The Month End Podcast
The Month End Podcast
Episode 19: Jordan Buckner • FoodBevy
The Month End provides emerging inventory-based brands real life knowledge in the accounting, finance, and operational world. Our guests are not only similar brand founders and owners, but key stakeholders and contributors to the industry. Each episode provides a glimpse into the vast experience and insight from its guest’s unique background in a casual, conversational tone.
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In episode nineteen, Accountfully's CEO and Partner, Brad Ebenhoeh, sits down with Jordan Buckner, founder of TeaSquares and FoodBevy. Jordan has taken the lessons learned from running his own CPG company and parlayed it into a flourishing hub to align CPG brands with a (literal) bevy of resources and industry decision makers. Everything to help - from startup to scale. This episode offers some great insight into where to go first, once you've decided it's time to launch a brand in the CPG space.
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The FoodBevy Website: https://www.foodbevy.com/
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Welcome to The Month End, a CPG community chat. The Month End will provide emerging CPG brands real life knowledge into the accounting, finance, and operational worlds. Our guests will be key stakeholders from those same brands, as well as other key contributors to the industry, all of which have vast experiences and insights that will be shared with the audience. Welcome to The Month End, Episode 19. Today we have Jordan Buckner of FoodBevy. How are you doing today Jordan?
Jordan Buckner:Doing great Brad.
Brad Ebenhoeh:All right, Jordan is the founder of FoodBevy, which is an online community for food and beverage founders to help take businesses from startup to scale. Additionally, Jordan has some background as a founder of a CPG brand. So he has a lot of CPG experience, and we're looking forward to chatting today on those items. So Jordan, while we get started here, can you give a little background of, you know, CPG industry, what you've been up to like, and what FoodBevy is, and then we'll get into the conversation, and more details, definitely?
Jordan Buckner:So I have the honor of working with hundreds of food and beverage founders right now and helping them grow from those early startup days to scaling their businesses and helping overcome the challenges to do so. I'm a previous CPG founder, myself, I ran a brand Tea Squares, a line of energy bars for six years, and been through, you know, the gauntlet of building the brand. Everything from creating the brand identity, recipes, managing operations, cash flow, everything in between raising investment rounds, having Kickstarter campaigns on Whole Foods, right, the entire gamut, and learned a lot about the experience. So now I'm just here to help other founders make this journey of starting a company a little bit easier.
Brad Ebenhoeh:Awesome, awesome. Yeah, there's a, you know, what you guys do over a FoodBevy plus a lot of great resources that exist, let's not recreate the wheel in the space, and let's just kind of, you know, be better as a as a community. So, I'm looking forward to this. Let's start with your - the brand that you founded, and I kind of want to just chat about some experiences that you had. So using the, you know, accounting, finance operations aspect of what we're talking about, what was the biggest challenge you had, as a CPG founder, like, as you look back now on the entity, or on the business in that experience? Like, what was it? What was the biggest challenge?
Jordan Buckner:Oh, my gosh, so a couple of things. I think starting the business without any previous kind of CPG experience was a huge learning curve. And personally, I'm the type of individual that likes to learn everything myself, and honestly, holds on to things for way longer than I probably should. So over the course of an entire business, I did all of our bookkeeping, all of our accounting, finance, running reports, doing market analysis, pretty much everything on the finance side of it, except for actual tax preparation, right? And so having my hands in everything, I loved it, because I got to understand really the nitty gritty of the business. But also there are a lot of things that I've missed that because I wasn't an expert in. Yeah, as an example, a little bit further along in our business, we were selling with a national distributor, and you know, we would get chargebacks from them. And, you know, I was kind of just adding them into our QuickBooks and saying, like, you know, it's just part of the business, I really wasn't accounting for them correctly. And when I finally sat down and looked at all the numbers, over six months, we had chargebacks valued at 30% of everything that we sold that client, which was our entire margin, right, and we ended up barely breaking even, if not losing money, because we didn't have good insight into how our financials were working with that client. So I say all that, right. Like, by doing myself, there's a huge number of gaps that I didn't even know we had.
Brad Ebenhoeh:Yeah, the old deduction, kickback trade spend on the big mass distributors is always a nightmare story for new CPG. You know, founders are even getting in that sales channel. It's always on sales calls with clients. So like, "by the way, do you do this? You do that with deductions?", because it's just, you hear and it's not fair to small businesses, but it's the space in the industry and hopefully changes over time. What was your experience with fundraising?
