Hello and welcome to episode ten of The Vegan Business Tribe Podcast with myself David Pannell, co-founder of Vegan Business Tribe. If you have a vegan business, or are thinking of starting one, then Vegan Business Tribe is here to support and inspire you not just to build a vegan business, but to build a SUCCESSFUL vegan business.
And if you want to go beyond the podcast and connect with our community of like-minded vegan entrepreneurs then head over to Vegan Business Tribe .com where not only you will find tonnes more content for free – but you can also join our paid membership to get access to all our online events, workshops, business clinics and to also ask questions in our mentorship forums.
And today’s episode is actually in response to a question that two separate people asked in our forum, and I thought it was worth expanding the answer into a full podcast. It’s a question that you might have asked yourself when you first set up your vegan business, and it’s: how big is the marketplace for a vegan business? And this is also a question that you might have been asked if you are working with a business advisor or an accountant who isn’t vegan themselves. You might have come to them with this great idea for a business selling to vegans, or you might have said that you want to change your current business to be one that works with other vegan companies and they wince and wrinkle-up their nose and say “But vegan is a fad”, or “the market isn’t really big enough”.
Now, I could actually make this a REALLY short podcast episode and just say ‘trust me, the market is big enough. Thank you – and see you on the next one..’ but I understand that YOU might be in the position of having to convince someone else, not just yourself. You might need to convince that non-vegan accountant or your bank manager, or you might even need to convince your partner or others in your business that you’re not going to just completely blow the company by heading down the vegan route. And in the last episode, episode 9, I actually talked about why businesses usually fail, and this is the first point to make: Being passionate about what you do goes a long way in the success of any business. So if you are passionately vegan, or as someone recently said to me SO VEGAN THAT IT HURTS, then the chances of you succeeding with a business that aims to further the vegan cause, or replaces an animal-based product, are just so much higher. And if you are working with a business advisor, they should know the role that passion plays in success. They should recognise that if this is a topic or sector that you live and breathe, if it’s something that gets you out of bed in the morning, then to you it will never just be a day job. You will find the tenacity and determination you need to make the business work because you care not just about the business, but about the customers you are working with and the change you are making in the world.
It might be that you already have a non-vegan business, and you are thinking about changing that. Think about the clients you work with at the moment, how much do you care about them? Now, of course, I’ve had a number of service businesses over the years so I know just how important it is to LOVE your clients, but that doesn’t always mean ACTUALLY loving them. You make yourself love them because they are giving you money. You go that extra mile because it means they’ll keep using you and you want them to be happy with your work or your product. BUT – if what your business is doing is actively allowing someone to choose an animal-free product over the life of another being… Or if it’s helping someone live a better cruelty-free life… Or, if it’s supporting other businesses or professionals who are doing this, then how do you feel about THOSE customers? Do you love them before they even pay your invoice?
And I will tell you now, since I moved over to having the two separate vegan businesses that I currently run, this is the first time where my customers have ever become my personal friends. This is the first time I have cared not just because that influences the invoice – but because we’re all on the same mission. I actually want them to succeed, not just so they keep paying their bill at the end of the month, but because I believe in what they are doing.
So, I know I’ve already convinced you about running a vegan business, but we still need to convince the others. So let’s look at some stats. Now, what statistics you are interested in will depend on what your business is: Are you selling to vegans? Are you selling to other companies? Are you selling to other VEGAN companies or are you just selling to the general public?
And we can look at statistics for each of these separately, starting with vegans themselves, because just HOW MANY VEGANS are there in the world? Now, it might come as a surprise to you that not everyone is vegan yet. I know, I don’t get it either, but you have to remember that because you ARE vegan yourself, or if you’re listening to this then you’re probably well on the way to becoming so, that our view of the world is biased. You will follow vegan influencers, you will watch vegan YouTubers – you’ve probably picked up a bunch of vegan friends on Facebook after going to Vegan Campout. So you will get a lot of vegan-related STUFF in your newsfeed. To you, vegan might be everywhere right now. But a lot of that is because the algorithms that oversee our digital lives know you are interested in veganism and so brings you more of what you like. When in reality, other people are not seeing the same news stories and vegan product announcements that you get. So to you, vegan might seem like it’s everywhere but the reality is, the best guess in 2021 is that we’re probably looking at about 2 to 3% of the population identify as vegan. Some surveys estimate more like 5%, some just 1% – so if you’re vegan, not only can you pat yourself on the back that you are an early adopter, it also highlights just how much extra work there is still to do.
