This Business Makes Vending Machines Look Dumb⏐Ep. #270

If this was a full time job with no employees, you could profit a couple thousand bucks a day doing this.

Yeah, 100%. Some of my days would be like five, $6,000 days, $7,000 days.

My brain is melting right now. I'm sorry. Every vending machine guru out there like selling a course, but this is objectively better. You don't have to buy a $3,000 machine that breaks a thousand dollar credit card reader. You have to replace the snacks all the time. You might lose the location where you're going to have to test 12 different locations to see which one works. This is better. It just is.

This is the same exact business plan, but mine's like $800 drops in stores.

And those VIN machines, they're doing that like every four months.

It's just crazy that no one thinks about this business.

Is this a business that people could literally start with no money?

You don't need anything, really.

Move over vending machine businesses because I found something much, much better than you. You can start it with literally no money. I mean that. I know what you're thinking. It's clickbait. Nope, I actually mean it. And you can make three to $10,000 a day with no employees. And you're in the middle of Montana. Middle of nowhere. Still works. You don't need to buy equipment or vending machines or credit card readers. You don't need experience. You don't need a bunch of industry contacts. You just need an Internet connection, a phone, and some hustle. Last week I saw this guy in my YouTube comments named Forrest, and he said, chris, you need to interview me. I've got a business that your followers will want to hear about. And I kind of rolled my eyes. I see that a lot. But then I looked into it more and holy crap, this guy's doing 50 to 60 grand a month. And he's only been doing this for about a year? 30% net profit margins, guys. He made $20,000 his first month. And he started this business with almost no money because your customers pay you in 10 days and you don't have to pay your bills for 14 to 21 days. That's how you can start with no money. Every single customer is worth $505,000 a month with recurring. This is the diamond in the rough episode you've been waiting for. Please meet Forest. You're going to love it. All right, Forest, so this is your story. Correct me where I'm wrong. You moved from Colorado to Montana because your wife wanted to, and you're a good Husband, you didn't know anyone in Billings, Montana, but you said, I'm going to start selling snacks to gas stations. And your first month in business in a brand new place, a rural place, you did 20,000 in sales. And by month seven, six. Somewhere in there, you were doing over 50,000amonth and growing in sales.

Exactly what happened?

Okay, that's an incredible story, and that's why we're talking. So welcome. Thank you. Okay, so let's back up. When you were in Colorado, what was your background like? What were all the pieces of your story that led you to do something?

Yeah, so I started kind of like a lot of people and not a lot, but in this industry. I worked at Pepsi, Coke, just a merchandiser. I was just shoving stuff on the shelves, kind of worked my way up.

Now tell us what a merchandiser does, because I think most people don't know.

Yeah, Plain English. So merchandiser is just, you got product and you need to shove it on the shelves. So in these big grocery stores, most of the times the stores won't fill it. That's part of the agreement between the distributors. Like, I will fill it for you. And I just worked my way up and I, I ended up working for Coke for a long time. And then I started working for Bang Energy when it was like doing its big spike bang.

Oh, yeah. Oh, those, those sour heads.

Used to be I was part of the big incline when it crashed to the ground too. So. So I worked in the distributor world, like my whole career. And then I got my first gig working for a startup beverage company, and they were in Colorado and they pretty much were like, hey, we have this brand. Like, go make some money with it.

Go sell it.

Yeah, just go sell zero dollars. Make us make a lot of dollars. And I just went to distributors. I was always the distributor. This time I was not. I was actually the brand. So I ended up growing that brand really well and finding a whole bunch of different distributors. And then I learned what distributors I was looking for. Because you don't always want. When you have a brand, you don't always want the biggest distributor because they have a million different products. They can't focus on your one brand. So I started looking for those smaller distributors. And then time goes on. And I did that for a while. And then I had the opportunity. There was this failed business in Colorado. Failed. The guy was just trying to get from under it. And it was. He was selling pastries. And I told my wife, I was like, I think I can make this make money. And she's like, well, it makes no money. I was like, well, I think I can make it make money.

So yeah, yeah, yeah.

So I gave it a. I gave it a chance. I. I quit my job. It was a pretty good. Best job I ever had. And it was one route and I started growing it and then I made my wife quit her job and so she could come help me. And she was super excited. So we ran that business for a while.

Okay, I'm loving everything that's coming out of your mouth right now. Let me clarify and recap. So you're in Colorado. These jobs you're working for, Pepsi and Coke, they're basically entry level, right? You don't need a degree, you're in a truck. I imagine like you're slanging beverages to grocery stores and gas stations, right? Okay. And then this startup finds you and they're like, hey, you seem pretty good at this. Come sell our beverage. How did that go? Was that successful? Was the startup successful? Super successful.

So what it was is it's a, it was a beverage like magnesium CBD beverage. And it's still, I think it's like the number one CBD drink in the nation right now. I mean, it's big. And I end up leaving. I still have a little bit of Sharon stuff in it, but super cool. I mean, I still stay in contact with them, but I kind of want to do my own thing. I kept seeing all the money I was bringing in. I was like, I could do this for myself. Yeah, yeah, that money looks great.

I want some of this. They're like, congratulations, Forest. Here's your paycheck for $70,000 a year. And you're like, thank you so much. Very grateful for this. But I made you $3.8 million last year. Right? Like, I'm making up these numbers, but that's usually how it is with a job. Like, you look at it and you're like, huh? And then, you know, other businesses, you're like, like, let's say you're selling a widget. You're like, okay, well, yes, I created all this value, but I don't want to raise money and set. Create a widget and prototype it. And like, that's not me. I'm thrilled with this job. But in other industries, like distribution, you're like, hold on, what? I already know the guy. I know that vendor. I know the routes, I know how to talk to people. I don't have a non compete. I don't really need money. Why would I keep doing this for someone else? Is that kind of where your head is at.

And because like I said when I first took over that startup, the startup beverage, like I said, they made $0. It wasn't in one account. And I just kept knocking on like store, like door to door salesmen, like, hey. And I gave him my spiel. And then I grew it to hundreds and hundreds accounts. And I think in Colorado alone I, we had like eight different distributors. I opened up. So I was like, I can do this.

Wow. So were you cold calling distributors or were you literally knocking on gas station doors and, and grocery store doors or.

What that look like with distributors? A lot of distributors won't just bring on a random brand. So what I would do is I would reach out to like regional accounts or any account, get them to sell it. And then now that I have that sold business, then I would go to distributors. I was like, hey, I need someone to sell to all these stores for me, so I'll do the legwork.

You say account, you mean like a dude that owns seven gas stations? That's an account. You sell it into there. So then you can go to distributor A and say, hey, dude, I'm in. Like, we're brand new. We're in seven gas stations. He's loving it. He's selling through the product. He's ordering more.

Do you want to pick a hundred percent?