Jordan Buckner:Good and bad. So our very first fundraising round happened a couple months after starting the business, I was actually doing a demo at Whole Foods and an individual Mike Kaplan from Spiral Son actually came up, he's like, "Hey, we're, I like the product," he like, brought over his. I think he's like, sisters in town, like to try it. And he was like, "Hey, we're starting an investment fund. This is really great. Your local, he liked our story. And a couple like a month later, they ended up investing in us, which is our first fundraising round, which is like, "Oh, great. This is awesome, right?" So you know, at the time, we're like super early, we're only doing $10,000 In sales, so like at the very beginning, and so it was great to have someone believe in us. But then I've also had on the other side where we went out to do fundraising rounds, and talk to 30, 50 investors and got nothing, right?, like no one was really everyone. Well, I shouldn't say No, everyone was like, "Oh, this is like really cool. Come back in a couple of months", or "let me know, we hit this milestone", but couldn't close those deals. And so had the entire kind of both sides of it, and learned a lot in the process in terms of what worked and what didn't, you know, we had a Kickstarter campaign that we ran a couple years ago, and met our goal, I think we brought in just under $12,000, from that - enough to kind of kick off a production run for a new product launch. So yeah, you know, definitely an interesting experiencing doing both of those routes.
Brad Ebenhoeh:What was your supply chain, like, did you, you know, turnkey co-packer? was it, you know...
Jordan Buckner:Nightmare
Brad Ebenhoeh:nightmare?
Jordan Buckner:It was our own fault, because when creating Tea Squares we were thinking about, we didn't understand supply chain, and what manufacturers were actually out there in the space. So the way that we designed our squares, if you look them up, they're like one by one inch squares. And we would pack those into like a pouch. But the way that our formula was designed is we could only manufacture those using what's called a rotary moulder, which a lot of times you'll see for like cookie designs, but it's actually rare for like energy bar/ protein bar space. And so there were very few manufacturers in the US who actually could produce that. And so we started off making ourselves in a commercial kitchen actually went to a metal fabricator and fabricated our own molds for the shape. And that should have been the first warning sign that this was going to be more difficult. When we got to a certain point, we tried working with a co-manufacturer that had a slab method, which essentially you put the mix on the conveyor belt, and it presses it down and cuts it. But because of our mixture and the recipe, it wouldn't work. We kind of like hacked together a solution, but then it was expensive to make for them. So when they got an order for like a million bars from another customer, they basically booted us out. And at the time we were selling in Whole Foods, we actually went out of stock or one of our SKUs because we didn't have a way of manufacturing it. So eventually had to bring it back in house, try the another manufacturer a year later, who is a multi-million dollar manufacturer - that didn't work because they didn't have the right equipment, went back to making it in house ourselves. And so we were on this constant journey, and when we closed the business, we were still making it ourselves in our own facility.
Brad Ebenhoeh:Yeah, the old supply chain and inventory, that can be your biggest advantage or your biggest disadvantage across the space. So. So it sounds like the experiences that you're you know, that you went through with Tea squares related to you know, accounting, finance, fundraising, inventory, like really has led you to the new venture FoodBevy.
Jordan Buckner:Now that's exactly right. And, you know, we didn't make every mistake, but we made a lot of mistakes. And I want to help others learn from that to say, "hey, here are the different paths, right?" There's not one way to be successful in this industry, there's dozens, but here are some of those paths, so you don't have to reinvent the wheel, like you mentioned, and things to avoid. And the biggest thing is really talking with brands helping them begin with the end in mind. So understanding where they want to go with their business, how they want to get there, and what are the steps in between so that you know those challenges from the beginning and can choose either to avoid them or purposefully take them on. The worst is when you get into a situation where you're like, "I had no idea this would be an issue". Right? That's where your business has problems.
Brad Ebenhoeh:Yeah. So then, you know, when when did the the FoodBevy? You know, light bulb go off? Like when did you like, "you know what, I think there's an opportunity here".
Jordan Buckner:So I actually had been working with founders for the last like four years. Just on and off, we put together just informal founder groups while I was still running FoodBevy, and it was fun. But then the business kind of got in the way or got in everyone's way of kind of dividing up time. And so about two years ago, when things were winding down with Tea squares because of the pandemic, I was looking to understand how to make an impact in founder's lives and what I wanted to do, and I realized I loved being in the space, working with other founders and helping them and so launched the platform really as a resource hub for founders. We have a directory of industry providers on has experts, DIY articles. And then we also have founder communities were founders can talk to each other and our expert partners. And that's really taken off really just as a way to connect founders to one another.
