00:00:00:00 - 00:00:21:05

Hey everyone, today we're going to be speaking to Audrey Zahara from Burlap and Barrel, a single origin spice company. Today we're going to talk about his journey, basically building the company, bootstrapping it over the last eight years. I hope you enjoy. If you like these podcasts, please subscribe. After the episode.

00:00:21:07 - 00:00:47:20

All right. What's up man? It's good to meet you. This is the first time we're meeting. Yeah. Yeah, it's great to be here, but. Yeah. So some of the things I want to talk about today, I want to talk about your journey. This isn't your first company. I also just want to talk about, like, you know, discovering, different sort of, looking at, at traditional business models and different ways to actually bring something new to the market that, you can speak about and has efficacy in the marketing.

00:00:47:20 - 00:01:09:01

Obviously, that's what a lot of you guys do at burlap, Burlap and Barrel. So let's start with just the basics of like, what is the business? And, and really kind of where that, where that angle was. Yeah, totally. So we're now, about seven years old or turning eight in October, so about seven and a half years old right now.

00:01:09:06 - 00:01:26:22

But Burlap and Barrel is a single origin spice company or a social enterprise. And so we work directly with smallholder farmers. Now, around the world, we pay them more. We set them up to be direct exporters. And because of that, we get way higher quality spices. So it's a little bit like what happened in coffee and tea and chocolate.

00:01:27:01 - 00:01:45:15

Why we go to farmers markets, why we go to our butcher for higher quality stuff instead of the spice farmer selling spices into the commodity market, where good and bad and mediocre gets mixed together, years pass. All kinds of stuff just kind of happens along the way that we don't know much about. Talk about all the cinnamon scares and turmeric shares and all that stuff.

00:01:45:16 - 00:02:03:21

And we work with the farmers who grow the spices, who are excellent farmers in their own right. And instead of selling into the commodity market, they're cleaning, drying, grinding, blending, in some cases preparing for export. And then we pick it right back up from their farm right after the harvest and bring it into the US and pack it up to send out to home cooks and chefs all across the US.

00:02:03:24 - 00:02:22:08

Is it a marketplace model in that sense, or you're just using them as, as basically like, raw materials and selling it under the burlap? And yeah, it's all under our brand. But what we do is we talk about where they came from on our site. We have more information than I think exists on the internet for this whole lineup of spices.

00:02:22:11 - 00:02:39:23

We try to make the the first kind of comprehensive single origin spice business. And so we talk about the farmers. But but they're all represented in the products they made. But it all comes under burlap and barrel. So you don't have to travel around the world. You have to go to a company that specialize in Vietnam or Indian foods or Greek foods or whatever.

00:02:39:23 - 00:02:58:10

You can kind of come all through us and get the kind of best places in the world all in one place. Yeah. That's great. I love the I love the value proposition there. And it sounds like you're doing something great for, for some of these different farmers. Are they able to, you know, live off of Burlap and barrel, as, you know, a major part of their income?

00:02:58:12 - 00:03:15:08

Yeah, yeah. And I can give you, like, an example. So we what we believe is we believe in kind of farmer led pricing with the idea that we talk to the farmers, we tell them the quality that we want. Often many say that's too expensive because they used for years and years of the commodity market just pushing them down and just saying, do whatever you can, cut corners.

00:03:15:08 - 00:03:40:19

We don't care. We don't want to pay more than X dollars. And so we're paying farmers 5 to 20 times the commodity price. I mean, we we see that even Fairtrade organic, turmeric in India usually goes around a dollar a kilogram and we pay north of $5 a kilogram, but it's not the same thing. It's instead of the farmer selling into this whole supply chain, the farmer gets to internalize all the stuff that often other people are marking up.

00:03:40:19 - 00:03:58:00

They're providing a service like grinding, but they're marking it up. We're asking the farmers to handle more of that process. We guide them. We we, we teach them how to be their own exporters. And so they're able to make a lot more money. And that's the idea, is that we work right now with like 25, 27 countries with farmers all over the world.

00:03:58:02 - 00:04:18:00

And the crazy thing is that we don't have these like legal contractual agreements. So what we're really trying to do is to be the farmer's best customer. We do massive down payments during the harvest, in some cases even before they plant the seeds to grow the spices. And so we're trying to create this win win where the farmers are able to grow better spices and where their best customer pay.

00:04:18:05 - 00:04:43:05

That's kind of guaranteed on the other end of that, to to pick up their spices. They'll take up their product. So it's really meant to be this thing where where we like, we both succeed together. And then we have to our job is to convince customers in the US to kind of catch their attention, tell them that the stuff that they're getting is probably mostly sawdust, you know, in the grocery store, and that they actually they care about where their food comes from and the flavors that we really have an incredible sauce for.

