3
Building strong distribution channels

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THE CREATIVE CHALLENGE:
Finding innovative ways to ensure your products are in the outlets best designed to reach your customers

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Once you’ve determined who your target customer is, you need to figure out how to get your product to this ideal customer. If you’re wholesaling to retailers, your first concern is developing effective distribution channels so your product is placed in stores where your end customer will see it. If you’re selling directly to customers, you need to have a system in place so your product can be shipped in a timely fashion to your own store or to your customers.

A strong distribution channel is critical to your sales and growth as a company. In this chapter we’ll give you some examples of companies that have created good relationships with their distributors or found creative ways to get their products to their customers themselves.

Creating effective distribution channels involves a number of factors: developing relationships with those who are carrying your product; using shipping methods that get your product to the store quickly and without damage; meeting promised deadlines; and delivering a high-quality, uniform product. You will have to make sure each of these elements is well thought out and that you maintain consistency in each area as your business grows.

If you are wholesaling to retailers, you have to convince these retailers that their customers will want your product. One way you can do this is by selling the value of your product to the end customer. An example of this strategy is holding a special in-store promotion that highlights your product or educates the store’s customers about your product or socially responsible mission.

However you put your product into customers’ hands, you can incorporate the following Distribution Strategies into your operation to help you with this very important part of building a successful business and continued strong sales.

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DISTRIBUTION STRATEGY NUMBER ONE:
Know your distribution channels and target your efforts to meet the needs of each.

Your business may rely on several different ways to get your product to your customers. You may have a retail store of your own with online, telephone, and catalog/mail-order capabilities, as well as wholesale your product to other retailers. To be able to put your product into the hands of your customers by using all of these methods, you need to adapt your sales efforts, product lines, and shipping methods accordingly. This means thoroughly understanding the needs of each of these sales and distribution channels.

Keep in mind the nature of your sales for each. In other words, who is purchasing through each channel, what are they buying, and why are they buying it? You may find that you are selling to different departments within the same organization. Each department may require a different product and a different shipping method, and you may need a different approach when developing a relationship with each department buyer.

Establishing a strong relationship with a distributor is a critical first step. However, products often find new avenues of distribution, and you will have to consider new options as they appear. For example, if you are selling a product to a store for placement on its shelves and suddenly the store manager asks if you can create custom-made gift baskets that customers can order in advance, ask yourself if you can find a way to meet this demand and still maintain the integrity of your brand.

Our next entrepreneur learned that taking her story directly to store buyers could get her toe in the door of building a strong distribution network.

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Lessons with the Buyers

Kunmi Oluleye of Atlanta-based Sheba Foods had an idea that kept surfacing in her mind, and eventually she acted on it, using her faith, belief in herself, and instincts to keep it rolling. A native of Nigeria, she had been preparing African food for years for her family, and she often froze it to be reheated later. She decided to approach grocery stores about carrying her frozen African food—before she developed any packaging. When a supermarket executive said yes, he’d buy her products, Kunmi was forced to quickly learn more about what was involved in getting her products into stores and making sure they sold. Like Lynn Gordon of French Meadow Bakery, she put in aisle time to determine what kinds of products were on the shelves, how she should design her packaging, what her price point should be, and any other requirements that would help sell her products. Once she knew how to best present her products, she approached the store buyers and followed up with them. All of this she calls “lessons with the buyers.”²

Once Sheba Foods is in a store, Kunmi often does product demonstrations and samplings to help promote sales. At Whole Foods, a natural food giant and a distribution channel Kunmi recently added, she will be teaching a cooking class. The entrepreneur also has her own store in Atlanta, where she tests new products before taking them to supermarkets. And she uses the Internet to showcase her line and sell products.

Determined to make a profit from the beginning, Kunmi has always built in at least a small profit, and she discounts the standard notion that a new business can’t be profitable for the first three years. She tries to price on the high side and lets buyers tell her if they think her products are too expensive.

