Welcome to the Community Call Podcast.
I am Melissa Travers, Director of Community here at Bevanetta Nosh, here with my co-hosts Jackie Brugliera and Mike Schneider.
If you're enjoying the show, please follow and review us on Apple Podcasts or your listening platform of choice.
Hi guys.
I would like to start this show off by embarrassing myself.
I went to Portland, Maine last weekend, and I did something I've never done before.
I ate dinner at three different restaurants in the same night.
Is that?
Yes.
That's my dream.
Is it?
But you've done that?
I mean, okay.
Has anyone heard of the term bang bang?
Yes.
Yeah.
But I've only done the bang bang.
I did it with Landis.
Not a bang bang bang?
Taco and then pizza.
No bang bang bang.
Bang bang bang.
You've done the bang bang bang?
I've done a bang bang bang, yeah.
Okay, what was the bang bang bang?
It was sushi, then tacos and then ramen.
Mine was so, I mean, mine was at Landis and he's like, let's go have pizza and then we went and got tacos.
He's like, let's do the bang bang.
Yeah, I'm so, I don't know what's up.
It was awesome.
I mean, I had never done it before.
I was like, we can do this.
We had Vietnamese food, Japanese food and then pizza and at pizza, we ordered two pizzas.
I mean, I feel like, I know, I know.
We took some home, we took some home, but.
Okay, so when you, when you did the bang, bang, bang, was it three full meals or was like one kind of apps and one was like little snackety snacks?
Light, light meals.
And then two pizzas.
Did you Cookie Monster all pizza?
I like that we've talked so much about like intuitive eating and like that kind of thing here.
Listen to your body.
My body wants, my body wants pho, then sushi and now pizza.
I know it was, we did go light, we did go light at.
And now Lexington Bakes.
You want to know something.
So I actually was going to withhold this, but then after the last bang, so I wasn't even, I wasn't even going to say this, but now that that wasn't humiliating enough, we swung by the Portland Food Co-op and got some snacks for the hotel room.
Like you said, this is a safe space, Melissa.
So I'm glad you feel safe to share that extra bit.
Make some space for sharing.
Jackie, would you care to share?
And now a sound bath.
I love sound baths.
I know, right?
Well, I'm glad that I'm in a sort of protected environment.
That wasn't, I actually feel a weight has been lifted off my shoulders.
I feel like I can't say the same for my gut, but I'll work on that.
And then before the bang, bang, bang, we have lunch at Ongie, which is-
Bang, bang, bang, bang.
Bang, oh yeah, bang, bang, bang.
As we go on, we're gonna be adding more bangs.
I feel like-
You admitted it.
I forgot I admitted the second part.
Whoa, okay, the snacks.
What kind of snacks were they?
Were they the kinds we like?
I was hoping you wouldn't ask.
So it was ice cream, so it was Talenty ice cream.
Yep, and I specifically got the Talenty ice cream so I could take the container home.
Yeah, and then I got Little Lads popcorn, which we did not get to in my defense, but you know what's so sad?
I accidentally left it in the hotel room and it was like 10 bucks or something.
I know, really sad.
Maybe they'll come to nosh.
Little lads, we want your popcorn.
I was gonna say though, so earlier though we had lunch at Angee and it's a shop in Portland, Maine that sells all kinds of fermented things and it's such a cool specialty shop.
They started in these sort of shipping containers that sort of acted as a testing ground and then they moved to their own location and they've started offering congee and I think, I thought it was such a cool concept because you, or isn't it, it's so good.
You order the congee and then they have the condiment bar of your dreams.
So in the condiment bar that day, they had Ocean's Balance, Benito for a Cacke, Kari Kari, Chili Crisp and Little Brother Chili Crisp with black, and then they had black vinegar and tamari and seaweed flakes and stuff.
How did you choose?
I put all.
Everything?
I have a question.
Yeah.
Just since we've already had a bang, bang, bang, bang.
What time was lunch?
It was like 1.30.
Oh, okay.
That could be added as a bang.
Yeah.
Sounds like a bang, bang, bang, bang.
That's a full handful of bangs.
Yeah.
I don't know if I'm proud or...
Is that the unit?
A hand of bangs.
A hand of bangs.
But I thought that was such a cool way to sample.
I mean, it's so hard to get people into stores and sample products and stuff like that, but I thought it was such a cool way to sample products and also, of course, delicious up your congee.
Yeah.
It's a cool space.
I was looking at their website, creeping on them because I saw that you went there.
And I saw that they have Maine blueberry sriracha and some cool fusion condiments that they source from Maine.
Maine blueberry sriracha?
I want to try it.
We've got to try that.
They have so many cool products there, and I did pick one up as well.
This is Dashi Okume.
It's from a company called Okume in Japan.
They're one of the first products or brands carried at the Tsukiji Fish Market.
They're retail grocery in Japan.
There are these little Dashi packets that you can use to make Dashi.
Then on their website, you can custom make your own Dashi packets.
I thought that was so cool.
You custom made one here that's all circled and stuff.
This one is the ready to go, the grab and go Dashi.
It still has really good words on it.
Check out these words.
There's words like dried bonito, dried soda bonito, dried tuna, dried mackerel, dried amber stripe scad, boiled and dried anchovy.
I mean, this is great, dried squid, dried scallops, dried, there's lots of dried, lots of kelps.
And lots of stuff like you just wouldn't buy on your own to mix up.
They have 30 different kinds of ingredients.