That kind of how it goes. Okay, now granted, you've got it. Like in this scenario, it needs to sell through, right? Like it needs to actually be selling or does it just need to be in the stores to have enough legitimacy to get to it?

That's always a tough one because like the first stop is just getting it in because you got to get customers that to recognize it and then give it that one try. And then after that one try, then hopefully more sales would go through.

Okay. But you're kind of like, it just doesn't make sense to go to distributors first. In the case of a brand new product, you got to go bottoms up. Right? Whereas with a Pepsi or a Coke, you're, you know, you have the brand name.

That's what's hard. A lot of people with startup like brands and products, they go to the distributor first. The distributor's not going to care to sell your product. They're like, we make all this money on this product that already sells. Why would they take away that spot to put something that's not proven, so you have to prove it.

Yeah. Yep. Yeah. And then when they see a little proof, they're like, this could be the Next bang, this could be the next Celsius. Right. And they're. You're kind of selling the dream at that point. All right, so then you go to the pastry business. How much did you pay for this? Did you get it for free? Did you seller financing deal look like?

I mean, I, I'm a talker. So every time I go into the stores, I talk to everyone about every business. I was like, who, who brings in this? Who brings in this? I'm just kind of nosy that way. I'm just curious. And I kept, people kept complaining about this pastry company. They're like, they sell so much, we just can't get it. So I got the owner's number, called him. Yeah, bad offer, bad opera. He was just done and I bought it for 15 grand. So.

Yes, cash. Yeah. Okay. All right. So you, you go, how did you find the, the seller? You, I mean, just.

No, I called. So it was just like, it wasn't his pastry. He just bought it from. So I, he was just the middleman.

He's just a middleman.

He was just the distributor. Yeah. So I bought it.

Okay.

Yeah, so I bought it from him. And he didn't really have any numbers. The numbers he showed me were like so whack. I was like, there's no way. This is like, he just, he didn't know he wasn't running the business.

Yeah, you're just like buying on goodwill and like a handshake. And you, you know that, you saw it in stores, you know that the store owners themselves told you it's selling, that's your due diligence. And I, I think a lot of people are listening to this and getting anxiety, like, how could you do that? Like, dude, if you want an insane life changing deal, sometimes you're going to have to do stuff like this. Period. End of story. If you want a nice buttoned up deal that's listed on biz by, sell that. Okay, Let me. Send me your deck. Send me, let's talk, meet with my attorney. You're not going to get a deal. You're just not. That's the trade off.

So what this product is, is it was a bakery in California. We'd ship it to Colorado. We rented a freezer space and pretty much I just went to all the stores and just resold it like, hey, I'm the new guy, I'm gonna service you. And we grew it huge. It was like one little route and then it became two big, big routes and it was just catching on. It got to the point where it was just too much. I was enjoying it. I didn't really want to have employees. It was really cool to work with my wife. Um, and she got pregnant and I was like, cool. Have we. That would be our second. So I was like, we'll have. Have her stay home with the kids. So we sold that one route out. So it was just one route and I still ran another one. So someone wanted it. I sold it for dirt cheap.

Okay. So kind of like when you go on biz by sell and you can see tortilla routes for sale. FedEx routes for sale. And they're always like a two to three to times profit multiple, right?

Yes.

That's kind of what you did. Okay. You didn't want to walk away from it because there's real value there. But you also were kind of. Maybe you start. We're starting to have shiny object syndrome a little bit.

100%. I wanted to keep bringing on new items and I was like. And I'm. That's why I. I lean to so much your content because I feel like we're similar in certain ways. I want to grow this business. I want to do all this stuff. And then I go, oh, that looks like fun over there.

Yeah.

So it's.

Yeah.

So I. We sold that one off and did pretty well with it for only having it for like a year.

Do you mind sharing the numbers and are you able to share the name of the bakery in California? Or would you rather not? Doesn't matter.

I can. It was called Bon Appetit was the.

Bakery and what type of pastries.

So they did. Their main competitor was like obviously Little Debbies and Hostess and all that. But they had donuts and then their big thing was Danishes. Like a packaged Danish.

That was like their. Their what they were known for.

Yes. And I mean they did really well. It's just I started what I. When you start running a business, you find things you don't like. And the dates were a big thing because it's a pastry. So it's like. Yeah, we were riding off a decent amount.

Well, I used to be involved with a fresh bread business and he had. It was five ingredients, no preservatives. We had seven day shelf life on that bread. And that is a hard business to run. Right. He was buying back thousands of dollars worth of bread every week from grocery stores. Anyway. What were the unit economics on this? What were you buying? You don't need to go into like all the pastries, but give or take, you're buying a $2 pastry and selling it to gas stations for three and they're selling it for four. Like, what did it look like?

Yeah, it was pretty spot on. I think at that time, after everything, after the final like net profit or net amount was every donut I'd make 40 cents on. So it wasn't nothing crazy, but it just added up. So it was about 40 cents a donut. So. And then we were selling. I mean, with both of those routes, it was probably close to at the end. Before I started selling it though, it was doing about 800,000, I think gross.

Of just before you started selling it.

Or before I started selling off the route?

Okay, okay.

Before I sold off, I think our max was about 800,000.

So when you took over the business, you don't really know what the revenues were, but ballpark, what was it? Fifty thousand a year? Hundred.

Yeah, I would say, I would say it was probably like, gross was like a hundred. And then you were probably netting, I mean, 30, 40.

Wow.

Maybe.

So you bought a business that was netting $30,000 a year, which would be like $100,000 business for $15,000.

Yeah.

So that's incredible. Period. Full stop. I don't care if the owner's running it. If it's not scalable, I don't care what the structure looks like. That's an amazing deal for a business. I'm guessing the owner was doing everything himself, which is kind of why it was hairy and ugly.

Yes. And you tried to hire some people and he was just hiring not the right people too. So he had a full time job. He thought it was. He was his first time owning a business. He was like, I'll just hire people to do it and life will be great. It wasn't.

Yeah, he's just going to hire it out. Right. It's like, yeah, I just want passive income, which is what I say on this podcast all the time. It's like you have to know and understand and live in the weeds before you outsource the weeds or you're setting yourself up for something like this. I mean, he took an $85,000 haircut on this business because of the fact that he didn't. Because he did this. Right. And if he went and listed it on biz by sell for a hundred grand, it probably ends up selling for 15 or 20 grand a year or two or three later, anyway. Right? Yep. Okay, so you took it from call it a hundred thousand to eight hundred thousand a year in how long?

It was close to two years, maybe two years.

Okay, so you 8X'd a business. You 8X'd a hundred thousand dollar business in two years that you paid fifteen thousand dollars for, right? Yes. And what was your annual profit on 800,000?

It wasn't as much as you. That's what's hard when you see the 800,000. My gosh. But I think.

Sure. No, it's fine.

I think we were probably close to like 180 after everything.

Close to what?

Probably around the 180 mark.

