Grasping at straws pays off

Name: Peter Baron/Martin Chimes

Business: Unistraw International

Industry: Food technology

IP smart since: May 2003

On Unistraw International’s website, an animated mascot emblazoned with the word ‘Sipahh’ floats over some of the world’s most notable landmarks: the Statue of Liberty, the Sphinx, the Sydney Opera House and the Taj Mahal. It is a symbolic illustration that Sipahh, a milk flavouring straw manufactured by Unistraw, has taken off across the world.

In just over two years since the company’s official launch, Unistraw has signed distribution contracts with 35 licensing partners for 100 countries. Such dramatic growth is reflected in a host of awards and honours, including the nomination of Sipahh as one of the 50 great ideas for the 21st century, by UK newspaper The Independent.

Sweet incentive

The straws contain beads impregnated with flavours such as chocolate, cookies ‘n’ cream and banana, are now sold as part of McDonald’s restaurants children’s meals and in major supermarket chains. The straws also have a serious side – prototypes are being developed to administer vitamins, probiotics, dietary supplements, antibodies and other medicines.

Yet Sipahh is no overnight success. It is 10 years since inventor, Peter Baron, first made straws with internal filters and flavour beads for his milk-drinking grandchildren, without adding excess sugar to their diet. The idea now has the potential to transform lives.

“We see that our real focus is going to be on this as a delivery tool for the wellbeing of kids,” says Unistraw CEO, Martin Chimes, an entrepreneur who in the ’90s turned Corporate Express into Australia’s largest office supplies company, and is the Ernst & Young Eastern Region Entrepreneur of the Year for Retail, Consumer and Industrial Products.

“Parents want their children to drink more water and more milk. So we added flavour to that, and now we’re looking at how to fortify that. We’ve got micronutrients that will be able to be used by kids infected with AIDS to lower their suffering.”

Chimes says any AIDS-related initiatives will be conducted on a not-for-profit basis.

Liquid ideas

Since launching as a food technology company in January 2005, Unistraw has gone to extraordinary lengths to protect its intellectual property, creating its own licensing model and pursuing patents.

Chimes says manufacturing plants have been established in China and the US.

“Our key thing to do was develop low-cost manufacturing,” he says. “We knew we had to set up in China or somewhere else that would give us that base. We realised we had to develop a global brand and that to get rapid expansion across the globe, we would have to do international licensing.

“We’ve had to develop and protect our intellectual property – that was a key focus for us. In our strategy towards protecting intellectual property, number one was that we should protect ourselves as much as we are able to in the form of patents, registered design rights, trade secrets, copyrights, and trade mark applications.”

Unistraw has implemented a sophisticated protection measure: it segments the manufacturing process to ensure that its products and systems are not violated.

“Although we own the intellectual property, there’s not one person in our company, who knows the whole manufacturing process from end to end,” says Chimes, who reveals that Sipahh flavours and filters are produced in separate plants and then assembled on other sites.

One sip ahead

Despite such impressive security layers, there have still been problems. When the product was first shown in Germany in 2005 at Anuga, the world’s largest food and beverage trade show, Unistraw learned that a food giant competitor was about to launch a similar straw in supermarkets. That set off alarm bells.

Baron had been in preliminary discussions with the company back in 2003 to develop the product. While those talks eventually stalled, the competitor company executives did get a chance to examine Unistraw’s manufacturing process and try out samples in Sydney. Unistraw has since taken the company to the High Court in London. The case has been settled out of court and the terms are confidential. It is understood the competitor only sells and markets its straws in the UK.

Another company that launched a flavoured straw in China through the Internet was shut down in 24 hours.

Chimes explains: “We work straight away on the basis that if somebody’s going to copy us, we’ve got to make it a minefield that’s as difficult as possible for them to get away with it, and we will be vigilant on it and pursue people endlessly. If you step back off it, then you’ll get copied. I think we’re developing as a company a reputation for being a fierce protector of our intellectual property.”

Flavour for success

Unistraw teams up with specialist trade mark and intellectual property law firm, Shelston IP, to safeguard its business. While IP protection costs money, Chimes says it is crucial for businesses of all sizes.

“There’s no way around it. You’ve got to put together an IP strategy which works for your business and marketplace, like we’ve done.”

Along with the new health-oriented products, Unistraw is also releasing a range of water flavouring straws and on-pack straws that attach to tetra packs. Chimes isn’t allowing the business to rest on its laurels.

“We’re never still and always want more, but if I take a step back and reflect, I say we’ve accomplished an enormous amount in a very short space of time,” he says.

“Now that we’re two and a half years into it, we’ve got manufacturing in place, our intellectual property protected, distribution in place – we’ve built the highway and now we’ve got to fill it with cars.”

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