And it says on their website that they're over a trillion combinations of Dashi packets.
So I bet you somebody's got like a Pinterest board with just all these things.
Totally.
They looked it up and like, let's put it on Pinterest.
Yeah, but they have great, great stuff there.
Maine has obviously, Portland, Maine has so many great food and dining options.
You can dial them in too.
They've got like, they've got, they've got some little spectrums here.
You're like elegant to full bodied.
This one's very full bodied.
You got sweet to bitter, sharp to rich, refreshing to flavorful, versatile to unique.
This one's a good deodorant.
It's very, it's high in versatility.
You can also clean your ears out with it.
They didn't mention the secondary use as a deodorant, but I think we should let them know about that.
But Maine has such good food, such good beer.
Yeah, I know.
I feel like we need to do a field trip there, a Bevnet field trip and I'll fly out.
I did find a little piece of Portland, Maine.
Well, 20 minutes north of Portland, Maine.
Maine Beer Co., they finally sell Maine Beer Co.
in my local grocer.
Did you get lunch?
Yeah, I got lunch.
Yes, nice work.
It was in a cooler in the front of the grocers just looking at me.
Lunch is the best.
Lunch used to be legendary.
Everyone was so confused though, because I was serving dinner at home and I was like, do you want some lunch?
They had no idea.
Of course you did.
That's amazing.
I also want to mention that Lorena of Tasu Fruit Chips is in our Slack community.
I had a delightful conversation with her the other day.
These are dehydrated fruit chips and they're so crispy and sweet and delicious.
I have the strawberry banana here, but I can't believe that they've done in such a good way.
These are made in Guatemala and welcome Lorena.
It's so great to have you in our Slack community.
Who's the genius who decided that strawberry and banana were just like made for each other?
They don't come from the same place, but they got together.
Are you sure strawberries don't grow near bananas ever?
No, not ever, but typically they don't.
Bananas are in trees, right?
Strawberries are in bushes.
When was the last time you saw strawberries in the jungle?
Hey, listen, I was thinking, what if there's like a banana tree and then underneath it, there's like a strawberry patch and the banana falls on the strawberry patch.
It's delicious.
Well, Lorena, so great to have you.
You can all join our Slack community at slack.bevnet.com.
It can be a real struggle to get products like Tasu fruit chips and Okume's dashi packets on retail shelves before there's real data to show buyers, which is why emerging brands are so dependent on retailers who are willing to take a chance on brands with limited distribution.
In this community call, we will talk to Couplet Coffee, Lexington Bakes, Parch, Glonuts and Better Sour, all brands carried by Outfox Hospitality about Foxtrot and Dom's recent closing.
We will hear what the impact on business was, what brands are doing to recoup losses and then we will get some advice from the experts on how to move forward effectively.
Please enjoy.
Today on community call, we are going to find out how brands were affected by the closure of Foxtrot and Dom's stores by Outfox Hospitality shutting down, how everybody is navigating the aftermath and then we will exchange strategies on how to move forward effectively.
On today's call, on the brand side, we are so thrilled to welcome Couplet Coffee, Better Sour, Glonuts, Lexington Bakes, Parch and then for experts on the panel, we've got Trent from Gotham Brands and Sarah from Synergy.
Thank you all so much for joining, especially on late notice.
It is so great to have you here.
We are going to start off by hearing from our brand partners.
We'd love to hear just a little bit about your brand, what your relationship with Foxtrot looked like, where you are now and then especially what you need help with moving forward.
Geffen from Couplet, I would love for you to start.
Let's do it.
Hi guys, Geffen from Couplet Coffee here.
I guess the TLDR was that that was actually our first ever retailer.
They reached out to us right before we launched and it was really wild that they had even found us and put us in the up and comers category.
We were a finalist in that and they had been writing for us and working with us so closely for a long time.
So it was really, really crazy that this all happened.
And what was really awesome about it, you know, my quick note was what was really awesome about this is that a lot of people, both customers, and I know this from other people as well here, Glonuts, Lexington Bakes, I've seen a lot of people say that they're just going to miss our products in the stores and now they're buying from us direct to consumer, which is cool.
But a lot of those connections are, you know, it's gonna be hard to maintain them when it's not in the place that they always are used to it.
But to be honest with you, we've had a lot of people come to us, especially people who worked at Foxtrot, managers, other people in the ecosystem, direct store distributors, other markets in areas surrounding and from even from Texas, where we kind of sold a bit less than the Chicago area.
So it's actually generated a lot more business and connection than I think we even had at Foxtrot, which is interesting.
So you know, one giant door closes, many other ones open.
So that's that's my start to this chat, I'm excited.
Are you dealing with inventory?
Are you trying to get inventory back?
Do you have inventory and DCs that you need to move?
How does that sort of shake out?
So we're actually still waiting for more.
A couple of the retailers that Podfoods reached out to on our behalf and other people in this room have actually shown interest and we just have to negotiate costs with them, which is it's one of those things where do I give them a bit of a discount because they know that we're in a bit of a distressed situation?
Or do I give them a discount because that's just kind of their business model?
Or, you know, do I kind of hold out a couple more weeks?
You know, coffee is something where it needs to be sold for me relatively fast for others, you know, it's okay if they sit a little bit longer, but freshness really is key.
So it's really just about waiting for those last words from those retailers that Podfoods connected us with, which they've been really awesome in supporting us.
So I really appreciate them.