That's great. 20 percentage. Yeah, no, that's. That's great. Now, did you have employees with that?

Nope. It was just me and her. And then I'd bring the kids to kind of mess around in the warehouse. We ended up selling just her route. It came with a van, but for 85,000 is what we sold hers for. And then maybe another eight months. I don't know. Time. Time flies. It's hard to know. And then I had someone want to buy my route that I was on. So I was like, you know what? I'm kind of bored. I'm ready to move on. Because it was. When you have a business like that, the bon appetit, the pastry still kind of runs how they think the business should be. And I was. I wasn't a fan of that because I thought there was other avenues I could have.

So, yeah, I'm a business owner. I don't want a boss. But, like, I wouldn't be in. Like, they could pull the plug at any moment. Then you're out. I mean, you could find something new to distribute, but it's still not in your hands.

Yes, exactly. So I was like, you know what? I want to. I want to do something on my own. So I end up selling it to him. I sold it to another guy for 100,000 the other route.

Okay. Okay.

And that's when I didn't have a job no more. And my wife kept going. You know what? I've been wanting to move to Montana. And I was like, I know how to do this now. Almost overconfident now, being in the weeds. Like, I was way, way too confident for actually knowing what I was doing.

Yeah. Okay, so before we go to Montana, you sold your wife's route so she could be home with the baby. Awesome. 85 grand. Cool. You're still doing it. You sell it months later for 100. Awesome. So you put 185 grand in your pocket, and you also profited a bunch of money along the way. I'm guessing low six figures, right? Yep. So let's say you, you over this two year experiment, you invest 15,000, you pull back out, call it 250350 somewhere in there when it's all said and done and. But you had like, that was your quote unquote full time job the whole time. And you learn the industry. Like the most important part here is you were paid six figures to learn a new industry, right? To learn it even more. Like you'd work in the industry. But I'm sure owning it as a business owner is a totally different vibe than owning it, you know, or that not owning it, just being an employee in the industry. So you've got shiny object syndrome. And I want to take a note there because that should not be a pejorative. Like shiny object syndrome is a feature, not a bug. Like you could use. You could say shiny object syndrome is just motivation. Like force is motivated. No, I just want better. I want more. Also, shiny object syndrome is opportunity cost in disguise, right? You're saying, man, I'm working 40, 50, 60 hours a week, I've got two kids at home, I really feel like this thing would net me a thousand percent more money for the same or less amount of work. Right? So it's just opportunity costs. You're being smart, you're being diligent. Like we would never want to invest in a stock that just keeps losing, losing, losing, losing, losing, when you know that this other stock has just. Or like, let's say investing in the market as a whole goes up 8% every year no matter what. It's like, that's opportunity cost and it's very expensive. That's not shiny object syndrome. That's being a good steward of your money, Right? You're trying to be a good steward of your time and being, trying to be a better provider for your family by always looking up, looking to the next thing, right? Yes. Okay. Sorry, that's like a soapbox I have. But so then your wife says maybe you start watching Yellowstone. And your wife's like, we're moving to Montana. So you pick up. You don't. Do you have family there? Friends, anyone?

Yeah, so she, she was born and raised there, so she still had family there.

Okay. And then where were you? In Colorado? What city?

Colorado Springs.

Okay. It's a beautiful place. Like one of the best places to live in the country, right? Oh, cool.

I loved it.

You loved it. And it's like, it's not, it's not like Denver, but it's not like Billings either. It's like a decent size and billings Is pretty dang small. I mean, there are no big cities in Montana.

Billings is the big city. I'm big city living right now.

Okay.

That's what.

All right, so you move to Billings, like, you get moved in. Like, you get all set up. What is the first thing you do?

So, actually, before. Because we were still, like, in Colorado for a few months before, and I was invested in this business idea now. So my very first step I did was I need. I had this idea of what I wanted this business to be. So I just started calling any business in Montana and China that seems similar to what I wanted to open up.

Okay.

And. And I called up.

These are. Sorry, These are future competitors. You're calling up distributors?

100%.

Yes. Okay.

And. And I'm. Because what I'm trying to do is I want to find what sells in the area. I don't. I've never, like, really been there. I don't know what does. Well, I know I didn't want to do pastries because the state's too big, and I can't go to their stores that often. So I wanted something with long dates. So I called a whole bunch of them. Some of them not nice. They don't want to talk to me. And some. I have one that's, like my best buddy. Talk to him every week. And he really gave me insight. And you notice, like, business owners want to help other business owners. So.

Yes.

And by talking to him and the other guys, I kind of figured out, okay, I think I want to do billings. And then once I found my area, because he was up north, so we would never be competing. Once I found my area, then I just started calling a whole bunch of different products that I thought were interesting. And I was like, hey, do you have distribution and billings? You do? Never mind. And I just kept calling until I got products.

As in beef jerky companies?

Yep. Beef jerky. I started with three different companies. A beef jerky, a. A candy, and then, like, a novelty candy. Like the goofy little toilet candies and that kind of stuff.

Yep. Like a giant gummy worm or something.

Yes. Yeah, exactly.

Okay, so how are you finding these contact infos?

Yeah, some of them were for. From, like, me calling those other distributors that were cool and giving me some insight. And then others are just Google and just Google, like, what's a cool jerky? And I just. Oh, that one's cool. I don't think I've seen that before. And then I would give them a.

Call because I guess you. You can't reliably go into a gas station and look what's on the shelf and then start calling them. Because you want brands that might sell well in a gas station that aren't in a gas station yet. Right.

Because you don't want to compete with a company that's already there.

Yeah. Okay, so what's your pitch when you get these novelty candy companies or jerky companies on the phone?

Yeah. So you. You really got to pump yourself up and. Because they want to work with people that know they're going to make money with. So at the very beginning, because I didn't have a business, I just would kind of tell my story and be like, hey, I'm with Kofdra Wholesale. I'm looking for a new jerky company. I think I have a handful of stores that would do it and kind of give them my spiel that way. And by that time, before I even. Once I knew I was doing billings, I would go on Google and I would just find independent stores that looked independent. So it could be. I mean, even franchise stores, like hardware stores. I do so many hardware stores, and I would just make a list of anything that looks independent, and then I use that store as my selling pitch to, like, the. The brands. I was like, I have 50 stores. I know I could get your jerky rack in.

Mm.

And then. Then I would just get my brands that way.

So you're kind of. You kind of a marketplace. You got to kind of work it from both angles. You got to get buy in from the food brands, and you got to get buy in from the stores kind of at the same time when you have nothing but your story. And I always like to say, sell your story, even if your story is not. I've come from distribution. I've done this. That doesn't have to be your story. Your story could be. I'm a data, too. I'm willing to do whatever it takes to make it happen. I just moved to Montana from Colorado. I don't know anyone. I'm the hardest guy you'll ever meet. I have no experience in this industry, but I promise you, I'm the fastest learner yet. Like, your story does not have to be. I have all this experience. I'm the bomb. Right. It just needs to be authentic.

