H is for Helping Hands

In May I was heavily involved with the Wollongong Launch of South Coast Food – a not for profit group formed to bring local producers and local consumers closer together.

The 3 events we put together over the weekend were in hindsight a formidable undertaking. In the end we managed to spread the local word to hundreds of keen Gongites/ (Gongsters?) at Wollongong Mall, Illawarra Brewing  and Bulli Foragers Market (definitely Wollongong’s best small producer market). We also gave our “Foodie” membership base a solid kick start.

Whilst it was fantastic to meet all these keen food consumers the highlight for me was the amazing co-operation from very busy local producers. Whilst not every producer I asked was keen we still had invaluable helping hands from the following wonderful local producers….we couldn’t have done it without them so plese support them.

KVO logo Love My Earth Logo Pompadours Chocolates Logo Ravenous Logo South Coast Dairy Logo Taste-of-Paradise-3R Delano-Logo foodscape tours logo Ilawarra Prime Alpaca Illawarra Brewing Logo K V Fudge

G is for Growing Pains – Dr Pigeon’s Preventive Prescription

Whilst undertaking the Pigeonhouse150 end of month accounts (please keep reading it gets more exciting!) I noticed the growing list of producers who we have been in partnership with – now up to 40 – but there are only 8 that are still on my regular list of pick ups.

This got me thinking about the key characteristics of the producers who are on track to growth and the growing pains that have kept others in small producer sick bay.

5 Keys to Reducing Growth Pain

1. Money 

It’s a fairly obvious one – but many producers are still dreaming that they can expand using only operational cash flow. With most producers not even getting a wage in the first 2 years finding funds for investing in staff, production capacity and marketing out of sales revenue is pretty much impossible.

Of course there are alternatives – angel investors, government grants, crowd funding – but none of my suppliers has taken this course. What I have seen work is spinning off from an existing successful business and using the funds/resources from this to subsidise the new venture. In particular Ravenous Food Company has used their highly successful Ravensthorpe Restaurant/Functions Venue to provide kitchen and staffing resources through the difficult first years. Cleverly they also use the Ravenous brand to promote Ravensthorpe – handing out flyers at farmers markets and using QR codes on the product to link to http://www.ravensthorpe.com.au/ – which by the way if you are in the wedding planning process you won’t beat!

2. Focus

The suggested remedy for the money problem (cross business subsidising) unfortunately presents a problem when it comes to stage 2 in the growth journey. I’ve seen this with a few suppliers who are trying to manage 2 income streams – an existing successful business and a new business still trying to find it’s way. To be honest I’ve faced this same struggle – balancing an established corporate catering business http://www.wickedfoods.com and Pigeonhouse150.

My more advanced suppliers have taken the next leap – by either selling the old business or hiring capable management to run one or even both businesses. This allows the producer to focus on the area of the business where they can have maximum impact. From my experience this is as a “brand ambassador” – nothing is more impressive than the products original creator getting out and meeting their customers, being a player in the industry eg. David Lowe from Lowe Wines.

3. Realistic Short and Medium Term Goals

Initially the starry eyes of the artisan producer were appealing and mesmerising to a new distributor. A few years on and yes, I’ve become a little cynical. Growth won’t be in a straight line, if it’s less than 10% p.a. it will be painful, if it’s more than 20% p.a. it will be painful.

Aim for 20% growth but have a plan for no growth too – it happens – big customers come and big customers go. Don’t aim above 20% unless you have everything else ticked off (especially the money).

You actually need 6 realistic plans with detailed P&L and Cashflow analysis.

  • Short Term (I suggest 6 months) Bad, Ok and Good 
  • Medium Term (1-2 years) Bad, Ok and Good

If you can’t explain where the cash will be coming from in Month 15 on the Bad Plan then you have a serious problem. A good distributor will be asking you for these plans – you don’t need to hand them over but it sure helps if we are dancing to the same beat.

4. People Skills

Be honest, be really honest – is one of the reasons you like being a small producer (with no boss and no staff) because you’d rather be with your pickles than with people? Like any critical skill in business if you aren’t strong in an area you will need to find someone who is. Vested Interest Alert…. Get a distributor who knows how to handle customers – you only have to pay them when they make a sale and maintaining a good strong relationship with one distributor is so much easier than dealing with 30 small customers – many of whom have the same people skill deficiency as you.