To be honest with you, maybe half a pallet or pallet we might just send straight to Amazon at this point because we're seeing some traction there is kind of going to help us get more inventory in there and also D2C is picking up so it's one of those things where we're not super stressed about it.
Like we can indeed do it when we just really have to decide.
Like I'm kind of waiting right now for the final decisions and then going to make sure that it's the right decision.
Like I don't want to act out of panic or like distress or I need to move this fast.
Like let me just get rid of it even if I lose money on it.
So there's a couple options and I've kind of with the help of a lot of people in this room, been able to sort of really take a step back and be grateful for even having options at this point.
So.
Geffen, thank you so much for that.
Bella Hughes from Better Sour, I'd love to hear from you next.
So nice to be here.
And I actually, Geffen, as you know, found your brand at Foxtrot and then we met in real life.
I said I bought it because the packaging was great and I've been a jumper ever since.
So I make sour gummy candy with my lifelong best friend.
And we celebrate tart fruit flavors from the Middle East and Asia Pacific.
We are not even 52 weeks old into retail.
I pinch myself all the time at how much has happened.
And I will say in the last almost 52 weeks, we started selling May 9th in Arowan.
A lot of that is from the early accounts that give you that trial and that early data story.
So Foxtrot was our second retailer and they committed to us.
Like now we've got some insane data out there.
They committed to us just like Arowan did when there was no data.
They were there.
And I think historically, my understanding of Foxtrot has been they've always been that early champion and an early adopter and really there for the startups.
And I'm a repeat founder, three times CPG founder.
So those accounts are just so critical to the ecosystem.
I've been in CPG a long time.
I remember some of you have been in CPG a long time.
I remember like Lucky's closed in 2020.
So these things, they do happen.
They're part of the industry.
They're part of business.
I will say I've been blown away by the response of our distributor, Pod Foods.
They've been so incredibly proactive with the inventory that we have sitting in their DCs that is specific for Foxtrot, which is always a little hairy because what are you gonna do with that product, especially if you just shipped it?
They have not only had like a community call for their brands.
I don't know, Geffen, if you were on that, it was very helpful for us, but they've actually already placed us into 15 different Dashmart locations.
This is in less than a week in seven states.
And then they're in the process right now of actually pitching us to some national retailers.
So really, really grateful to their proactivity.
Historically, on my end, I've always looked for like amazing partners in the industry that take like maybe your lot code is expiring or changing your branding.
So I've always loved working with like a Misfits, for instance, and I think those can be really great resources, but just kind of like Geffen has shared really, really impressed with just Podfoods leadership on this.
Thanks for that.
And then are there any kind of sticking points specifically that you're working through right now or things you're trying to figure out next steps on?
I will say for us, Foxtrot was an amazing retail partner and the buyers were so amazing to work with.
We really, really love working with Mitch and with Kristen and the whole team there.
It was nothing but positive and incredible.
They were a great trial account and I'm sure a lot of folks may feel this way because someone who naturally shops at a Foxtrot probably is a trendy or ahead of the times before it hits mass grocery customer and they would often find us there and then as our retail footprint has grown nationally, then they might be buying us at Foxtrot when they're there for lunch or a meeting, but they're doing their big grocery shops, still in more traditional, whether it's natural or a mule-o retailer and then stocking up there.
I think on our end, what we're trying to work through is what are additional accounts where we can use as a real big trial experience, where folks can find us in something a bit more experiential and then drive that foot traffic to the natural mule-o retailers or Amazon.
And that's where we're right now feeling there's a missing link in the puzzle because those early adopter accounts are so key.
So what you're saying is we need to get those buyers jobs at existing retailers.
I think we do.
And I really like thinking about the buyers that were at Foxtrot, I hope they all land on their feet with amazing jobs because they were such passionate champions and advocates.
And then if they can go to other retailers, they'll be like, hey, hey, this is our early visionary idea.
I think we should bring it in and be the continued advocate that I think so many of us on this call probably have felt from them.
Right, well, we will get working on that immediately.
Lex Evan, thank you so much for that.
Lex Evan from Lexington Bakes, how about you?
My immediate thoughts were always about the people.
I had recently gone to Chicago and DC in the fall and literally just walked to every single Foxtrot store and got to meet every manager.
I became friends with them, so I had them on Instagram and just messaged them immediately back and forth as all the news was kind of unfolding.
And then again, like Bella said, our buyers at Foxtrot are phenomenal partners.
Lexington Bakes would not be where it is if it wasn't for Foxtrot.
I launched this brand January 2022 and by March they had decided to put us in all their stores.
I don't know what other opportunity like that exists.
So I'm also sad for aspiring founders and upcoming brands.
Like I don't know where else that's gonna happen as quickly as it happened for us.
Luckily we've been there for two years.
We grew a lot.
It helped us grow and kind of attract other attention.
So while it is devastating, we're at a point where it won't kill our business.
But if this had happened last year, it absolutely would have been the end for Lexington Bakes because I put all my resources into retail because that was such an early kind of takeoff where I essentially turned DTC off because all the inventory was going to Foxtrot.
So are you thinking that you might re-energize DTC?
Any thoughts on how you'll supplant that Foxtrot business with alternate business?
I thought long and hard about what to do because it all happened so quickly in 2022 where I just said yes because it was the first opportunity to get into retail and really test this out in hindsight or kind of now having this opportunity to pause and reset.
Doesn't LA-based food startup really need to be in Chicago, Texas and DC.?
Do I double down in California and just simplify my operations and logistics?
But then the other part of me is like, no, you've been in those states for two years.