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Kunmi has big plans for Sheba Foods. She wants to take the company nationwide in the next eighteen months, and she hopes to open a big supermarket that will feature everything, from food and apparel to music, pertaining to the varied African cultures. In addition, she wants to open “African food, fast” restaurants all over the country (“There’s nothing fast food about African food,” she explains), and in nine years she intends to go public.³

Kunmi has traveled her entrepreneurial road by adhering to two important philosophies. First, she listens to her instincts and doesn’t let anyone tell her that she can’t do something. “When you tell me, ‘Kunmi, you can’t do this. You’re going to fail at this,’ then that is where the adrenaline comes from that says, ‘Watch me prove you wrong!’” she explains. And second, she believes a person must get comfortable with failure and have an exit plan when things don’t work out as planned.⁴ With Sheba Foods already making appearances throughout the eastern United States, Kunmi is well on her way to proving any disbelievers wrong.

DISTRIBUTION STRATEGY NUMBER TWO:
Make sure your values are aligned with the values of those who are selling your product.

You might be tempted to put your product anywhere a potential customer is located, especially when you’re starting out and trying to build sales and gain a name for your brand. However, as a socially responsible company, your brand is directly connected to your company’s actions and to your core values. This means that you need to develop relationships with distributors who share your values and will support your mission and build respect for what you stand for as a socially responsible company.

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Kellie McElhaney of the Center for Responsible Business believes that when you’re trying to get into the supply chain, the challenge is utilizing your commitment to corporate social responsibility (CSR) as it relates to trust. “In so many people’s minds,” she says, “a company or leader who’s committed to CSR is viewed as more trustworthy, and we all want to do business with trustworthy business partners.” Kellie feels that you must consider two important points when attempting to get your product into the distribution channel. First, establish yourself as a trusted business partner with a quality brand and a reputation for delivering on what you say you’ll deliver on. And second, keep your sustainability or CSR message short and to the point, and then train the distributor about how to talk to your end consumer about it.⁵

To demonstrate this “short and to the point” messaging, Kellie cites a California vineyard that has developed a distributor kit that provides a little bit of information about its organic growing process. The vineyard is also creating a hang tag for its bottles so the consumer can see the wine’s benefits as an organic product. By developing the CSR messaging and making it clearly visible on the product, the vineyard is promoting its social responsibility and also helping the distributor to look good because it is carrying a product that has a socially responsible track record.⁶

In our next example, we show how a company committed to the triple bottom line of people, planet, and profits and operating under the philosophy that it will “only be successful if behind every product we share with you, are countless ways in which the lives of those who grew it, harvested it, produced it, and brought it to you are affected for the good”⁷ is getting its products into stores and educating consumers about its message.

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Conscious Goods and Conscious Actions

Kopali Organics is a fair-commerce organic specialty food company that was founded in 2004 at Punta Mona, an off-the-grid educational farm and sustainability center in the rainforest of Costa Rica. Founders Zak Zaidman and Stephen Brooks feel one of the major threats to people’s health and the health of the planet is large-scale chemical agriculture—a situation they witnessed firsthand in Costa Rica. With Kopali, they wanted to create bridges between small organic farmers and the growing market of conscious consumers.⁸

Zak feels they are participating in a trend of total trans-parency—a transparent chain from the consumer all the way to where the product originated. In other words, everybody knows everybody else and how they operate, and they are all connected by a chain of actions that is designed to be good for everyone. Kopali actually got started when Zak and Stephen realized that most of the bananas farmed in Costa Rica for U.S. consumption are grown using tremendous amounts of pesticides, herbicides, and chemical fertilizers that create a long history of death and destruction. When they found a few farmers who were still growing crops in sustainable ways, they wanted to help them sell their products in the international marketplace since these farmers could never compete with large growers on their own.