Yeah. I mean, most of these stores I'm selling to, I don't do contracts. I don't do any of that. It's all relationship most of the time. And that. The cool thing, when you're working with, like, independent stores, like, just a guy that owns Jake's gas station. Jake wants to help out other local businesses. So like, if you're just real with them, I mean, most of the time it's a lot easier to sell than you think.

Yes, I think that's a mistake we make a lot is we go into it pessimistically, maybe out of fear, insecurity. And we approach someone like, how would they, why would they want to help? It's like, dude, like business owners want to help. Business owners want to help. And just look for that optimism and you will find it.

Yeah, and I just had, you have to give them value too. Like obviously they're not going to drop everything just because you're a nice dude. Like so my main value was like most of these gas stations have like one large wholesaler and that wholesaler will sell all their candy, all their jerky. And how, how it works is the store will go in and or like scan the barcode and then send, hey, I need these products on the next delivery. The whole seller ships it, drops it, piece out, they just leave.

So there's no relationship.

No relationship. And it in my point of view was like, there's no way to upsell. Like, there was never a salesman going in there to upsell new items. So how my business is set up is I go to all my stores every other week if it needs it or not. And by doing that, I gain that relationship. And what makes my pitch so easy compared to the other wholesaler is like, I'm not, I always tell them I'm not taking over theirs, I'm just in addition to. And I will show up every other week, I will place my own order, I will merchandise, I'll put the product on the shelf, I'll rotate it and I'll buy back all credits. If it doesn't sell, I'll buy it back. And once you say that, most of those business owners are like, I mean this is less work for me. Why wouldn't I have someone do this?

So it's like I no longer have to worry about this mental load of inventory and ordering, which like, as someone who has owned wholesale businesses and retail businesses before, it is a mental load. And it is, I don't care what AI tool you have, what spreadsheet you use, it is literally impossible to forecast your inventory correctly. You'll never get it right ever. So you're basically taking off that anxiety, the mental load and the time of doing it and then saying, I'll buy them back. Right. So this is like your no brainer.

Offer to them, oh, 100%. And like when they hear that you'll buy back the credits, they're like, okay, like this is no risk. That's usually my spiel is like I come in and I'll manage that whole section for you. It's one less. Any, when you're making your pitch, you want to really like push. Like I know how busy you are. Let me take off a workload for you and let me just take care of this section. And I really, like we talked about, I really focused on products that they couldn't normally get. And if I had any cheat code, if I was going to tell anyone starting a business, like what's one thing you could do that would make you stand out? And it is. I brought on national products. I've done a whole bunch. But what's really changed, my business was local. Find a cool local jerky. My number one selling jerky is local, out of billings. And what it is is those large wholesalers, all their stores have to look the same, right? Like they buy a million different products and they sell them to throughout the nation. They're not going to bring on a regional product because that's not going to sell in New Jersey. So they don't even try. So it gives such an opportunity for us local guys to bring in those products.

So it just comes down to incentive alignment, right? Like everything in business and life comes down to incentive alignment. The big wholesalers, they're doing fine. They don't have an incentive to upsell because they're going for scale, right? They would rather just run and run and gun, right? In and out, in and out, in and out. Don't spend any more than 60 seconds in the store. Bring in the dolly, drop it off onto the next. Your route is 52 stops a day, right? Whereas you might be doing like, you know, two tenths of that. And then they're, they want all the stores to look the same because consistency, because scale, because why would you know it's not going to sell in New Jersey? So you're going in there and you're saying, I, I'll do this for you. You're not gonna, you don't pay me like a service fee. You're just buying the goods. I'm just making a margin because I'm the business owner. It's just, it's a no brainer offer once again.

Yeah. And I mean doing the, doing the local products. What's helped me too is like there's a lot of regional accounts that they like, certain gas stations can Run. They let this region kind of do its own thing. And the only time they'll let a new. A small distributor in is if it's something different. They're not going to bring in jack links through me because they get it through their main one. So I've. I've brought on a few different, like, regional accounts, like 20 store accounts. Because I was the local guy. That was just my big leverage. And then now I'm going to all these stores every other week. I'm building the relationship. A lot of my stores, I started with one item. Like, all they told me. Yes. Was like, I could do one jerky there. That's it. And now I could think of some of those stores. I have, like 100 different brands or 100 different products in there when it started just with one.

Wow, that's your foot in the door.

Yeah.

And they've de risked you like they know you. There's the relationship. Is there. It's much less friction for them to buy new stuff from you than to go try to find it from someone else or from their old guy. Right, exactly. Can you break down what the unit economics of, like, an average order looks like? So we're talking one store, one order.

Yep. So it just really changed. Like, obviously there's busy stores and not busy stores. And at the very beginning, I was just opening up everything. I wanted as many accounts as possible. Like, I have hardware stores and all that. But I would say for gas stations, an average order, especially in the summer, is like 500 to 900 a delivery. And then I have some. And that might even be low because I have some. Like, then I have some grocery stores. Like one of my best grocery stores. Every time I go there, it was like 3, 500 drops. And that just. I started with one item there, and then I. Now they were like, wow, this guy will come and do the whole section. Why. Why am. Why are we doing work when we could have him do it? And I took over full jerky sections in these stores. So I'm the jerky guy or I'm the candy guy.

Yeah. Now, all right, so let's call it a thousand bucks for an order. What is. What's your gross and then your net margin on that order?

Yeah. So the gross would be the thousand bucks. That's what I'm selling it to the store for.

Well, that's gross revenue. But, like, what's your. How much are you paying for that stuff before accounting for gas and travel?

Yeah, about. I would say about 7, 6, 5,000, 700. So I mark every, when I buy my product I mark it up kind of depending on category. I want to be competitive obviously. So I'm my margin, gross margin, my markup, I usually do 30, 30 on the low end to 45. So on that thousand dollar order, depending on the items I brought in, because it changes, I mean that's probably almost $400 profit drop.

Okay. So some people get this confused. This is a lesson to the listeners or viewers. Markup and margin not the same. Right. So if you have a 10, if you have a $10 product that you sell for 15, that's a 50% markup with a 33% margin. Right. Because 5 of those $15 is your gross profit margin. Your net profit margin is going to be your gas. Any other like insurance that's going to come out of that $5. So if your gross is 33, your net might be 20. Is that kind of what you're hoping for in a net margin is like 20%?

No, I'm, I would try to be closer to the 30.

Nice. So 40, call it 40 gross and 30 net. That's with you doing it. And if you hired it out, maybe closer to 20 net. Yeah. Which is, I mean for any industry, 20% net margin is solid. Like in restaurants you're looking at 3 to 5%. Like in a lot of industries you're looking at single digits or low double digits. So I would have thought that this industry was lower margin just because it's wholesale distribution, which is something I know better than most industries. But food, like I just think you found a little, a little niche here that's higher margin than a lot of other wholesale distribution industries.