Brad Ebenhoeh:So then who's your like core - who's the core founder, like the target founder like the target business?
Jordan Buckner:The ones taking the most advantage tend to be about 200k to 4 million in sales, who are you know, one to five person team so they can't, they're doing everything themselves. They're looking for help. And then within there, we have a couple of different groups, some founders are more interested in like doing more things themselves. And so you know, we have resource guides on, you know how to do Facebook ads and set those up and manage those on your own. But then we also bring in partners, so like Accountfully, as a partner to say, like, "hey, you need help with finance, accounting, with some production management, right?" Instead of doing this yourself and making mistakes that I did work with someone who knows all the ins and outs and works with dozens of brands, so that you've seen everything that can happen.
Brad Ebenhoeh:Awesome, awesome. Yeah, definitely great resource kind of community hub for connecting people with different industry leaders across accounting, finance, ops, marketing, etc. Um, what has been your like biggest, your biggest, your proudest moment? So far at FoodBevy?
Jordan Buckner:Ooh, proudest moment, we've done a lot of work in amplifying in helping out founders from disadvantaged and under resourced areas. And so we work a lot with minority owned founders, women owned companies, to really provide them a resource to help their businesses, which are typically fairly, you know, they have additional challenges that they face. And you know, as a Black founder myself, I've seen a lot of experiences too. And it's where, you know, I had to overcome networking challenges and funding challenges that others, you know, had an easier time doing so, and so that's one thing that we do. So we've had partnerships with, say, Instacart, where we provide, it was like $20,000, in advertising credits to brands, who were to Black owned brands to be able to help them succeed. And that was just really great, and getting essentially free money and resources into their pocket, so that they were able to really start scaling their advertising and growth for their business. And so kind of bringing together opportunities like that we're actually helping people make or save real money is huge.
Brad Ebenhoeh:Right? What do you think, is the biggest improvement opportunity for the CPG industry itself, from the, for the zero to 5 million, or zero to $4 million brands?
Jordan Buckner:Who, you know, that's a, that's a tough one, the biggest area is around I think, fundraising and capital to start their business. And I say that because a lot of, you know, foods is interesting, because it has very low barriers to entry. You know, everyone eats so everyone has experience with food. And so it's very easy for someone to have an idea and get into the industry, but many of them don't know or don't have the funding possible or necessary to really grow their business. And so I think one; education around how much money is necessary to get business to a certain point, and then where that money can come from, and how to build a business. I think the other challenge and the industry is that we've taken a lot of the growth ideas from Silicon Valley, and V/C firms, where it's, "Hey, you need to start your business, grow nationally, become $100 million brand, and then sell all within five years". And obviously, like not everyone's going to do that most people aren't. And so I've become a big proponent of building a profit-first business, where you're actually building a self sustaining business, and that instead of gambling on some, you know, 1% chance of an exit, at some point, you actually built your business to be profitable from day one as much as you can, so that you can have small gains and small wins every single year.
Brad Ebenhoeh:Couldn't agree more with those kind of answers there. So recently, he did a survey via, you know, FoodBevy that you sent it to CPG brands, I'm sure people that are all involved in the community and stuff and you sent out or you kind of compiled a state of the CPG food and beverage beverage industry survey, which was kind of neat to read. So can you kind of highlight some of the insights that you gained from the survey?
Jordan Buckner:Definitely. So it was a fun survey. We were able to reach about 67 emerging brands for that. And we asked him questions around fundraising, sales, and investment. And a couple of things kind of stood out from that thing, one, we realized, and from that, about 67% of the companies surveyed were not profitable, and they have been around for at least like a year or two, which leads to this very high investment minded growth area within CPG. And within those, I think another thing is like how much money it takes to start a brand, we found that 58% of the companies had invested over $50,000 of their own money to actually start and launch the brand. And about 23% of those actually invested over $200,000 of their own money to launch a brand, which is kind of wild when you think about those barriers of entry to, to get started.
Brad Ebenhoeh:Yeah, I know, it's interesting cuz the barriers to entry had never been easier now, especially with the internet, right and direct to consumer. But there's a ton of different challenges of actually having people buy your product can consistently come back as returning customers. So what about, was there any kind of information there just on pure kind of operations or inventory management?
