Looking back, 2020 will probably be remembered for the major disruptions to our health as individuals and as a society. At the same time, the nature of the disruption has dramatically scaled back the pace of our lives. With many forced to work from home, people have taken stock of their fortunes. We have learned to make peace with our failures and to be grateful for our successes. So, we spoke with several CPG company CEOs and founders for Staff Street’s Mover’s Spotlight. As a result, we learned four things these entrepreneurs wish they did differently, and the one thing they’re proud they did.
One: Doing It By Yourself For Too Long
Businesses are built on the blood, sweat, and tears of individuals who bring their ideas to fruition against all odds. Getting a business on its feet requires a lot of solitary work. Much of the foundational effort comes down to you. It can be a grueling endeavour stretching yourself over all aspects of your business. And it can also be rewarding.
Kara Freedman, CEO of Baked by Nature, says that wearing every hat in the business has taught her valuable perspective.
“One of the best things about being a one-woman show is that you gain a real appreciation for what each job entails,” Freedman says, “My understanding is first-hand because I’ve done it.”
Like Freedman, CEO Brian Tate laid the cornerstone of his million-dollar breakfast company Oats Overnight in the solitude of his own kitchen. As a former professional poker player, Tate’s instinct was to rely on his own acumen to make the right calls. Looking back, Tate wishes he would have sought out more people to work with.
“I would have hired more advisers. I would have worked with more people,” admitted Tate. “In business, what I’ve come to realize is that there’s people that have done it before. I didn’t have to learn it on my own,”
As for Freedman, she’s learning a lot from experts at SCORE. Having only launched Baked by Nature early this year, Freedman fills any gaps in her one-woman operation with input from New York’s finest business leaders.
“As entrepreneurs, you learn along the way. So, I’m really lucky to have people who can help me make less mistakes. Learn more quickly. Rely on the experience of professionals and experts in the industry, who know a lot more than me.”
Two: Offering Too Many Options
Brevity is the soul of wit. It’s the same thing when you’re making a product offering. Entrepreneurs mistakenly offer too many options because they want to play to as many customer preferences as they can. Studies have shown that this strategy can backfire against actually converting your sales leads. Too many choices can lead to confusion, second thoughts on actually making a purchase, and buyer’s remorse.
Alex Bayer, CEO of Genius Juice, admits that, in the beginning, they tried to offer too many flavors. Eventually, they scaled it down to two options. Then, they focused their efforts instead on perfecting the healthy, creamy coconut goodness that Genius Juice is known for.
According to Bayer, having less flavors turned out to be the more strategic option. “We didn’t have to discontinue anything or remove flavors,” Bayer explained.
Nevertheless, don’t expect Genius Juice to start offering new flavors just for the sake of offering new flavors. Bayer explains that as the company continues to grow, expanding their selection will most likely be strategic. New flavors will have to be delicious, of course. But, more importantly, they have to be able to position the company towards greater success in branding and in sales.
Three: Forgetting to Manage the Margins
The success of a business depends on finding that sweet spot between the costs of sales and the selling price. One of the things entrepreneurs often find themselves wishing they did differently was managing their margins.
According to Sasha Millstein, CEO and founder of Aunt Ethel’s Pot Pies, consumer packed good companies often make the mistake of failing to examine the size of the industries they want to penetrate. As a result, many companies misestimate the viability of the product they’re offering.
“A lot of times, people just say that ‘Oh, I have a salsa that has been in the family for fifty years and the family loves it, so, I’m just going to start selling it’,” observes Millstein. “You really have to understand things from a financial standpoint. Firstly, how much capital are you going to need to invest in it? How long are you going to be not profitable based on the course and the trajectory of the CPG industry? What are your margins?”
IWON’s CEO and Founder Mark Samuel said that if he could, he would have made different choices around costing and margin requirements during the earlier days of the company.
“Early on, there were just a lot of things to learn,” describes Samuel. “If I could take those times back, I would have saved some money and resources.”
Additionally, Millstein says integrating a CFO as early as you can reduces the tendency for financial mistakes or mishaps. A good financial officer can help predict your sales forecast, determine the felicity of product, and measure how long it will take for your product to stabilize to maked it profitable.
