Mediterranean frozen food company Afia LLC launched a fresh product line this month as it settles into its new factory in Taylor.
After a year and a half of construction, and having to turn down several retail opportunities because of limited production space, Afia moved Aug. 1 into the 21,000-square-foot facility northeast of Austin. It has an 8.5-year lease on the space, which should help the company reinvigorate growth — CEO Yassin Sibai said it will allow the consumer packaged goods startup to grow its product portfolio and reach around $50 million in revenue before needing more room.
Afia leaders this week welcomed Austin Business Journal to the new manufacturing facility to see how the major investment is advancing the business.
Afia's claim to fame is its authentic frozen falafel. Yassin Sibai and wife and fellow co-founder, Afia President Farrah Moussallati Sibai, started the company in 2017 and originally made 1,000 falafel a day by hand. They later moved to a 5,000-square-foot facility in Jarrell that supported tens of thousands of falafel per day and helped them growth to more than 3,000 stores, including locations of H-E-B LP and Whole Foods Market Inc.
Afia raised $3 million earlier this year to help with the factory buildout and new product development.
The Taylor facility, located at 270 BFG 9000 Way, allows the CPG company to make half a million falafel a day. To that, they are adding a line of frozen falafel bowls in four flavors: sweet potato and kale; crispy onion and lentil; zesty artichoke and quinoa and roasted peppers and tomato.
In addition to boosting production, the facility has a new nitrogen freezing process that takes seven minutes, where it once needed two days.
The company experienced 100% year-over-year revenue growth for several years, according to Yassin Sibai. This year lagged, with growth of less than 50%, because of capacity limitations. Next year looks more promising, he added.
The Sibais are already planning to pitch their product to Target Corp. and The Kroger Co. as part of their new roadmap. They are also chasing Costco Wholesale Corp. and have secured a part in the retail giant's roadshow in Austin.
"Just getting into the roadshow is a big deal," Yassin Sibai said. "That's a big first step into connecting with the consumers at that store."
Companies hoping to get into Costco participate in a two-weekend demo in multiple locations to gauge traction with consumers, Yassin Sibai explained. If accepted, the retailer commits to a seasonal display in the region and, depending on this performance, can commit to additional rotations in the region and beyond, he added.
Afia's frozen meal line is sort of an untapped market. Grocery stores carry a variety of frozen meals, but Farrah Moussallati Sibai said ready-to-eat Mediterranean meals are not commonly found in the freezer aisle.
To help with shelf presence, the company chose reusable packaging decorated in traditional Syrian tile patterns, a decision that resonated during consumer testing instead of the black trays that have become ubiquitous.
"The landscape's changed, consumers are warming up to frozen, ready-made meals because there is more to offer now than there was before. It's no longer TV dinners,” Farrah Moussallati Sibai said. "That all started with Covid when people actually that weren't shopping frozen started to shop frozen, and then they realized the convenience of it and that there are some great products in the freezer section."
The frozen meals are not yet available in H-E-B because the frozen section's review, which grocery stores typically handle an annual or bi-annual basis, is not open for submissions until April, according to Yassin Sibai.
"We got lucky that when we submitted to some of the existing accounts like Publix and Wegmans that we were right in the review period," he said. "The response was very positive and they took us on."
Additionally, Afia has secured new retail distribution through Oregon-based New Seasons Market LLC and North Carolian-based The Fresh Market Inc.
The new facility could also mean new sources of revenue of Afia. While it's not front of mind, the Sibais are open to the idea of co-packing, which is when a company handles production for other CPG businesses.
With its new space and meal lines, Afia has grown to roughly 17 employees. Despite the larger production volume, advanced machinery handles a lot of the work, so employees can spend more time with packing, for instance.
Afia recently shifted from a five-day workweek to four 10-hour days per week. As the facility undergoes daily sanitation and teardown, reducing days can be more efficient, Farrah Moussallati Sibai said. The new schedule has also led to a more productive and energized workforce, she added.
As the Sibais plan for the future, they're already considering their next real estate move. They have their eyes on the property next door. They could also expand by 20,000 to 25,000 square feet at their current facility.