00:04:43:05 - 00:04:56:19

And if they give us a chance, they're not going to go back. And we see that in our reorder rate. We said we would just keep coming back after they've had their first taste of our spices. Interesting. So there's a couple things that you hit on there that I want to just focus on. One is like you're actually adopting.

00:04:56:19 - 00:05:18:01

I would call like the altruistic part of the direct consumer model where you're truly like looking at an antiquated industry and being able to pay suppliers a higher wage and offer it directly to the consumer with a lot of other DTC brands. I spoke about that, but that wasn't actually the case. They were just like cutting out one layer of retail.

00:05:18:03 - 00:05:35:22

Yeah, totally. And I think the dirty secret was a lot of especially food products, is that most people go with their recipe and they're like package designed to some kind of co-packer core manufacturer that just takes existing ingredients and just combines them in a slightly novel way. Usually it's pretty trendy or hippie. So like, what do we want?

00:05:35:22 - 00:05:56:07

We want prebiotics, we want mushrooms, we want CBD. Like it's just off the shelf commodity ingredients being being kind of combined in a different way. And really at our core, we're we're a supply chain company. And that really means that that we're working hard to, to build all the way, like we work with farmers. We're not just buying from a local manufacturer here domestically.

00:05:56:09 - 00:06:18:03

We're building this global supply chain from all around the world. And then we get to present that product. So I think then comes the other half of what other CPG or whatever companies do where they'll do something slightly different in their look or the feel or the combination, but we actually have this strong supply chain behind it. So by the time you get it in your home, you smell it and you taste and you're like, oh, this is a fundamentally different product.

00:06:18:06 - 00:06:45:09

It's not just a repackaged, rebranded version of something that's been hard available online. It's not just like marketing. It's not like marketing fluff. It's it's these are the best sorts of, you know, relationships when you actually have competitive advantage of these of the supply chain or the product, you can actually tell the story. The story is directly aligned with that sort of competitive advantage, and people respond and resonate with the marketing totally.

00:06:45:09 - 00:07:02:14

And I think, you know, this from the marketing perspective too, is you spend so much time bringing in a new customer. No company can live off of new customers at one off orders. Companies live or die based off of the reorder rate. And so when that product that arrives at your customer's home, they're either like, oh my God, this is as amazing as you promised it would be.

00:07:02:14 - 00:07:16:00

And now I love it and I'm going to be a returning customer. Or they see and say, that was pretty expensive. And it doesn't do the things that I expected it to. And it just kind of like is sold to me. Well, but it didn't live up to that kind of expectation that that was built in me.

00:07:16:05 - 00:07:31:07

And then they just peace out. And so I think it's it's companies live or die by how well they're able to take your customer from like, you've convinced me, I'm going to give it a try. And how you can then turn them into a recurring and repeating customer from there. And we do that really, really well because the product quality stands for itself.

00:07:31:11 - 00:07:48:24

We still have a big job to do, to reach out to people and to show them that that a new thing exist. We do this even with chefs at major restaurants, that still they know about their cattle rancher and they know about their produce farmer. But spices are just spices and they don't think about it twice. So there's a lot of education that happens along the process.

00:07:49:03 - 00:08:08:04

Yeah, I definitely want to dig into education and how you guys are able to do that, because I think it really determines how quickly you're able to convert someone, which is really important in CPG. The best marketing is like super simple, so you just need to just condense and truncate the message so people can understand it. And then they're like, I'm going to try that.

00:08:08:04 - 00:08:27:21

That actually that actually sounds good. But going back I think there's like so many important parts of the customer journey that, you know, we know the obvious ones awareness, conversion. But for me, where a product can really, you know, carry its weight in gold is during the unboxing. I think that's a really important moment, which we talk about a lot on this podcast.

00:08:27:21 - 00:08:50:21

And then, in loyalty and retention. And that's a question of like how the person has reflected and is enjoying the product and if they're going to really come back. Yeah. And we put a lot of work into designing that unboxing process. I think most e-commerce companies, you get a shipment and it's full of trash. I don't know, like it just like papers and like other stuff like that and then like it travels safe.

00:08:50:21 - 00:09:08:15

I think that's the lowest level that your packaging can do. We literally designed custom three packs and six packs that were able to hold our jars tightly together and give a really beautiful unboxing experience. The actual boxes, you can rip the back off of it that are spices shipping and use them as a tray for your spices in your spice cabinet too.

00:09:08:19 - 00:09:22:09

So I really try to be really thoughtful. How can we make it small and compact and efficient? How do we make everything work? How can we make it all recyclable? And how can we like? It's one of those win wins where if we do it right, we can save costs on shipping and we can design it to do that.

00:09:22:13 - 00:09:40:02

But then you open it and it feels like a gift, and that's what we really want. And we see that about 10% of our customers are so send our spices as gifts. And so that's a huge form of customer acquisition too, is if you get gifted a beautiful set of spices, you get to try them. Hopefully that's a way that you find out about us and that you keep coming back.

