S01 E40 - Brewing Innovation: Building a Coffee Brand with an Ocean Air Advantage

Episode Summary

In this episode of SKUFood Recipes for Success, we sit down with the co-founders of Saltwinds Coffee, Laura Richard and Brad Rideout, to explore how innovation, science, and entrepreneurship have come together to create one of Canada's most unique coffee brands. From their roots in New Brunswick to expanding into retail markets. Saltwinds has built their business by being different through its proprietary Ocean Air infusion process that brings a distinctive maritime element to every roast.

Laura and Brad share the story behind building Saltwinds Coffee, combining expertise in chemistry, product development, technology, and business growth to create a brand that stands out in a crowded category. They discuss the challenges and opportunities of bringing an innovative product to market, the importance of differentiation, and how they've translated a unique concept into an award-winning brand with national reach.

We also explore the balance between innovation and commercialization, the role of storytelling in building consumer connection, and what it takes to scale a premium food and beverage brand. 

Connect with Laura & Brad:

https://saltwindscoffee.com/

https://www.facebook.com/saltwindscoffee 

https://www.instagram.com/saltwindscoffee 

https://www.tiktok.com/@saltwindscoffee 

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If you would like to be on the show, send us an email :

peter@skufood.com or  susan@skufood.com

Keep informed and up to date about the latest news in the food industry, and follow us on social media:

• Join our weekly SKUFood newsletter 
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Thanks for listening!

Transcript

Welcome to SKUFood: Recipes for Success. Your host, Peter Chapman, understands the food and beverage industry. He is committed to helping producers and processors get their products on the shelf and into the shopping cart. Peter has considerable experience from developing products, building relationships with suppliers throughout the supply chain, to retail merchandising.

Peter worked for 19 years with Canada's largest food retailer, Loblaws. After leaving Loblaw, he started Skew Food to help producers and processors understand retailers better and sell more. He's also the author of A La Carte: A Supplier's Guide to Retailers' Priorities. Peter has provided retail insights to The Globe and Mail, the Toronto Star, Canada AM, Maclean's Magazine, and he writes a monthly column in The Grower.

Please welcome your host of SKUFood: Recipes for Success, Peter Chapman. Welcome to SKUFood: Recipes for Success, where we talk about stories from our food and beverage industry. Every episode, we're committed to sharing stories behind some of the food and beverage products that you might find in the store.

In this episode, I'm really excited to have the opportunity to talk to Brad Rideout and Laura Richard from SaltWinds Coffee in Fredericton, New Brunswick. And, uh, you know, coffee's a tough category. There's a lot of big players in there. There's a lot of competition. But, uh, Laura and Brad have found a way to differentiate their product, and, uh, I think it's working for them.

We really see their product growing in, uh, sort of number of stores and, and hear about it in different places. So, uh, Brad and Laura, welcome to Skew Food: Recipes for Success. Thank you, Peter. Thanks, Peter. Thanks for having us on. All right. I'm Peter Chapman, your host, and, uh, it's exciting for me to have the opportunity to learn about these food and beverage businesses in every episode.

And, uh, this one is, is really interesting. The point of differentiation that, uh, Laura and Brad have been able to achieve in a very crowded category is something that people should really strive for. So I'm excited to hear how things are going for them and what's going on in coffee. But I think we really have to start with the story of, of how SaltWinds Coffee came to be and, and how you'd sort of figured all this out because, uh, as I say, it's hard to find differentiation in coffee.

So, so how did it start, and, uh, and where did it... You know, whose idea was it? Where did it come from? All those good things. Well, you're, you're right, Peter. It is a, it's a very crowded space that we're in, but, uh, and I think when we started, we weren't necessarily looking for differentiation. It, it started with a, a story I'd heard years ago when, when I was younger and, and it was, as the story went, coffee originally came to Canada on wooden sailing ships And, uh, when they switched over to the steel-hulled ships, people wanted the old coffee back because the, the coffee was no longer infused with the salty sea air that it would've been when it was on the wooden sailing ships.

So it was, it was during the pandemic, uh, Laura and I were talking about it, and, uh, Laura's a chemist, and she started experimenting with, uh, roasting coffee in ocean air and fusing coffee to see if there was any truth to this story, so. Pretty much how it, how it went was, uh, you know, Brad asked, "I, I wonder what that coffee on the sailing ships, what it tasted like.

You know, do, do you think we could recreate that taste, Laura?" I, you know, I've got a PhD in chemistry. I love nothing better than fiddling around with stuff- ... in my basement lab, so. A PhD in chemistry, and you're gonna figure out how to put salt air in coffee. Well, yeah. Right. My words were something along the lines of, "Well, hold my beer, Brad," and I went down to the lab, and, uh-

you know, many experiments later, boxes of coffee beans by the beach in Shediac, and, uh, lots of experiments like that. All right, mm-hmm. We, we found this coffee that, while not salty, it was smoother, sweeter, less bitter, and just had unique aromas and flavors that weren't present in the original coffee, and that was the start of Ocean Air Infusion as a technique. 

