BranchOut Food Inc. (NASDAQ: BOF)

BranchOut Food Inc. is a growth stage consumer packaged foods company focused on developing, manufacturing, marketing, and distributing clean label plant based dried fruit and vegetable snacks for retail and foodservice markets through BranchOut branded products, private label offerings, and industrial ingredient sales. The company is headquartered in Bend, Oregon and operates a 50,000 square foot manufacturing facility in Pisco, Peru. BranchOut uses proprietary GentleDry™ technology, licensed from EnWave Corporation, to convert fresh fruits and vegetables into shelf stable snacks and ingredients while preserving taste texture color and nutrients.

The company generates revenue from three primary sources: sales of BranchOut branded snacks, private label manufacturing for retailers, and industrial ingredient sales to food manufacturers. These products are sold through retail grocery stores, club stores, online retailers, direct to consumer ecommerce platforms, and foodservice distributors. A substantial portion of net sales comes from a limited number of large national retail customers such as Costco and Walmart.

The company operates through the following segments:

• BranchOut Branded Snacks: This segment produces and markets plant based snack products under the BranchOut brand including pineapple chips, strawberry halves, banana slices, bell pepper crisps, and carrot sticks sold through retail grocery stores, club stores, online retailers, and direct to consumer channels.

• Private Label Products: This segment manufactures fruit and vegetable snacks for major North American retailers under the retailers' brands offering items such as dehydrated prunes, carrots, brussels sprouts, and raisins distributed via the retailers' existing grocery and club store networks.

• Industrial Ingredients: This segment supplies dehydrated fruit and vegetable pieces, fragments, powders, and inclusions derived from banana, mango, blueberry, pineapple, cherry tomato, avocado, and other produce to food manufacturers for use in cereals, snack bars, baked goods, salads, and ready to eat meals.

BranchOut Food Inc. competes in the highly competitive consumer packaged foods snacking segment where better for you products are gaining shelf space. The company faces competition from established snack manufacturers emerging better for you brands and private label suppliers many of which have greater financial marketing and distribution resources. BranchOut differentiates itself through its proprietary GentleDry technology clean label formulations and ability to produce unique textures that preserve taste color and nutrients. The company also leverages its manufacturing platform in Peru to achieve cost efficiencies and maintain reliable supply to retail partners.

BranchOut Food Inc. sells its products to large national retail customers including Costco and Walmart, to private label retailers, to food manufacturers, and to direct to consumer ecommerce platforms. A limited number of customers account for a substantial portion of net sales making the company sensitive to changes in purchasing patterns or distribution decisions by those accounts.