00:09:40:05 - 00:10:00:01

I love it, I love the spice trade. How did you get into this business? So so this is a second business for me and my business partner Ethan. We had an ice cream business back in 2010, and that was we were like, Ethan was cooking at restaurants in New York. I was eating at those restaurants or some mutual friends we met, and that was that was how we started spending time together.

00:10:00:03 - 00:10:16:18

And he was actually making ice cream, working as a pastry chef at one of those great restaurants. And when he thought about what to do next, he kind of came and shared with all of his friends, saying, I want to make some kind of ice cream business. And I said, absolutely, I'm in. Let's figure it out. And so we started testing out ice cream sandwiches and all that.

00:10:16:18 - 00:10:33:04

We decided to call it Guerilla Ice Cream. Like kind of insurgent. We had a little ice cream car. We pushed and we had flavors as far as political movements and revolutions from around the world, and we doing it all for profit. The charity, it was like, our social enterprise training wheels, just to kind of see what we could do it put together.

00:10:33:06 - 00:10:53:07

And it went really well. And after that business was one summer, Ethan moved to London to get his master's in international development and to Afghanistan as an aid worker. And then actually came back to the US with all kinds of cool ingredients that he had bought from the markets there, but in particular this wild cumin that grows in the northern mountains of Afghanistan.

00:10:53:07 - 00:11:09:00

All of his chef buddies were like, oh my God, tell me more. I will buy this from you right now. And so in my journey, I left the ice cream business. After that summer, my taste was like, what have you done? I got a lot of shillings in, and that's just, a risk that happens when you run an ice cream business.

00:11:09:00 - 00:11:29:10

And then I went, I moved to California and I wanted to do the next entrepreneurial thing. Ethan's business is culinary. Mine is really. So Ethan's background is in culinary. My background is in business. And so I ended up running a venture backed mortgage company. We started it. I met some investors. There was a great opportunity. And over four years, he raised $32 million.

00:11:29:12 - 00:11:47:11

Grew to over 100 employees, got licensed in 12 states. But but we were running a loss every single month. And so it was really this high stress grow quickly even at a loss. And ultimately, we had a signed term sheet for a $40 million series C and it all fell apart. We had to cut the team all the way back.

00:11:47:11 - 00:12:12:08

We ended up selling it to one of our investors, and I just came out there with my head spinning, saying, I really don't want to do this again. And that was right when Ethan laid out when and yeah, that when like the, I, we just, I know, mortgage a bit. Yeah. Is that when mortgage market just started to fall apart and, 21, 22 or 22 so that was, that was a we were from 2013 to 2017.

00:12:12:08 - 00:12:30:19

And that marked, mortgage, refi rates going way up. So all of a sudden there was this big refi bubble that had really pushed a ton of mortgage companies, and then all of a sudden there was no refi because rates went up and all those buyers disappeared and we had the business. Yeah, yeah, it's a cycle. Totally.

00:12:30:21 - 00:12:46:18

So, so we were so we were and you know, shame on us for also not figuring out a profitable model. But that's what all of our investors, they didn't care about that. And all of a sudden they cared about it. I think a lot of startup founders and people that service will now better mortgage, you know, totally, totally.

00:12:46:20 - 00:13:10:10

So we got out of it. Ethan. Right then landed in San Francisco. He we sat at no. A great restaurant. He pulled out this wild Cuban from Afghanistan. He met a vertically integrated cardamom farmer in Guatemala. He had met, an organic co-op in Zanzibar, growing cinnamon and black pepper and nutmeg and vanilla. And I just watching these chef's eyes, like, just pop out of their heads as they were trying this.

00:13:10:15 - 00:13:38:12

And that was at least my first kind of light bulb moment to say, oh my God, if we can do this for restaurants, and then we can really start to do this also for home cooks, they'll love it too. Yeah, totally. So is that so? The business started supplying restaurants in the city is. Yeah. Yeah, it really started Ethan early on was just bringing stuff in his suitcase, you know, into his apartment in Queens and, and literally at some point yet over 1000kg of spices in his apartment.

00:13:38:12 - 00:13:57:23

And it was just unsustainable before we started selling to chefs. And the reason was that chefs really could tell quality just by tasting and smelling. He could walk around to restaurants in New York City. And I did the same in San Francisco. Eventually, and we were able to they were just able chefs are used to buying from all kinds of strange suppliers.

00:13:58:04 - 00:14:17:13

There's a story of how regalia started selling truffles. I don't like the this dude's, like, trunk literally running around the restaurant. And so chefs are a really good first audience because they could tell quality they were willing to buy unconventionally from a guy, you know, walking with a backpack full of spices. And three is they gave us a lot of kind of like authority.