Really? And so you, you kind of figured out how to, to recreate this journey and do it sort of in modern times, I guess we'll say. Yeah. We do it in a scalable, food-safe way. So it's about recreating the conditions that were on the sailing ships so that we can bring back that historic taste in a way that people can enjoy today.

Wow, amazing. And Laura, you do have a background in consumer packaged goods, right? You did some work with, uh, some large consumer packaged goods companies. So you kinda understand some of the challenges of developing a food product. That's right. I, I hadn't worked in food products before, but my background was at Procter & Gamble, and I helped to bring, uh, Tide PODS to market, and was with P&G during the, the whole Tide POD challenge, uh, crisis.

So- That might not have been the best time, but- Well, it was a great learning opportunity. We had to reformulate and make a lot of changes. So I had some ideas about, um, the challenges that would go from taking a fun experiment by the Beats to Shediac out to product that we could make metric tons of and sell in the international market.

Hmm. Well, and Tide PODS are one of the, the products I use as an example many times when I'm talking to food processors because it's one where, you know, the benefit to the retailer was so big because people... Y- you could control the dosage, right? That's it. Instead of people using less liquid laundry detergent, one Tide POD was for one load.

So the amount of money that that would, you know, impact the, the category for the retailer and for P&G, uh, was massive. And, and sometimes, you know, it's important to remember the benefit for the retailer and the consumer. So, so I think your pro- I'm sure your P&G experience was valuable as you kinda, you know, started to do some of the things with the coffee.

One unique thing people don't think about with P&G's products is that the scent of them is, is really characteristic of the product. Like Tide has a very particular smell that's very unique. And so an important process control at P&G was the smell of the product. So they had whole suites of, of people who, you know, would smell the products coming off the line and make sure it met, uh, controls.

And it may sound funny, but that process of analyzing the scent of the products is not all that different from analyzing the scent of coffee either. So I've been able to transfer over some of that, that insight into how you manage that sort of quality control into how we keep our coffee consistent and delicious here too.

Hmm. Interesting. Okay. And Brad, you didn't really have much of a background in the food industry. You came from a different sector altogether, right? Yeah, definitely. Yeah. Yeah, I was originally from an IT sector in electrical engineering, and but I did have... I've been an entrepreneur for decades now. And, uh, a lot of the companies I had were actually online advertising companies, so they actually, and marketing companies, so they, they've worked out very well for this particular product.

So I sit mostly on the sales and marketing side of, of Saltwinds now, and do most of the graphic design and package design elements as well. So, um, so that, that's been, been very helpful. Yeah. So- No, I think it's, it's great to have, you know, two different backgrounds that you can bring together in the business, for sure.

And, and I would suggest, and I think I, you know, it's, we'll come back to a little bit, some of the disciplines that you've brought to kind of d- how you've grown the brand and, and the volume online, which I think is, is important and, and great learning for people So you were doing these experiments in Shediac on the beach, then you decided maybe there is a business opportunity here.

Is that kinda how this looked? Right. You, you're gonna take over the, the grocery industry? Well, we thought we would just dabble at the local farmer's market. We were giving the coffee to friends and family. They all said they really liked it, and they wished they had a chance to buy it. So just for fun, we thought, oh, you know, we'll bring this down to the, the Garrison Night Market in Fredericton.

Maybe we'll sell a couple bags. You know, heck, maybe we'll learn something about entrepreneurship. Why not? Brad and I, we both had, had good jobs, so this was really just having a little play. But, uh, what we found over the course of that summer we were at that market is that we sold out almost every week.

And at the end of the summer, there was a number of local independent stores who approached us and said, "You know, we've seen the lineups at your market booth. People love this stuff. You know, I'm already thinking about the end of the summer when you're not at the market anymore. Can I sell your product at my store?"

And Brad and I kinda looked at each other at that point, and we're like, "Uh, holy smokes, maybe there's something to this thing." So hadn't really been in the, the long-term plan, let's say, but when an opportunity like that presents itself, well, you decide either you're gonna go for it or not, right? And we decided to roll the dice.

Mm. Exciting. And, and it is rolling the dice because you, you really didn't have sort of the guaranteed markets kinda thing. Mm-mm. So you, you've had to really- Not at all ... build that. So- No ... so you got into a couple stores? Well, e- even, uh, figuring out how to sell coffee, you know. I remember the first day at the market, we're standing here, we've got coffee, and we're like, "Okay, now what do we do?

Like, how do we actually convince people that they wanna try this coffee," you know? So it took us a while to figure out how to position the, the Ocean Air process. We had, you know, different namings, different pitches that we tried throughout the summer till we, we kinda nailed down the, the elements of it that people were looking for in coffee, and then, and then things really started moving, so.

So yeah, by the end of the summer, I mean, we had a f- loyal following coming every week to, to pick up the coffee. We're both still working full-time jobs at this point, so this is a, this is a side hustle for us. So we, uh, continued it on, you know, for the next year, I guess, or the next six months. We did a lot of consumer shows to get it out there, 'cause after the garrison market, you know, how do we do sampling now?