If you treat your customers like they owe you something they will repay you by finding a similar product elsewhere eventually – so leave the people skills to the people who love people.

5. Partners

You are probably going to need a few different partners who at least understand your dream, even if they don’t fully agree with it.

Your life partner – critical that you share the expectation realistically. Even more important share the small successes with them. They will hear all about your bad days – that’s human nature – but make sure you balance this with every happy moment. Make sure you also dedicate some resources to relationship growth too – small business can easily dominate a life.

Your business partner (may be the same as your life partner -if so I am in awe of you!). Hopefully your business partner will bring some skills to the business that you don’t have, and also be appreciative of the special skills you bring to the business.

Your trading partners- your suppliers, your customers – they are all partners in your growth. The more they understand your dream and your plan the better. It amazes me how happy a producer is to go through all the pain of a farmers market (think packing up your car, setting up stall, getting rained on, packing away etc) yet to get them to come and talk to a retail customer is like pulling teeth. Incidentally the retail customer is spending more than every customer at the farmers market – and a conversation with them will almost always mean they will try harder to move your products.

This list is by no means exhaustive – unlike being a small producer – which is always exhaustive.

For further information about how to grow your artisan food business keep reading this blog – which I hope is helpful.

Existing producers comments are very welcome – as are those of consumers, retailers – anyone with a genuine interest in small scale food production (unless you are a spammer of course).

Justin “Pidge”

 

 

F is for Feedback – Chew On This

Pigeonhouse150 now works with 16 small scale local producers, distributing their unique products to 70+ retailers and food service businesses in Canberra, Sydney, The Southern Highlands and the South Coast of NSW.

The business is as much about information distribution as it is about food distribution. Primarily I have tried to bring the story behind the food to the retailer so they can share it with their customers, but increasingly I’ve realised how important it is to bring information back to the producer- yes customer feedback.

In my experience many producers struggle to deal with non-positive customer feedback in a non-emotive way.

It’s an interesting change in dynamic when a distributor becomes involved in the food chain.   Up until this point the producer has relied on direct feedback – usually at a farmers market or face to face when they deliver to a “trusted” retailer. 

Both these groups are often a little in awe of the artisan, or very conscious of the ego or even the feelings of the person who made the product. As a result almost all feedback is gushingly positive.

Imagine you are at an art exhibition, critically commenting to a friend about a painting when the bystander to your left turns out to be the artist. Immediately you try to soften your comments, highlight the positives, and in an extreme fit of guilt maybe end up buying the artwork. 

akiane, funny cartoon, critic, child art

I believe a fair percentage of purchases at farmers markets come about not from a desire to actually have the product – but to make the artisan across the table feel better – it’s almost an exchange for their time in talking to the prospective customer.

Retailers/restaurants have a different relationship with their customers. Generally they are service driven and they take every half comment from their customers as gospel – especially if it’s a regular. As a result retailers can be scared of change – of removing an existing range or of increasing a price. Often this is to the detriment of their business as they fail to innovate or take advantage of higher margin premium products that might bring in a whole new market.

The same retailer that was sensitive in passing on the feedback to the artisan gets enormous relief when a distributor becomes involved. Suddenly they can let loose, passing on the customer comments that they have been soaking up since their relationship with the artisan began. In extreme cases I have even had retailers hand over all the returned product that they were too scared to give directly to the producer.

A distributor can be more subjective than both the retailer and the artisan. We didn’t make the product, and through daily interaction with the producer we don’t live in awe of them. We can collate all the customer feedback and decide when it’s meaningful to pass this on to a producer, and even time this information exchange so it’s not while they are elbow deep in a milk churn. 

This is important – if a distributor is passing on feedback it means they believe it is critical for your business.

A distributor relationship also allows the producer to have a small WTF moment without losing their customer. I’ve seen a cranky producer lose a valuable cafe client just because the cafe operator was brave enough to pass on some customer feedback. He spat the dummy in the middle of the cafe, they decided they didn’t need that kind of distraction from their business.

But, and here’s the big BUT, after you’ve had your post-feedback moment and you’ve put away the Kleenex, your distributor does have some expectations.

We want you to “Chew on the Feedback”. Seriously, talk about it with your employees, partners, with us. Work out if this piece of criticism is a golden opportunity to improve your product, to grow your business.

Then make the changes.