00:14:17:13 - 00:14:35:13

They gave us a lot of legitimacy because then when we were ready to start selling to home cooks, we could be like, look at all these chefs, right? The same way. They're like Nike sponsors, athletes. But we were just doing this naturally was our business. We just had all these really loved our spices and we could be like, look, the restaurant, 11 Madison Park, three Michelin stars, buys our spices.

00:14:35:13 - 00:14:52:17

Don't you think you would love them to dear Home Cook? And that really helped us open the door in the early days. It's really interesting. I was just having this conversation with, someone I'm thinking about working with who has a seafood business. They supply, you know, half of the Michelin restaurants in New York City with, with fresh seafood.

00:14:52:17 - 00:15:14:09

And he has this just really integrated supply chain where he could offer seafood marketplace for, you know, anyone who wants to buy it. Across the United States, e-commerce is just such a different motion. And you really need to be thoughtful about it. How, I I'm and I want to take that into your experience. You know, going from chefs, obviously you had the social proof component.

00:15:14:09 - 00:15:37:21

It helped out. What were some of the challenges getting the direct to consumer business live? And then today is the business. How does it split between retail Amazon direct to consumer. Yeah, totally. So so today, I'll, I'll kind of walk you through because we were we always had our website going, but we were bootstrapped. And so that was one of the big decisions that we made is we wanted to have control over our own business and path.

00:15:37:23 - 00:15:59:09

It meant that we weren't able to pay ourselves salaries for the first two years, which we're able to kind of get by off of savings. I did a little consulting at the beginning, but early on we were really in 2019, we were 50% e-commerce, which we had done through PR a little bit through some affiliate promotion, which is really like Wirecutter like publication affiliate was really helping us starting to pick up things.

00:15:59:13 - 00:16:17:21

But we were about 60% foodservice to restaurants and 50% e-commerce. And then 2020, the pandemic hit. And in March, we were both in India on a sourcing trip. We came back. It turns out we both had Covid. We had two founders of a the spice company with no sense of smell. So we were a little bit worried.

00:16:17:23 - 00:16:35:09

And luckily it came back. But really our restaurant business went to zero. And so we, we thought we're going to run out of business. And you know, what ended up happening is by May, home cooks had more than made up for what we had lost in restaurants, and we ended up growing five X through 2020, the whole business.

00:16:35:09 - 00:16:56:19

So e-commerce grew ten x, you know, so the whole business could grow five x. And so we really tried to people we noticed that people weren't going to grocery stores. There was a meaningful behavior change where people were starting to look online and typing in best spices. And because we had so much PR and because if you type that in, we can't do SEO for the search for like best spices.

00:16:56:23 - 00:17:11:10

But food and wine writes about the best spices and we were there and survival rates about the best spices and all these other food publications had written about it. And we were there on all their lists. We'd made friends with them a lot of them were based in New York, which helped us, but our site was converting really well.

00:17:11:13 - 00:17:27:01

So even for us doing a little bit of revenue share with them through all those like Wirecutter style listings, we were there too. And so all of a sudden people started discovering us and giving our business a try because their grocery stores were just trying to keep, like, toilet paper, you know, and like beans and whatever in stock.

00:17:27:02 - 00:17:44:23

And so all of a sudden people were cooking at home and going online for it. So that really blew up our business. And by the end of 2020, we were 85% e-commerce. And in 2021, everybody supply chains broke down. We're a supply chain company. We built all of our own supply chains across all of these countries. So we were in stock.

00:17:45:02 - 00:18:04:03

So we then almost doubled again in 2021. And now that we've been growing, our big kind of accelerator in 2023 was we went on Shark Tank, which was very fun and ridiculous and wonderful. But we did our song and dance for a million people watch Shark Tank, and that was the real gift of Shark Tank, Deal or No Deal.

00:18:04:03 - 00:18:34:16

You know, we were just really happy to be exposed to such a big primetime US audience. And so our sales again grew. And so today Shark Tank really built up our Amazon. So we're about 70 ish, 75% e-commerce, about 8% on Amazon. And then the rest of it is split through grocery foodservice in bulk. But really we're focusing in the last year have been really focusing on grocery, too, because what we really learned was that we can be on e-commerce all day long and people like it.

00:18:34:16 - 00:18:56:06

It's an area with headwinds, meaning that more and more people are getting used to buying their spices online. And so it's just over time, it's going to keep growing. But today, still, out of all the people, it's about 95% are buying their spices at the grocery store. And so that it became a mission of ours to say, hey, if you're already shopping in the grocery store, we're not going to have our full lineup there.

00:18:56:06 - 00:19:12:17

This is the gift of e-commerce, like you said, is we can do storytelling online. We can tell you about the farmer, we can show you photos of the farm and of the seedlings of black peppercorns. And we can give you tasting notes and recipes on our site. We can have limited run things. We can do all that stuff on our site, which is really phenomenal.