The founders discovered a product common to Costa Rica but unknown in the United States—banana vinegar, made from bananas that get too ripe. The vinegar is a staple in Costa Rican kitchens. A nongovernmental organization (NGO) had previously established certification cooperatives in the region for farmers who were growing crops organically and had already set up a factory for producing the vinegar. Zak and Stephen were aware that farmers now receive only about 5 percent of a 48crop’s value, as compared to 95 percent in the past. So their goal was to allow these local farmers to profit from this value-added, nonperishable product they were producing. In the process, they wanted to share these farmers’ wisdom for benefiting humanity with customers in other parts of the world and promote this wisdom and the benefits of organic farming.

To get Kopali’s products into the U.S. market, Zak and Stephen approached Whole Foods, and, according to Zak, they literally sat on the same side of the table and hammered out an equitable way to put Kopali products into the chain’s stores by using a centralized warehouse. Because Kopali’s founders had a clear agenda about their products and their mission, it made sense for them to distribute their products through a natural food chain like Whole Foods.

Key to Kopali’s success, Zak feels, is telling people what they need to know and continuing to promote the company’s mission-oriented work. The Kopali team promotes the company with Conscious Goods Caravan Tours featuring a 100 percent vegetable-oil-fueled bus. The team members take their conscious lifestyle message and products across the country, promoting the importance of organic agriculture, fair commerce, renewable energies, and other sustainable solutions. They also created a television program that premiered on the Travel Channel and are producing documentaries and other videos to promote their cause and the farmers’ products.

But whatever they do, from getting their products into more and more stores to generating broader brand awareness, their story is what drives their actions: “The story that we act behind is these small farmers that are the holdouts,” explains Zak, “growing food sustainably, who are our friends, who are people that we know and really love and are real heroes.”⁹

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DISTRIBUTION STRATEGY NUMBER THREE:
Believe in your product and be bold about promoting it wherever you are.

Throughout this book you will read about business leaders who have become successful because they put their passion for their mission and their product behind their actions as business-people. Passion carries over into many realms in the business world—the publicity you receive, the attitude you foster among your workforce, your ability to attract investors, the actual sales you generate in dealing with customers. It also is important when you are setting up your distribution channels. Even once you’ve gotten your product distributed, you may have to work at promoting your product to your distributors or to your end consumer.

This point was illustrated in our opening example when we explained how Lynn Gordon visits grocery stores to learn about trends and the stores’ customers and then lets the stores know she would like them to carry French Meadow Bakery products. As Lynn points out, stores listen to customers. Lynn’s approach is a form of word-of-mouth advertising, which, of course, is a powerful tool in building brand identity, putting products on shelves, and creating interest among consumers.

When it comes to food products, personal testimonials and word-of-mouth “publicity” are extremely effective. Think about it—how many times have you tried a new restaurant because a friend raved about it or you read an especially glowing review by the local food critic? Since food is a product that offers not only sustenance but pleasure, reaching customers on a visceral level can be very important when you’re building distribution channels to add more customers. And while your goal may be to 50promote the health benefits of your product and overall socially responsible aspects of your business, you first must reach customers where they really “get” it. And in the case of food, that’s often how it tastes and how it makes a person feel.

Kellie McElhaney has discovered this fact in her work with socially responsible companies that market health-conscious products. She feels the first step in building sales is connecting with customers on this visceral level—convincing them that the products are good for them to put in their bodies. Once they have accepted this idea, they tend to be much more receptive to broader socially responsible actions, such as caring for the environment and creating healthier growing conditions. “It’s got to pass through the actual physical being of a consumer first,” Kellie says.¹⁰

This takes us back to being passionate about your product. If you know you have a terrific product that will somehow benefit people, sharing this passion and enthusiasm with everyone you encounter can help convince people that your product is worth trying. If they like your product and what it does for them, they are going to be more receptive to the rest of your message. Kellie adds that while corporate socially responsible messaging is effective and can definitely differentiate your product (to distributors as well as your end customer), it does not stand alone. It has to be combined with more traditional sales techniques, such as high quality and competitive pricing.¹¹

As our next example shows, Lynn Gordon carries her guerilla approach to marketing beyond the grocery stores where she wants her products to be sold. For years she has made a point to tout the benefits and taste of her products directly to customers. Her children may wince when their mother starts talking, but her technique is effective and has helped to make French Meadow Bakery a powerhouse in the organic bread category.