I think it's, it's very important, especially with this coffee, 'cause it's a, it's a very special coffee. Once you taste it, it's, it's one of those things that you, you come back for. So we started doing a, a lot of the consumer shows, which are mostly in the, in the Halifax area, you know, in the Maritimes. And, um, you know, so we'd be working our 9:00 to 5:00s and then leaving, driving down to Halifax trying to set up show booths for three-day weekend, and, uh, and it was getting to be pretty, pretty busy.

Laura was, was actually roasting. She'd be getting up and roasting at 2:00 AM to try to have enough product for, for the shows, you know. So we kinda at that point said, "Okay, we've gotta make a decision now. Is this gonna be a full-time thing or, or what's gonna happen here?" So... Mm-hmm. And I think that's, you know, lots of people in the food industry have some of those kinda stories where, you know, that kind of going through that startup mode.

But one of the points you made, I think is so valuable, is just learning from consumers in those early stages and, and testing different things. What resonates? Right. What, what gets them to buy? When do they walk away- Mm-hmm ... and you kind of go, "Oh man, we could have sold them something if, uh, if we'd said it differently," and that kind of thing, right?

Exactly. I was gonna say, we did a number of AB trials where we would have the same coffee in two different packages, and I would even have little smell jars you could open up and look at and smell the coffee, and it was the same coffee in both jars, but they had different names on them. I think the particular one, oh yeah, it was a dark roast, and the, the name I liked had, like, a mermaid on the front.

It was called, like, Up She Rises, and there was, like, this sort of female empowerment feel to it. And, uh, Brad had the, uh, the Drunken Sailor with, you know, a salty seaman who'd had maybe a few too many. Exact same coffee. And people preferred three to one the Drunken Sailor to the Up She Rises. They would smell both and they'd say like, "Oh, this one smells better," pointing at the Drunken Sailor.

Mm-hmm. And it's like, well, okay, I learned something about marketing here today. Mm-hmm. Yep. Yep. I think the other one, too, that I, I still remember, too- So early on, I mean, we started to get people asking a lot of coffee questions that, you know, the one you always get is, or you used to get, we don't even get this anymore, but would be, you know, "Are you fair trade?

Are you organic? Are you blah, blah, blah," all these, like, certifications. So, you know, early on we were thinking, "Okay, we're gonna have to be fair trade, organic, you know, compostable packaging." So we actually created a blend that was, it was organic, it was fair trade, it was in a fully compostable package. We had it on the shelf.

It was, I think, 50 cents more than the other packages. We sold one, uh, ever of it. So it just showed, like, people, they like to ask the question, and they would ask the question. We'd be like, "Yeah, it's right here." Mm-hmm. But they would take the, one of the other ones would be the one that they wanted. So people are, they ask about it, but it's, uh, you know, they get enticed by the flavors or something else about it, so.

Well, and I think that they are kind of conditioned because it's on so much packaging. They think they should ask- Yeah. Mm-hmm ... even though they may not be super familiar with really what the difference is or what it even... You know, they couldn't probably define it for you, right? No. They don't know what it, what it means to the most part.

So if you think about it, actually, the only real differentiator that there's been in coffee in the last 20 years has been fair trade and organic. Like, what, what else has been different about coffee? Like, they're all, you know, different roast levels. Everyone has the same origins. So, I mean, Kicking Horse came out kind of at the start of that, that era, and they had, like, 100% fair trade, and they promoted on it, and they were successful on it.

But now everyone has fair trade. And in fact, fair trade is not even, people are starting to, to buck the trend now because- You don't need fair trade necessarily with coffee anymore because everyone's connected now online. So you can actually see the farmers that are, that are farming. You can, you know, you know if they're getting fair wages now and, and things like this, so.

And we, we actually pay about, I think, almost double what the, the required fair trade wage is. So, so ethical sourcing has kind of taken over now in, in the coffee business from fair trade in a lot of cases. And, but I also think that it shows how powerful your message of sort of ocean air infused is as a point of differentiation, too, right?

Mm-hmm. Yeah, it does for sure, because even still today, there's, there are no differentiators. Like, if you go, go into the grocery store, look at the shelf, look at the coffee. Other than brand, what's the differentiator? The number one way people select coffee right now is by roast level. Yeah, like the light, medium, dark roast- Yeah

kind of thing, right? There's not a lot of brand loyalty. But we've found now with, with our ocean air message getting around, now people are like, "Okay, yeah, this one is better. We want the ocean air infused coffee." And we're, we're seeing it, you know, coming off the shelf at retail and at, and at all the channels that we're, we're in right now.

I think on that point of differentiation, it was very early on we decided to enter our coffee into some international competitions. Mm-hmm. Just with the idea, like, "Okay, we'll go down to one of these big coffee conferences. We'll learn from everyone there. We'll have a chance to talk about what we're doing.