And it, it just depends on your area. Like not all mine. Maybe my, maybe mine's more 35. I, I mean average and then goes to 30, something like that. But I, I, I have buddies in depends on your area. I have a buddy in Breckenridge, Aspen and those areas high end. He doesn't do anything his gross margin or his margin. He is 45% because he can and it's just a one man show for him. So I mean that's just going in his pocket because there's not much overhead. I mean not really.

Yeah, so you drop off a thousand dollars or a thousand dollar order, you're hoping about 350 or 400 in your pocket of that you're going to pay like your gas and your insurance. Are there any other. Now you have like a storage un. Where do you store this stuff that you have to Buy back.

Yeah. So when I first. When I first started, I just went into. I mean, it's cold here, so if it was somewhere else, you could just get a normal storage unit sitting outside. But I needed temperature controlled, so I just got. I started with just one. I think it was like 10 by 20 unit. I just loaded my stuff in there. Then I moved the two units.

What does that cost you per unit?

It was like 180 bucks.

Oh, that's not bad.

A month. Yeah. And then. And then I got another one and that one was a little bigger, I think all in. For those two units, I was like 500. And then that grew to. It just became too much. So now I'm in a same company, but they have a warehouse. So I just moved to their warehouse.

Okay. I would imagine it's even maybe a little cheaper per square foot in a warehouse, is it not?

Yeah, I'm about 1500 square foot and I'm. I think my monthly, like everything is 1400, so. But I get to drive my truck in now, which is awesome.

Oh, yeah. Efficient. So you don't need your own warehouse. You don't need an office. You're working from home. Do you have any employees yet?

No. So I don't.

Yeah.

Pretty much how I set it up when it comes to like, delivery day. Every Monday is my warehouse delivery day. I bring the family, we all put away pallets.

That's awesome.

And this is super good for these people. Just starting. Everyone wants to get a big warehouse and do all that. I would call a whole bunch of storage units and find ones that have on like employees that work on, On. On the facility. Because, yeah, all my deliveries are received by someone that works at the place. So I never have to be there because that's a big cost. I can't. Montana is huge. I could be two hours away and I get a delivery. There's no way I could be there. So this place, that's why I pay a little bit more. But they go in and they receive the order, they check it, they do all that and they do it for you.

Brilliant. No brainer. You don't need a W2, you don't need a contractor. You're just paying a little more for storage and they're helping you out. Right?

Yeah. So that makes it way. Yeah, way more hands off.

Well, another testament to going local. Like if you go to like an extra space or one of the big, huge national brands, they're probably not gonna want to do that or care. But even if they have people on site, but I imagine you're using, like, a more local storage unit, which is. Those are easy to find.

Yeah, it was. It was super easy. There's several I could have chose from. I just called and I went to a couple and they're like, I mean, there's a whole bunch of other businesses in here that do the same thing. They just drop off the delivery and they go. So I pay a little bit more, but worth it.

Yeah. So the person will actually, like, check off. Like, they're not just, like, receiving it, signing for, but they're making sure that you're getting everything you're expecting.

Yeah. Especially if you befriend them. You just tell me, like, hey, we just go over it a little bit and they go, yeah, not a big deal.

Okay. So Mondays you receive pallets and boxes from the food brands. Right. And then throughout, you know, Tuesday through Saturday, you're delivering it.

Yep. So actually the product shows up throughout the week because you've probably worked with this, that the delivery drivers is going to show up whenever their. Their heart desires. So. But Monday is the day that I, I kind of. I call my office. Warehouse day. I don't do any sales. It's just, I go to the warehouse, I have pallets, I put it away, I make sure my truck is filled up. And that's kind of just get ready and prepared for the week.

Okay. And you're only, like, you're, you don't have to guess what to order. Like, you're placing the orders, and you're ordering an aggregation of all of your orders. Right. But you do have to buy stuff back. Do you hate doing that? Is it like a headache because things expire, or is it just part of the business? Or do you love it because even though it's a headache, it's your competitive advantage?

So I, I, like I said that's my spiel. When I sell in, I like, hey, I buy everything back, which I will. But most of the products I really choose, I'm. I'm the one placing the order. So I'm going to be very cautious.

Yeah.

Like, if I, I wouldn't buy back credits if I was having someone else order it. I'm managing it. So it's very rare, honestly, how much I buy back.

Okay.

And if I do buy back something I don't. I, I get rid of it. We're not selling it no more.

Yeah. And if you take a flyer on a random jerky flavor that just doesn't move, it's not expiring for six Months anyway, so you still probably don't have to buy that.

Usually Two years.

Two years? Yeah. So you just. You just wait it out.

Yeah, just wait it out.

What about payment terms? How does that look like? What is your cash flow conversion cycle look like?

Yeah, so most of my product, like, I'll say the manufacturers, because that's who I usually buy it through, the manufacturers. I'm. I'm set up usually to net like, 14 to net 30. So two weeks to a month before I have to pay.

Okay.

And then I set up most of my customers. Obviously, COD would be best, like, give me the money right then. But most of them, I have them on net 10, because I show up every other. I show up every 14 days. I want to get paid before I make my next delivery.

Oh, man. You just, like. You're having your cake and eating it too, because it's like, all right for us. But, you know, margins are good. Sure. You grew it really fast. Sure. You don't have employees. Sure. But the cash flow conversion cycle must kill you. You're like. Actually, it's what's called a positive CA flow conversion cycle, where I get paid before I have to pay now. I'm sure some people are late to pay. Like, it doesn't always work out that cleanly. You got to wait to get it from the bank. Right. But on the whole, you're getting paid up front before you have to buy your products. That's beautiful. When do you think you're going to hire for this business?

It's tough. I. I enjoy this. And right now, like I said, this business is all relationships. So I'm only a little over a year, so the relationships are still fragile, and I'm still growing in these accounts. But I would say this summer is going to be kind of a true test of how much I can do. Because last summer was pretty good. And I mean, a lot of those last summer, I only had, like, really three selling days because I don't have that many accounts yet, so. And I'm getting new accounts. I just reached out to. I just actually closed another. I think in this area, be about 25 accounts. It's a regional account, so I just jumped on. So I'll be. By next summer, I'll have 25 more stores. So I'm thinking next summer or this coming summer, I'm gonna have to at least get someone to help have them ride with me so we can at least visualize and prepare.

So how long has this business been running in Montana?

So far, like, a little Over a year, Maybe a year and like, three, four months.

Okay, and how many accounts do you have?

So I'm close to 100 now. So I'm like 94, 95 accounts.

Okay. And that account that includes, like, one gas station that has 10 locations. That would be considered 10 accounts or.

One that would be. That'd be 10.

Okay. Okay. Now, and what is your monthly revenue, give or take, right now, across?