00:19:12:19 - 00:19:35:01

But in grocery we can't tell that full story. Our jars and our packaging. We have to do a lot more heavy lifting. But can we get our top ten, 12, 20 spices in some of the specialty grocery stores where people go to buy higher quality things, then hopefully that's your fuel, their first taste with us, they can still get one jar without having to pay shipping for it, but they'll still come to our site when they're ready for the full experience.

00:19:35:04 - 00:20:00:06

So I mean, you bring up a couple of interesting points. One being when messaging and advertising are so important to the reason why someone actually buys your product over the existing, you know, spice players on shelf. I'm talking about at retail, like at retail, it's probably really tough for a customer to discern what burlap and barrel is versus, you know, the competitor totally screwed up supply chains, right.

00:20:00:08 - 00:20:27:21

So I'm just curious how you're thinking about if 95% of consumers are buying across or they're buying in the store where they get their spices, that's obviously the next frontier for you. How are you thinking about getting into the minds of the minds of those consumers? Have you explored retail media? Is it a function? Yeah, we're trying to think about it in general, we've been a company where, like traditional advertising, like if we're going head to head with, like, PepsiCo or Unilever sponsor company, we're going to lose.

00:20:27:21 - 00:20:49:16

And I think that a lot of companies burn through a lot of VC cash trying to kind of make it happen. And, and many of them are running at a loss their entire lives with the goal of not necessarily being profitable but being acquired and then somebody else that acquire making that profitability. We've done something a little different where what we did is we said, okay, not all groceries and same.

00:20:49:22 - 00:21:09:01

So we started with small independent specialty and we start there where there isn't a whole wall of spices and there isn't like 50 different brands and they're not selling McCormick at like $2 a jar or whatever they're doing there. And so they're already kind of curated and people come in there to find out about new products, new brands and people that love certain categories.

00:21:09:03 - 00:21:25:23

They come in there to be like, what? What do they carry? What's the new thing that I can kind of keep in now? We've been expanding into specialty retail, grocery, but that are regional. So maybe they're there five stores to like 50 stores, you know, and we're trying to kind of get into areas that are still known for higher quality.

00:21:26:01 - 00:21:46:10

But I think a lot of people are like, I need to go to the Whole Foods or Bust. And I really think that Whole Foods has put more small businesses out of business that it has, like built them up because it's so expensive. And I think that companies go way too early into retail, because when you're still small, you're paying more for packaging, you're paying more for packaging, you're paying more for everything in your business.

00:21:46:10 - 00:22:02:22

So if you can grow and this is why we're now in our eighth year, we've now grown enough that we're able to, like, source our glass jars directly from the factory in Asia, and we're able to do all these things. So now we've built margin that then can get reallocated to a distributor, to a broker, to a merchandizer.

00:22:02:22 - 00:22:26:15

And so we're able to actually do it profitably, where if we if you ask us 3 or 4 years ago, we wouldn't have been at the right scale for it. And to answer your question on how we're having people kind of find out about us honestly, our e-commerce has been the engine of it, and hopefully people have known about us or heard about us, either because their customers or their friend is a customer, or they tried it at a restaurant that they love, or they read about us online, and then they see us at the grocery store shelf.

00:22:26:20 - 00:22:47:16

We think about taking a stranger to a customer. All in grocery is a really expensive proposition. And so how can we, the how can you get to know us outside of grocery so that eventually when you do come into your grocery store and see 12 spices from burlap and barrel on the shelf, then all of a sudden you can kind of like, you get to know us and like you're like, oh my God, I've heard about them.

00:22:47:16 - 00:23:05:09

I've wanted to try them. Here's my chance. Now, one other thing that's been kind of fun is that we've now we're not working with a handful of grocery stores that carry a lot of our spices. So like, if you live in Seattle, you might have gone into a metropolitan market where they carry 30, 63 of our spices.

00:23:05:11 - 00:23:23:17

If you are in Texas, you mean how many spices do you guys have? We have almost 100 now, but a lot of them are like limited edition. A lot of them are collaborations, which I know, I know we can kind of touch on because that's been a good commerce acquisition strategy. But the idea is like, how do we if we can kind of create this like visual block in the grocery store?

00:23:23:19 - 00:23:51:12

And most places won't trust us for that because, like, we have to like work our way up to that. But stores that love quality and know our spices know that we're going to really sell a lot better than than the commodity spices in their stores. Yeah. It's, it's really interesting. I think I talked to founders and they have totally different perspectives regarding, you know, how e-commerce fits into the business, how retail is it is really so dependent on the category that you're like in, and, you know what?

00:23:51:12 - 00:24:11:16

Marketing tactics also just inform that for me, that's part of the fun of entrepreneurship. It's like kind of figuring out how all of the pieces really fit together. But I love the way that you guys are building your company. You're not rushing. Which it's so funny. You probably felt this at your venture back company when, like, being profitable every month is.

