Solid supply chain. The worst thing that can happen is that you spend all the time and effort it takes to land a big retail account and then you can’t keep up with demand or follow their parameters. The retailer will get frustrated with you and most likely kick you out in favor of another brand that is ready to go and won’t let them down. It is SO much easier to keep a customer than it is to acquire a new one — and the best way to do this is with excellent customer service. This should show through in your product availability, quality assurance, and ability to deliver product in the fastest possible time. If you think one of your ingredients may be unavailable in the future, or if your copacker is shutting down for a holiday, you need to make sure that you plan around these events to ensure 100% service.
As a part of our series called “5 Things You Need To Create a Successful Food Line or Specialty Food”, I had the pleasure of interviewing Christina Appleton.
While other people go to the grocery store, Christina literally grew up in one. She is a fourth-generation grocer who lived above her family’s store. The original Appleton’s Market was a Mom ’n’ Pop grocery store founded by her great-grandparents in small-town Michigan. Passed down through the generations, the store was her home — riding her tricycle through the aisles and building paper-towel forts. It’s where she fell in love with food, and it forever shaped her career. After college, she worked at General Mills in brand management, working on brands from Trix cereal to Green Giant vegetables. After attending Harvard Business School she moved to Los Angeles and worked in entertainment before catching the startup bug and making her way back into CPG by joining healthy e-tailer Thrive Market. Focusing on better-for-you products quickly became her passion. She created her own business to help make everyone’s lives a little bit easier and a little bit healthier — which was the birth of her Appleton’s Market.
Thank you so much for doing this with us! Before we dive in, our readers would love to learn a bit more about you. Can you tell us a bit about your “childhood backstory”?
In some ways, I had a very typical childhood — growing up in a small town in the Midwest, playing outside, going to school with the same people for most of my formative years. And then there is the other side where I grew up as the child of two small business owners, learning the ins and outs of grocery distribution, customer service, inventory management — and playing in the grocery aisles after hours. “The Store” (as we called it) was my first job — stocking shelves around five years old — and instilled a very strong work ethic in me. I started my first “business” at 11, taking a babysitting certification course at the local community college and flyering my neighborhood to drum up clients. I ended up with a half dozen families that I consistently worked for throughout middle and high school — some of whom I still keep in touch with to this day! So hard work and “hitting the pavement” was always expected.
Can you share with us the story of the “ah ha” moment that led to the creation of the food brand you are leading?
It was late afternoon on a random weekday. I was running from one meeting to the next, thinking about all the emails I had to send but all I could focus on was how hungry I was. So hungry I couldn’t even think about what I wanted to eat — I just knew I wanted something tasty, something nutrient-dense, and something NOW. I looked around my desk at the sad bag of almonds and a dry protein bar and thought, “there has to be something better, right?”
Well there wasn’t. There was nothing that could give me the satisfaction of a fulfilling meal (greens, protein, fiber, healthy fats, and delicious savory flavors) quickly and conveniently. So I headed to my kitchen to make it myself. After months of testing I knew I had the perfect mini-meal — and the perfect way to make it. Microwaved in a BPA-free steamer bag for less than a minute, “Power Veggie Bites” are the ultimate hunger solution.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
The first steamer bags I tried to use for my product were…not right. I was doing rapid prototyping in my kitchen so used whatever I had on hand — which isn’t always the best option. They were more akin to storage bags, but I can now confidentially tell you that storage bags are not meant for reheating! After one minute in the microwave, the storage bags had swollen up like an angry pufferfish — and would often loudly pop like a bursting balloon. I can still hear those mini explosions when I close my eyes!
Rest assured, the steamer bags I use now are purpose-built for my product. The ad campaign writes itself — “now without explosions!”
What are the most common mistakes you have seen people make when they start a food line? What can be done to avoid those errors?
I think there are two main reasons that people make common mistakes — over-thinking it and under-thinking it. On the over-thinking it side, I’ve worked with many entrepreneurs who just can’t see how to get started because they think they have to be a 20MM dollars brand out of the gate. This manifests itself in what I call “co-packer paralysis”, where a food entrepreneur spends months trying to find the perfect partner with the perfect setup to make the perfect product — when in reality they could probably just make it in their kitchen. It’s always good to have a long-term view, but not if that prevents you from actually starting. It’s never going to be perfect, so just dive in and get started and let the mistakes come.
