The Month End Podcast
The Month End Podcast
Episode 40: Karim Khalil • Yaza Foods
In episode forty Accountfully's CEO and Partner, Brad Ebenhoeh, talks with Karim Khalil of Yaza Foods . Karim brings his love of authentic Labneh made by his grandmother in Lebanon to the U.S., which (up until now) has been sorely lacking in filler-free, authentic options.
Combining his years of experience running complex CPG companies and his financial expertise, he leads Yaza Foods, which is rapidly growing in the international snacking space. This episode shares insight into Karim's unique background and the interesting ways he developed his management skills. Learn the important skills and inventory management tools that go into a retail-heavy CPG brand and how they can be tackled with great consumer insights, a knowledgable team and an enthusiastic founder at the helm!
For more small business and CPG- focused resources, visit Accountfully's resources page, where you will find helpful articles, guides, eBooks and more.
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Welcome to the month end 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 in the industry. Welcome to episode 40 of The Month End Podcast today, we have Karim Khalil of Yaza foods. How you doing today Karim?
Karim Khalil:Great. How are you? Brad, thank you for having me,
Brad Ebenhoeh:for sure. Looking forward to having you. So Karim is the founder and CEO of Yaza Foods. Brand name with Yaza and they are an emerging CPG brand, been around a couple of years, so we're excited to learn more about Yaza and what you all do. So why don't you go ahead andgive us a background of of Yaza, as well as a background of just kind of where you're at before Yaza, just before you started your entrepreneurial journey.
Karim Khalil:Yeah. So, so, Brad, thank you for having me. I actually come from a background of CPG. My founded. My father founded a CPG company in Nigeria, which I joined back in 2008 and not as a founder, but kind of as an employee. And that's where I learned everything I know today. And that was kind of my MBA. I spent seven years there. I was lucky to be part of the the sale of the company. So I learned all that process as well. And I moved to Atlanta to found the Yaza in 2020 the as I was found in 2022 it took me kind of a year and a half during COVID to kind of figure out exactly what I wanted to do, how I wanted to do it. And, you know, we started Yaza January, 1 of 2022 I took an office. It was just me on my own, and they start building a team. There's there's five of us now. We're looking to add the sixth person in the next couple of months, and we've been growing really well. We we launched in retail just over a year ago, and we've hit over 1000 doors already so quickly. And we think by the end of next year, we'll be at 2500 doors.
Brad Ebenhoeh:Congrats on the growth so far. So Yaza, you guys create and sell authentic Labneh, is that right?
Karim Khalil:So we're proud. So I'm originally from Lebanon, where Labneh is from, I had the chance to have lived all around the world. I was born in Switzerland, raised in France, High School in Lebanon, I went to college in the UK, worked in Nigeria, as I mentioned earlier, and worked a little bit in Lebanon as well. So I had the chance to kind of live all around the world. Food for me has always been a passion, and Lebanon has always been part of my culture, always been part of my passion. That was kind of the way for me to feel, to feel home wherever I went. And I always saw the opportunity in the US they there's all what I call authentic Labneh. Is the Labneh that my Grammy used to make back in her, you know, in her kitchen. And I wanted to launch that authentic Labneh. So we launched Yaza and not only we wanted to launch authentic Labneh, we also wanted to launch flavored Labneh. Because Labneh is kind of an ingredient. It's a staple in our culture, in a cuisine, but no one eats it as is. People always add things to it, and because the consumer is not familiar and not used to it, we kind of created different flavors, different authentic flavors, and we kind of focus on that authentic flavors, because it's very important to bring the real food, the food the way we eat it, back home, to the consumer here, and that's kind of of our success story.
Brad Ebenhoeh:That's awesome. So as we kind of back up, even when you first dove into the CPG kind of space, when you were seven, I believe, or years ago, you said, What were you doing for your dad? I mean, all odds and ends. Was there anything that like specifically that your job or or process, or anything in relation to that company that you really enjoyed or became, you know, helped you become very passionate about the, you know, the food and drink CPG space.