Around 50.

Okay, so call it that. 500 bucks a month per account. Is that right?

Yeah, that's probably good. Average. Some of my accounts are a little slower, so I maybe skip theirs, but, yeah, as an average.

Okay. And how much money would someone need to start a business like this with?

Okay, I get this question a lot, and I. I think once you find your product that you want to sell, you just reach out to them, ask them what their minimum order is, because you. You buy in bulk, and that's why you get a discount. Right. So. And a lot of them, like, my first jerky company I started, they had different tiers. Like, the more you buy, the cheaper you get. But they had the option of 2500 order, so. Which is not bad because they give you free racks. $2,500 is only if you sell in four racks. That product's gone, so.

Wow. Yeah.

Right. So you sell in those four racks, you that all that product you just bought is now gone, is sold, and usually go to your stores every other week. So hopefully you get your money by then to place your next order, and then that next order will help you get new accounts and also help you top off your existing ones. And that's just how I grew from zero stores to where I'm at now is like, I just. Every dollar I'd get from the new ones, I would open up a couple new accounts, top off my existing, and just slowly just grow.

Yeah. What type of vehicle does someone need? Could they start this with a car? Like, I would think a case of jerky could fit in a Kia trunk. Yeah.

I knew a guy that did the pastry thing, and he had just an suv, just a Suburban, but, yeah, I mean, you can have anything. I just had my old pickup with an enclosed trailer, and I just shoved. Maybe built. You could build shelves. I did. But you just throw it on the ground right on the trailer and just go for it. You don't need anything, really?

How. Like, how many hours per Week at 100 accounts do you spend actually doing deliveries? And how many days? So, like, are you spending, like, three hours a day for three of the Seven days a week or what does that look like?

Yeah, so like I said, Mondays is my office. I don't usually do sales. And then three to four, I go to my stores every other week. So there's like one day I still have to fill up. But I'm averaging like 10 to 12 stores a day. And that's, I mean a six to eight hour day depending on where I'm driving. I have one location that's big volume for me. I do about two and a half hour drive there, two and a half hour drive back. That's, that's my big day.

But so in like the most extreme example of being rural other than like west Texas, let's say an eight hour day, to be conservative, is 10 deliveries. Those deliveries are 700 to $1,000 a piece. Right? So seven to 10 grand of revenue in one day of deliveries once you have the accounts. And of that, let's say 10 grand of revenue, you're putting 2 to 3 grand in your pocket.

Yes.

That's incredible. So like theoretically, if this was a full time job, you had enough accounts to keep you busy with no employees, you could profit a couple thousand bucks a day. Doing this, running this yourself.

Yeah, 100%. Especially in the summer. I mean I was, I would be doing some, some of my days would be like five $6,000 days, $7,000 days. And I mean, and that's just selling jerky. So it's like. And what, what blows my mind is like there's a lot of people that will sell candy. I do candy and stuff too, but as just a filler, just. Yeah, I'm already there. Let's sell that store a hundred dollars of random candies. But the jerky, like I have a couple cases of jerky. I sell everything by the case. I don't pick ones and twos, they get the full case. And I have a couple jerky cases that are over a hundred dollars. So I sell them. That one case, there's $100, $30 in my pocket.

So what, what type of software tools do you need to run this business?

So you don't really need anything. I went and got a cheap little invoice making app. I pay like 10, 12 bucks a month on, but I know a lot of people. I have a buddy that he handwrites his tickets, he goes and goes, writes out each thing. I'm, I don't really like that just because that takes so much time and my handwriting is awful. So I just use the app and I print it and it was when you have something a little more professional, it was easier to pitch myself to these regional accounts.

Yeah.

So I would just. Yeah, so it's just, that's it. I just have that one app.

So if someone were just getting started and all they had was a car might be tight fit, but theoretically they could fit it in a car. I've, you know, I've driven hundreds of small packages to USPS in a car before I've done it. You put in the driver's seat, the back seat, the trunk, et cetera. And you can level up by getting a hitch on your car. Go to u haul, 2 or 300 bucks, get a hitch on it. Get a trailer, an open trailer, because it's cheaper, not ideal because it rains. Then you level up, get an enclosed trailer. Then you level up, put shelves in it. Then you can get like a sprinter van if you want. At Texas Snacks. My gas station business, we, we were going to do a big truck and we just got these big vans. It's just easier. It's all enclosed. It's nice. Right. You don't like, you just need a phone number, an Internet connection, start calling. Is this a business that people could literally start with no money, like just a phone?

I think so. Just because usually when you get your manufacturers, they, most jerky Companies naturally are 14 day terms. So that gives you 14 days to sell it. And like you said, if you just did it out of the car, you could at least fill up enough product in your car that fills up one rack. So you go to the store, they say yes, you sell them that $800 full, fill that rack. And if you have another store, just go back to your, go back to your house or your garage where you have the product and just start over. Your days might be a little longer, but it'll be done.

Yeah. So like if you have a car only, maybe you're inefficient, you just have to make multiple trips. Big deal. Maybe you, if you have a big day of deliveries, like eight to 12 deliveries, you, you rent a U Haul truck that day for 40 bucks plus 50 cents a mile or whatever. Right. Like, there's so many creative ways to do this. Are, are you able to get 14 day terms and for those listening terms, that just means you don't have to pay for 14 days. Are you able to get terms like that when you're brand new, just starting out from a, a jerky company or is that more unrealistic?

So for me, I, I was able to, but I kind of sold myself I'm like, hey, I just sold my last business. I'm moving here. I think I can get you in 40 stores. And I sold myself and they go, okay, cool. And I led. I was like, I would like to do 12, 12 week terms. At that point they see the money. They're willing to kind of like do what they can to.

Yeah.

To make this work.

Now, do you think most markets are more or less difficult than billings?

So I think there's two ways to think of it. And there's like two different markets. So there's going to be like in Colorado there was a lot of stores, but also a lot of competition. Right. So you have a lot of opportunity, but you're fighting a lot of people on that space. But here in Montana, there's not a lot of stores, but there's not as much competition. So you kind of pick your poison. Right? So yeah, out there I was able to open up. I mean that's why I grew it so quick. There's so many accounts.

Yeah.

I met a guy that owned 30 stores, so that was like boom. Once he said, yes, I got 30.

So yeah.

But then here there's not many people. I'm. There's not many distributors like me, but there's just not as many stores. So there's definitely a way to grow a business in both places. And I've done it in both places.

Yeah. And like I was gonna ask, is this scalable? But like of course it's scalable. Like there's so many distribution businesses out there, Cisco, U.S. foods that are billion dollar businesses. The question is like, how hard is it to scale? I would imagine finding people at this wage is. It could be difficult. What is like a standard pay for someone for. In this industry? For someone to take over your job, so to speak. Not to do the sales, but to just do the deliveries and maybe the reordering.