You know, maybe we'll get some great ideas." Um, so yeah, this was still in just our first year of business. We brought our coffee to an international cold brew championships in El Salvador, and I was there against international level baristas who were doing very fancy staged moves and drinks with, like, 40 different ingredients- Yeah

and, you know, throwing bottles in the air. Yeah. And I roll up in my plaid shirt. I've got three ingredients. I've got coffee, I've got maple syrup, and I've got Dolf's. Oh, Dolf's. I- Mm-hmm ... I mix them together to make sort of a maritime cold brew espresso martini. Mm-hmm. And, uh, we took the bronze medal just off- Wow

you know, the taste, the quality, um- Mm-hmm, and the story ... and so that, yeah, that really gave us an indication that, you know, it wasn't just, just a good brand story, but also a great tasting coffee. Right. And it's not just a maritime, you know, Canada thing. It's, like, the, the judges were from all over the world, and they loved the story, they loved the, the coffee flavors that, that it was bringing, so.

So you get the validation on sort of a, a global scale really, right? Right. Right. Yep. And I know in coffee there's, it gets graded, that kind of thing. Like, there, there are different ways to differentiate it other than light, medium, and dark roast, and that kind of thing. And so your coffee, after you've done your roasting, it does get graded quite high, right?

That the, sort of the, the people who know how to do that understand it. The, uh, so the way the coffee works is when it's, when it's harvested, it's graded. So it, it's the green beans themselves, and they would get a grading, like, zero to, to 100. Anything over an 80 is considered a specialty coffee. So we, we take, like, all high quality specialty coffees for our, our different blends.

And the interesting thing is when we apply the OceaNair infusion technology to it, it actually increases the quality scores of the coffee. So it actually allows us to have higher quality coffees- For a lower base cost than our competitors, and that's, that's another piece of the puzzle that's been, been very good for, for our coffee.

That's why people, they try it, they'll try a competitor and be like, "Oh, this is way better coffee." Well, it is better coffee. And so, you know, it's obvious when you try them. Mm-hmm. So if, if you and your competitor were starting out with a bean that costs the same amount, after they roast it, it's one thing.

After you roast and do your ocean-air infusion, it's a, a better quality coffee. Exactly. It tastes better. It has, uh, the qualities that people are looking for in, in coffees are enhanced. So the, the ocean-air infusion we do, it actually, uh, it reduces bitterness in the coffee, it makes it smoother, and those are two of the...

Like, bitterness is one of the key negative components that most people don't like in coffee. Um, and it even enhances flavors in the coffee. So it, uh, yeah, it makes a really, really special coffee when, once people, uh, taste it, they're... We get, get excellent, you know, reviews on the website, on Amazon. Mm-hmm.

And I can attest to that, 'cause I've had it. So, uh, I can, I can agree that it does bring... I don't know. I'm not an expert at it. I'm kinda more the type of person that says I know what I like or whatever. But it does, it is different and, uh, and I, and I... Now that I hear you talk about the bitterness, I think that's probably where I would suggest that I see the difference or taste the difference really.

So, uh, one of the interesting things that, you know, different people in the industry face is commodity costing and, and pricing changes. And coffee, anybody who's a consumer of coffee knows that in recent years we've seen a, a huge increase in the price. So maybe, you know, I'm sure as you were just getting some volume rolling, then all of a sudden the price went through the roof and you had to deal with that.

So how did you manage through that? Yeah, I mean, that was, it was tough. It, that hit hard. We were, so we were in, what, our third year of operation. We're not profitable yet. We're working hard on optimization of processes and things that, to bring down our cost. We're just getting to a, a breakeven point, and the, the coffee, the green coffee price is double in price in essentially a, a couple of months period, and there's nothing we can do.

I mean, we're buying it basically as we need it, so, so we have to bear the cost of that. We're in a lot of retail. You can't just jack up your price in retail, so we just had to, had to figure out how to weather, weather the way through it. So, um, so yeah, it was, it was a little difficult, but we managed.

Luckily, we're still small enough where we could still... We had a lot of optimizations we could do, so we worked hard on those to bring our costs down, and we were a- we were actually able to keep our costs stable during that period. So- Oh, wow ... the positive thing was all the other coffee companies' prices went up by 40 or 50% in the same period.

So we, from a relative perspective in the stores, we were actually much, not the, an ultra-premium brand anymore. We were premium brand, so. People came closer, you know, their retail got closer or even comparable to yours as opposed to- Even above some of them. Yeah. So- Wow. Yeah. Yeah. And I think it's a great message for people that sometimes when, when you are faced with cost increases like that, whether it's packaging or, or ingredients, whatever, sometimes you, you have to also look at what you can do as well.

And so, you know, I think that's a great story for people to really take a look in, at their own business too and say, "What can we do?" And maybe you can't offset all of it, but if you can offset part of it, it's a win. So- And what did the retailers... I, I'm curious what the response from the retailers was when all those other coffee companies were going up, and you were able to hold your price.

What were they saying to you? Well, we, we talked to a number of them, and I mean, we weren't raising our price, but, but they were just, like, shaking their heads. They're like, "The prices, like, on coffee, you know, are, are just going insane." And, you know, they... There's not much they can do about it. They know the green bean prices are going up, so they've gotta just deal with it, uh, on, from their own, their own perspective, so.