Karim Khalil:So,excellent question. So, so that company was not, it was a CPG, but it was not in foods. It was, there was hair extension. We had our own plant. We had 6000 employees. It was a very big operation. When I joined and my father was running the business, my father got sick. He had to leave. I was 21 years old when I took over the whole company. I didn't know anything about the company. I didn't know anything about CPG. Obviously, I went to very good school. I had the Masters in finance. I understood numbers, but I never I didn't have that experience, and I was thrown out there, and I had to do something about it. So I spent the first six months in the factory working the line. I spent time in every step of the supply chain, every step of the production line, and I think that was the most important part of me succeeding in running the company, because otherwise I wouldn't know anything. And I think it's very important for any entrepreneur to get their hands dirty, to understand the business, to understand every step of the way, to understand all the issues that may arise. I think that was the most important part of my learning and taking over like. Company. So my role was, as, you know, managing director, CEO of the company. Eventually, I did everything so we didn't the company didn't have was very successful, but I didn't have a marketing department or sales department. They had two customer service ladies who would take up the phone and take pickup orders that that's it. By the time I left, we had 200 people in the sales and marketing department I kind of focused on, I kind of, for me, that was very important focus on that they used, and it was back in 2008 but still, they had one laptop for the whole company, with a Yahoo email, no spreadsheet. Everything was pen and paper. Everything. By the time I left, we were implementing Microsoft SAP, you know, kind of take everything to the next level. Obviously, the acquisition really helped me learn, because we got it acquired by a multinational firm, and there was a transition period of around two to three years with them, where I learned a lot from them. And I think all of everything I learned there helped me be who I am, and helped me be able to run and start Yaza. So Yaza is the first company I've ever started or founded. But hadn't I been in Nigeria and went through that whole tough, very tough experience, a lot of ups and downs, a lot of different things I learned on every different aspect of the business. I want to be able to launch Yaza the way, the way we did. So I'm glad I went through that. And I think it's important that any entrepreneur goes through some some kind of experience in some way.
Brad Ebenhoeh:Yeah, definitely a very good internship there, I would say, for you, and it sounds like you excelled at it, but I would agree with you. I mean, just running an accounting firm, just doing the day to day and understanding and empathizing over your team members of what they do, what the client needs, and understanding that really helps you become, I think, a better business owner, just across the board, in terms of managing people, managing clients, managing products, operations, once you kind of do it, you can really see the the benefits of certain things you do, or even the the downsides of your processes. So fast forward now to Yaza, I guess, as we kind of get into that process while we were talking about the operations or inventory like, what is your inventory and supply chain process that you have at Yaza?
Karim Khalil:Yes. So so we still old school, still use Excel, which I really like Excel. I am really good at Excel. I went through I used to work in in finance, and we use Excel, the Excel tool, a lot. So Excel is really helpful, initially abroad. So we launched in retail Exactly a year and a month ago. And at the beginning, we used to produce on code date. So we had a minimum order production. We just produce every time the code, the code date is about to end. And for packaging, we used to order minimum quantities, so we never had to really worry about inventory. Is just whatever the minimum we have to order. We ordered, and we got to a point where we got national distribution with Whole Foods. Obviously, that really helped distribution a lot and get the product out there. But we jumped. So some January till July of this year, we sold in August, three times that number. And we sold in September, twice August, and we were selling in October. You know, October is not done yet, but we're we're on track to two, one and a half to two times September. So the growth has been incredible. It's really hard to predict the future. So what we do is we now have all our inventory in one place. We track that on monthly basis, and I like to have twice the amount and lead time that's needed for our projection. So we have projections going forward, and because lead times and things, you know, sometimes get delayed and very conservative when it comes to to inventory. So I always like to have extra, you know, three months, six months, depending on what kind of item we're buying,
Brad Ebenhoeh:yeah, and I think that makes sense clearly, you know, a big what I take from that is essentially keep your process and workflow like mirror or reconcile to kind of the needs and complexity of your business, right? So through the last three or four months that you're mentioning, you've had to ramp it up, change your process proactively, source and then buy inventory. Now that you have kind of a curve go bell curve going up prior when you didn't have that, you know, just in time, when the codes were kind of expiring, things like that. I do see various, you know, brand owners or clients with inventory that may over complicate it to begin with, and then all it does is creates a drain of resources, time, energy, money, complexity and it doesn't allow you to make the best decisions. Where sometimes an Excel sheet that you've created that can do it can last you a long, long time, as long as you understand the inputs, how it works, and have a good kind of consistent process with that.