Other times, under-thinking is the problem. I see a lot of entrepreneurs say “well this is the best tasting product” when there are already 50 competitors doing nearly the exact same thing. It always helps to do your research, and then check your findings against an unbiased third party (none of that “well I haven’t seen any of this so it must not exist”). I’m not saying that the business is doomed, but it is going to be an expensive battle to fight your way into that market and personally I find it more rewarding to create something new (even if it might ultimately fail).
Let’s imagine that someone reading this interview has an idea for a product that they would like to produce. What are the first few steps that you would recommend that they take?
I would first recommend getting a lay of the land — go to as many stores as you possibly can and see what is on the shelf where you would like your product to be. Visit Costco, Kroger, Whole Foods, Walgreens — anywhere that someone could possibly buy something like what you want to produce. Take photos of the shelf sets, noting how items are packaged and how much they cost. If there are employees nearby, feel free to ask them about what is important to them when it comes to this category. Reach out to people who have experience in the space — whether that be other entrepreneurs, investors, or buyers — to gain a high-level perspective. And don’t be afraid — people in the food industry are generally very helpful and want to see you succeed!
Many people have good ideas all the time. But some people seem to struggle in taking a good idea and translating it into an actual business. How would you encourage someone to overcome this hurdle?
It is incredibly important to create a community in this business, as this community will help give you support and feedback on your ideas and your creations as well as take the sting out of your inevitable mistakes. It should be filled with people who are ahead, behind, and adjacent to you — so you can both give and receive help — but most importantly it should be people who are open and genuinely want to help each other grow. Facebook Groups, Slack, and business groups like Foodboro and Foodbevy have been incredibly helpful in building a strong community for those of us in the food business.
It is also critical to not be too hard on yourself. You will make mistakes, but those mistakes are what enable you to make v.2 of your product. And you won’t always have all the answers — I have yet to meet anyone who is excellent at all of the skills it takes to launch a successful food brand, so don’t beat yourself up if building a financial model is not part of your skill set! Reach out to your community and see if they can either help you, or put you in touch with someone who can. It will greatly reduce your stress and make your life so much easier and enjoyable than constantly banging your head against the wall and getting frustrated.
There are many invention development consultants. Would you recommend that a person with a new idea hire such a consultant, or should they try to strike out on their own?
I generally recommend against pairing a consultant in a super-specific area with a very early stage business. Hiring a consultant at that stage will generally take a lot of capital away from your business — at precisely the time you may not have a lot of extra resources — and there is no assurance that you will be on the same page. I believe that an early stage entrepreneur is better served using that time and money to find freelance experts in the specific areas of the business that they need help with, like finance or operations, and put together an MVP (minimum viable product) on their own. The consultants will still be there at that point if you need them.
What are your thoughts about bootstrapping vs looking for venture capital? What is the best way to decide if you should do either one?
That is the big question in the CPG world, isn’t it? There are so many factors that go into this equation, and often they are highly personal. There is risk everywhere in entrepreneurship — the entrepreneur needs to decide for herself what she is comfortable doing. One of my professors in business school said “there are two types of entrepreneurs — those who want to be rich, and those who want to be king.” You need to decide what kind of entrepreneur you are.
Working with a venture firm is great in that you have immediate access to a little (or a lot) of capital that can be used for customer acquisition, building out the team, and delegating tasks that you either don’t like to do or aren’t great at doing. Many firms have expertise and relationships that you wouldn’t have access to otherwise. The cons of working with venture money is that you are no longer the sole captain of the ship — you now have “bosses” who have a very vested interest in how you run your business. They will also often have strong expectations about your growth and expansion that may not fit well with your current goals and margin structure. And I would be remiss if I didn’t mention that statistics show that only 2.7% of VC dollars go to women-led companies, with an even lower number going to women of color. This inequality persists despite the fact that women-led companies generally perform better, with around 10% better returns.