00:24:11:16 - 00:24:29:00

It's like a breath of fresh air. You have unlimited time, you know, and when you look at it in that perspective, it's just you're able to think on a longer time horizon. I think when you have the pressure of either you're losing money or you have investors that you need to, you know, answer to just creates a totally different dynamic, psychologically.

00:24:29:02 - 00:24:45:22

Totally. And we've had to solve it creates also the discipline of having to solve things profitably. I think at my last company, we would be like, I don't know, we have to grow ten x. So like, let's hire a bunch of executives, let's do this. So I think we did a lot of inefficient things. And a we're like, okay, we have to grow profitably.

00:24:45:22 - 00:25:09:12

So let's find ways like we did. We redesigned our packaging so we would shift better and faster. We wanted to gift packaging. So instead we did these drawstring gift bags. You know, we couldn't afford to hire full time people and spatulas for everything. So instead our team is a fully remote team. Everyone's a customer, and a bunch of our customer support team, we just hired our customers to do customer support.

00:25:09:14 - 00:25:30:10

And so, you know, like just a fun little fact that listeners, if you want to think about this too, like our audience, if you think about it and think in your head, are they mostly male or mostly female? And this is for e-commerce on our site. Think about that. Think about if they're, over 40 or under 40, and then think about if they're in cities or outside of cities.

00:25:30:10 - 00:25:48:23

And when you answer those three questions, you'll have some something in mind. Most people think of themselves when they do this just because of cognitive bias. But what we learned is that ten what was it? 10% of our customers have AOL, Yahoo, or Hotmail email addresses. And so we have middle aged ladies. There are customers and we love them.

00:25:49:02 - 00:26:07:19

And so the we we found out that it was good because they had 20, 30 years of experience cooking in their homes. So they're actually quite experienced cooks. They were cooking because they loved it. And and they were willing to spend a little more disposable income on, on the spices themselves. And then three is they lived outside of major cities.

00:26:07:21 - 00:26:28:06

And so what that meant to us was that they couldn't drive to especially store, like, if you're in New York City like we are, you have 20 specialty stores with great products all around us. And so they were the ones that were more likely to order incredible ingredients online, because if they wanted to get it themselves, that would mean that they would have to really drive all around the city or go for hours and all that stuff.

00:26:28:08 - 00:26:45:22

And so as we're trying to think about this, like, how do we make our site more friendly to people who are maybe middle aged? And those aren't all of our customers, but those are our earliest customers and our most fervent customers. We saw that we had a 70% reorder rate. We saw that 5% of our customers had spent more than $500 or less lifetime.

00:26:45:24 - 00:27:08:22

So like, we started getting this real picture of our customers and we were able to really serve them well through e-commerce, and kind of build this really warm thing that we were able to do profitably for them. And so now we're trying to say, what is the grocery version of that? And you mentioned categories like, yeah, in spices, if you move point eight of a product per week per store, then you're doing amazing in spices.

00:27:09:00 - 00:27:23:22

But if you were in chocolate or chips, they would cut you the next day. And so we're trying to find out how do we stand out in this area. So we're trying to make our labels a little bit better. We're seeing that like blends sell a little more than single spices. So we're starting to push more blends in the grocery store.

00:27:24:00 - 00:27:38:08

We're trying to wrap our heads around all this stuff on. How do we make it kind of an experience? Because we don't have the budget to do samplings and 20% off and buy one, get one free, like we don't have the budgets for that. So it's forced us being bootstrapped to just be more clever and to take our time with it.

00:27:38:10 - 00:28:03:18

It's being disciplined. I think it's just one of the most valuable skills to have no matter what you're doing, personal in business, you know, it's really important. Let's talk about some of those partnerships that you mentioned. How has that so obviously like creating different sorts of conversations and a good product experience, being in the right mix of, of of restaurants and chefs like and publications.

00:28:03:18 - 00:28:24:22

That's been a huge part of your of your growth. It's kind of just common sense. It's like, let's make a good product that works for a specific subset of people, and let's get the right people to talk about it. What other sorts of partnerships have really stood out as being important parts of your growth? So the publications for sure, and I think getting through journalists and know us and like our product, but it has to be good, right?

00:28:24:22 - 00:28:41:22

That that's the same thing is you can't just slap a logo on a thing that, you know, and then the people that are professionals in this industry, chefs, food writers, they're going to look at and be like, this, is this is nothing. You know, it's not legit. And so, yeah, so we were able to do something we put in front of them in the open and they said, oh, this is this is great.

00:28:41:22 - 00:28:58:18

And I need to tell people about this. The other thing that's been really helpful is we've been doing what we call collaboration blends. And so we'll work with a collaborator who's somebody who is an expert in a particular area of food. Maybe it's a cuisine, maybe it's a type, a type of specific food that they make themselves.

