Condiments and Sauces Company
Startup Costs: $10,000 - $50,000
Home Based: Can be operated from home.
Franchises Available? No
Online Operation? Yes
Put that secret family recipe to work!
Ask the Expert: Kamaal Jarrett, Founder of Hillside Harvest
What is the first step to getting started in the condiments and sauces Industry?
The first step to getting started in the food space is to do your research. There are a number of trade magazines, facebook groups and secondary research sites that you can simply google in order to learn more about the industry. The more you learn about the food industry and the specific category in which you're interested the better equipped you will be to identify opportunities. Part of this research should include leveraging Linkedin and reaching out to players in the industry for an informational interview. You should garner, supplier, retailer, manufacturer, and even potential consumer insights to gain a clear understanding of where your product will best fit. This is probably true for any competitive industry. The key is to get as much information as possible without letting analysis paralysis limit your speed of execution.
How much money can a person expect to make in the first year and in five years?
Depends in initial investment structure but usually $0 in personal income in year one if self-funded. As you grow your customer base that can jump to $30k-$50k by year three and $50k-$70k+ by year five. Again, much of this will depend on how quickly you are structured to scale as well how much external investment you bring in to the firm. Condiments tend to have a slower velocity than, lets say snacks, so if you decide to only focus on one state or region for your sales you may not achieve enough revenue to support a huge paycheck. Conversely, scaling into other regions and/or leveraging online sales may help to pave the way for additional customers (and repeat purchases) which in turn may enable you to pay yourself a higher wage.
What kind of experience/training do you need to have?
There are low barriers to entry so no formal experience required. That said, understanding the retail space as well as knowing how to read a profit & loss statement, balance sheet, and cash flow statement will help to put you in a good place for initial success. It should also go without saying that knowing your product and production process inside and out (whether you make it yourself or not) is the cost of entry.
What do you wish you knew when you were just starting out?
Turnover per store is far more important than your overall store count. Folks often times want to focus on how many stores they’ve been able to obtain over time. Your store count, however, means nothing if your product is not moving off the shelf in any of those stores. There should, therefore, be a concerted effort to maximize your velocity in any given store. Focus on your marketing tactics once you’ve won a new account. How can you support the store with demos/ tastings, promotions, coupons etc.? How will people learn about your product and what will get them to buy – and keep on buying?
Who are your customers?
In its initial stages, Hillside Harvest’s primary target skews slightly older. He is an older Millennial or Generation Xer. These segments have higher purchasing power due to greater earnings, but they are also more likely to spend their discretionary income on higher priced gourmet packaged foods. These segments are diverse in their make-up, which also provides more familiarity and openness to ethnic flavors and dishes. This Shopper also supplements his visits to large grocery outlets with frequent visits to Specialty outlets- Hillside’s main distribution channel. Note: Millennials account for 37% of Specialty outlet consumption and Gen Xers account for 29%.
Are there any resources you recommend that were extremely valuable to get your business off the ground?
A clear understanding of customer marketing and/ or the retail space, in general, has been profoundly beneficial in the growth of the Hillside Harvest. Checkout online resources like foodboro, bevnet, nosh, brandchannel, adage to keep up-to-date with the industry and marketing/ advertising in general.
Additionally, focusing on maintaining a high-quality product throughout my growth process has ensured that we stay true to our customers who have been with us since day one of our journey. It may seem like a simple tenet, but having a clear view of what you want your brand or product to be and what your not willing to compromise will be extremely valuable.
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