Karim Khalil:Let me just clarify, clarify something, Brad here, so I want to separate two things, the raw materials, inventory. Versus the finished goods. So the finished goods inventory, we still produce to order. We produce a weekly basis. We get orders the week before whatever order we get, we produce it the following week, because it takes, you know, we need a week ahead of time to kind of buy the milk we have. We use a co Packer. We're lucky to have one of, you know, really, the relationship, relationship has been really, really good. And when we produce once a week, they buy the milk for us. So that's that's been really good when it comes to packaging and other raw materials, you know, different flavors, different spices that we use. That's where we didn't know how to buy. We used to buy the minimum order quantities, but that's where now we kind of have a better idea going forward, and now we're starting to buy and building inventory. Yes, it's a little bit costly, but what's more, more costly is, you know, if I'm out of the foil seal, whatever covers my my the cup, I can't produce anything, and I close shop and I lose sales, and that has a 12 weeks lead time, because it's coming from far away. I may have to print it, etc. So I'd rather we have a bit more and tie in some cash. We're lucky to have that opportunity, and we make sure that we never run out of the market. We try and meet our demand as much as we can.
Brad Ebenhoeh:And you're selling into retail. Are you? Have you ever sold direct to consumer? Are you ever going to I mean, I know you're probably, like, a refrigerator product, so like, shipping or freight, you know, pretty expensive, but like, is that kind of the reason why you're that's
Karim Khalil:talking about sales channels. We are in retail. We we would love to be direct to consumer. It's really expensive and really hard to be so that's not the channel that's that works for for Yaza, for now, we are going into club very soon next year. So we got packaging arrived last week, and we're launching club instead, and we are looking at food service and C stores. We just recently launched our product called Yaza on the go, which is a snack packed version of Yaza. So Yaza on the bottom, pita chips on the top. And we're very excited about that. We've had some interest from universities, different schools, different hospitals. Just try to get things working for that. That's going to be a bit tough. And then on talking about food service. The only issue we have with food services, Yaza is a premium product. We don't use any thickeners, any preservatives, any powders. And the issue we have food service when it comes to retail, consumers, look, read the ingredients, have the opportunity to know the brand and get become loyal to the brand. When it gets to a restaurant. The restaurants you know, you don't really know what kind of brand they're using, what kind of product they're using. So that's where it's more complicated to to convince a consumer that you have to pay, pay more for a plate of Lebanon a restaurant, because it's a premium product. We've we have some restaurants, premium restaurants, who are very interested in Yaza, and we're just trying to get distribution sorted for that. That's kind of where the the bottleneck and the challenges we have when it comes to food service. But Brad, you touch a very important point. Retail is a very good sales channel, but one anyone has to diversify those sales channels. And retail is very expensive channel, so you have to pay to play, whether it is slotting fees when you get in, or that it's free sales, all the promos you have to do, all the certain deductions that the big distributors take on you. It's a very expensive place to be at, and it's not sustainable to only be selling through retail in the long term.