00:28:58:23 - 00:29:16:23

Maybe they have a specific opinion on food, and how and how it should be presented. And so what we've been trying to do is bring in some of these. And one of our superpowers as a business is that specifically for e-commerce, we like to have lots of new things. We're always introducing new products, whether it's a new kind of spice, a new spice blend, the new this and that.

00:29:17:02 - 00:29:33:15

So we were able to really make it easy. Most CPG companies are introducing four products a year. We introduce four products a month, and we get to learn a lot. And if it sells well, we keep making it. If it doesn't sell well, we say, thank you. That was really fun and we discontinue it. We sold kelp, sold that.

00:29:33:15 - 00:29:55:13

Our friend domain. Nobody wanted to buy it, but it's an excellent. So we learned that we can sell stuff like that. And so we started working with collaborators, that that have big audiences that have a strong message and a point of view about food and that we wanted to represent. And so we would find folks like, like Soleil Wylie and her husband Ham, who came from the blown up attic test kitchen and now is just a food star in her own right.

00:29:55:15 - 00:30:11:09

And what they did is they they want to do three kind of fun, nostalgic spice blends. And so we're like, okay, great, we'll take your lead. We have all these spices and all these ingredients. Let's do a blend together. And so we did, nothing he had in ranch to kind of poke a little bit, find it Hidden Valley.

00:30:11:11 - 00:30:28:05

We did a yo quiero taco blend and a pizza kind of party seasoning. And so these are kind of fun. These are less intimidating. These are a little more approachable. And then Solon Ham has millions of people following them. Where are you going to be like, look at what I mean. Go check this out. And we did a healthy revenue share with them.

00:30:28:09 - 00:30:47:08

But even more so, I think it's tied for our collaborators about them taking themselves and making a really unique and special product. And we're here to like, source new ingredients, bring new spices, do all kinds of cool stuff to make it feel really special. And so that you wouldn't have otherwise, like kind of come across. So we're trying to do this kind of way to win.

00:30:47:11 - 00:31:09:07

When we get something really cool and new for our audience, they're going to love it. They're probably not finding anywhere else, and they're collaborators get to kind of put themselves into a product, and we do this revenue share. We run these in batches and and we just try to every month have 1 or 2 new cool, unexpected spice blends to both delight our existing audience and to have the collaborator push their audience over to us.

00:31:09:07 - 00:31:29:07

And then hopefully through that, they get to know us and start getting to know our whole lineup of spices and do that. So again, a little bit of a win win. One other fun and unexpected partnership is we try to find other complementary food producers. So one of my absolute favorites and a mentor of ours is the folks at Rancho Gordo Heirloom Beans.

00:31:29:07 - 00:31:48:05

Check them out. They'll change your life. But what do people that buy beans need? They need spices to go with it. And so they have been also carrying and selling our spices. And so then instead of paying for acquisition, they're paying our wholesale margin to kind of pick up our products in cases. And then they're introducing us to their bean loving audience.

00:31:48:05 - 00:32:04:18

And people that are buying beads online are the same people that would buy spices online. So that's been a really, really nice kind of overlap where we both get to win, where they get in higher average cart size, they get to sell their customers a little more, and we get to be introduced to this really, really relevant customer base.

00:32:04:21 - 00:32:24:12

Yeah, I think those sorts of win wins are just so critical. When you're smaller and you know, you need to tap into other ways of acquiring customers. Yeah. And we can we're I think we can scale it up. I don't know. But this is the hypothesis that we're trying to test. But like we just started work with a company called Sitka Seafood that does incredible frozen seafood.

00:32:24:16 - 00:32:45:04

And we made three custom blends for them to sell to their customers and to give for free for customers to sign up. And so we're trying to say like, how can we get to bigger and bigger partnerships over time with both bigger influencers and food personalities and also with bigger producers? So King Arthur Flour, for example, also carries our spices, and that's been a really huge.

00:32:45:04 - 00:33:00:18

But that took us years to get to the point where they knew us and they trusted us, and they got to try our spices and we were able to get into their lineup. So I don't know yet, but one of our hypotheses that we're trying to test now is how far can we push this so we can do this without having to do paid acquisition for customers?

00:33:00:18 - 00:33:22:20

Yes, we have less control over it. Like we can't just like quadruple our ad budget because it's partnership based, but we're hoping to keep a really healthy pipeline of these that keep introducing us to new audiences. You can scale that. I think the, the really interesting thing about e-commerce and brand building today, building today is the the org structure is changing in terms of what makes sense.

00:33:22:20 - 00:33:46:11

And the decisions that brands are choosing to prioritize. So I'll give you an example. I was just talking to, Caleb Wolfers from Haven Athletic instead of hiring like a head of growth or ahead of paid, he hired a head of partnerships who just negotiates these sorts of deals. If we spoke five years ago, there would have been a head of growth hired in the stead of that person, and budget would have been allocated towards beard.

