A Recipea for Success? Nestlé’s Plant-Based ‘Milk’ Brand

A Recipea for Success? Nestlé’s Plant-Based ‘Milk’ Brand​

The Story

Nestlé is set to launch Wunda, its very own plant-based milk brand, in Europe (Financial Times). The milk will be made from yellow peas, rather than oats, almonds, soybeans, or coconuts – the usual popular flavours that consumers and investors are accustomed to. Nestlé chose yellow peas as the designated plant for Wunda because the peas offer “a higher protein content and more versatility for use in drinks and cereals” (Financial Times). Naturally, the company also wanted to “stand out and break some norms” (Nestlé). At the time of writing, Wunda is only set to be launched in France, the Netherlands and Portugal; however, further expansion across Europe could reportedly occur in future (Nestlé).


What It Means For Businesses And Law Firms

Investors are showing a keen interest in the market for plant-based alternatives to animal products and will presumably continue to do so for the near future, as increasing numbers of consumers are experimenting with vegetarian, vegan, and ‘flexitarian’ diets for health-related, ethical, and environmental considerations. Fuelled by growing consumer demand, the global plant-based milk market alone is expected to be worth over $40 million by 2025 (The Vegan Society).

Market leader Oatly is pursuing a $10 billion blockbuster Initial Public Offering (IPO) on the Nasdaq; if successful, the IPO is likely to act as a trendsetter for plant-based milk brands looking to boost their finances, credibility, and reputation. Another strong contender, French dairy giant Danone, aims to increase the revenue that it derives from plant-based products to $6 billion by 2025, relying on its popular ‘milk’ alternative brands, Silk and Alpro (Fortune). Nestlé’s Wunda could be a challenger to the likes of Oatly and Danone, potentially shaking up the buoyant market with its innovative ‘milk’ recipe.

If consumers continue to rally behind plant-based milk brands, more actors will seek to get in on the action. Some may follow in Nestlé’s steps, and break into the market by launching their own brands and experimenting with novel plant-based alternatives. However, such a choice is likely to be reserved to large, well-established companies, either acting on their own or embarking on joint ventures.

Law firms may be called upon to advise on product safety regulations, supply and/or distribution agreements, as well as any corporate reorganisations needed to establish the new brand. Alternatively, law firms may be called upon to advise on mergers and acquisitions (M&A), such as Danone’s 2017 acquisition of WhiteWave Foods. The acquisition enabled Danone to launch its two beloved plant-based milk brands, Silk and Alpro, in the United States and Europe, respectively. Companies that do not pursue mergers or acquisitions for strategic reasons might otherwise opt to issue green or sustainable bonds, to fund investments into plant-based milk brands. In these instances, law firms with market-leading expertise in sustainable finance would likely reap the benefits.

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