Brad Ebenhoeh:Yeah, it's, it's tough being a small guy in the space that you're in, and so it's, it takes a lot of cash. It takes a lot of, you know, management of the business in general to kind of execute, when How do you manage, you know, speaking of cash, like, how do you manage cash on your end? You know, what is your kind of accounting finance like, workflow for for Yaza,
Karim Khalil:so, so we have an accounting firm. We use third party and they, they could, they do our books every month, and that's really helpful. But what we like to do, what we started doing, so I have a person named Grant. He just joined the company in July. What we started doing is bi weekly cash flow, because that's kind of where it's important, kind of deciding who to pay, when to pay, how to make sure we don't run out of cash. Because when things are tight, the value of cash is also very expensive. So you want to make sure that to make sure that you make the best of it. So we do bi weekly cash flows. We're planning to do next year, a full year of cash flow. It's it's going to be hard, but that's kind of where we plan to be on when it comes to Financials. And when I did the business plan, it was more, I would call it a road map, versus a business plan where a lot of people say, oh, let's do five year financials. There's so many numbers unknowns you don't know. You know, if you ask me three months ago where I'm going to be today, I really don't know. So the thing that was, that's a waste of time, in my opinion. So what they focused on is rather a budget. So what are the things we want to do? How much will it? Would that cost us? And kind of a budget? For every step to make sure that we try and not go over budget. And you know, a lot of times we have we had to go over budget because there's so many things we don't know and so many things that happen, so many challenge challenges we went through. But now I think we're at the point where we're working we have 2025 26, 27 financials, three-year projection, we can do it, and all we have to change is a few assumptions along the way. You know, let's say we get a big retailer, we get into big distribution, then we can just add one or two numbers and we're covered there. But I think it's important at the beginning to focus more on budget and how much money is going to take you to kind of sustain the business. And then next step is kind of do projections, and we're kind of looking at when is the break even point? How many years will that take us kind of make sure we get to a point where we stop bleeding, because this is when things get interesting and fun.
Brad Ebenhoeh:Yeah, so many different, you know, terms that you use there. I think, number one, you're 100% right. When people start with a brand new business and doing three year five year forecast, it's like, it's just like a waste of time, energy. I mean, it's nice to kind of see how, where to go, or possibility, but don't waste a ton of time, energy on it. Focus on, you know, the next 90 days and the next 12 months. That's kind of what I'm always like, rolling 90, rolling 20, you know, 12, right? So you can kind of manage cash on the short term and then continually change your your assumptions on the 12 month, but also to your point, like, reconcile that to a budget and expected outflows of money. You know, it's hard when you're playing in the the distribution space and paying to play and things like that. Sometimes it's hard to have exact timeliness of understanding, number one, when you're going to get paid from the big big guys, especially as you start the relationship, and number two, how much you're actually going to get paid from the big guys once you start the relationship, after you're involved with them. Over time, it kind of becomes more like refined and defined. But initially it's really, it's kind of unfair, as we've discussed that, but I mean, it sounds like you're in a good working relationship with them at that point, and you understand the cash and the deductions and all that type of stuff.
Karim Khalil:Yeah, so I've, I've heard a lot of bad stuff, and obviously I've watched a lot of your podcasts, and different podcasts, spoken to many people in the industry. Yes, I've heard a lot of bad stuff. We've not had, we've not have been hit bad yet. And I hope that that, you know, touch what that will stay. We have a good relationship with both UNFI and KeHe. Obviously, UNFI, we have distribution almost everywhere with with Whole Foods and KeHe, we have distribution in half of their warehouses. The relationship has been good. And what I think is important, Brad, so these deductions will happen, that's that's part. That's how they make money, right? And one of the things that's very important for everyone, for every entrepreneur, every CPG founder, to do is to get a financial expert, or whether it is, you know, an accounting expert who's familiar with CPG, or maybe someone industry who understands those deductions, and you take those into account, and you can never, let me just be clear, you can never take into account because they are very creative at deduction. But at least if you have some kind of budget for that, you know where you're going, then that really helps. Whereas you have a lot of people who like, okay, cost me $2 to produce. Let me set it at three, and then they forget that distributors need to take their margins, their cost, plus the freights, and then all the deductions, all the promos, but then the retailers needs to get margins, etc, etc. So one of the most important things to do is to understand your fob cost, the cost that the product will cost you at the warehouse before it gets shipped out, and what does that translate into retail price? That's the most important part, I think, to start any business to see if it's feasible. A lot of people will be like, Oh, that seems very you know, people are selling whatever the Labneh at $7 a Whole Foods. Oh, it cost me two or three, or whatever, dollars to make it, that's how much profit the company is making. That's not the case, and that's very important to understand, especially when it's rated, especially when it's a competitive asset. When retail margins go up to 60% they expect you to do at least four promotions a year. They charge you for promotions, other than to start all the free fields and the slotting fees that you have to incur, all the promo fees, all the different deductions, and then unifying ke will deduct here and there, all the trade shows you have to attend, etc, etc, etc. The list goes on.