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Successful in Spite of Themselves

Lynn never expected to create a highly successful business. She just loved to make bread and figured she could do something she loved and eke out a living, and all would be well. But when her breads and sweet goods and later sandwiches and soups started to create a clamor and a growing demand, she realized that she and business partner Steve Shapiro had a business and products with wide appeal.

Like many great success stories, Lynn’s journey began simply. In 1985 she was a macrobiotic teacher who decided to bake her own yeast-free, organic bread and make it available on a wholesale basis in Minneapolis, where she lived and worked. Once people in the neighborhood where the bakery was located got a whiff of the freshly baked bread, they began begging Lynn to open a retail store. Lynn gave in, got out her family recipes, and threw together “on a dime” French Meadow’s Minneapolis cafe. She was so convinced that the cafe wouldn’t attract any attention, she told Steve they wouldn’t need a cash register—the box they took to the farmers’ market would be fine. But people poured in, and Lynn was soon yelling for someone to find a cash register. According to Lynn, she and Steve were “successful in spite of themselves.” The place quickly became one of the city’s hot spots—it even attracts Hollywood celebrities who want natural, organic fare when they’re in town. Lynn also says the cafe is where all of the natural food industry executives do their “wheeling and dealing.” Even Social Venture Network took root in the French Meadow Bakery & Cafe.

Since it opened, French Meadow Bakery has grown considerably, with two locations at the Minneapolis/Saint Paul airport and an organic wine and martini bar that is slated to open in December 2006. French Meadow’s presence at the airport led to 52a partnership with the SuperValu grocery chain’s Sunflower Market, which is featuring the bakery in stores in Broad Ripple, Indiana; Chicago; and Columbus, Ohio. According to Lynn, plans are to open French Meadow bakeries in 100 Sunflower Markets around the country. The brand also can be found in the specialty, frozen, and refrigerated sections of major grocery stores nationwide. In addition, Lynn and Steve recently completed negotiations with a strategic partner that will enable French Meadow to expand even further. According to Lynn, this alliance will help her with day-to-day operations that aren’t her strengths, such as managing, distributing, and building profit margins, and allow her to focus on aspects of the business where she excels: developing new products, being creative, and continuing her guerilla merchandise marketing techniques.

The airport cafes were the springboard for French Meadow’s expansion via Sunflower Market locations. SuperValu executives saw the cafe, were impressed with it, and wanted to add French Meadow bakeries to their Sunflower Markets. Adding the airport as a distribution channel resulted from a combination of the hard work Lynn and Steve had put into their operation over the years, the quality products they had developed, and good old serendipity. Steve had heard that the airport was interested in adding local vendors as retailers, and on the day of a large meeting to introduce the concept, he told Lynn to get over there. Just returning from a trip, she arrived at the meeting late but did manage to get her business card to three people, one of whom was a French Meadow fan. A deal was reached, and the first airport French Meadow Bakery & Cafe opened in April 2005.

Now, about her guerilla marketing. If you’re with Lynn at one of her cafes or shopping with her in a grocery where her products are sold, be prepared to witness a passionate entrepreneur in action. And pay attention because you will learn how she has turned French Meadow into a multimillion-dollar operation.53 “I’m extremely passionate and extremely tenacious,” she says. “I never give up. I never stop believing in myself.”¹²

When she’s at the freezer section of the grocery and sees customers trying to decide what to select, she will fill her cart with French Meadow products and let those around her know why. “I pick up my bread and I put it in my cart and I say, ‘Well, this one’s amazing. My whole family eats it! We just love this bread.’ And I leave a store and I’ve sold the whole freezer door.”¹³ This tactic does two things for French Meadow. One, it creates new customers. Two, it empties the freezer shelf. Will the store buyer notice this second fact? You bet, and this will help strengthen Lynn’s relationship with that distributor.