I think what actually happened, it w- it was... It's been pretty interesting. I think a lot of the, the consumers of, like, the really, you know, low-cost coffees now are actually going up to much better coffees, 'cause they're, the differential's not that much between them anymore. And they, you know, once you try the better ones compared to those, it's like, okay, the quality is so much better in these other coffees, so, so I think it, it's actually been good for, you know, getting people to experiment with some of the other, the other coffee brands that are out there.

The other way to think about it, the other side to that, too, is when it comes to the annual reviews with the category manager, you're in such a better position if you're not coming with an ask to change the cost. If I'm like, "Okay, you know, we're good on the unit cost. Maybe let's talk about how many facings we have, you know.

Can we grow that instead?" Right? And so instead, we've been able to take more market share and increase our presence in- Mm ... the coffee aisle, because we're not having to argue about what our price is per unit. So I, I think that's put us in a good standing, and our, our ring-through sales show that. We've been growing significantly each month, so.

Awesome. Yeah, no, great point. And, and, uh, and I think, you know, to leverage that, uh, with your customers is, is so smart because, uh, you know, the... As a, a former retailer, I can tell you, you kind of get tired of listening to people come in and complain about, you know, that their costs are going up, and this is going up, and that's going up.

And it's a breath of fresh air when you have somebody, or maybe a breath of ocean-infused fresh air- Right ... when somebody comes in and says, "Listen, you know, we've been able to, to make some changes, and, and we're gonna be able to, to keep our costing in line." And I think they'd probably be happy to give you more space, because they think you're working at it.

And, and there's always a bit of a preconception from the retailer that the suppliers just accept a cost increase and try to pass it on, as opposed to doing some of the, we'll say, maybe more harder work. So no, that's great, and I think it's, uh, it's, it's, it's paid dividends for you. And, uh, taking advantage of shaking up the category like that, you know, the fact that consumers look at coffee differently is, uh, valuable learning, for sure.

Great. So we're so happy to have Laura Burchard and Brad Rideout from Saltwind Coffee with us on this episode of SkúFood Recipes for Success. Uh, when we come back, we're going to, uh, talk to Brad and Laura about their visit to the Dragon's Den and how that went for them, and, uh, and also how the business is looking into the future.

Presented by FCC. If you produce it, process it, pack it, or move it, FCC can finance it

Welcome back to Skew Food Recipes for Success. Laura Richard and Brad Ryder have been sharing some of the great story of SaltWinds Coffee, how they've weathered some of the challenges of increasing prices and, and just growing their business from, you know, a real true startup to being on the grocery store shelves.

And, and maybe one of the questions I should ask is, where do people find SaltWinds Coffee now? Because every time I talk to you, it's more stores and more markets. So where is it now? And then, then we'll get into the Dragon's Den. Effectively, uh, any port of call, Peter. When you said there- Perfect answer

that we'd weathered the Dragon's Den, I thought you were gonna launch into a bit more, you know, nautical allegory, but- I thought about it. He can't hear you. You know, I was gonna go there, and then I thought, "Well, maybe I'm pushing my luck on the-" No such thing as too many nautical references. People love it.

People love it. Yeah. Oh, okay. I'll get back... I'll see if I can find a couple more of them. Yeah, yeah. I don't know, Brad, if you wanna spell out the channels a little more. Sure. Yeah, yeah, for sure. But a- anyone looking for it, I mean, in the... obviously in the Maritimes, we're in, uh, we're in all the Sobeys locations in Atlantic Canada, and we're in about, I think, uh, a dozen or so of the superstores right now.

And then you can always buy us online, it's, uh, www.saltwindscoffee.com, or through our Amazon channel. All right. And we're gonna get back to Amazon after we explore the Dragon's Den, because, yeah, I think that's been a, an important channel, and, and you bring a, a strategic approach to it, not just sort of getting it up on the, on Amazon.

So, so tell me about your experience on the Dragon's Den. I mean, you know, we, we see the episode and I, and I know that, you know, you're, you're in front of those people for a lot longer than what we actually see on TV. So maybe share sort of the, maybe a little bit of the prep, you know, going into it, because you have to do some work to get ready for that.

But then, you know, the experience, uh, itself as well. Well, we decided we would nail the audition first, which you do through like a video that you send them, by doing it in front of a seaport with, you know, seagulls behind us- Mm-hmm ... and the waves crashing. Nice. You know, just to really- Palm trees ... get home the message about the ocean air.

So. Yeah. Uh-huh. We were actually buying coffee in Nicaragua at the time, so it was a great, uh, tie-in to the story of how coffee came from place like Nicaragua up to Canada. So- Mm. And it was, it was one of the comments they made. They, they were all laughing about the, the fact that we were actually in a, in a tropical area for the, for the film, so.

Uh-huh. Well, when you said palm trees and stuff, I knew you weren't in Halifax for that one, so. Right. Yeah. Yeah. So you nailed the audition, which I think is a great point. You, you do have to get their attention because- Yeah ... you know, I don't know if they air, whatever, say, 25 stories through the season, they probably get 425 submissions.

Yeah, they do. They get a lot, I, I know. Um, and then you have to obviously do, uh, you work with a producer, you know, from the CBC. And our producer was, was excellent. He, he kind of, uh, drills you on questions that you might get asked by the dragons just to see if you're actually prepared for answering those sorts of questions.