Jordan Buckner:Well, one thing we looked at were things like, margins. And so, you know, when we looked at across the board, the gross average gross margin was about 30 to 40%, of their sales, before trade spend. What was also interesting is like, some of the brands had, like 10%, gross margin, which is really challenging. And then others had a, I think, there were like, you know, two that had like a 70, to 80%, gross margin, which definitely is able to help set you up for success. And then a lot of the companies were also working with, they're selling on eCommerce on their own site. And so the other thing that's been big recently are like customer repeat rates, so that you can understand your growth and your customer loyalty. And the majority of the companies there had about a 20 to 30% ecommerce repeat rate, which I think was, you know, is probably in line with what's the case in food and beverage. But also, I think there's a lot of room for improvement there as well, as companies began to really focus on that as a source of growth instead of constantly finding new customers.
Brad Ebenhoeh:Yep, definitely. Yeah, in the back to the margin, kind of, you know, extremities or the variants, I think, in seeing a lot of inventory based clients, and specifically in the CPG world, like, you do see different ways of calculating gross margin across different founders and you know, in brands and you know, where they come from, or their consultants. So it's not always like that consistent look, in terms of it. Was there any information on just like sales channels, like, are more and more brands still going to distribution route or more, you know, clearly, you know, there's more direct consumer the number just because of the the day and age we live on, but like, is there anything - was there any data in that?
Jordan Buckner:Yeah, so one thing we looked at were, how many - what percentage of their sales were through ecommerce versus retail other channels, and for about 25% of the brands, they had only 10% of their total sales were ecommerce. And then on the flip side, we had about 12% that were ecommerce only. And so a lot of brands we're seeing are launching with eComm, and then going to retail kind of from there, right, like eComm is their testing ground. But both channels are challenging in order to be successful. And then we look at what retail channels the brands are selling in. The majority are selling it independent grocery and co ops followed by kind of natural grocery stores like Whole Foods or Sprouts. Instead of you know, conventional was much lower for some of the larger brands but we're definitely seeing this approach of having more control of your supply chain either through eCommerce or working through independent retailers.
Brad Ebenhoeh:But that definitely makes sense from my experience in terms of the the the size and the the age of these brands in terms of getting their foot in the door. And then what about like sales channels specifically? So like clearly you have on their website direct to consumer through like typically Shopify, you can have the Amazons of the world direct to direct to wholesaler direct to retail as well you know, independence or big guys as well as then distribution is there, you know, more and more as we're we're seeing these other kind of reseller accounts or wholesale accounts, like Faire is a big one, and then there's like so many small ones that you know exists in this day and age. Do you have any just maybe not even in the survey - do you have any kind of insight or thoughts around kind of those new ones in terms of what works best for the the up and coming ones just because it seems like you know, every day a new reseller or a new platform comes out?
Jordan Buckner:Yeah, definitely. I mean, I will like I, I use Faire, and they've been one of the most dominant players recently. And what they've done really well is develop a tech solution that works really seamlessly. But also they've done a ton of work in onboarding, retailers onto the platform. And they also do a lot in terms of making it very retailer friendly, without compromising brands, right? So a lot of national distributors, they'll actually offer products on consignment to retailers so that if they don't sell the retailer can return it, which hurts brands because brands end up paying for it. Companies like Faire they're able to offer like 60 day payment terms, and things that really help smaller retailers and so they've been able to onboard 1000s of buyers, which is always helpful for brands. I think that's the problem with a lot of the platforms, I can tell you, even from my own experience was very easy to get on to a new platform, it was very hard to sell off of it. And we had with Tea squares were maybe on three or four platforms, and would maybe see one sale a month, right? Like it was minimal and more so a distraction of even having it. And so I do think that those platforms are valuable. I see a lot more brands as well who move their wholesale sales from their own eCommerce site to Faire, and they actually got rid of managing it themselves, even though they could capture more of that margin, because there's easier just managing it all through sites like Faire. There's definitely a couple of others, and some products do better than others on there. For some reason I've heard like jerky doesn't sell as well as on Faire, just because of their consumer base. And I think, like they sell more on Maple. I'm not sure exactly why, but just like little interesting things like that. So yeah, I think that that B2B space is really important. But it's, it's becoming saturated. And so it's definitely key as a brand to focus on, you know, the ones that are doing the best for you.