As for bootstrapping, it also comes with its own list of pros and cons. On the pro side, you have 100% control over every decision, goal, and action of your business. It grows at the rate you set and, if you have allocated sufficient savings for the business, you can generally take more time to build the fundamentals of the business without worrying as much about topline growth. On the con side — it’s YOUR money! I speak from experience when I say that can be scary, and sometimes it’s very hard to escape the idea that you just spent 10K dollars in packaging inventory rather than go on a vacation. And bootstrapping often means fewer team members, so more work for the entrepreneur.
So deciding whether to bootstrap or seek venture capital is a personal decision. Because I place a premium on building a sustainable business that fits my vision (and I have an incredibly supportive partner), I’ve opted to bootstrap this business for as long as I can.
Can you share thoughts from your experience about how to file a patent, how to source good raw ingredients, how to source a good manufacturer, and how to find a retailer or distributor?
I have not filed a patent, but I did apply for and receive a trademark. It is very straightforward, but be prepared for the tedium of reviewing hundreds of product categories to identify the ones that apply to your product. If you have extra funds, many attorneys offer a “trademark package” that includes all of the filing and correspondence that is required — all you need to do is identify the relevant categories for your product. I am lucky in that my partner is an attorney so he filed everything for me — although I will fully admit it was not the most fun Saturday afternoon we’ve spent together.
Sourcing quality raw ingredients and finding a good manufacturer follow the same process — guess and check. I personally use referrals from other people I know in the industry — for example, I have a friend who worked in private label sourcing — and asked for their recommendations. Then if that supplier/manufacturer didn’t work out, I’d ask them if they know of anyone else who could help. This process can take months, but eventually you find the right partners. After that, the three most important things are “test, test, test.” I did months of testing with my manufacturing partner before our first production run. I also recommend being physically present for every single step during the first run — there is no substitute for in-person direction and working together to fix the issues that inevitably come up during initial production.
Here is the main question of our discussion. What are your “5 Things You Need To Create a Successful Food Line or Specialty Food” and why? (Please share a story or example for each.)
- Community. It truly takes a village to launch and grow a food brand. I have been helped so much by an amazing group of mentors, friends, and even casual acquaintances I met at food shows. The community you build will mean the difference between spending five hours figuring out how to do something and 10 minutes actually doing it. I have an amazing friend (she is much further along in her frozen food business) who has been a HUGE help to me as I scale up my business. I know that I can ask her any number of questions — from the mundane (how do I insure the business affordably?) to the critical (is this distributor deal actually a good one?) and she will have a great answer for me. Fortunately I have been able to help her out too and it’s a great relationship!
- Capital. This may go without saying, but you will need at least some capital, even if you are bootstrapping. There are real tangible costs that go into producing and selling a physical good. Even if you can formulate, design, and sell the product yourself you will still need money to buy packaging, raw materials, and set up your website. There are ways that you can “hack” some of the things — I have spent hours stickering plain poly bags instead of investing in fully printed ones with higher minimums — but there will still be a cash outlay required. As you scale and these cash requirements grow, you’ll have to decide which trade-offs work best for you. Should you bring on outside capital or grow more slowly? Is debt better than equity? You’re the boss, and it’s ultimately your decision.
- Unique idea. I am not saying that launching another “X” product is necessarily going to fail if there are already strong, established brands in the market. And I’m also not saying that something entirely out of the box will succeed — sometimes there is a reason a product doesn’t exist. But generally it is easier to sell in a new product that will bring in incremental sales and new customers to your retailers than making the argument that your product is better than another that is already on shelf and potentially selling well.
For example, I recently met someone who launched a granola company a few years ago. She has had decent success, but nothing that has elevated her business to scale. A quick Google or Amazon search will give you hundreds of granola brands — a daunting sea of choice to break through. So she is struggling with acquiring new customers and getting into retailers. This is to be expected as the market has probably reached saturation and consumers are not as motivated to try new brands.