If you don’t do this then in the long term you will lose your biggest customer – your distributor. Distributors are rational – and they should never sacrifice growing their own business if you aren’t willing to do what it takes to grow yours.

A Pigeon in The Big Apple- Day 1

Feeling like a very lucky pigeon today…

Less than 12 hours after touch down we are in Central Park, the clammer of the St Patricks Day Parade ringing in our ears, and it starts to snow.

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I half expected the squirrel (yep we only saw one mangy squirrel – but it was a little chilly) to start talking and Mr Tumnus the fawn to emerge.

This was after a fairly food focused morning that took in Chelsea Market (too quiet – going back another day), Half the Highline – the amazing reclaimed raised railway line turned into a snaking sculpture garden…

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Union Square Green Market which was a little light on range due to recent cold weather – but plenty of root veg, apples and warm cider. It really brought home how much more the seasons impact agriculture in this part of the world compared to Australia. The challenge of eating local at this latitude would make for a fairly limited winter menu.

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Teeny Weeny Peanut Potatoes

Teeny Weeny Peanut Potatoes

The Food Highlight of Day 1 was undoubtedly Eataly – an astounding Italian food market in the Flatiron district (200 Fifth Ave) with 13 different counters to indulge in all things Italian. You can watch the buffalo mozzarella being made fresh and the pasta being rolled.

We stayed over an hour, wolfed down a Grande Piatto Misto di Salumi and Formaggi (5 Meats, 5 Cheeses and some amazing chilli apricots and Amaretto Honey)- and will be going back to restock for one of our “Too stuffed-eating in nights”.

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Also visited Beechers Cheese – a full cheese production facility on Broadway. Very informative tasting session which included the “No Woman” Cheese – a semi-hard cows milk cheese with subtle Jamaican Jerk Spice. Hard to imagine a Sydney CBD site that could pull this off (rent must be cheaper in NYC).

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E is for Education (& Enthusiasm)

I’d like to introduce my number one on-seller of local produce, his name is Oscar.

He works part time at a small local butcher shop that recently started stocking approximately 12 lines of Pigeonhouse150 products. Oscar has tasted the 1910BC Pickled Eggs and The Ravenous Fennel Shards, he knows who roasts the Rush Coffee and where the farm is that grows the Organic Rhubarb in Honey.

Because of Oscar’s product knowledge I now deliver two-three times a week to this butcher, which surprised me as other larger food retailers are ordering less.

Oh – by the way, Oscar is 8 years old. His Dad owns the butcher shop and has put Oscar in charge of running the Pigeonhouse150 brands. Oscar orders, merchandises and promotes the products – he fights hard for space on the A-frame blackboard outside the shop.

What if every outlet you distributed to had an Oscar?

I don’t see Oscar’s age as relevant – what you need is food retail staff who are

-Educated about your product

-Enthusiastic about giving their customers solutions to their food dilemmas

There are some simple steps that I have been implementing to get food staff educated and enthusiastic.

1.  Make sure every employee in the outlet has tried your product – and tried it in a real life situation – if your special sauce tastes great with a duck pie – bring in a duck pie and give them the pie as well. Some larger stores have a monthly staff tasting day – ask if you can add your products and be there too. Additionally if you are doing an in-store tasting give the staff the first opportunity to taste.

Test your new products on retail staff too – they will love being fundamental to your N.P.D.

2. Ask them what they thought – it makes them realise how important they are to you and also gives you a chance to add layers to the description they will share with customers.

3. Share the story behind the product – and with artisan products there is always a story. Put your story in a basic flyer but more importantly talk to the staff every time you are in the store (delivering, taking orders, even shopping yourself). Let them know you would love them to share the story with their customers.

4. Give them an incentive – best to keep this simple. Do a pop-quiz question to test their product knowledge and the first staff member to get it right wins a small hamper of your products. Alternatively you could work in with an owner to track sales on a product by sales assistant – you will need a strong relationship with the owner/manager to make this work.

5. Visit the outlet at different times to make contact with casuals and part timers. Don’t rely on store managers or owners to share your story with staff – they have countless other responsibilities.

You can never totally replicate your own levels of product knowledge and enthusiasm – but you can make a massive difference to your sales in each outlet by continually working with your on-sellers and most importantly the front line staff.

How Woolies influences what you eat – even when you’re at the Pub Bistro

The Pigeonhouse150 team had a very interesting discussion with a local chef this week.

