Dorset Cereals is moving into bagged snacks next year as part of ambitious expansion plans it hopes will double sales to more than £40m.
During 2008 the business will launch into more cereal products before breaking into new markets, with bagged snacks at the top of the list.
"It has been a year of spectacular growth," managing director Peter Farquhar told The Grocer. "We're no longer just about muesli; we're now in porridge, light flakes and cereal bars.
"In 2008, we're looking at doubling sales again as with this year, and we have exciting launches planned. At the moment our household penetration is 5%, so doubling that to 10% doesn't sound particularly ambitious."
Sales for its ready-to-eat cereals alone were £15.1m for the year to October, according to Nielsen data, up 122% from last year's £6.2m. Taking into account its Chunky Slices cereal bars and Naturally Light Flakes, total sales for this year are forecast to come in at more than £20m.
To support its expansion, Dorset Cereals will be "significantly" increasing its marketing, although it will still not use TV ads and the budget will remain less than £1m. Instead, it will build on sampling at events, such as Hampton Court Flower Show, and activity online, where it has built up a large consumer database, Farquhar said.
"We can develop product ranges very quickly in comparison with bigger competitors, taking 12 weeks from first meeting to getting products on shelf," he added.
In the past year, Dorset Cereals also claims to have overtaken Jordans to become number two to Alpen in the muesli market.
The company, which was founded more than 20 years ago and was bought out by private equity fund Langholm Capital in 2005, is also investing in factory expansion and new equipment, giving it the capacity to enable further growth.