4. Strong go-to-market approach (and probably a plan b). I learned this one the hard way — I spent around 6–9 months pre-launch building up strong relationship and sales channels in offices, co-working spaces, and “alternate” channels. Then, just before launch, the coronavirus came — and all of those channels shut down and show no signs of opening up again anytime soon. While I still truly believe that it was a strong go-to-market strategy for my product, I’ve had to completely scrap it and test out new methods. Fortunately I had DTC set up as a secondary channel and have been able to leverage that to become my primary sales channel — but this Plan B requires constant testing to identify the best way to get to new customers.
5. Solid supply chain. The worst thing that can happen is that you spend all the time and effort it takes to land a big retail account and then you can’t keep up with demand or follow their parameters. The retailer will get frustrated with you and most likely kick you out in favor of another brand that is ready to go and won’t let them down. It is SO much easier to keep a customer than it is to acquire a new one — and the best way to do this is with excellent customer service. This should show through in your product availability, quality assurance, and ability to deliver product in the fastest possible time. If you think one of your ingredients may be unavailable in the future, or if your copacker is shutting down for a holiday, you need to make sure that you plan around these events to ensure 100% service.
I saw this firsthand when I led merchandising at Thrive Market. We loved to work with small and upcoming brands, and many of our customers loved buying from these small businesses. But many times the small brands would be unable to keep up with demand, frustrating our customers and our team as it reflected poorly on us, too. If outages happened too often, we would seek competitor brands to fill the customer demand — thus leaving the small brand behind.
Can you share your ideas about how to create a product that people really love and are ‘crazy about’?
The most important first indicator is to look at yourself — is this product something that you really feel is missing from your life? Does it solve a frustrating problem for you? If the answer is yes, then you need to ask your friends and family. Is this something that they would like to try? Is it something that they would have regularly? The last phase is to test it out with strangers — I worked with my local co-working spaces to find as many people in my core demographic (working Millennials) who didn’t know me or my story to give honest feedback on the product, the flavors, and the pricing — anything that they would tell me. And you need to really listen. How enthusiastic are people? Are they interrupting you while you are telling your story to exclaim “oh my gosh, ME TOO!”? Are they asking if they can try more? If these things happen it’s still not guaranteed that you will have a hit on your hands, but you’ll at least have a strong starting position.
Ok. We are nearly done. Here are our final questions. How have you used your success to make the world a better place?
I started this business to seek out and celebrate those who in the past weren’t allowed the opportunity to succeed. It is part of the core mission of Appleton’s Market to work with and hire women, people of color, immigrants, and other underrepresented minorities as I can. I didn’t see enough of this in the world and have taken it upon myself to try to right this wrong.
I am also dedicated to corporate social responsibility. Not only is it important for me to carefully monitor Appleton’s Market’s supply chain to ensure ethical sourcing and lowering carbon footprints, but also I want to find ways to give back to the community. As a former chair of Share our Strength’s Taste of the Nation in Minneapolis, I worked hard to raise funds for ending childhood hunger and helping those who faced food insecurity. I am pushing this business forward so I can give back to that community in an even larger way through charitable giving and advocacy.
You are an inspiration to a great many people. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger.
I’d love to start a “10% movement.” Too often, we make the perfect be the enemy of the good, but perfection is an unrealistic and unachievable goal. If everyone set out to do just 10% better — whether that be in terms of 10% more recycling, 10% more exercise, or 10% better attitude — it would have a significant impact. These are all things that I need to work on and try my best to get a little bit better every day. Picking on small improvement every day, or every week, or every month has a real and noticeable impact on the world and on mental health.
We are very blessed that some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US, with whom you would love to have a private breakfast or lunch, and why? He or she might just see this if we tag them.
I love this question! My first choice would be Barack Obama, but as I imagine his schedule is a little crazy I’ll shift gears. I’d love to have lunch (because I am definitely not a morning person) with Sarah Blakley, the founder of Spanx. She has not only created an amazing product, which grew into a fantastic company, but she is dedicated to helping other entrepreneurs reach their dreams. She is an inspiration and I would love the chance to get to know her and learn from her.
Thank you for these fantastic insights. We greatly appreciate the time you spent on this.