You have built a really strong fan base.
Don't lose that effort and kind of momentum.
So I acted very quickly.
I tried to find a little bit of joy in a really tragic situation.
So I made some funny TikToks and they've taken off.
So we've got a lot of views.
That led to us landing inside every Equinox Cafe in Chicago.
I've personally reached out to like 20 to 30 independent retailers across all those states.
I didn't even realize there were that many independent grocery stores and I'm so happy to partner with them because it's again, supporting this ecosystem of up and coming, not just food brands, but there's other startups in the food and beverage industry.
There aren't just brands.
Like these cafes might become the next Foxtrot one day.
I love that I'm getting to meet them now in kind of the same early stage that my brand is in.
So I'm working very quickly to recoup kind of our footprint in those states, because like Geffen said, we had a ton of DMs on the first day of people just being sad that like, I buy your brownie like every week.
Where am I going to get this epic brownie?
Sorry, that was a plug.
They are epic, epic brownies.
Thank you.
That makes perfect sense.
And you know what?
We still have a number of brands to hear from, but I do want to take a pause and check in with Sarah Dorey and Trent Moffat.
You introduced a question that I think is a really interesting one.
Sarah, I'd love to hear from you first on Lex's question about should an LA-based brand be pushing the Chicago area?
Did I get that question right, Lex?
Yes.
The very unclear answer to that, in my opinion, is it depends.
But if you are seeing it two years in, if you are seeing what we call proof of concept, right?
So I think that the greatest thing is to say you are not in your hometown.
Are you turning well at a retailer that cultivates your consumer?
And if that answer is yes, then the next question is, can you afford to expand, right?
You've been in this long enough to know that it's not cheap.
So can you afford to expand and then go to the right next step, right?
But if you were like, I have to do in-store demos every day and it's a negative ROI to keep me living and breathing in Chicago, which is so far away, then I would say no, retrench, stay in your home market where you can stay a little bit closer, right?
And go after that.
But if you were seeing a success in a Foxtrot and you felt good about it and the levers you pulled were working, then they're not exact replicas, but then let's go talk to Central Market.
Let's go talk to Lowe's in the Southeast.
Let's go to these smaller, it's almost like you make your circle one step, one tiny little bit bigger, where then you say, okay, in these dynamics does my brand work?
And you keep expanding where you can.
Trent, how about you from a distribution perspective?
Any thoughts on that question?
Yeah, so I think she just touched, Sarah just touched on it.
If you've got a negative ROI, probably you might want to cut your losses and double down where you are.
You can get to your core consumers that have already found your product through online or other sources there that you probably work with.
But if you've got a positive ROI or trending towards a positive ROI, I certainly, we talked about earlier with Pod Foods, work with them, they're the ones getting hurt probably more.
I know you guys are devastated, but who's getting crushed the most is probably the distributor at this point.
They've got 30, 60, 90, 120 days worth of receivables probably owed and they're probably very much on your side to build your brand elsewhere.
You've already proven the brand that it sells, so why wouldn't they pitch it to every other store that they had to continue to grow their model?
I'd have as many meetings with them as you could and ask them to put you in front of as many buyers as possible and work with them because they're gonna wanna dig out of this as much if not more than you do.
So they've got a lot more skin in the game at this point, I would think, where you can quickly pivot to other buyers and other markets in your own market, right?
So I think if you work with them, it's gonna be advantageous to a quick growth and a quick pivot in that market if you wanna continue.
As someone brought up, this is certainly happened in CPG before Lucky's shut down previously and there have certainly been others.
What are some of the choices that Pod Foods is having to make right now and have you seen this play out with other distributors before?
What have you seen in the past?
So fair way here, right?
So when they shut down and they were bought prior, later, with a few other stores, a lot of people got hung in some instances on some receivables and some got paid out.
So there's a lot more places where you can go sell and when you are always selling the same accounts and you're always going back there and it gets redundant, good customers are great to have until you lose them.
And then you figure out, there's a lot more customers out there and you can go grab them.
So whether Pod Foods has got a great model and they've continued to grow and they've got good density in LA, and I know Texas and in Chicago, this is gonna hurt them, but there's other options, right?
And there's other stores that are gonna welcome them and they've got good products in their portfolio now because it's already been proven at sale, so they can show that.
So I think that that's the easiest one, but it's never easy, right?
So these are the guys that are holding the notes and you've sold to them and maybe they owe you a little bit, but if you work with them, I think that it'll go a long way.
It sounds like they're being really good about reaching out and continuing.
It's in their best interest too, right?
So, great.
Yeah, absolutely.
Well, thank you so much for that.
Let's get back to the brands.
Kristen Charbo from Glonuts, I would love to hear from you.
Hi, thank you so much for having me on this call.
So, Glonuts are healthy, yummy donut things made with clean ingredients that help you glow from within their gluten-free, sugar-free and vegan.
Foxtrot was a great account for us, just like everyone else here.
We had been in Foxtrot for two years.
We had a great relationship with the buyers, the corporate level.
We had a great relationship with the team members in stores.
We were doing demos with them.
For us, it was our first account outside of Southern California.
And so it was a great opportunity for us to prove that we weren't just an LA donut, that we had potential for product market fit in middle America and the Midwest, in Chicago and Texas.
Texas became such a great market for us.
And luckily through Foxtrot, we were introduced to Cahee and were able to bring them on as a distribution partner for Chicago and Texas.
And expanded into central markets through them as well.
