds. “Before we have flavors as simple as milk and chocolate, but today, we have so much R&D happening in the commissary. We now have strawberry cheesecake turned into a sauce, or a chocolate sauce as good as Ferrero.”

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Photo by BLK 513.

4| Know how to define roles and responsibilities

Leaders in the organization work better when they understand their roles and positions. When everyone knows what they are expected to achieve, they can focus more on things that matter.

“We made it a point that we should divide our responsibilities so Kim handles all the purchasing and importation including warehousing and operations while I focus on research and development, marketing, branding and leasing,” Fernandez says.

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“We do this so that our employees will not be confused. It is normal that couples sometimes argue and fight over some business decisions, which we cannot really avoid. But, at least if, we have separate accountabilities, we can make our own decisions independently.”

5| Know how to leverage talents for organizational success

Human capital plays an important role in bringing value to the organization through skills and knowledge. Leading and developing this valuable asset can be important to the success of the business.

“One of the hardest parts of owning a company is we have to get a lot of talents to help us,” Fernandez says. “It is easy for people to see us now as successful but behind it, it’s really a group effort. It is the people we hired who trusted us despite our being a startup company.

"As we grew the company, we also gained the support of our partners in the industry who gave us valuable advise and mentored us through the years.

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“We can only do so much if we will just do all the work alone,” she adds. “With more talents on board, I feel stronger because we know we have strong people in our company.”

 

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Henry Ong
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