Although still relatively small, China's natural products market is growing steadily, especially in cities such as Beijing and Shanghai. Ironically, many domestically produced natural products come from Yunnan but are not sold here due to market or distribution issues.
Beijing-based Shangrila Farms produces and sells all natural coffees, honeys and personal care products, all of which come from Yunnan. After having already established itself in Beijing, the company recently began selling its coffee beans, honeys and soaps at Salvador's Coffee House here in Kunming.
In addition to its environmental angle, Shangrila Farms is also a socially minded enterprise that operates on a fair trade model in which it pays its suppliers above-market rates for coffee, honey and other items in order to provide local farmers with a more sustainable income than they would receive otherwise.
A family business with roots in Yunnan, Shangrila Farms' distribution network and media exposure have grown considerably in the past year. We spoke with Shangrila Farms Managing Director Sahra Malik about the company's story and where it's headed:
GoKunming: How did you end up starting Shangrila Farms?
Sahra Malik: Shangrila Farms Gourmet Coffee all started when my family and I came across a co-op of farmers and roasting facility in Yunnan. We were enchanted by the delicious coffee and the possibility of buying coffee beans from farmers who care for the environment.
Originally Shangrila Farms was set up as fund raiser for the Yunnan Mountain Handicraft Centre (YMHC), however we soon realized the potential of this coffee project as a way to support rural communities in beautiful Yunnan.
I decided to quit my job in advertising and manage our growing coffee business. At the same time my sister started working on honey and Shangrila Botanicals, our natural cosmetics line. In January 2010 we decided to partner together. So now Shangrila Farms is a natural products company that sells organic coffee, natural & pure exotic honeys, and hand crafted 100 percent natural cosmetics.
GoKunming: Why did you decide to go with a Fair trade model?
Malik: My mother Carter Malik runs YMHC in Diqing Prefecture – in the area known as Shangri-la. She and my father often travel to Yunnan, and especially to Shangri-la. Our family ties to the area are the inspiration for starting the business – we wanted to give back to the area.
YMHC is a perfect organization to support as they do many projects that support eco-tourism and handicraft development. Their facility has a free library and English classes. We donate a portion of our profits to YMHC's community service projects in Shangri-la.
We want to support farmers that grow high-quality natural products. We currently pay four times the fair trade standards. We want to form a lasting partnership with the farmers that can help economic development in the area.
GoKunming: What were the biggest challenges in setting things up?
Malik: The biggest challenge is working with the Chinese government, especially in trying to get our company registered and legal. It has been quite a challenge and has taken over a year, where as registering a company in Hong Kong or the US takes a matter of weeks.
GoKunming: How many retail locations in China sell your products?
Malik: We sell our products in over 80 locations all over Beijing, Kunming, Shangri-la, Hunan, Hong Kong and Lhasa. We recently opened a kiosk in EC Mall in Beijing for our Shangrila Botanicals natural cosmetics line.
GoKunming: Are you exporting any of your products?
Malik: We export to Hong Kong at the moment. We have recently launched our coffee with Pacific Coffee in Hong Kong. It is available to drink as the "Yunnan Brew" and for purchase in all of their Hong Kong locations.
We hope to start exporting to the US. Our dream is to sell at Whole Foods!
GoKunming: What are your most popular products right now?
Malik: Right now for the coffee the Yunnan Blue and the Shangrila are the most popular. Our anti-aging soap is very popular. Also, our newly launched pomegranate honey is flying off the shelves.
GoKunming: You've only just started selling your products in Yunnan, do you plan on expanding your presence in the province?
Malik: We hope to sell our products more in Yunnan. Since we are based in Beijing we hope to work with a distributor who can help sell our products in the area. We are still looking for suitable partners.
GoKunming: How have Shangrila Farms products been received in Beijing so far?
Malik: We started selling in the beginning to the expat community, at the local supermarkets here, also at speciality shops. Our products have been well received, our coffee is quite popular in the grocery stores. Our honey is popular in specialty shops, such as the Yoga Yard and Tai Tai.
We have now launched in a Chinese mall, so we are aiming to sell to the Chinese market. In China consumers are increasingly sophisticated and there is a growing market for organic products.
GoKunming: Do you plan to add any new products in the coming year?
Malik: We have recently launched three new lines for our Shangrila Botanicals natural cosmetics line: anti-aging, lavender and rose. We have also expanded our natural soaps line from five to 25. One line we are thinking to work on is a maternity and baby line. We are always looking for customer feedback.
GoKunming: What do you see in the future for natural foods and personal care products?
Malik: A lot of brands position themselves as natural, but when you take a closer look you find that indeed there are many preservatives and additives. I think more and more consumers are looking for 100 percent natural alternatives. We have already seen a big move for this in America and the UK and we think this will catch on more in China as well.© Copyright 2005-2019 GoKunming.com all rights reserved. This material may not be republished, rewritten or redistributed without permission.