So definitely kind of rethinking, what our strategy is moving forward with Chicago specifically.
Foxtrot was our only account.
Do we try to rebuild there or just focus on re-energizing D to C?
Like you said, Melissa, I like that phrase.
So that's definitely one of our strategies.
It was a hit for us, but they didn't make up a massive part of our business at this stage.
We've had a lot of luck in growing to a certain number of accounts that support us pretty well between Southern California and now we're launching in New York next month with reinforced distribution.
So we'll be able to grow in another key market through them.
But yeah, just really sad and shocked to hear the news.
I was demoing in Dallas at Foxtrot the weekend before they closed.
And I had plans to go to Austin and demo in those stores, had made some really great connections with the team members there.
We were had just launched our two packs and shipped so much product to the Cahey DCs, which luckily or unluckily, I'm not really sure yet, had all been sold to Foxtrot.
So really questioning whether we will get payment from Cahey for that product that was sold to Foxtrot or not, but it's not sitting in the warehouses, which again, not sure if that's good or bad, but it's definitely a loss.
I think on the positive note from a lot of the exposure we've had as an emerging a brand affected by this, we've definitely seen a lot of inbound retailers reaching out to us and supporting us in these moments.
And for that, we're super grateful.
We're super grateful to be a part of calls like this.
I heard a question in there for sure.
So you have product that left the Cahey DCs and you think they made it to the store.
I don't know, Sarah and Trent, any thoughts on what the technicalities there are, whether you'll get paid or not, depending on where the product was?
I would definitely be going through your agreement, right?
What does this state, what is, once it leaves there, is your warehouse and it leaves their warehouse, where is that ownership?
But I would definitely be looking through the details.
Assuming you have a purchase order, right?
I think you're pretty good there, especially with somebody like Ke, I think you're fine.
You know, there's other sources, but I certainly would work with these distributors to find alternate sources for your product.
So that doesn't, if you have return clause, you have something like that, it doesn't wind up back in your warehouse or you can charge for it.
If it's under the dating, right?
You might have date clauses in there.
So you might want to take a look at that stuff, but the faster you can get it out there and the faster it grows, the better you're going to be with that distributor.
You've got an in, so I would take advantage and help them.
Help them help you, right?
Clarifying, Kristen, your product left Cahee and went to Foxtrot.
And so then your concern is Cahee's not going to get paid.
So you're not going to get paid, right?
Correct.
Everything was sold out of the two DCs that were in Cahee.
I will add when it applies to Pod Foods, obviously that's consignment based inventory management.
When I had last checked, we had 50 POs pending with Foxtrot that were delivered and net 30 terms.
So Pod isn't going to get that payment, which means we're certainly not going to get it, but Pod did confirm that they won't be charging us their fee on those unpaid invoices.
So at least that's very helpful in a small way.
And Kristen, is there anything that you need right now?
Like, is there a specific piece of business you're trying to figure out?
I know there were sort of a few that you mentioned in there, whether to lean on D to see more, but what's one of the biggest questions you have right now about what to do next?
You know, I think because Foxtrot was such an obvious account to go to for our emerging brands, because it was, you know, 33 doors in multiple cities, I'm wondering, you know, what accounts are like that, that have built community, that have great traffic, that are great places for discovery, where as a small brand with a small team, we don't have to spend so much on resources, going door to door to, you know, lock in, I think there are a lot of accounts that you can look to that do have that check those boxes as far as, you know, traffic and discovery and supporting emerging brands, but they're one door, two doors.
And I'm just wondering, you know, is anyone going to come in that has more, I guess, weight, or is a larger retailer going to step up to the plate to give more emerging brands a platform?
Sarah, Trent, any thoughts on what some of these smaller retailers in the area might be, or how to locate them?
Especially if you're out of the network, it's going to be a little bit more difficult, right?
So, and you're with Pod Foods, I think you said, right?
So I would...
Kayhee, actually.
So I would ask Kayhee for a list of the stores, right?
And a list of the areas that you could go to.
They're not apt to send you an entire list, but I'm sure based on the circumstances and by zip code, I'm sure that they could help you then.
So if they gave you some insight that these are good chains to go after, one, or two, independence, these are the good ones to go after.
I think it's advantageous for them and for you.
So I don't think that they'd hold back.
And it's one time where, I mean, time to call Kayhee and they won't call you back.
This is one time they'll probably call you back and they'll work with you.
So take advantage of and build a relationship here and make it a positive.
Thank you.
Yeah, I would underscore Trent's comment about, I think, across the board, take advantage of the relationship opportunities you guys are going to get through this bad thing because it will connect you and have a conversation today and have a conversation next year.
I would say, as you think through locations, I think what everybody is missing here, and I think this conversation has been enlightening in terms of, Foxtrot was kind of the sexy kid on the market, right?
And who 10 years ago, that was when I started in the small food side of this industry, everybody started at Whole Foods in one region and demoed every weekend and then got seven more doors, and that model really doesn't consistently exist anymore.
So I don't see, today for me when I look out there, I don't see who's the next one that's going to be the flashy kid on the block.
Someone's going to have to create that.
It's interesting we're having this conversation today when Wal-Mart's push against going after a private label Trader Joe's play is coming out there.
So we're in an interesting time in the marketplace.
That being said, in pockets in different areas, it depends on the way you want to go about it, but in Texas, you already mentioned you're in Central Market.
United is, although it is under the Alberts and Safeway kind of network, they do have some really great stores that have your consumer in it.
Relative to Chicago, that's a bit different.
