NotCo has confirmed the Chile-headquartered plant-based start-up has pushed back its target for reaching group-wide profitability from as early as this year.
The set-back to 2027 was first reported by Bloomberg, based on an interview with NotCo’s CEO Matias Muchnick, who told the news agency the profitability hitch was linked to its ‘co-branding’ business in the US and Canada with Kraft Heinz.
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However, based on communication with Just Food and the Bloomberg interview, NotCo has suggested its operations in Latin America and Mexico will reach profitability goals before 2027.
NotCo entered a partnership (The Kraft Heinz Not Company) with the Chicago-based US food major in 2022 to co-develop, produce and market plant-based proteins in North America, excluding Mexico.
A spokesperson for the Chile start-up told Just Food via a statement that a number of products have since been launched in retailers such as Whole Foods Market and Sprouts.
These are NotMayo; NotSausage; NotHotDog; Kraft NotCheese Slices; Not Mac & Cheese; NotChicken Patties; NotBurger and Philly Plant-Based Cream Cheese.
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By GlobalDataIn his interview with Bloomberg, Muchnick said NotCo had closed its office in New York and Kraft Heinz will take over the sale and marketing of the products in the US and Canada.
“NotCo, in collaboration with Kraft Heinz, made the strategic decision to consolidate its operational efforts in the US and Canada, [while] expanding the portfolio within the joint venture,” the spokesperson informed Just Food.
“The JV is now the primary vehicle for the commercialisation of plant-based food products for both companies in these markets. At the same time, NotCo remains firmly focused on its food business in LATAM, where it continues to experience solid growth.”
Kraft Heinz has not responded to a request for comment. At the same time, this publication has asked NotCo to confirm which of the two companies was conducting the manufacturing of the JV products and at which factories.
“The collaboration with Kraft Heinz not only broadened our portfolio but also created opportunities to enhance operations, distribution, and commercial efforts,” the spokesperson added.
“While we remain committed to profitability across all business units, we now anticipate reaching profitability by 2027.”
However, NotCo’s own-branded business, NotCo Foods, is “on track to reach profitability as early as 2025”.
Muchnick told Bloomberg that its Chilean and Argentine operations are expected to become profitable by the second quarter of this year, while Mexico and Brazil are likely to reach that goal in 2026.
NotCo also confirmed it had laid off about 11% of its workforce in November 2023 under a restructuring exercise to “optimise operations” in order to “enhance efficiency and ensure long-term sustainability”.
The company added in the statement: “Despite these adjustments, NotCo remains a strong and growing organisation, dedicated to advancing plant-based innovation and expanding its market presence.”