Don’t be put off by that though. 1 to 5% of the population is still a BIG figure though. Here in the UK, and we’re a relatively small country of 67 million people, that’s still a million-plus people who would say they are vegan. If you look at our global population of nearly 8 billion people, that’s 250 million worldwide – that’s bigger than the population of Russia or Pakistan, and just how many customers are you looking to sell to?
But – remember that I’m vegan too, so of course I’m going to say there are loads of vegans around the world, so to give you a fairer idea of where these figures come from let’s actually look at the stats behind them. And the truth is, these figures are our best estimates. Because we ARE only talking about a low per cent of the general population there has had to be some extrapolation. There is A LOT of data out there but the problem we have is sometimes that data comes from a survey that only polled a few hundred or a few thousand people – and if you ask 100 people if they are vegan and 2 say yes, then you’ve not really asked enough people to get a clear picture of how many vegans there are in the world. Another problem is that the larger studies on diet and lifestyle haven’t singled-out veganism. Often, all non-meat eaters have been lumped together in surveys or have classed veganism and vegetarianism as the same thing. However, a solid place to start is with The Vegan Society’s figures which they update every couple of years.
These figures come from Ipsos Mori surveys that The Vegan Society have commissioned themselves, along with independent surveys by the Food Standards Agency and The National Centre for Social Science Research. And these showed that in the UK, in 2014, 150,000 (or 0.25% of the population) identified as vegan. In 2016 that figure had raised to 276,000 (or 0.46% of the population), and by the latest survey in 2019, that figure had more than doubled to 600,000 people (which is 1.16% of the UK population). And those figures seem to be repeated by similar studies in other countries, with a 2020 YouGuv poll suggesting that 2% of Americans identify as being vegan. And that 2% might sound small, but that’s 6 and a half million Americans.
It’s also likely that we can continue to extrapolate those figures through into 2020 and 2021, however, one thing these figures don’t take into account is the global pandemic that we’ve all been living through which has made many people re-examine their relationship with animals. A more recent survey conducted by The Vegan Society found that 1 in 5 people in the UK cut down on meat consumption during the COVID-19 pandemic and 15% have reduced their dairy and egg intake over the lockdown period. Similar studies in Germany found consumers moving away from meat following high-profile coronavirus outbreaks at meat-processing plants. And this is where we can look to secondary data to give us a bigger picture and to show some of the trends of how veganism is growing. Looking at Google trends, which records how many people are searching for a specific term, interest in ‘veganism’ increased seven-fold between 2014 and 2019. You can also look at Veganuary’s sign-up statistics, which is a global campaign to get people to try a vegan diet every January. The number of people who are officially signing up to the campaign has almost doubled every year, with over 400 thousand people signing up in 2020. But my absolute favourite stat, however, is Waterstones the bookseller. If you’d have gone to their website in 2018 you would have found 944 books with the word ‘vegan’ in the title. Now, I’ve just done a search and there are more than 10,000 books available. So everything is indicating that the upwards trend will only continue.
One thing I will add in here however, is that this data is only looking at people who identify as vegan – but as you will know if you’ve listened to my previous podcasts, over 90% of vegan meals are bought and eaten by non-vegans. Beyond Meat’s own customer research says that 93% of their customers are meat-eaters. 2% of the population are vegan and yet all the major supermarkets now have their own in-house plant-based food ranges. 2% of the population are vegan yet 10,000 books are available with vegan in the title. The Grocer Magazine reports that 62% of adults in the UK have bought plant milk – that can’t be all vegans buying these vegan products – nowhere near. And that’s the thing to remember when you’re looking at the size of the marketplace, it’s NOT just a vegan market you are selling to, the whole ‘plant-based’ marketplace might be open to you, which is closer to 60% of the population who are showing interest in vegan and plant-based products, or are already on their plant-based journey but don’t yet identify as vegan.
So if you want to know what the size of the market for vegan products is then you have those two answers. If your product is ONLY suitable for vegans, then you’ve got around two per cent of the population to have go at. And two per cent of either a global or local population is still big figures. But if your product is suitable to everyone who has some interest in plant-based products, or are open to cruelty-free, or are reducing their meat and dairy intake or reliance on animals – then you’re closer to 60% of the population. So when you’re non-vegan business advisor or accountant winces and questions if the market is big enough for vegan products, you go back to them and tell them that more than half of consumers have adopted some form of vegan buying behaviour without actually identifying as vegan, and that number is only going to keep growing. is that a big enough market for them?