Yeah, So I think it's definitely scalable. I mean I. On the first question you had, I would say you pay someone 50 to 60 thousand dollars a year to run a full route. And that full route gross should do like my route's not full and that's why I haven't done it yet. Should be around 800,000 it should be bringing in and you pay that person 60 to 70,000. 50 to 70 to run it.

Okay.

And then. But yeah, so it's definitely scalable. Like what's really cool about this? Everyone always thinks it's just a small business. It could be huge. Like, you know, coke, most of the coke Coca Cola distributors, you see, aren't actually corporate. Coke, it's just a company third party. A third party. Like I worked for Swire, Coca Cola.

So yeah, same with bottling, right?

Yeah.

Coke doesn't bottle their own stuff.

So in a lot of the beer companies too, they are just a distributor that got that contract. Like I have a buddy, he got a contract with Red Bull, he sells Red Bull and he has a big operation and he started kind of like me. He just sold random stuff and then he was able to build out a nice territory and then Red Bull's like, hey, I need someone. And there you go. So it could, it could scale huge.

Yeah. So let's just say. So you said if your route today was full in a more rural area, It'd be about $800,000 a year of revenue, right? For one route?

Yep, I would say about that.

And you said that 30%, if you're doing it all yourself, 30% net profit margins are realistic, right?

Yes.

And especially it becomes more realistic as you scale because economies of scale, you add more efficiencies etc. Right. So theoretically $240,000 a year net profit would be what you would be looking at at 800,000 at, you know, max efficiency from just you. And is that you delivering and selling or just delivering?

So how I might explain it, but maybe not. So how I set up the business is, it's one stop shop. I don't like when a salesman goes in and they go, hey, I can sell you this display. It'll come tomorrow. I'm not a fan of that. It gives people chance to back out. So I have everything in the truck that moment. So the salesman is also the driver. So he shows up and goes, hey, I got this display, can I go grab it?

I guess what I meant to say is like growing the business, like actively trying to find new accounts is if you were doing 800,000, would you still have time, working 40 to 50 hours a week to grow the business or would you just be like doing the, the reordering and the fulfilling and just like maintaining what you have?

I would say at that, at that amount, that person would be just, man, maintaining. They would be growing. They still have like KPIs and stuff. They try to grow within each store. They're like, hey, I got a new brand you'll grow within. Maybe they wouldn't be like adding new accounts, but there's so many times where you see it right across the street, you're just gonna walk in like, oh, I'm not In that store. Hey, what's up?

Yeah. So like things would organically come up, right? Like, hey, we're just, I just opened a new store or hey, my buddy. And you would chase down those leads, but you probably wouldn't have very often like full days to just go do cold outreach, right? Like you wouldn't have a lot of time like that. It's funny because I cut my teeth in the pest control world as like a 15 year old. And I would every morning in Ormond Beach, Florida, I would go to these salesmen meetings. We would eat at ted's Diner on U.S. 1. Like, I'd get a can of coke and this huge country fried steak covered in gravy. It's probably 2,000 calories to start my day, right? And then we'd go to these sales meetings with the most old school guys. They're smoking cigarettes. And Danny and my boss would be like training, looking at tickets, all paper tickets. It was like 2003 or so. And then I would ride around with Danny all day and he had a route as the owner, he had a route and I would just pick his brain, Pick his brain. And I remember one day, I'm like, Danny, so like your tech, your pest control technicians are also the salesman. He's like, yeah, they're incentivized directly based on what they sell. And then after they sell a new account, they have to service it. I'm like, well, that doesn't work. Like, what, what happens when they're too busy to sell anymore? He's like. And he's just like, laugh. I distinctly remember this. He's like, that's never happened. That will never happen. Like, that's just not like, it's just not how it works. And now looking back, I'm like, oh, that's Parkinson's Law. Like, that's Parkinson's Law. Like the time and the resources expand to fill the space allotted to it. So like they always have time to sell new accounts. And Danny was never satisfied by hearing like, I'm just too busy. I'm just too busy this week, boss. I'm fulfilling all these accounts. No, there was always time to sell new accounts and their revenues would grow every year as a result. So I'm not putting that on you. I'm just saying, like that question reminded me of that conversation that I hadn't thought of in years.

So when I said they, they would probably make that dollar amount. But if I was going to hire someone or when I worked at bang, when I did hire people, you just make it commission based. Like, I would be like, hey, you get 6% like you want, you give them a percentage of sales. So they're out there just every store, like, ooh, I could clip strip another jerk. They're gonna want to. So they will naturally grow it, like. But yeah, that's, that's. That's why it was a hard question. I was like, I don't know. I still have so much time to add account, so I don't know when that would actually stop.

And you're trying to be conservative. Right. We're not trying to paint this rosy picture where, like, it's perfect. Nothing's ever gone wrong. I've never got a flat tire. I've never lost a customer. Like, no, it's real business. Right. Speaking of, what is your churn like, like in Montana? How many accounts have you lost since starting this business? Business?

So I think of it right away. I lost one.

Okay.

Which is usually I won't.

One percent annual churn.

Yeah. Pretty good. Pretty good. Yeah. One. Yeah. I lost one account. And I think about it all the time because, I mean, I was so excited. I just got these accounts. So it's like when I lose one, it kind of hurts your heart a little bit. You're like, what did I do wrong? But there's competition. I mean, there was another company that was a large wholesaler.

She's.

She's been on this route for years, and she kind of just talked the store out of it.

Gotcha. So you had just got the account and then she stole it from you?

Yeah. Probably like four. I had it for about four months. Three. Four months.

Okay. Okay.

And then she. She already services the whole store, but she was seeing how much I was selling, and she was like, I have product just like that. Let's just use mine.

Yeah.

But the cool part of that whole story is when I went there and they said, no, we're no longer servicing you, I was like, you know what? I'm going to go get another account. And I started driving around googling, trying to find something, and I got a store that does way more. I walked in and I've been to this store several times, and they always told me no. I went in this time, new store manager, he was like, yeah, bring whatever you want. Bring it in. I was like, sick. So it just. It just works out. So I've lost one store, but ended up working out for him.

Okay, what if you were to guess, like, well, let me just say this. What? How long would it take to drive from One end of the route to the other. How. What's the radius like?

Yeah, so I, right now I'm servicing, I'm in Billings, Montana. I service about a two and a half hour radius all the way around. And what's cool is like these little towns have just, they're local, so they have like little independent gas stations. So. Or independent grocery store. So in some of my best stores are in the middle of nowhere. You would never guess that this store that's the size of your bedroom. I drop fourteen hundred dollars every time in there. You just would never know.

No competition.

Yeah, no one wants to drive out there. But I mean, I have more time than money, so I just, I go for it and I enjoy it. The whole plan is to hit as many stores in a small amount in time as possible. And that's why like Colorado, so nice because it was like 10 stores in a mile. But yeah, here it's just a nice little loop and it's usually like seven hour day.