Which, I mean, we were pretty prepared 'cause we'd been up to our eyeballs in financials and all the, the things you need to, to know about your, your company on- once you get on there. Besides that, it's important to remember you're, you're making a TV show, too. So you've also- Right ... got to think about the production values.

Mm-hmm. So fortunately, we have a lot of experience from doing consumer shows about the kind of things that catch people's eye, what the customers like to see, so we brought a replica wooden fishing shack with us. Complete with buoys and lobster traps- Mm-hmm ... and all the nautical- Barrels ... paraphernalia so that- Mm-hmm

we could really bring that, that image home. It wasn't just coffee on a table. It was the feeling of the Maritimes transported to- Mm ... CBC Studio 1 in downtown Toronto. Wow. And I think that's so... People gotta remember when you're, you know, when you have an opportunity, whether it's, you know, something like the Dragon's Den or, or even just a, a pitch to a retailer, you, you gotta figure out how to make it memorable and stand out from the, the rest of the crowd.

Yeah, exactly. Exactly that. And I mean, you know, we got the opportunity to be on, or to be- to film in front of the Dragons, but that doesn't mean you're actually gonna get on, on television, even if you audition with them. So we knew that, you know, they're gonna need to craft a story around this to go in- into an episode.

So I mean, we brought the, the, the gear we needed. I mean, we had to drive all of that stuff up to Halifax, or up to, uh, Toronto, uh, you know, 12 and a half hours. We were there a full day beforehand setting it up 'cause you... The way it works, you actually, whatever you bring, they have to be able to take it in and bring it back out again in 15 minutes 'cause they film, they film the episodes back to back.

So we had this fishing shack, and we had to basically put it all on wheels, make it so that they could actually wheel the thing in there, bring it back out again. So we were there a full day beforehand, which, which was quite a... It was a pretty fun experience really, 'cause all the producers are there, you know, rushing around, and you get-- we got to see all the other People that were going on the show as they were filming that day, getting ready to go in, and a lot of nerves and- Oh, I bet

you know, it was, it was a, it was a fun experience, so. Me, I was, I was tense up until the moment we served the dragons a cup of our Ocean Air coffee. 'Cause for me, I know the coffee is good, but I want the dragons to see it's good and say so on TV. So we've got their mugs, each prepared the way they like. I go out and serve them all, and then we stand back.

And as soon as I saw the expression on their faces, I was like, "Okay." Mm. "We made it. Doesn't matter what happens next." This is good. "They like this." No. And then we pan through the dragons making their comments. You know, Wes, uh, says, "You know, I, I think this might be one of the best coffees I've ever had. It's so smooth.

It's not bitter." Even Arlene, who's a pretty tough cookie, said, "This is very good." Yeah. Yeah. Mm. So, yeah. Yeah. Whatever happened next, deal or no deal, the, the dragons reiterated our story, that it was a coffee that was smoother- Mm-hmm ... less bitter, and really high quality. And indeed, we saw the customers who came to buy our coffee after that and said, "I saw the look on the dragons' faces when they tried it.

I heard what they said when they tasted it, and now I wanna try that too." So getting that validation from them, you know, from the sort of the product quality perspective, was, was that job one? Was that kinda like your number one goal to- Yeah ... like, well, to get on- Yeah ... you wanna be on the show, that's number one.

But- Right. And hopefully with positive comments about the coffee. Yeah. Yeah. Yeah. So, 'cause they could say anything. You don't know. I mean, we knew it was great coffee. We have, you know, we have a lotta confidence in our, in our product. We've served it to hundreds of thousands of people at, at this point, and they've all, almost all, you know, really like it.

So, so, you know, we did know it was a good product, but at the end of the day, when you get in there, you don't know what the comments are, are gonna be, the commentary. So yeah, we were happy once we heard the, you know, the commentary. And I mean, it was a fantastic conversation with them too. I mean, you know, we were there over an hour with the Dragons.

I think they... I think the episode's, like, six minutes long, so they, you know, they clipped out a, a lot of little pieces from it. It doesn't really hold context, you know, of the, of the overall conversation, but that's okay. It, it... I think it turned into a, a good story. And one thing I noticed being there, though, like, they are very good business people, and just the knowledge that is instilled just in having a conversation with people like this is great.

I mean, we walked out of there with, with things. We're like, "Okay, yeah, we need to change this. We should change this direction. We should do this. We should do that." So, so even without doing a deal, you get a lot of value. If you pay attention, you'll get a lot of valuable insight from, from the Dragons. Mm. No, that's great insight.

Yeah, I mean, you're really having a, almost like a focus group about your business for 60 minutes with some people who've done a lot of- Absolutely ... really interesting successful things, right? Right. So. Right. And they're trying to... You know, I think on the show, like, the negative comments are actually more entertaining than the positive ones.

So I mean, they're trying to poke holes in your strategy, in your numbers, in, like, every element of your business. So it's, it's actually very good seeing how they react to the information that you're giving them about the business, so. And see how external people, you know, react to your strategy and, and the things that, that you're, uh, working on.