Brad Ebenhoeh:Yeah, no, I You're 100% right. I think number two things I take away from that, number one is understand what's going on at a high level, right? Like hire people that can help you talk to people in the space. There's so many different CPG communities that exist out here that somebody will help you to walk through and understand at a high level what it means and and just make sure that you're going into the situation. Your as best knowledge as possible. And then, number two, it's just consistently tracking and monitoring it and adjusting things as needed, and following up and understanding it, right? It's just not like I said it, and forget it. It's a consistent situation with your business and anybody's business as we kind of move forward to kind of people, right? So how many people do you have on the team that you're kind of in house, plus, like, what is your day to day like, and how did you did you decide to which people to hire for your different roles?
Karim Khalil:I think that's a very nice question. I can. I want to kind of walk back how I started. So in January 1, 2020 I took an office, had my laptop, and started researching. I didn't know anything about Labneh as a consumer. I knew everything about it. I visited some factories back in Lebanon before I moved in, but I didn't know anything about how to make Labbeh here in the US, etc. So I was looking for a, you know, Labneh is made out of at home, you can make it out of Greek yogurt. So I was looking for a Greek yogurt factory in Atlanta. I wanted to buy one, because initially, from in my head, someone coming from production background, let's buy a factory, and then we'll figure it out how to do it. So I wanted to buy one. There's a factory that had some issues. I contacted the person planning to buy it, and the guy's like, you know, I already sold it. I closed down. And I, you know, I don't think Labneh is a good idea. I don't think you should get into it. Forget about it. And I'm like, What are you doing these days? And he's like, I'm just a consultant. And I'm like, why don't you come? Let's kind of do Labneh together. And he's like, I don't think it's a good idea. You're crazy. I'm like, let's do it. So I employ Ron as a consultant initially, April of 2022, and he remained a consultant for a year, kind of paid by the hour to help me develop the product. He went through it. So he used to sell his own yogurts, Whole Foods in different stores. So he had some connections, some network, he's done it, and he went through a lot of different challenges. So it was really good to get all the experience from him. So Ron joined a year later, full time, and now he's, he's the guy behind our production. He's our chef, he's our product development. He's actually working on new new products as we go forward now. And he's always been at the production facility in upstate New York every time we produce. So he joined full time April 2023 and until then, I was doing everything myself, right? I was doing every single role, whether it is even HR, and kind of understanding how that works, and payroll, etc, in June of 2023, and he's still on part time basis. We employed a guy called Steven. He used to be the head of Whole Foods in the southeast. So he's very well knowledgeable on how Whole Foods, for me, was always my target, my dream. He's always he's very knowledgeable on that. He has a lot of connections in the industry, because he worked in different with different retailers. He knows a lot of people, but he knows also how things work, and he's the guy behind this is how much you're going to pay at every step of the way, kind of understanding the numbers. And he helped us. He helped us there. And I also employed the same time political Kelsey, straight out of college for marketing, and for me, I wanted someone young who understands social media, understands consumers, doesn't need to have the experience with someone who has the energy for that. So she joined at similar time, in June, July, just after she finished school, and she joined as a full time, full time, and she's still with us now. She does marketing, but she also does sales. She does HR, and she does all of that, and she takes care of all our events, etc. She has a lot on her plate, and it's this year, in July, we Grant joined us, also straight out of college financial background. I wanted someone that can help us with all tracking, like you said, deductions. But also from step one, from the POS all the way, but also on the purchasing and the inventory side, all of that, and kind of the relationship with the accountants, because I have less time on my plate. So initially I had, I would get one email every three, four days, and I kind of celebrate getting an email. Now I get an email. Maybe every minute was really fun. I enjoy every part of the job. I work seven days a week, but I love it, and that's why I think I'm able to enjoy it, because every minute and everything I do, I enjoy
Brad Ebenhoeh:love it. So sales, marketing, operations, sales, finance, logistics. You got kind of demos?