And so my message to you is if you can, right, this is always the question of how much inventory are we looking at and how much do we just need to get rid of, right?
But if you can, stay within the retailers that stay within your consumer target, because the troubling thing you can do is to say, I've got to get through this inventory, so just put me anywhere, right?
And then all of a sudden you go in here and a business that had felt really good and it was turning really well, all of a sudden stops working for you.
It could just be because you're all of a sudden in a retailer that doesn't align to your consumer base, right?
Whereas before you were in the perfect alignment.
And so, you know, there are other places to go within Chicago, like Mariano's, but that has to go through Kroger normally.
And so they're, you know, a fresh time.
Now, is that, that's not the, that's a different kind of a network that you're looking at there, but those are, there are great pockets of retailers.
You just kind of have to define, okay, where do I fit?
How do I service them?
And we can go through, and I do agree though, Kehe does have a list that they publish, go on the Kehe Connect site.
They have kind of at least key retailers and then utilize their reps as well.
We're definitely doing that and they have been helpful so far.
And I think the thing that, you know, was earlier mentioned is, I think it was you, Kristen, is that Foxtrot is like amazing for trial, but they weren't necessarily the biggest volume mover.
For us, it's been the same experience.
Like they were the early adopter customer, like I mentioned earlier, who would then go on their weekly grocery shop and buy a lot of product, like stock up.
But where there was that point of discovery.
So, you know, just as a founder, I think everyone should be looking to even more traditional or mass retailers.
Because if you're looking to move volume, that's really where you're going to move the needle in terms of your business and finding that product market fit and really compelling data.
There's a few things or a few learnings to share from like a brand strategy perspective.
When you analyze the like the allure of Foxtrot, right?
When I saw all the other TikToks creators were making, it wasn't where am I going to get my groceries?
It's where am I going to get my coffee?
So when you think about that, like going from Foxtrot in Chicago to like a Mariano's isn't going to have the same turn because people aren't going to Mariano's every day for coffee.
So they're not being exposed to new brands.
It's a bigger footprint.
Sure, it could work.
It's going to require a lot more marketing, a lot more awareness.
But the allure of Foxtrot was people are in there every day for their coffee.
So they're exposed to your brand, which is why it was such a great account for awareness.
But also their selection, specifically for Kristen and me, in the fridge, like there weren't a million snack brands in the fridge.
It was literally all the new emerging snack brands.
There were like less than a dozen.
So when you're standing waiting for your coffee and the fridge is right there and you look over, you're like, oh, this must be important because they only have eight snack brands in the fridge.
Let me investigate.
That's why it's such a good account for Discovery.
But because of coffee and being a snack, like obviously, sure, I want a brownie or a Glonut with my coffee.
It was high turn for us.
But again, there's other parts of Foxtrot where if you're wandering, like it is great for Discovery to go into dry aisles too.
So if your goal is to recapture that like Discovery Avenue, think about where consumers are going to be going on a daily basis, which is why I reached out to a lot of these independent coffee shops that have markets or cafes.
Like that's the important thing for me in Chicago and DC and Texas is capturing that same kind of consumer behavior to leverage for my brand growth versus just trying to get doors again.
You know, Lex, I really love your perspective of how you're thinking about it, right?
I'm thinking about the way consumers are approaching the store and kind of trying to get to other places where they have that same mind frame or mindset.
So I guess my answer is no, back to most of your specific question.
No, I haven't seen it.
It doesn't mean it won't happen, but I really think too, and this is a heavy push, relative defeat on the street, but going into the market of literally kind of figuring out what is close by, even if you can get ranking of what are my top Foxtrot stores and then, you know, seeing what's in that community because a lot of times you're only going to get into those points of distribution, whether it's a cafe or a retail store by walking in the door because they're not going to be a big chain, right?
They're local, people felt connected to Foxtrot as consumers, just like everybody here felt connected to them as business partners.
And so it's likely some of this is going to be likely on foot or via email or even I think there's an opportunity here with, you know, kind of leveraging like you did Lex of leveraging like the PR of it, right?
Like of sending out a, hey, we miss them too, right?
Like I know for me when I relocated, I am personally sad when I don't have my local place to go shop, right?
Consumers are feeling that.
And so the degree you guys can be talking and talking to them about that creates a connection point for you guys.
Can I add two things?
Please.
So the TikTok and Instagram content that has worked really well for us, what it's resulted or yielded is replicating that in-store kind of walk-in to pitch your product to these retailers.
Because those independent retailers are seeing the reels and the TikToks, our consumers are tagging them in the comments.
So they're essentially doing the work for us to tell these retailers, like, we buy this product, we're going to keep buying it, we really want you to stock it.
I had one account in DC that said, we primarily focus on Asian food and snacks, but we really see the awareness of your stuff, like we're willing to give it a shot.
That was mind-blowing to me because I'm like, you would have never considered Lexington Bakes before, but you're part of this kind of response, and it's emotionally driven, and it's again, same as leveraging the PR wave, it's leveraging that emotional wave to kind of get into places you probably wouldn't have gotten into if Foxtrot hadn't abruptly closed.
And the second point is, I actually spoke to Thrive Market yesterday.
They did launch a RangeMe application.
They are kind of like, hey, send us all the brands that are in Foxtrot.
There's a questionnaire to make sure you are actually in Foxtrot and you're not trying to hijack this.
But yeah, they are reviewing brands now in the middle of their cycles.
Thank you so much for that.