Lynn is also a master at promoting her products in her cafes. Given the opportunity (and Lynn always finds one), she will rave about the sandwiches or bread or whatever a customer might be considering. A recent exchange at the airport cafe went like this: “A lady said she’s waiting for a sandwich, and then I said, ‘Oh my God, they’re the best chicken sandwiches. You know it’s organic, don’t you?’ And she said, ‘No,’ and I said, ‘Oh, we always eat here.’ And then another lady chimed in, ‘Oh, you’re kidding. What else do you recommend?’”¹⁴

Lynn’s honest enthusiasm for her products persuades people to try her recommendations—and no doubt, keep coming back. Friends have laughingly called her tactics “shameless,” but Lynn believes too strongly in the quality of her products to ever stop. “I do it all the time, wherever I am,” she adds.¹⁵

DISTRIBUTION STRATEGY NUMBER FOUR:
Differentiate your product so it will stand out to retailers.

Differentiating your product is critical in a world where new products are constantly being launched and thrust upon consumers.

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You have probably addressed this issue from the very start of your business. If you’re selling directly to your end customer, you know your product must stand out and offer a benefit to that customer. Differentiation can entail many factors: quality, ingredients, who makes your product, how it affects the environment, how it benefits your suppliers—the list could go on and on.

When you are wholesaling and trying to get your product into distribution channels, you must also consider ways to differentiate your product so it will attract buyers’ attention and keep them reordering. Even though some of the same factors apply as when you’re selling directly to consumers, in this case you may be competing for shelf space in a sea of products similar to yours. Or you may be introducing a product that is unfamiliar to the distributor and therefore is an unknown commodity when it comes to how it will sell.

Here we present an example of a product line that gained a foothold in a distribution channel and maintained it as its category and the industry grew.

Better-Tasting Products

Imagine Foods, now part of the Hain Celestial Group of Melville, New York, and created in 1982 by Robert Nissenbaum and a partner, introduced Rice Dream and Soy Dream to consumers back when such dairy alternative products were largely unknown. In the eighties, according to Robert, natural food stores didn’t even carry dairy products, so there wasn’t much of a demand to carry dairy alternatives in those stores. And groceries didn’t carry natural foods at all back then. However, some consumers had a need for such products because of dairy allergies or other concerns. Soy products were just beginning to be introduced, but the taste left a lot to be desired. And the natural food industry offered few prepared products, especially prepared foods 55that you’d enjoy eating. Enter Imagine’s Rice Dream, Soy Dream, and frozen nondairy desserts and shelf-stable soups, which became popular because they tasted really good.

“Imagine Foods became really successful and known because we made better-quality, better-tasting prepared food products,” explains Robert. This was the differentiator that got the brand shelf space in stores, especially Whole Foods, which Robert started selling to before the grocer became a national chain. Because Imagine’s products were always some of the best-selling products in the entire natural food category, they evolved with Whole Foods as the grocer began to expand around the country. Robert credits this industry giant’s success in the natural food category with influencing mainstream groceries to begin carrying natural foods, which helped everyone who was making and marketing such products.¹⁶

Innovation in the form of a better-tasting product is what propelled Imagine Foods to a top-selling spot in the natural food category. Once it had a leading position in the category, it was easy for the company to keep growing as the entire industry expanded. Robert sold the company in 2004, but today the nondairy beverages and soups are still ranked as best sellers. “We were definitely one of the companies that started raising the bar for the quality of products that were out there,” adds Robert. And quality made all the difference for this successful entrepreneur.¹⁷

DISTRIBUTION STRATEGY NUMBER FIVE:
Make it easy for your customers to buy and receive your product, as well as promote it to others.

Depending on your type of business, distributing your products may be as simple as getting your product from the manufacturer (which may be you) to your customer. You don’t wholesale to 56retailers, so you avoid the middleman. You probably have a Web site and use it to provide information about your product and your mission. You may even have an online ordering system set up.

However your business is organized, it’s important that you simplify the way your customers obtain your product. And if your customers themselves are instrumental in getting you more business, be sure to create a reward system that will encourage this action. You may want to build the cost of such a system into your operation from the beginning so it won’t become a budget item you can’t handle in the long run.