Chef Tim (not his real name) runs a bistro at a busy iconic pub that caters mainly to regular locals.

Recently there’s been a change of ownership at the pub. The new owners are the Australian Liquor and Hospitality Group (ALH). The acquisition of this hotel was part of a group of 27 NSW hotels purchased late last year, which brought the total number of hotels controlled by the group to nearly 300.

ALH is 75% owned by the fresh food/petrol/gambling/credit card people Woolworths. Until I spoke with Tim I had assumed that Woolworths main interest in pub acquisition was the stream of revenue from gambling and alcohol sales. I didn’t think of the impact on the local pub bistro until my chat with Tim.

 

I’m the first to admit that pub bistros are more often “Deep Fry Temples” than centres for food innovation or locavore hubs. However it was still a channel I felt could be influenced to get on board the local food mega trend, with flexible menus and strong local patronage.

Something tells me the efficient and profitable Woolies system is going to be a barrier to this.

Hopefully the Woolies marketing team can see beyond the superficial checked shirt “Fresh Food Fair” and leave a small but genuine window open for local producers in their “local” pubs. This would support this statement on the ALH website:

” Our portfolio includes iconic hotels and neighbourhood pubs, each tailored to its local market”

As always the fork is in the hand of the consumer – so if you see a local bistro featuring a local product eat it. Not just because it’s local – but because it will probably taste better too. If you see your local bistro not featuring local products get into the ear of the chef and find out why not.

 

 

 

 

 

 

 

 

C is for Customer Cubed – How to go from Farmers Market to Customers Market

So you’re an old hand at the local farmers market, your regular customers can’t get enough of your unique hand crafted product. You also capture your share of the one-off farmers market attendees.

You’re turning over $1000 in a day, taking home $200 after all your expenses…life’s good?

What’s missing is any chance of business growth. If you don’t want to grow you are at the right show.

The alternative to the Farmers Market is what I call The Customers Cubed Market – I call it this because there are more customers there than farmers – and this is why your artisan food business can grow there.

You also have more levels of customer at the Customers Market – at least 3:

  1. Distributor
  2. Retailer
  3. Consumer

As a supplier to the customer market you need to dance with 3 partners, all of them dancing slightly different dances. Importantly you need to choose a ball gown that works for all 3 dances. (If you’re wondering what this odd reference to dancing is all about check out this simple “new marketing” article that my business partner recently shared with me http://blogs.hbr.org/cs/2012/05/marketing_needs_a_new_metaphor.html?awid=5234573821286001113-3271).

What this means from a practical viewpoint is that you need to understand how your product will improve the lives of 3 people.

For example

– will it complement the products in a distributor’s range so they can deliver more to the same customer base?

– will it provide a simple interesting story for a waiter to share and boost her tips?

– is the jar size just right for Rachel Williams of Engadine’s Osso Bucco recipe so she doesn’t have a half a jar left in the fridge until it goes mouldy?

Dealing with Customer Cubed is way more complicated than the one dimensional transaction at a farmers market.

For an artisan producer used to the goodwill in a Farmers Market, where to be honest there is plenty of pissing in the producers pocket, the realisation that a customer has specific demands can be an affront to the ego.

And the biggest demands come from the second customer – The Retailer. They think differently to the artisan producer – essentially they have a customer that they want to consistently please. Most producers have a product that they want someone to use.

The single greatest demand I hear from retailers/food service is consistency. Once the initial charm of an artisan product wears off (normally the second or third order) a retailer will no longer tolerate size variation or a burnt edge. These are things Farmers Market customers will normally let you get away with.

Spend some time on your production systems and quality control (especially when you start employing staff). As an absolute minimum get a photo of how your product should always look. If you don’t meet the standard get ready to refund the retailer.

Artisans who think a little less like a producer and more like a retailer will have a far better chance of growth. A great example of this is Brisbane’s Di Bella Coffee Roasters http://www.dibellacoffee.com.au/about-us/about-di-bella-coffee.html – they grew from Farmers Markets to International company and have an awesome retail concept happening that combines production and food service.

Just writing this has given me more doubt about the term “Artisan”. Now that Woolies has “Artisan” Lettuce is it time for a more practical term for small batch food producers. I’m thinking something that captures the effort involved but also that the purpose of the product is to be consumed and enjoyed – not hung on a wall.

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