Mm-hmm. Yeah. Oh, it's a definitely great experience and, you know, you have to be well-prepared and, and, uh, and figure out, you know, what your position is. And, uh, so speaking of your position, so, uh, I've seen the episode, but, uh, maybe just share kinda where it ended up with people. A- and, uh, I, I commend you for how it actually kinda wrapped up, to be honest, 'cause I think it's sometimes easier to go the other way, so.

Well, the net result was the dragons were really impressed with the ocean air infusion process and how that transformed the quality of the coffee. Arlene in particular, uh, who owns Balzac's Coffee, um, you know, clearly saw the potential of, of the process we're doing and how it can increase the quality of a coffee and, and probably in, in her books maybe bring down our cost of goods sold, right?

And so Arlene, um, wanted to purchase my patents, which I'm happy to share with this group, just got a notice of allowance from the USPTO, so- Wow ... that's a, that's a great, uh, step. That's a big accomplishment. Yeah. Yeah. That's, there's not a lot of patents in coffee. Some of the last ones were around instant coffee, right?

Oh, wow. That's been a while then. Like 40 years old stuff. Yeah. Mm-hmm. So yeah, Arlene made an offer, uh, to buy the patent for a million dollars, and to take that technology herself and, and probably use it at Balzac's. And wrapped up into that, she wanted to then become our toll manufacturer, right? All of Saltwind's would probably be made by her own companies, right?

And then just labeled. And you know, it, it didn't take us very long to decide that that was not the offer we were there for. We wanted a partner who's gonna help us grow and expand and, and that was a sellout for technology that we think could be worth a lot more than a million. Mm-hmm. Yeah. Absolutely.

Yeah. Well, no, I, I have to commend you because when I watched it and I was like, "Okay, it takes..." And, and, you know, when somebody's putting, you know, a fair amount of money in front of you, and you people have worked hard to get to the point where you're at, uh, I'm sure it is, you know, somewhat, uh, in, at some, there's some place in your mind where you're saying- Yeah

"Okay, you know, that's, that's pretty good." But- Yeah. We're leaving a million dollars on the table. Yeah. So, yeah. Right. Yeah. I mean, it's up there for like top 10 offers- Yeah ... on Dragon's Den. Wow. Uh- Yeah ... and we walked away from it. There's nights I feel like, you know, "Why did we say no to a million dollars?"

Right. Most of the time I feel good about it. Yeah. Yeah. Yeah. Well, I, you know, it's easy for me to say here, but, uh, I think you should feel good about it because, uh, that's the tougher decision to take, I would say. Mm. Mm-hmm. So, uh, but I think great experience, great exposure, and, uh, and, and another step along your journey.

And one step I just wanna touch on is, is Amazon, because, you know, I think a lot of people, uh, look to Amazon. Obviously, coffee is probably a good category because it's relatively easy to ship and, and some of those kind of things, which there's some tougher ones, you know, if it's liquid and, and that kind of thing.

But that's fine. I think that, uh, it's still... When it's good for some place, some components of Amazon, it also means it's very crowded on Amazon. So maybe just a, a few of the things that have sort of, you know, as, as a channel, is it helping you and, and, uh, what are some of the things you're doing to make sure it does help or contribute?

Yeah, for sure. I mean, early on when we were, you know, kind of considering the Amazon channel, I think, uh, the thing about Amazon is they've, they've done a, a really good job of, of making it one of those channels that you need if you're gonna have, like, an omni-channel presence. 'Cause there's people, even, you know, with our specialty grocery stores and the different grocery stores, they'll go into a store, they'll look you up on Amazon to see what your reviews are li- like, and then they'll pick it up off the shelf.

So there's a whole element of Amazon helping your sales in, in all of your other channels, you know, that, that goes along with the sales you get on the Amazon channel itself. So but you're right, we, we had looked at the category. We did quite a bit of analysis actually on the different products and the different, the sales.

There's a lot of great... You can get, like, full numbers on Amazon of all your competitors, all of their brand, you know, their products, what's selling, what's not. Um, and we did see that a lot of the products we have, we didn't have a lot of competitors actually for a number of our products. So we thought there was a good chance that we'd be able to, you know, stand out on that channel.

So we made the decision that we were gonna, we were gonna run a, a pilot of it. We set aside, uh, a budget to try to get profitable on Amazon within a year Um, I think we set aside around, I think it was around $20,000 as a pilot budget, and we started the channel up and, uh, you know, put up our products and monitored it, did what marketing we could within our budget.

And as it turned out, we were, we were actually profitable within, uh, I think about eight months on the channel. And it's, it's been a great channel from a, a revenue perspective 'cause it, it does almost the same as our website does on a, on a month-to-month basis. Now, the margins on it are terrible, so, 'cause Amazon takes so many fees from you.

Um, but I mean, we do-- we are able to do it profitably, and we, we make money off of it every, every month, so that's the, that's the important thing. And, um, the one thing about it I find for coffee especially is it's, I think it's a great way to, for people outside of the Maritimes to try our coffee 'Cause with, you know, with FBA, with the, uh, fulfilled by Amazon, so if you have Amazon Prime, you know, you don't pay for shipping.

