Finding Your Way into the Food Business
6 steps to getting your food product to market
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5. Pound the pavement
Nobody knows more about your product than you do, so it’s best to get out there and sell it yourself, Purdy says.
“I think every small food manufacturer starts off peddling his own product. When you’re so small, you can’t afford to do it any other way, so schedule appointments with buyers, give a presentation, tell them why your product is better and unique, and let them sample and ask questions.”
Kuahine suggests pitching small mom-and-pop or specialty food stores to get your foot in the door. “Don’t even think of the big-box stores yet, like Sam’s Club and Costco,” he says, “because, chances are, you won’t have the capacity to service a major account like that right out of the gates. It’s one of those things that sounds good on paper, but is much harder to execute.”
As far as buyers for big-box stores are concerned, Kuahine says, it’s all about the numbers. “If the sales aren’t there, they’ll pull your product off the shelf. It’s better to start small and grow steadily than to go big and fall completely off the wagon. To me, one of the worst things you can do is over promise and under deliver, so don’t bite off more than you can chew.”
In the past, Purdy has worked with a distributor but found that, because his dips are unique, they require a lot of product education and pushing to generate sales, “and I just wasn’t getting that kind of attention and commitment from distributors,” he explains. “They’d also add a big markup and it just wasn’t working.”
On the other hand, Kuahine swears by his distributor and says it handles about 80 percent of Pelekunu’s overall sales.
“We’re now in Don Quijote, Marukai, Times, Foodland, Sack N Save and Longs,” he says. “My mentality at one point was that we didn’t need a distributor. I figured I could get the product out on my own at the lowest price, but then I realized that a retailer like Foodland has 30-plus stores and there’s no way I could service all those locations alone.”
The trick, Kuahine says, is not just to find a distributor who will sell your product. “You have to find someone who believes in your product and who you trust.”
Belmont has used a distributor, but has reverted back to selling and servicing his own accounts with the help of his wife.
“It’s tough to sell on your own, but nobody said this job was going to be easy,” he says. “That’s why it’s so important to network and form good relationships with others in the business. I joined trade organizations like the Hawaii Food Manufacturers Association and met a lot of people who referred me to vendors, suppliers and buyers, and I’ve gotten many good leads that have helped boost my business.”
6. Keep it fresh
Even after you’ve developed a strong following and solid vendor list, it’s imperative to keep customers interested.
“When you’re a big-name item, then maybe your product will sell itself, but, for everyone else, you have to keep your products fresh and constantly come up with new ideas to expand and improve,” Purdy says.
Even a big success like McDonald’s rolls out new or seasonal items to engage customers. Purdy says he is constantly experimenting with new flavors and recipes, and his regulars at the farmers markets make it a point to stop by to sample his latest offerings.
“Even though I have no intention of adding these market specials to my regular line, I still like to mix things up so my customers don’t get bored,” he says. “Sometimes they’ll make suggestions for new flavors and in a few weeks, I’ll come back with their requests. It’s fun for me and it’s fun for the consumers.”
Purdy and Belmont also advocate in-store demonstrations. “This goes back to the fact that there’s nothing else on the market like what I’m selling, so people want to try my taro dips before they buy it,” Purdy says. “And, many times, once they do, they buy it.” He estimates sales increase by as much as 80 percent on days he performs demonstrations.
Belmont says another revenue stream is from Internet sales. “It’s not that difficult to create your own website, but, even if you have to hire professionals to help you, I think the investment is definitely worth it,” he says. “People are so reliant on the Internet these days that you have to have something they can look at to find out more information about your product.” He estimates about 10 percent of his company’s overall sales come from online orders.
Kuahine ships his teriyaki sauces to the mainland and Asia, and is always amazed that customers are willing to pay the high cost of shipping, which sometimes ends up being more than the price of the sauce.
“Food has a way of connecting people and stirring up strong emotions,” Kuahine says. “The best compliment I ever received was from a woman who came up to me at one of the product shows and said, ‘My husband used to always tell me that I was such a bad cook, but ever since I started using your sauces, he now tells his friends that I make the best chicken he ever tasted.’ ”
Help for Your Food Startup
• State Department of Health Sanitation Branch: Information about permits at 586-8000 or hawaii.gov/health/environmental/sanitation/index.html.
• Hawaii Small Business Development Center Network: Free, confidential, one-on-one counseling by qualified business professionals on Hawaii, Kauai, Maui and Oahu. Offers workshops, seminars and online training courses. www.hisbdc.org.
• SCORE: Free, confidential business advice and counseling from experienced professionals tailored to meet the needs of your small business. Workshops for startups and experienced entrepreneurs.
• Small Business Administration of Hawaii: Offers information on small-business loans, grants, bonds and other financial assistance. SBA provides seminars and training primarily focused on access to capital, entrepreneurial development, government contracting and advocacy. www.sba.gov.
• Business Action Center: Register a business; obtain a tax license or get a federal employer identification number; receive comprehensive information on licenses, permits, and registration requirements for state, county, and federal governments; attend business-counseling sessions and workshops. The BAC has offices on Oahu, Maui and the Big Island.
• Pacific Gateway Center Culinary Business Incubator: Rent space in a certified commercial kitchen.
www.pacificgatewaycenter.org or 851-7000.
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