Karim Khalil:Demos I do trade shows. That was last week I was at trade show. I try and do as many demos as possible, because that's where you get the feedback directly from the consumer. That's the guy that's consumers paying for it. The easiest way is to give someone something for free to someone, and he's going to say, it's really good. No one's going to say anything else. He's not going to give you feedback, because it's free the second they have to pay for it. Even at the demo, he would try it, he says it's good. If he doesn't buy it, then you know he didn't like it. Or you have an idea, if he doesn't take a coupon that you're trying to offer him that gets a discount, you know, he's never going to buy it, or he's not interested. And you kind of try to understand why. I also like to hang out so. Initially, I used to hang do that a lot. I have less time. Now, I used to go to grocery stores, especially the whole food aisle, and stop people and kind of understand the purchasing habits and kind of ask them questions. I've had weird people giving me weird faces, and I've had people kind of interacting, kind of explain to them why I'm doing it. Listen, I'm here. I want to understand what why you're looking at the aisle what you're looking for? And I care more about people who take their time looking, versus people who know exactly what they want. They take it and they leave, because those people are harder to convince. But the people who take their time are those who I kind of care to understand how they think. What are they looking for? Is it the ingredient panel? Is it the Nutritionals? Is it the item that they're looking for, something new or, you know, because there's so many options we are, yes, I sold in the same category as hummus. And there is 12 different flavors. There's seven eight different companies in every retail store. So it's really hard buying hummus these days. So it's kind of good to understand, why is this person choosing that brand over that brand, or that flavor, or that flavor? Is it the box size, or is it ingredients, or is it whatever criteria they're using?
Brad Ebenhoeh:Need to go where the customers are. I like it. Final couple questions here, as we kind of move forward. Number one is like, what are your kind of your KPIs, or key performance indicators that you kind of look at consistently, whether it's on the financial side, sales side, marketing side, operation side, just kind of, what's a couple of them that that you like to look at.
Karim Khalil:So the most important one I've learned from the industry here is velocity. So it's, it's, in a way, I'm not going to say easy. It's hard to get into retail, but it's easy, and if you can pay for it, and if you have the right product, etc, as easy as you get into retail, they're going to give you a chance. The hard part is to stay on shelf, and velocity is the key word, is the speed of which the product stays on shelf. Because at the end of the day, these retail stores are real estate for them, that's that they're renting you out real estate, and need to make money. The more they turn the more they sell per SKU or per shelf space, the more money they make. So velocity is a number we track, and we have access to data either something that we purchase, but we also have access to data from different grocery stores and different distributors share with that with us, and that's something we track very religiously, to make sure that the velocity keeps going up in every store, and we make sure that we've said no to retailers where we feel the area is saturated for Labneh yet, kind of make sure that. So we launched on the west coast with Erewhon and Pavilions, kind of the premium banners. We did that same thing in the East Coast. Same thing in Texas Central Market and HEB. Kind of Whole Foods everywhere it's more natural space, premium stores, and now we're starting to get into conventional as Labneh becomes more trendy at Whole Foods chose our flavor as a top 10 trend for 2025 so that shows you how, how much levy has gone through in the last year. So velocity is the key. That's the number one. The other one we look at is a promo uplift. So we kind of compare. So we do a promotion. Let's say we give, you know, buy one, get one free, or we do a 25% discount. We want to kind of see the velocity or the promo uplift during the promotion, but also after, do we gain customers? Do we not gain new customers? It's very important to do that, and that's also applicable when we do demos. So we've, we've just done, we've been doing demos for the last two months in Atlanta, where where our headquarters located, and that's the strongest city. Now, by far, it kind of beats every everyone else. When we bought data, and initially on Labneh, it was the worst region. It was the lowest region. Now, yes, has stopped performing cities Atlanta just because of the number of demos we've been doing. It's kind of, you know, following that up as well. And obviously when it comes to financials, not the financial statements themselves, but more of the cash flow. So we predicted that the next two weeks we need X dollars. Obviously, some checks been delayed the mail, and all the hurricanes and different things that affected that kind of did we plan correctly or not? And how can we adjust going forward to make sure that, because the more you grow, the more cash flow you need, or the more working capital you need to to finance the business. So we need to make sure that we don't run out of working capital going forward. And as we're adding more doors and more sales, we need to have more cash. And any mistake can affect that.