00:33:46:17 - 00:34:08:02

So the ties are just shifting, and I think people get attracted to paid because it's scalable. Because it's super efficient. It's obviously an ad auction and there's unlimited sort of eyeballs and demand and, and ways to serve an ad. But, sometimes it's the things that are take a little bit more time and are a little bit more manual that end up paying dividends long term.

00:34:08:03 - 00:34:29:19

Totally. And those we find are really sticky, really loyal customers that come through partnerships and collaborations because they love food. And we're not kind of interrupting them in the middle of doing something else. We also don't do discounting or sales like we really are trying to say, like if we can bring you in and convince you that this incredible jar of human is worth $10, then then we got and then you're going to love the rest of our lineup.

00:34:29:19 - 00:34:52:22

But if we are going to buy everything 50% off in one time only and this and that, and there's some companies that are able to really just do quarterly sales or are kind of doing this discounted meal and they're able to bring in happy customers like bless them. But we we are trying to kind of keep our value up and say, if you're willing to pay for this full price and we're trying to keep our price as low as possible, almost everything on our site is under $10.

00:34:53:01 - 00:35:20:24

And that's incredible for for what you have to do for sourcing and packing and doing huge down payments and all that. And so we're trying to do it every day. A little pricing, but if you come in and buy that value proposition, then then you're going to lose everything else that we do. That's the job of the founder to figure out what is the the sweet spot between what a customer is going to pay and you know what your minimum margin is basically, to run the business in the way that you want it to.

00:35:20:24 - 00:35:42:21

I do the same thing at, at my business at Dark Room. It's like I used to charge. I used to try and just continuously increase our pricing as our brand would get better and better and our services become more sophisticated. A certain point, it's like we just want to provide the best possible product and in our case of service at, you know, a reasonable price that that is going to, you know, promote longevity for the customer.

00:35:43:02 - 00:36:03:24

And I think it's the same thing on the product side. The interesting thing is, though, the last 12 years, marketers got so used to discounting and all of these interesting e-com tactics that really just erode brand loyalty in many ways and also erode profitability that just weren't exercised before. Yeah. And we've had to get really creative about it.

00:36:03:24 - 00:36:19:15

So just like one thing that we do is we have a space club, which is a quarterly subscription, almost copying a wine club, you know, it's a mystery box, I love it. We were like, you know, you don't know what's in it. You're going to get spices. We had to get it a high enough price or it's enough product so we can cover shipping.

00:36:19:17 - 00:36:36:10

And so we're like, okay, it's going to be four full size jars of spices, plus an extra collaboration of of a non spice product that we make with a partner that we really love. And we have now thousands of subscribers to that. So that was a clever solution to try to create a subscription product that wasn't discounted.

00:36:36:15 - 00:37:02:21

But it's still a really good deal because you get new spices before anyone else and you get a bunch of exclusive spices, and it's a fun curated box. Yeah. It's exciting, it's fun. You have to you have to add those moments into the marketing. Let me ask a personal question. What do you what's your favorite spice? Oh my God, I have to tell you right now, my favorite spice that we do is, we have a sun dried tomato powder, and we bring this in from Turkey, and it's just tomatoes.

00:37:02:21 - 00:37:18:11

They slice them, they extra dry them, and then they grind them into a powder. And it's just like savory, umami, salty kind of bomb. I even put them on tomatoes. I don't know, but it's been really fun. You can make tomato paste out of it. You can put it on top of eggs or kabobs or chicken or fish rubs.

00:37:18:13 - 00:37:34:06

It's been so fun. I always love that kind of a savory, savory thing. And so I've been putting that on everything, and I haven't seen it much in a spice. And the other one that I just always love is are black lime whole lines are dried in the sun, they oxidize and turn black, and then we grind them into a powder.

00:37:34:08 - 00:37:53:14

There's black lime used in Persian cuisine. They're called Omani limes. Also are Persian limes. But typically they were just whole lives of like ping pong ball size. And that's great if you're going to like steward, which is how it traditionally used. But grinding it into a powder lets you sprinkle it on like guacamole or like, you know, your margarita or whatever.

00:37:53:14 - 00:38:08:22

And so I always want a little bit of sourness anyway, I want to squeeze a lemon or lime, kind of using this black line powder. And it's just it just like levels up the flavor. Well, you're converting me to a customer. I'm getting some spices after this already. Thanks so much for joining us. I really appreciate it. Appreciate all of your perspective.

00:38:08:22 - 00:38:25:15

Congrats on Burlap and Barrel. It sounds like you guys, have a spicy future. I'm going to have to thank you so much for having me and anyone that's listening, feel free to reach out. I'm Audrey at Burlap and barrel.com. Happy to chat, and I hope there's also other entrepreneurs on their journey on this duo, so thank you for having me.

00:38:25:20 - 00:38:34:07

Thanks very.