As for Samuel, hindsight is 20/20. He values the lessons from his almost 20-year experience working in the fitness and startups industries what they bring into the present and the future of IWON.
“I can look back as far as taking those experiences and supplying them to what we’re going to do tomorrow,” explains Samuel. “You’re going to get punched in the face a few times. Some of that is going to come out of your pocket. But that’s just the way things land. If you have the opportunity to move forward despite these things, then you’reblessed to be able to do that.”
Four: Not Documenting Your Journey, both the Good and the Bad
In the 2-3 year that it takes to make a busines profitable, entrepreneurs go through a lot of ups and down, commiting common enough mistakes and wishing they did things differently in the end. Like, forgetting to study the margins of the market. Or failing to listen to your customers. Recouping takes a lot of work and energy, with little spared for keeping track of the little things, from small joys to turning points.
For Chris Kirby, the CEO of Ithaca Hummus, his biggest regret isn’t being able document the journey.
“The biggest regret that I’ll always have is not taking pictures and documenting things from the very beginning. For so many years, it was about barely making it by, brute-force and white-knuckling it through every single day. It wasn’t the kind of environment where you would stop and go, “Let me take a picture.” But looking back, we did have a lot of great moments that I wish we had more documentation of,”
Stopping to document your journey might sound like an unnecessary indulgence when you’re stressing through tax deadlines and balancing your books. But a little mindfulness can help map where you are and where you’re going, as well as let you to appreciate what goes into the process. And somewhere along the line, once you’ve made it, the success becomes all the more delightful remembering how you got there.
The One Thing They’re Happy They All Did?
Well, they found the right people to work with.
For many of the CEOs we’ve spoken to, the key thing that got them through the years, including the disruptive and unpredictable chaos of 2020, was having the right people on their team. As companies starting off on limited capital, they had be strategic.
Firstly, they built around their strengths.
On the leadquizzes podcast, Tate talked about hiring poker players as part of Oats Overnight’s management team. Oats Overnight’s organizational make-up brought a unique advantage to the way they run things.
“We’re all used to being logical thinkers. What you get is people who are more open to sharing their ideas. We evaluate performances based on their results. At the same time, we’re also more inclined to question the status quo.”
Secondly, they kept their organizations agile by organizing smart. They built partnerships and outsourced functions to meet compentency needs.
“At Genius Juice, we’ve built a smart model combining different organizational strategies,” explained Bayer, “Initially, we figured we didn’t want to tie up money in our own factory. Essentially, what capital we save from having outsourced the freight, the production and co-packing, and our finance department, we drive into sales growth, marketing and supporting the product in our stores. It has really worked well to help us conserve capital and drive growth.”
“It’s easy to rush in things quickly, wanting to build yourself as big as fast as possible,” noted Kirby, “We’ve been able to avoid those mistakes, and have stayed very hands-on about what we outsource.”
Kirby’s team at Ithaca Hummus create their network on a simple criteria. “We look for people who are fans first. If we’re on the same page there, there’s a much higher opportunity for alignment on values and decision making.”
“Building things this way has served us extremely well. We’ve been able to work with people and partners who share our values and our work ethics,” said Kirby proudly. “They’ve also allowed us to stay flexible and to turn things on and off, as opposed to having everything in-house and obligated to figure out how to utilize them during times like this.”
Lastly, these CEOs worked with people they actually liked.
“The real key is that we all like each other. You all have to like each other to work well together,” added Bayer, which is what makes it easy to work towards a common goal at Genius Juice.
Samuel says the same thing of IWON, likening their team work to any sporting team. “Except we’re in the food and beverage business.The only thing to do at a high-level performance situation is to make sure that everyone is playing their part, that everyone is focused and dedicated to what they’re supposed to be doing.”
And or many of the start-ups and entreprenuers who used the same smart organizational models, they found the transition towards remote relatively smooth, if not beneficial in overall productivity and employee welfare.
“Our team has always worked from home,” says Bayer, “Before the pandemic, everyone was already virtual and remote. Nothing really changed there. If anything, things improved because it allowed our employees to have more time at home, more time with their loved ones, more flexibility, and more time taking care of themselves. They’re happier staying more productive on top of all that,”