Brad Ebenhoeh:Yeah, I've seen, it's that little nuance of like, do you want to be spread thin across 10 things? Or can you just execute at a high level of three things like, right? It's just kind of that we see some clients that are like an eight platforms, and to your point to sales to sales a month three sales for sale, and then a lot it's like, okay, it's kind of distraction, and just from just a pure management, you know, operational, even finance, accounting, it's like, "I got to deal with this and manage that, and are you getting paid?" So, but again, you know, there's a ton of opportunity out there and a ton of different variability in on the platforms that you can choose and everything. So, as always exciting times, you know, for anybody and the entrepreneur. What is the goal for, you know, foodbev, these kind of growth development kind of long term plan? Do you have any kind of, you know, additional things, you're going to offer? Resources or kind of, you know, what, where do you want to take it?
Jordan Buckner:My goal is for anyone who's starting a natural product company, to be able to come to FoodBevy and get those tools and resources for them to be successful. And so it's, you know, we have plans to add more connections and resources around connecting with Angel investors, connecting with retail buyers, optimizing your DTC eCommerce platform, these things that can really help make a difference in the brand's experience. And ultimately, they kind of fall into two areas. One is like helping founders build relationships and finding both other founders and experts they can trust and also just helping them make more money and save money, right? Like at the end of the day, it comes down to, "can you actually help my business grow?" Or "can you help me save money on other things I was paying for?" And so that's my whole goal is to be very aligned with helping people, you know, build successful businesses on both sides of it.
Brad Ebenhoeh:Yeah, big fan of FoodBevy am happy that Accountfully can support it, and the brands on it. So as we kind of wrap up the podcast here, I kind of want to, you know, ask my two main questions that I do to everybody on here. So what is from your experience in FoodBevy, in your prior, you know, experience at Tea squares, like, what is one CPG industry do?
Jordan Buckner:Definitely go with where the opportunity is, and ride the wave. So what I mean by that is, there's certain consumer trends that are really taking off and growing a big one is keto, for the last five years. And really, the core behind that was low carb, low sugar, which has had history and lots of other diets and brands who launched a Keto brand. Even if they were like half in it. They saw like a million dollars in sales in the first year, right? Like the waves were just so big. So definitely move with consumer trends and don't fight against them. Otherwise, we'll be a harder time.
Brad Ebenhoeh:And then what is one industry don't?
Jordan Buckner:Don't chase people who make it difficult to work with you. Right? I heard a lot of brands who email buyers 30 times, they have a call and they just like, "I just can't get the store to take my product." And so they hound them. And eventually the person's like, "okay, fine, like we'll bring you in." It doesn't get easier. It only gets harder. They might you might get your foot in the door, but they're not going to help you sell your product and it's going to be a detrimental relationship. And so, only you know, I have the old boss who once said, "turn up the gain and turn down the pain", "work with the willing work with the people who want to work with you". And don't chase those that don't right like life is too short. Don't work against people who are only going to bring you down.
Brad Ebenhoeh:I love that man. That rings true just in personal lives, you know, business relationships, like running Accountfully For a decade like chasing key network providers, chasing clients, like typically, you know, within the first several interactions you have with somebody, you get an idea of their response in this timeline, if they're willing to work with you, if they're proactive. And, you know, I agree like, life's too short, one of our most constrained resources, is time and energy. Focus on the positive aspects of it. So awesome. Jordan, I love those. Those -
Jordan Buckner:And just as a quick aside to - you were talking about investment earlier - we raised two rounds both times for the investors said yes, in the first meeting. Yeah, there's essentially yes on there is like, "let's work things out. But it was Yes, at the first meeting. Yeah. And so I say like "the people who want to work with you, they'll tell you they want to work with you".
Brad Ebenhoeh:Awesome. Well, love the chat today. Jordan, can you give a little info on where we can find FoodBevy like if somebody wants to get involved, like, just give them more background on that, please?
Jordan Buckner:Yeah, and definitely check us out at foodbevy.com. And you can also find me on LinkedIn. I'm having conversations like this with founders every day and so happy to answer any of your questions or, you know, helping your business at any, any ways possible.
Brad Ebenhoeh:Awesome. Anything else to chat on Jordan?
Jordan Buckner:No, I think we're good.
Brad Ebenhoeh:Awesome. Well, thanks for your time, Jordan again. This was episode 19 - Jordan Buckner from FoodBevy on The Month End podcast. Thanks again. Jordan, you have a good one.
Jordan Buckner:Thanks, Brad..