No Stale Bread

Small Potatoes Urban Delivery (SPUD), based in Vancouver, British Columbia, started with a great idea and four employees that initially delivered to nine customers. Today the growing company delivers grocery items to over 6,000 customers and is branching out to the United States. It has streamlined its operation by making smart use of the Internet and builds increased distribution by developing strong relationships with its customers.

Key to SPUD’s success, according to president and CEO David Van Seters, is the fact that customers don’t have to read the labels when they order products through the grocery home delivery service. “It’s that peace of mind,” he says, “that they know if it’s on our Web site, it’s going to be okay.”¹⁸ In other words, SPUD customers know that the groceries they order are wholesome, usually locally grown and organic, and free of harmful ingredients.

SPUD’s growth has taken an interesting route, and traditional mass advertising hasn’t played a significant role. To get his distribution process up and running (SPUD sells and delivers directly to customers), David mailed flyers that educated people about the environmental, social, and personal economic benefits 57of having their groceries delivered. This meant pointing out the fossil fuel savings (one small truck can deliver 100 orders, which David compares to emptying a parking lot as well as cutting back on traffic congestion); the time savings a person enjoys by not spending the average ninety minutes a week grocery shopping; the money saved by not buying gas to drive to the grocery; and the quality of the products, which include fresh and organic produce. (Food is brought to SPUD’s warehouse—mostly from local growers and suppliers—and delivered to customers within twenty-four hours, so they never have so much as day-old bread.)

One reason flyers work so well is because the company can target the audience geographically. If it has an area where SPUD can add customers, it can put out flyers in specific neighborhoods to build up the route. If SPUD did general advertising, it might end up with an oversized route and have to split it, which could create challenges in handling the deliveries. SPUD’s customers themselves are also responsible for the company’s growth. “Word of mouth is the number one way that we get customers,” adds David. Supporting this customer-to-customer approach toward increasing sales is SPUD’s generous customer-referral rebate program. Every customer’s invoice has a coupon at the bottom that can be given to a friend for a discount off the first four orders. In addition, the person giving the referral also receives a discount. “I think we’re probably closing in on 50 percent of our new customers coming from customer referrals,” says David.¹⁹

The Internet also plays a major role in moving the business forward. Customers order online, pay online, and can even request products that SPUD doesn’t currently carry. They can also go to the Web site and find out the distance every product travels to get to SPUD’s warehouse (one-third the average distance compared to a conventional grocery or natural food store).

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The folks at SPUD also use ingenuity in promoting the business and its multiple benefits. One Halloween they held a wake for a shopping cart, which had “died” because SPUD customers order online. They went through downtown with a gigantic coffin containing the shopping cart, ending up at the Vancouver Art Gallery, where they read a eulogy for the poor, deceased cart.²⁰

Not only have all of these actions helped SPUD add customers and new distribution channels throughout four regions of North America, but they have helped the company gain valuable publicity in the media. And that helps David educate more and more people about the benefits of using SPUD to buy groceries, which adds up to increased sales and profitability—no small potatoes in the business world.

DISTRIBUTION STRATEGY NUMBER SIX:
Be willing to adapt your business to new distribution opportunities.

To put it simply, be flexible and open your mind to new possibilities about getting your products to your customers. Throughout your company’s growth, you will encounter situations that may, at first glance, appear to be insurmountable challenges. If you can remain calm and look at the situation from all angles, you may discover an innovative approach that gives you a competitive edge in the marketplace.

You will also discover that innovation may surface in unlikely ways—through an employee suggestion, from a customer, via happenstance that forces you to look at your business in a new light. However it arrives, we encourage you to weigh the situation carefully and imagine where it could take you.

In considering new distribution opportunities, you may have to come up with new packaging, new shipping methods, or even a new formula if a potential distributor is interested in your 59product but has certain requirements. Your job is to determine whether making the changes will be cost effective and offer significant growth in the future. If you’ve created a strong relationship with the distributor, he may work with you about making the changes he needs in order to sell your product. For example, maybe he will allow you to sell a new design on a trial basis until both of you determine if it will be popular.