And that was a false start earlier, Ayla.
Last but certainly not least, Ayla from Parch, please give us a quick Parch overview and we'd love to hear from you, what your experience with this whole thing has been.
Totally.
I think we've got two different perspectives.
One is we got a double whammy.
So if anyone's in the non-alcoholic space, which we are in, which is non-alcoholic agave cocktails with adaptogens, our lead account, our very first account, Boisson, closed the prior week.
So again, rug ripped out from under us.
I definitely have some contacts in this space.
And for both these examples, Boisson and Foxtrot, which then came the following week, I'd had some inklings, but I mean, pretty shocking.
I don't know if that's ever precedented.
Boisson had 10 stores between New York, LA and Miami.
I think Miami might have been opened for two weeks.
And then Foxtrot, 33 stores, we were not in all of them.
But I mean, that's essentially a universe of high value.
Consumers are number one and number two accounts.
As a brand that we've been at in market for 20 months, we started in Boisson, the biggest retailer for non-alcohol beverages.
And then number two, we're at Upcommer's shortlist for Foxtrot, kind of that pinch yourself moment.
The Dream account that was on my vision board, both of them were, that we got in our first month of operation.
So amazing.
But over the journey over those 20 months with Foxtrot specifically, we did not have a great relationship with them.
We got in as this kind of celebrated brand in the showcase of Upcommer's for that first summer.
And then allowed us to get position on shelf with one SKU.
They wouldn't re-evaluate our second SKU, which was delayed in production.
And we frankly found it impossible to find anyone in this category as the category buyer over the year and a half of our relationship.
So because we were building a new category, not all beverages, they were not really ready for that.
They were very focused on building their own trademark.
So they had their own white label, very cool-looking wines and cocktails.
I could see a little bit, like we had diversified early on.
So yes, they were dream accounts, but we quickly diversified and that's kind of the key for all this.
I feel devastated for those folks who have so much inventory in there, especially, you know, I saw the story about the merch provider who was at 100,000.
I have friends who were at 30K from Boisson and then X from Foxtrot as well.
Like we were lucky in that maybe we weren't so successful that they had both, their last POs were kind of three months ago, so they had been paid up, but I just feel for the staff.
We had great relations with some of the buyers, the people who were going through the process for the Foxtrot Up and Comers were wonderful, the staff from Boisson were wonderful.
They didn't have a clue that this was coming.
I mean, that's why those POs were going in, ridiculous numbers.
That was shocking that they were able to put in these huge orders for small retailers.
I know one of my friends' businesses is pretty much at the end of their journey now, because they're out 30k, they can't pay their suppliers.
They're through the Boisson relationship, but Foxtrot must be the same for a lot of the folks.
Our only experience is, I saw they weren't, we opened it with them in Austin in that store, and then we got, didn't get repurchased, didn't get delisted, had no communication from the Chicago group of stores.
And then a few months later, the DC buyers reached out, completely separate, to bring us in store just a few months later.
So it was completely haphazard, and as I saw them get so much money and expand so fast, it was pretty much a replica, albeit at a bigger scale than Boisson.
You know, doubling, tripling your retail footprint, not having the folks, people, buyers to be able to answer simple questions on RPOs and sampling demos.
We want to help move this product, both Boisson and Foxtrot.
Absolutely, whether it was unreasonable goals from VC Investment or whatever the reason, the expansion was ridiculous.
And so in one world, I thought, oh my God, this is amazing.
We're going to be in all these stores.
And I quickly realized that no one was replying.
And people, especially with that merger with Dom's, no one knew what their job titles were.
You know, it was just impossible to find people and it felt like chaos.
So I feel very fortunate that we're not out, like some of our friends, but we're here to help in any way we can to partner with brands, to, you know, leverage them, support them.
We're a tiny too, but whatever we can do as a community is really important.
Honestly, I think there's other people who need the help rather than us.
We've been, we're definitely pivoting in certain ways.
We have distributor issues, on-premise stuff we're moving to, buss.
I think what is happening and I, you know, I'm sure we all follow Andrea a lot on SnackShot, but there's another store in Brooklyn, Meckleburg, they closed their flagship location.
It's a two-door, but it's very much that Foxtrot model of like curated, lovely, high-end consumer.
They also shuttered and Pop-Up Grocer has been struggling, I think, as well.
These kind of, was on, was a specialist store for non-alk.
That's going in-house in mainstream grocery and natural grocery.
These curated buyers are going in-house and they're kind of creating this store within the store experience.
So these one-stop destinations that were for curated, interesting startup brands, they're kind of going immediately to the mainstream, which is good for scale.
And so for everyone who's kind of on this call, there's absolutely those buyers who are more interested in these, what would have perceived as niche opportunities before.
So the consumer is much more mainstream than I think people thought it to be.
Thank you, Ayla.
I do see messages here in the chat.
Danny, who is an F&B coach in Chicago, is doing a pop-up.
So you can reach out to her on LinkedIn.
Danny, I think I'm going to butcher this name, but Zuka Vicki, Z-U-C-H-O-V-I-C-K-I.
There's an email in there too.
So there will be a pop-up in Chicago to try to help solve that issue of other retailers in the area.
And then I also see a comment here from Russ Taylor.
It sounds like there may be a consideration in the insurance department that certainly we would love to talk about a little bit here.
Yeah.
Hey, Melissa.
How are you?
Great to see everyone on the call.
Some familiar faces, some new faces.
So immediately when we heard about Foxtrot, we went through and looked at all the policy language that we know about.