Now, that’s all good and well if you are selling to consumers – so if you make a product and sell it directly to the end buyers – but what if you are a business selling to other businesses, or B2B as we call it? And this might be where your account thinks they have you! You might be selling a service, such as being a web designer, or a vegan bookkeeper or even a vegan printing business. OK, so we can prove that there are plenty of people open to buying vegan and plant-based – but surely there are not enough vegan companies to support a vegan service industry? If you’re going out there saying you’re now only going to work and support other vegan companies, you might as well just throw your business down the drain surely? Well, again this is a really interesting conversation to have, because I’ve got a mailing list of thousands of people with vegan businesses who have signed up with Vegan Business Tribe that says you are wrong. If you went to VegfestUK at London Olympia they were packed out with nearly 400 companies who had taken a stall.
And yes, there are less vegan companies than non-vegan companies, but how many new clients do you actually need if you are a service company? 10 a year? Maybe even just one or two a year? The last company Lisa and I had was a service company and I only needed one new major customer a year because of how much they spent on average. So yes, the marketplace may be smaller but the big difference is: if you’re a vegan company then other vegan companies are going to want to work with YOU over non-vegan companies. They will at least take your call when they might not even have a conversation with others. Sales and marketing is always a numbers game to some degree, but why choose to sell in the larger general marketplace when your success-rate is one in a hundred and you are up against everyone, instead of in a sector where your success rate might be one in twenty and you have an advantage over your competitors?
Niche companies (or nitch as our American listeners will call it) are always more successful – as long as you can prove the niche is big enough for YOU. So, if you need more than just a handful of new customers every year, then let’s see if we can work out how big the marketplace is: just how many vegan businesses actually are there?
And this is where we have to be a little bit more forensic in looking at the statistics because, unfortunately, Governments don’t have a SIC code (or a Standard industrial classification code) for if a business is vegan so there’s no easy data to look at. I can’t just go to Companies House (if you are in the UK) and pull up a list of all registered business that are vegan. But what I can do is take a damn good guess based on other available figures. First, we can take a look at how many ‘ethical’ businesses there are, and this is how a lot of vegan businesses first position themselves when they move over to offering a vegan service, because yes – some people might be put off by the word ‘vegan’ but no-one is put off buying services from an ‘ethical’ company. And as part of you being an ethical company that means ensuring none of your products or services causes harm to animals, because, well, why would you? And it’s amazing how a slight re-framing of veganism can make it seem more reasonable to people who haven’t yet connected with the term.
Almost EVERY company will say they are ethical. Even large energy companies actively tearing apart the world will push their ethical credentials, but what we want to work out is how many companies there are that have actually been set up to deliver an ethical agenda. And for this, I’m going to be referencing UK data because, as you might have been able to tell by my accent, it’s where I am in the world, but each country has it’s own company records you can check yourself. And in the UK there are three types of businesses that we CAN identify as being set up on ethical agendas and have some stats for, and these are CICs (or Community Interest Companies), Social Enterprises and Charities.
Currently, there are about 19 thousand CICs in the UK, and this is growing by 20% year on year. There are also 470 thousand social enterprises (and that’s according to the official 2017 UK Government estimate) and 168 thousand charities. So, from an approximate 6 million registered businesses in the UK, 10% of those come from these three sectors, suggesting these are organisations that are lead by their ethics and what we refer to as a ‘triple bottom line’ – where social and environmental results matter as much as profits. So that’s 600 thousand companies in the UK alone that care enough to have actually set up with a legally-binding ethical framework instead of just setting up a standard company. Surely out of that 600 thousand you could find a few that would want to buy cruelty-free services from an ethical company like yourself? If not, could we speculate how many of the other 6 million businesses who are not CICs, charities or social enterprises might be open to buying services from an ethics-led vegan company? Even if that means leading with an ethical message over a vegan one to first open the door? Again, how many customers do you actually need?
Instead, let’s use this brainpower and guesswork to try and answer our final question, forgetting ethical companies you can sell to for a moment, how many actually VEGAN companies are there?
And I will be honest and say that now we are into speculation, and the best we can come up with until we have a mandatory universal vegan business register is a really good educated guess. But we can base that guess on facts. Around one thousand eight-hundred new companies are registered in the UK EVERY DAY according to Companies House figures. And again I’m using UK data because that’s where I am right now, but each country has its own register. If we think 2% of the population identifies as vegan, that means through the law of averages we’ve probably got about 36 vegans starting up a new business every day in the UK alone. Now I think it would be fair to say that if you’re vegan and starting a business, there’s a good chance that company will either be a vegan company, or at least operate on vegan ethics. So, let’s go on the conservative side and say a third of all vegans starting their own company will start a vegan company – that still gives you a guestimate of four and a half thousand vegan start-ups a year. In the UK alone. And we’re a relatively small country, so times that by the size of the world if you can deliver your services remotely.