So you can order a bag of- on our website. It's about a dollar, about similar price to a dollar more, depending on the, the coffee you're getting. And if you've seen our ads on Meta or you've seen our ads wherever, you can just jump on and, and get a package easily. You don't have to pay for any shipping, so it gives you the opportunity to, to try it out.

And then I find, like, I think most of the people, if they like it, then they'll actually go to the website and, and order from there. So, so I think it's a good option. Interesting. And, and probably helps you, uh, as you look to enter other markets, you can start to say, you know, we do have a bit of a consumer base in, in this geography or that, that type of thing too, right?

Yes, absolutely. And even... We had actually started a pilot in the US on Amazon as well, but we've, we've had to stop- ... due to the- We started- ... due to the tariffs, but ... three months before the tariffs came in. Oh. Oh. Right. So, yeah. It's not all been smooth sailing. Yeah. Uh, yeah. Yeah. That, that didn't pan out. You got...

I noticed you got that smooth sailing reference in there, Laura. I- Yeah. I'm well practiced at this. Yeah. Great. So, uh- Yeah ... so what's next? What's, what's, uh, on the, the horizon? I know you've, you've just moved into a new space, and well, so what's in the future? I'd say we've got the- Yeah ... wind in our sails.

Exactly. All right. Yeah, so we just, we just, uh, moved into a new space. Gonna allow us to have about 10 to 15 times our capacity that we, we currently have, which is great, 'cause we were maxing out our, our old space. So... And we're now, we do have a growth plan for, for the next year. We've been, been able to double our sales year over year, so we're hoping to continue that again for another, another year.

I mean, Canada, obviously we do, we do about half of our business in the Maritimes. About half our business is in Ontario right now, so... And there's a lot, lot more of Canada to do, and the Maritimes, uh, like, all across. And we are, we are looking to probably try out some other geographies too in the new year.

Through the marketplace, whether it be Amazon or a lot of the countries have their own marketplaces that they, they utilize, but it's a great way to kind of, you know, break into the market to test it out. You can get a good sense of whether the product is gonna resonate or not in the country. So I... And it's fairly inexpensive to do a pilot using that.

So I think we'll... Well, we've chosen a couple of countries that are, they do a lot of online purchasing And, um, you know, we'll, we'll go into those and, and do some tests over the next year as well. It's, it's part of the plan. Awesome. Well, that's exciting. And, uh, when, when you have, uh, 10 to 15 times capacity, then you gotta start to fill it, right?

Mm-hmm. So you gotta increase share where you're at, and, uh, and then also probably some, uh, some new geographies as well, so... So one question that we ask everybody, uh, on Skú Food Recipes for Success is, what are the ingredients in your recipe for success? What are the things that have helped you grow from sort of this idea of ocean air-infused coffee to the shelves of grocery stores and Amazon and Dragon's Den, all the, all the progress you've made?

Well, I mean, for me, it's, it's a standard, uh, recipe, I think. But, you know, having a great product, a, a great story, lots of hustle, and then iterate quickly once you, uh, get feedback from your customers. And I think you keep doing that, and, and you're gonna have success. Mm-hmm. No, I think those are great, uh, great ingredients, for sure.

And, and, uh, you know, I think you've been doing that since the beginning, when I hear you talk about what you learned from people right at when you were direct selling and, and, and continuing to listen, though, right? I mean, it's not just listening at the very beginning, it's listening all the way through, so...

No, I mean, we're still, we have people out there doing the consumer shows, but we're, we're both still at the shows, like, constantly, 'cause you, you can get great feedback from people, you know, as they're, as they're picking up your, your coffees. You can try new coffees- Mm ... see what people are liking, so- Mm-hmm

yeah. Great. I think to build on that, I'd say you have to pair, you know, the ability to weather the storm with a willingness to chart a new course, too. Okay, you batten down the hatches and you stick out the tough times, but if all the indications are pointing one way and the wind's blowing another, well, golly, you better change your mind on where you're going, because it's gonna be a real hard, you know, row if you're trying to keep to your current course.

Mm-hmm. So accepting some of those things. And, and I think everybody with a business, y- you have a plan or you think things are gonna go one way, and, and it, it does come at you differently, and you gotta, you gotta adapt, right? That's it, yeah. Absolutely. Well, Laura, I think you win the prize for getting the most, uh-

salty sea air, uh, you know, words and- References ... and statements into the podcast. But, uh, I really wanna say thank you to both of you for taking the time to join us. I think it's, it's, uh, such an interesting story, and, uh, congratulations for getting to the point where you're at. And, uh, we look forward to seeing, you know, where the, uh, the sail's set to, uh, take you into the future.

Thanks, Peter. Good reference. Yeah. Thanks a lot, Peter 

Thanks for listening to SKUFood: Recipes for Success. At SKUFood, we are committed to helping producers and processors get their products on the shelf and into the shopping cart. You can follow Peter Chapman on LinkedIn for more food and beverage industry information.

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