And traditional, you know, general liability and product liability, umbrella insurance really isn't designed to cover something like this.
So there's no real recourse through prior existing policies.
But trade credit insurance, excuse me, which a lot of you have probably heard of or heard whispers of, traditionally employed by larger brands, can work in some unique ways in this scenario.
And we reached out to one of our partners who does a lot, provides us with a lot of the trade credit policies that we access.
And they said, yes, this is something that could be covered.
I'm not saying this would be the perfect fit for everyone, but definitely as you're scaling or you're thinking about entering a new retailer, I think my comment in the chat was, if there is a new kid on the block that pops up that looks and feels like a Foxtrot, right?
At multiple locations.
And, you know, now we're uncertain of the funding behind them.
This might be an avenue to look into and do some cost comparisons of what it would look like to get a policy that protects against their inability to fulfill or them canceling an order on you as you're scaling a production to go into their retail shelves.
I know insurance is usually everyone's favorite topic, but it can, you know, with the appropriate strategy in place, a lot of times you can find something that allows you to hedge against the model that's hopefully going to help you scale growth.
So we at Secure CPG, we specialize in CPG insurance.
That's our shameless plug.
But we're happy to talk brands through sort of the strategies around it and show them what options they might have if they're worried about a looming decision or contract that they're thinking about entering into.
Let's see.
Trent and Sarah, any thoughts on maybe even big picture?
What we saw Boisson shut down, obviously we're here about Outfox Hospitality.
Any thoughts in general about what's going on in the industry right now and what you might be keeping your eyes open for in the future?
I'll start.
I think we're in a really tough time in the industry.
There is no denying that we've all seen the challenges from a private equity perspective in the last year.
I'll be honest, I don't love seeing the consistency of a lot of things shutting down, but I also think we're all paying the price of some bad money.
There were some bad things that were allowed in the industry that is all coming to fruition now.
But that being said, the thing that I come back to is the push for better for you, cleaner, you know, this push for better quality food is not going to go away.
I firmly do not believe that, and I firmly believe that that's not going away.
So how does it get there?
I think some folks have said it's going to go mainstream faster.
That's going to be hard, right?
It is really the bigger footprint you go into, the harder it is to get your people to pay attention to you, and that's why that early engagement in a small location is really important.
So I think it's a matter of, you know, these things are hard.
Have faith, right?
Be really thoughtful on how you are approaching your consumers, and I think that this is a pivot point or an inflection point where you have an opportunity to have that personal conversation, you know, via the digital world, obviously, with consumers that clearly are going to feel the loss of not having access to you at their local store.
And so take advantage of that.
You know, Lex's comment was great about, you know, a store in Washington, DC are going to take us in, and we would have never thought about that.
These are kind of opportunities to engage that you don't always get.
That's the silver lining.
So use it to your advantage and talk to those consumers.
But I think, again, it's going to look different.
I still think you stay the course of, if you can, you stay the course of go into retailers that align to my consumer.
It's the easiest way to gain your trial, to make your levers work really hard for you and continue to take steps.
I don't think this means you need to turn around and go to a mass retailer or a large retailer where you're going to have to fight the noise and the pricing and the promotional pressure as aggressively.
But know that this is an interesting time in the industry, and you're going to have to be nimble and flexible and thoughtful, and ideally as conservative too in terms of your finances.
So I hope that's helpful.
Thank you, Sarah.
So just to follow up on that, I would say, look, these type of accounts are gems and they're hard to find, like the Foxtrot's of the world, the Fairways of the world that went under, but there's others like Airwon, Molly Stone's, and there are several throughout the country that benefit brands because there's limited SKUs and there's less competition and it's easier to get in and work that way.
But maybe that's part of the model why it didn't work so well because they're a select consumer.
We've got a Goods Mart in New York who's tried this model for a very long time and you have to expand to that degree, right?
But same model, very simple brands.
When you put a brand in there, it explodes for a brand, but that doesn't mean that they're able to pay huge rents, huge overhead, et cetera.
So you've got a pretty serious earlier proof of concept.
So you benefited from being in these stores and taking that proof of concept and take the win and move it to another buyer, and that's going to be a win.
And also somebody said earlier, but keep in touch with your buyers now.
They're going to end up somewhere else, especially the good ones.
They're going to end up quickly somewhere else, and they're going to appreciate your support.
Reach out to them, LinkedIn.
I've been there.
So when you've been down and things are bad and you get them patted back or introduce them to somebody else, it goes a very long way.
It could be two years from now that they end up somewhere great and they return the favor, never return the favor, but it's just a good thing to do now because these folks probably wasn't their fault, many of them, and a little push sometimes, especially at this time, goes a long way and it's certainly worth a shot.
Thank you so much for that.
Well, I think that just about does it.
Before we say goodbye from our brand partners, Couplet Coffee, Better Sour, Glonuts, Lexington Bakes and Parch, any final thoughts, parting words, what you're going to do next, any advice for other brands who are working through this problem as well?
I just have one note.
Be like Lex and make content about it because that is what people are connecting with, especially with Lex.
You're on it.
I'm seeing it all the time.
So huge kudos to you.
I'll be taking notes from that for sure myself.
Thank you.
I'm glad I figured out TikTok just as it got banned.
Thank you all so much for joining.
I so appreciate the conversation.
It's been just such a pleasure to hear from all of you, and I really appreciate you all taking the time out of your day to chat with us.
That concludes another episode of the Community Call Podcast.
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