And just like if you’re selling to consumers, you should think if your marketplace goes beyond those who actually identify as vegan, if you’re selling B2B (or business to business) can you sell vegan services to non-vegan businesses? This might be something you’ve not considered. Could this actually be your biggest marketplace? Lisa and I have consulted with some of the biggest brands and food manufacturers in the world about entering into the vegan marketplace – and in the main, they are non-vegan companies wanting to pay for that specialist expertise. There are a lot of companies making vegan products who are looking to engage with plant-based consumers and don’t understand them like you do. And it’s not just food companies – the number of vegan residents in care homes has almost trebled in five years, could your business provide those care homes with the expertise of how to cater for vulnerable vegans?
But the final point I’m going to make is that knowing all these stats might give you some answers, but it really doesn’t make much of a difference. All it does is gives you some evidence that there are some potential customers. It doesn’t give you any confidence those customers will want to buy what you sell though. The way to REALLY prove there is a market is to TEST. That’s how Lisa and I started Vegan Business Tribe when we wanted to see if there was a marketplace of people with vegan businesses looking for help. We set up a very simple site and put a little bit of money into Facebook advertising to drive traffic to it, and during our testing period we were getting about 10 people a day signing up to the first version of the site – and that is how we knew the market was there. Not the stats, not the research, but the testing. Statistics and figures are nice if you need to convince someone else, but unless you’re trying to attract backers and investors then the person you REALLY need to convince is YOURSELF.
And you don’t need to throw the piglet out with the bathwater to do this. If you already have a business that you want to veganise, you don’t have to sack all your current customers. Before you spend all that time rebranding or refocusing, just set up a quick 1-page website. Create a download that your target market will find really valuable and see how many people put in their email address to download it. You can do all this whilst you continue your current business: create a separate brand that you run alongside your current company while you test how people interact with it. Do some low-budget social media advertising and see how many people leave their email address in return for the download or sign-up for more information. This will give you an idea of interest and also start building your mailing list. Getting a business going from scratch will always take you longer than you think, and you’ll find that this quick testing will give you far more information and confidence than researching statistics on the marketplace.
OK, so let’s have a little re-cap of what we’ve just learnt in answer to the question, how big is the marketplace for a vegan business? So…
Before you even think of researching the market, know that being passionate about what you do goes a long way in the success of any business. If you are passionately vegan then the chances of you succeeding with a business that aims to further the vegan cause in some way is much higher.
If you are selling to consumers (so B2C as we call it), then most surveys and estimates put the number of vegans at 1 to 5% of the population. That may not sound like much, but that’s six and a half million Americans or more than a million vegans in the UK. And that’s rising year on year.
But remember, the big market for vegan products are actually non-vegans. More than 90% of vegan meals are eaten by meat-eaters. Surveys suggest that more than half of consumers have taken on some aspect of vegan buying behaviour.
If you’re selling B2B, or selling to other businesses, then the number of ETHICAL businesses is huge and quantifiable. The number of vegan businesses we have to guess at, but it’s not an unfair guess that in the UK alone there might be more than 4 thousand vegan companies starting up every year.
Again, like selling to consumers. It might be that your biggest market as a vegan B2B business, might be selling to non-vegan businesses who need your specialist vegan expertise.
Finally – don’t just put your faith in stats. Go out there and TEST first. Put together a 1-page website, drive some traffic to it, see how people interact and learn from that.
So, that should have given you some confidence if you were wondering if the market is big enough for a vegan business. And, remember, I recorded this podcast on this specific topic because two of our members, Kayleigh and Michael, asked this question in our forums on the Vegan Business Tribe website. So if you’re struggling with a question or a problem at the moment, then that’s where you can go to post a question for either myself and Lisa to answer, or others in our wider community.
And if you’ve got right to the end of this episode, then that means that hopefully you found it useful, or at least interesting. I am always grateful for your time and if you are listening on a platform that allows you to leave a review, or give us a like, or even just to tap the subscribe button, then I’d be even more grateful if you could spend a few seconds doing that for me – because that’s how you can help US get this information into the hands and ears of even more people who are building their own vegan businesses and striving to create this vegan world we’re all trying to bring about together.
I’ll see you on the next one.