EMMA AND TOM
EMMA & TOM’S NEW WATER RANGE
Water with Vitamins & Minerals; Raspberry & Cranberry, Pink Grapefruit, Lemon & Lime, Orange & Mandarin and Blueberry & Green Tea
Emma & Tom have done a sort of a back flip, they were the juice people now they are the juice & water people. But they did say to smartcompany.com.au that they would be launching freshly brewed tea.
“In two months, we are launching a range of iced teas. Some companies use extracts but we are making ours from a brew".
The old website is gone, the colours streamlined and simplified. The newsletter initiative has also been sacrificed.
They have new friends, to bad I am not one. I could of recommended some tips to save them some dollars, but hey people love to repeat the same mistakes that others of have made. Nothing smart about it.
“We did use the media. We felt we didn’t have good media contacts so we used a PR firm and had them on a retainer that cost about $1500 a month".
Did you know that it could cost you as little as 50 cents per media contact in Australia. You can even manage the campaigns and lists from your computer. I wish I knew this earlier when I was in the game, I now know the importance of networking, experience and knowledge.
I have jotted down some finer points of interest, that I think are important for beverage start-up entrepreneurs.
a) Predictions are just that, when a newbie starts the optimism jacks up the estimate of the sales. It is better to aim for the break even point. That will give you an idea of how much product needs to move for you to cover the costs and also gives you an idea how long it will take. The increments of sales per quarter can help make readjustments of the estimated time frame of profitability. If your good at predicting exact results for beverage start-ups, you should be making millions as a trader in the futures market.
b) Competitors (threat) can always launch a similar product around the same time as you, if they happen to have more muscle and resources behind them then the job of selling your product has just been elevated to the super heavy weight category. We know how the mismatch usually turns out! In the case of Emma and Tom their competitor, Berri flopped with their entry and the product was sexed up to look super duper premium
c). Hit the pavement and build your niche market, it is usually starts with the smaller establishments at the beginning.
“We started walking the pavements, presenting every shop with a six-pack holder and asked them to taste it, returning in three days. We focused on selling into stores owned by people like ourselves. That way we could have direct interface with the customer and it was good brand association."
d). Point-of-sale is crucial, emphasis should be made to have something creative and long lasting, so as to gain favour with the store owner and store employees. If you give them an incentive to look after you, they will make sure the point of sale material is well looked after. Here is a suggestion, why not try a VIP "Emma and Tom’s special friend’s" card. I am sure you can get your existing customers to sweeten its attractiveness, one person’s demand is another’s promotion.
e). Money is a luxury when your working with limited capital, yet the best marketing comes in really cheap. The traditional methods work but they can be matched with Guerrilla Marketing and viral marketing. The key to success is creativity, HARD WORK and consistency. Have a look around the Internet for examples which are freely available.
f). Estimated sales figures, thanks for sharing Emma and Tom.
This of course is based on hypothetical scenario on some figures provided in the article:
Breakdown.
1000 Customers (stores)
$2.00 Product Price per unit wholesale.
Estimated Net Profit 16% on each unit.
1000 Customers (stores) x 10 units average for each store every week = 10,000 units
A carton of 24 items will cost around $48.00 ea, wholesale.
Calculations.
10000 units x $2.00 = $20,000
Net profit = $20,000 x .16 = $3,200 net per week.
The total number of cartons sold a week on average is around 417.
So you can play around with the above figures and work out what is being made, but if they are selling onto distributors I believe the margins are smaller. And as your business grows so does the inventory levels and you could have substantial amounts of capital sitting in storage. This is another stumbling block facing under capitalised beverage start-ups. If customers are late in the payment cycle then cash flow is affected and puts strain on the businesses operations.
"We are cash flow positive, as long as our suppliers pay on time".
So if you want to learn a little more about a beverage start-up, then have a read of the article at smartcompany.com.au
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