The next example shows how two entrepreneurs’ flexibility in adapting their business when a problem developed has been instrumental to their success.

What Are We Going to Do with All This Lettuce?

Myra and Drew Goodman found themselves in a quandary when the chef who had been buying their organic lettuce suddenly left town and the new chef told them he had his own supplier. Organic farming entrepreneurs in Carmel Valley, California, the young couple had a surplus of lettuce to sell and suddenly no buyer. The year was 1984, and the Goodmans were teaching themselves organic farming on their two and a half acres of land. They had already learned how to grow the farm’s raspberry crop organically and were venturing into other produce, even though many in the area were telling them they were nuts. According to Samantha Cabaluna, senior marketing manager for Earthbound Farm, the couple were determined to follow their intuition. “They just had this intuitive gut reaction,” she says, “and back then, before the Internet, they thought there’s got to be a better way to do this. And they just started digging around and found Rodale’s Encyclopedia of Organic Gardening, which was, of course, the bible. And they just said, ‘Well, let’s go for it!’ And everybody told them they were insane.”²¹

The farms were big in that part of the country, and they used conventional farming methods, which meant heavy use of chemicals and pesticides. But the Goodmans were convinced 60that organic farming was the way to go, and they didn’t want chemicals in their land, in their food, or in their bodies. They began experimenting with new kinds of lettuce, such as baby greens, which were uncommon in salad fare back then.²²

Since the couple had already been washing, bagging, and refrigerating some of the lettuce for their own meals, they wondered if they could possibly do the same thing with their produce for which they suddenly needed to find a buyer. “We were left with all this lettuce,” Myra Goodman says. “We remembered how convenient our nightly bags of salad were and decided to try to make and sell these to local grocery and gourmet stores.”²³ The stores weren’t optimistic, but to their surprise, Earthbound Farm organic packaged salad mixes did sell, and the Goodmans had a whole new distribution channel and way of selling their produce.

As Samantha explains it, “One of the keys to this company’s success is that Drew and Myra stuck to organic, even when everybody told them they couldn’t do it.” The Goodmans’ commitment to organic products—and their flexibility about how to sell them—paid off handsomely in 1996 when they were approached by retailing giant Costco. Costco wanted to sell their packaged lettuce but did not want the packaging to say “organic” because at that time, organic produce was considered expensive and not of high quality. The Goodmans knew this was a great opportunity to grow their business, so they redesigned the packaging for the Costco lettuce.²⁴ Their entry as a Costco supplier helped give their brand, as well as organic foods in general, a huge boost.

The Goodmans stayed true to their organic values when they repackaged their lettuce for Costco, but they were willing to make changes to meet Costco’s needs. The result was a win-win situation for both the retailer and for Earthbound Farm.

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We end this chapter with a short story highlighting Dancing Deer Baking Company of Boston and how happenstance propelled the company into the direct-to-consumer business.

When you’re baking cookies and cakes for local cafes and restaurants and just trying to get your business established, thoughts of shipping your products all over the country may not be foremost in your mind. However, Trish Karter and the other cofounders of Dancing Deer discovered quickly that sudden publicity can be a real force in causing a business to either act and take advantage of the expansion opportunity at hand or do nothing and stay small and rooted where it is.

The situation was one right out of the movies, and it’s only fitting that it was a man from Hollywood who propelled Dancing Deer into the spotlight. This food writer showed up in the bakery looking for directions. The products caught his attention—and obviously wowed his taste buds—and soon the bakery was being touted on national television as making the best cake in America. Dancing Deer decided to act on the amazing opportunity that had suddenly landed at its doorstep. Within twenty-four hours the bakery had a toll-free number up and running and found itself shipping cakes all over the country.²⁵

Dancing Deer’s decision to take advantage of this change in how they sold their product has paid off, and today the bakery continues to find new and profitable ways to build its business.

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