This week on the Podcast, we catch up with Setti Coscarella, CEO of TAAT Global Alternatives (CSE:TAAT/OTC:TOBAF). The company has been making waves in the tobacco market specifically because it has a non-nicotine, non-tobacco solution for smokers who want to kick their habit.
Coscarella hails from a Big Tobacco background, having worked in a senior role with Philip Morris International (NYSE:PM), and understands the distribution dynamics of the tobacco industry. TAAT is tackling the same market, using the same outlets, but is not subject to the same marketing restrictions. This gives the company an edge when it comes to selling its product.
On the Podcast
We have had Coscarella on the podcast before, but since then the company has been making some real progress in terms of getting the product out into stores in the US and further afield. TAAT has now signed a master distributor for the UK & Ireland, and now also for Australia. Coscarella tells us on the podcast about his strategic plans for the European market, as well as continuous improvement of the Beyond Tobacco product.
Distribution relationships have been critical to TAAT’s mushrooming sales growth. The company launched in Ohio with distribution into 100 stores in December 2020. It is now sold in over 1000 stores. Coscarella talks about the consumer response to TAAT in the US so far and progress with wholesale networks and retailers.
TAAT has been upgrading its manufacturing hub in Nevada to meet demand. We discuss how it is possible to scale this up as the sales of cigarettes picks up. Coscarella talks about how he wants to keep TAAT asset light and leverage a lot of the excess manufacturing capacity in the market, including in Europe. “That will help speed to market,” he says.
The company has put out some spectacular numbers this month.
Coscarella is very bullish on his expectations of sales figures going into 2022. “It’s not just a perspective of a few stores here and there, we are talking to distributors that want distribution deals across entire countries…this is not par for the course for a company of this size,” he says.
Critical to success and the nature of conversations with distributors has been TAAT’s ability to prove in Europe that it can ship and can distribute. The deals in the UK and Ireland have been critical for this.
We also discuss the changing dynamics of the Big Tobacco market, and the search by the larger cigarette companies for non-tobacco solutions. TAAT has spent a lot of time and money on protecting its brand and its IP, including its suite of patents.
Coscarella says that Big Tobacco is spending more time listening to its consumer – “There’s only so long you can keep selling someone something they don’t want,” he says. “This is a big shift in direction for a lot of these companies, looking at other things that they can deliver to this consumer base.”
Not discussed on the podcast, but worth mentioning, is the fact that Horizon Ventures in Hong Kong has now backed TAAT with another C$10m. This follows on from the excellent set of results from TAAT for Q3, and demonstrates the commitment of TAAT’s biggest shareholder.