Why Paktli’s Snack-Sized Shift Won Over HomeGoods

Seena Chriti had big dreams when she launched a brand of traditional Mexican snacks called Paktli in 2021. Too big, it turns out.

Her first iteration of Alegria bites – a candy-like snack made with a chocolate-coated mixture of puffed ancient grains including quinoa, amaranth and millet – came as a large, 1.27 oz. single-serving and was a hit with people like Holly Adrien, who discovered Chriti and her brand at a farmers market in Cincinnati. But while Chriti stayed true to the recipe, she produced a winning product that was still far from retail-ready.

“[Adrien’s] my guardian angel and has been pivotal in my journey,” Chriti said. “She said, ‘it’s too large, it’s too crumbly. It’s my favorite snack. I buy it in my local store. But when you have it in a pouch, in a bite-size [format], you will grow.”

Chriti added, “I was laughing at her, like, how do you expect me to do it in a bite size if I can barely make my big circles?”

But Chriti, who had been making the products by hand, said she continued to hear this feedback from others, including key retail players. She called an array of co-packers over the course of the next year, but chocolate manufacturers claimed the mass used was too solid and granola manufacturers all refused to bind with chocolate. Chriti determined she needed her own machine.

Building For Bite-Sized

Chriti eventually found her solution after meeting a Mars’ R&D team member from Poland at a tradeshow in New York. The individual took one look at Paktli’s product and came back with the exact make and model machine she needed. Next, she had to find the money – $100,000 to be exact.

She went through the woman-owned and minority-owned certification processes, enabling her to then secure a zero-interest loan from the state of Ohio, in addition to other financing. Chriti has kept spending tight, only attending tradeshows where budget requirements are minimal to none. This year, Paktli exhibited at Expo West for the first time, and for no cost, through :IncludedCPG.

Once the machine was built, the Cincinnati farmer’s market delivered Chriti yet another impactful encounter when she met the owners of a newly opened chocolate co-packing facility nearby that could house her equipment.

“The first production was a huge challenge. We weren’t able to figure out the right temperature of the chocolate at first and they were sticking,” she explained. “I was so desperate, because this thing was tested, and the first run was good, and then everything started sticking. I’m [thinking] I spent $100,000 for nothing. I was really upset.”

Her co-packing partners, who also consult for large CPGs like PepsiCo, have offered Chriti a significant amount of flexibility and support throughout the process, she explained. Within a few days after the failed, first production run, the partners also figured out how to adjust the production line so that the bites were coming down the line in perfect form; all it took was a slight temperature adjustment at the chocolate coating phase, she said.

“After creating 130,000 circles by hand myself in four years, I was standing crossing my arms, looking at my bites coming [off the line] and I was crying,” Chriti said. “I could not believe it, for big companies achieving a line of production isn’t always a success, but this is a lifetime achievement for me.”

Discount Distribution

Paktli now sells four SKUs of pouched, Alegria bites in a range of flavors including dark and white chocolate and feature mix-ins like dried blueberries, dried cranberries and cacao nibs. The co-packing partnership also enabled Paktli to acquire a slew of new certifications including certified organic, gluten free, kosher as well as food safety and quality standard BRC Certified, which allowed it to begin considering a launch into larger chain retailers.

The brand officially rolled out to HomeGoods stores nationwide at the end of March, its first distribution beyond farmer’s market and independent stores. Chriti said she has also received a request to distribute to HomeGoods England and Ireland, in addition to gearing up for a rollout to Sprout’s Innovation set in September.

Paktli also has a few other high-margin, regional foodservice and convenience opportunities in the pipeline, including airport store Paradies Lagardère and Levy Restaurants via The Compass Group at the Cincinnati Convention Center. But for now, it plans to focus on successful execution at its first big chain partner.

It took nearly seven months of communication with HomeGoods, who found Paktli during a Specialty Food Association Summer Fancy Foods Show, to negotiate terms and pricing. The products are now on shelf for $3.99 per 2 oz. bag, about a 20% discount on its expected $4.99 SRP at grocery. But Chriti emphasized that with HomeGoods there is no promotional spend, sampling requirements or additional discounting.

Because HomeGoods picks up product directly from the co-packer and serves as its own distributor, Chriti has also avoided having to onboard with mainline distributors like UNFI or KeHE and take on deductions, chargebacks and onboarding fees.

Chriti believes the pricing will “even out” and generate the same profit as a grocery retail launch would have. But beyond profit, Chriti also believes that this is the perfect venue to drive trial for her novel snack concept.

“The HomeGoods food aisle has an incredible curated variety of products, which I wasn’t expecting,” Chriti said. “A lot of the products are not yet in big retailers… I am really loving it because the hurdle to go into big retailers is so large that you find the same products everywhere. This is really a fun place to explore… the amount of snack offerings was absolutely incredible.”