Brad Ebenhoeh:Love it. So cash flow velocity and then promo uplift, great kind of KPIs and great definitions and backgrounds of those. I love it, alright. So as we kind of head into wrapping this up, we always like, as a experienced entrepreneur on the CPG space that we can kind of share some insights to the to the audience, which you've already done, but just from a kind of a CPG retail business owner, can you provide one do and one don't to fellow CPG brand owners?
Karim Khalil:So yes, so that, that obviously will depend on the category, the kind of item, etc. So it's I'm going to talk about Yaza, my experience, what I've seen, I talked about the Co-Packer. Please go. Co-Packer don't produce on your own, at least at the beginning, because that's an extra layer that you don't want to get into. That's an extra stress you don't want to get into it. I think I kind of touched and explained why do get someone an expert. Do get expertise, especially when it comes to understanding pricing and costing, whether it's it's an accountant that's experienced in CPG, or someone in the industry, and do market research. So we, one of the things we did early, very early on, we did the focus groups where we kind of understood the consumer, how they see Labneh, what's it? What it is for them. Make sure that you understand who your consumer is. You buy data if you have to to understand the space, to make sure that you're launching. You're adding value to the category. If you're not adding value. There's so many brands, so many smart people with so many good ideas. You know you need to to be different. And to be different, you need to understand who you're selling to. Those are the big do's. For me, the big don'ts. It's don't launch until you're ready. And I've met a lot of different CPGs firms that are very excited and in the rush to launch, and we delayed our launch by three, four months because we had production issues. It was just no, you know, when you scale up, it was just not working out. And we kind of debated and internally, do we just launch it? Because it's not that bad, and I'm like, No, until it's 100% perfect. We made huge losses on production. We just had to throw it away until it's 100% there's no rush. It's not, you know, it's a marathon. It's not a race. Take your time and make sure that you have the what you think is the best product, the product you're comfortable with, that you think is going to do really well, because it's more costly and it's harder to fix the problem later on. So that's, that's that's kind of a, don't, um, understand the financial so don't launch if you don't have the finance to sustain the business. And I've seen, and I've read a lot of case studies where so many great ideas, and they get to a point where they just can't afford you, they have to close shop. And that's kind of, really, you know, it's heartbreaking, because either they have to go to VCs are early on investors and and sell their company for so cheap, and nothing remains for them. It's not even worth the work, or they just close shop. And I think that's that's another thing that's important. Maybe the last don't is, don't be a, you know, don't shy away from your mission, whatever mission you have in mind. And you know, for us, is bringing authentic Lebanese Labneh finding product, finding flavors. Our all our competitors use, use powders or thickeners. It's cheaper they make they have more margins and make more money. We don't. Don't shy away from your mission. Our mission is to have the authentic way we make it, the way my grandma makes it. Think that's the best way, even on flavors. So we launched the tar and olive oil. People don't know what the tar is. We're kind of worried about, do we call it the tar? What do we do with that? And one, it's our best selling item flavor. It's it got the Nexty award at Expo West. I don't know if you're familiar with Expo West. I got next year award for People's Choice Awards The people voted for it. And three, it got the top 10 trends for Whole Foods Market for 2025 as a flavor itself, as a Yaza Labneh Zatar and olive oil flavor. So it tells you that, you know, when you stick to your mission, that's that's the unique proposition we offer to the market, authentic Labneh, authentic flavors, and that's what that's the recipe behind our success.
Brad Ebenhoeh:Awesome, great info, several do's and several don'ts. Do you think would think one question popped up? Do you think you'd be here today if you didn't take over, you know, your father's business, or were involved in kind of the space several I don't
Karim Khalil:think so. Brad, and I think I learned a lot from him, from the team he had, and from the experience I went through. And I think that it's very, very important to go through ups and downs, because you're going to have ups and downs, and you're going to have to deal with things, and just learning how to deal with things. It's not a particular experience of just copy pasting what you what you did. It's just learning how to think and how to react and what to do when and CPG world is full of challenges, and it's a lot of work. You have to understand. Anyone who wants to launch a company needs to understand that from the beginning, it's a life commitment versus a typical nine to five job or typical career.
Brad Ebenhoeh:Yup, yeah. It seems like, just from our chat here, you've definitely taken a very kind of wise and mature and proactive approach to the to the business. And it seems like you know the growth and the success kind of to date, and especially.