And what gun to your head, if you're not able to expand this footprint at all, you've got to keep finding new accounts within your most outlying cities. How big can this business get? Another way of asking it. What percentage of the market do you have today? Which is a total guess, but humor me.

Yeah, so the percentage, I don't know. That's a tough one because in the stores, if you go into a store and you look at like all the products in the store, I'm probably like 4%, 2%. Like I'm nothing. Like I said, there's one wholesale company that he does, they do all the candy and you think how many candy bars, candy, jerky, they do all of it. And then there's Frito Lay that does theirs and then Coke and Pepsi. But for the category I'm hitting, I mean, I'm only a small portion, small part of it. So right now I'm still trying to grow my customer base, but now I'm growing within stores. And what's been really cool is because I'm servicing the store. So I go in there and merchandise and do my thing they want me in. So there's stores that go, hey, I haven't seen my other wholesaler, the sales rep, in six months.

He's a loser, dude.

Yeah, he's a loser. Yeah. And they see me every other week if they want to or not. So it just gets a Christmas card from you? Yeah, exactly. And it makes it so easy because they see me and they're like, hey, do you want to Take the space. So I just recently had a chain, I think they have eight stores. And we're in conversation of me just taking over the whole jerky section for all their stores. And that's just because they, they don't. That big company, there's, there's out of stocks all the time. They have out dates that they're not buying back when they've seen me do this. So they, they rather just me do it. So those conversations are just becoming easier now because I've proven myself.

Yeah. So you're known for the dry goods. But what if you were to roll in one day to one of your best customers that really likes you with a case or 10 of Celsius, something they're already selling and say hey, you're paying $1.13 for these. I got them for a $13 buy from me. Now could you be able to do that if you wanted to? And if so, what are the chances they would start buying from you instead of their other guy?

They would. So they would definitely buy through me. Like that jerky section I'm telling you about is I'm bringing on big name products like ones you'd see in every stores, like every jerky set.

I'm bringing those droppers, my favorite old truck.

Well that's, I'm just bringing, that's coming on.

It's my go to.

But yeah, so that's. Yeah. Shout out. There we go. But yeah. And I'm going, I'm able to be drastically lower in price than these guys and I can I merchandise it. So a lot of these stores, if you're cheaper and you have that relationship, they're going to just buy it through you. I have a, another four store chain that he was like, if you could bring in this brand, I'll just buy it through you. So that at this point, even a year in the relationships are so good that they just, they're naturally shoving me in their stores.

Yeah.

I walk in and they go, hey, this product. And so I have this whole section. What do you have to put there? I was like, oh, I have so much stuff.

So of your 100 ish accounts, call it 4% market share of the actual stores, like inside the stores. Okay.

Yeah. And maybe even less, but yeah, something around there.

Okay. Now anecdotally you're driving through town. You drive by, you know, 10 gas stations inside your route. How many of those are your customer in any given.

So that's tough just because a lot of corporate like there is like corporate chains and I always Tell everyone, is.

That like out of touch entirely or.

Just harder to get at the beginning? So when people first start, they should not even try to mess with it because there's such a large management. You got to talk to the buyer and it just, I mean, so let's.

Just say independent stores.

Yeah.

You drive by Independent. 10 independent stores that could be a realistic customer today, now, in the future, racetrack, QT, whatever. Maybe you're not worried about that. 10 independent stores in your route. How many are your customer today?

I would say 8.

Okay. 80% market share of that kind of type of store within your route. Amazing. And within that market share, 4%. And I mean, other than like there's going to be like some lotto and like beer and alcohol or like cigarettes that maybe stuff. Some stuff you don't want to sell or has more regulations you have no interest in, or like fresh foods, you don't want to mess with that. But like, let's just say theoretically, could you get to 50% market share inside a store selling products that like, you could acquire?

I. 100.

Okay.

It's. It's super common. I have a guy up north that he sells and he. I mean, he does cigarettes and stuff. And you could. For like the, the candy and all that, that could all become a lot larger. Like I said, at one of my best accounts, I do the whole jerky section and I'm probably about 30 of the candy. So it's like, it's slowly.

Yeah.

Going that direction.

Chips are next, baby.

I know. I'm not. I'm trying to stay away from dated issues I like.

Yeah.

Not worry about it. Ever.

Simplicity. So if you were to take your current account and grow them to 50 of the store, then your business is 12 times bigger. You're doing 6, 7.2 million a year with your current customers. Half market share. 80% market share. You know, almost twice that. We're looking at 12 million a year in rural Montana. And it all comes down to relationships. Of course. At that scale, even with the same number of customers, it's more volume. You'd need bigger trucks, you need more employees. Of course.

Of course.

But like, that's just incredible. Like, I. I'm obsessed with this business. I've done wholesale iPhone, part distribution, battery distribution, smartphone distribution, crypto hardware distribution, snack distribution. Today I've done wholesale retail. Like, I know this industry. It's. It's a great industry. You just. Yeah, I just. I love this story.

Yeah, no, it's amazing. I. I love it. And I. Like you were saying like there's so much room. Like who would have thought a small place in Montana, a business like I think about this all the time is like a year ago there were zero dollars were being made from this business. I just went out and just grabbed some random products. I didn't compete with no one else's. I don't use the same brands they do. And I just put them in the stores.

You just grew it and the pie.

Yeah, I grew it. So it's, it was like free, it was free volume. No one was no one it. So yep.

And like with the, in the age of AI. And I'm not saying this is a bad thing, right. I talk about AI tools every day. I love AI tools. They're, they're amazing. But in Billings, Montana today, there's hundreds, dozens, thousands of 20 to 50 year olds playing around with AI tools, vibe coding apps from the comfort of their, their 68 degree apartment. And they're building stuff and they're builders and they're contributing to capitalism and their community and society. And that's great and good for them, but that just means there's going to be fewer and fewer people like you wanting to get outside in the negative 20 degree cold in this case and get their hands dirty literally and like drive across Montana to make 50 grand a month. Like, I think the outlook for this business is better than it ever has been because AI is growing the pie, the entrepreneurial pie. So much for so many people. The sweatier startups are going to get even more profitable in the Future.

Yeah, yeah, 100%. And I wanted to talk to you about this because everyone, everyone always compares this and I know you have interviewed a lot of vending machine companies and everyone compares this to the vending machine world and talk about that. I don't know, I, I've never owned vending machines. I don't know if you have. Was that ever something you got into?

I've sold them, but I've never like placed and filled vending machines. No.

Yeah. So that, that market right now, everyone's just talking about, they think it's the best passive income and whatnot. But what's cool is like this is the same exact business plan, 100% the same business plan as vending machines. Like they go just going in a bigger box. Yeah. They put it into a box. They paid for several thousand. They have to maintenance those vending machines when I'm just selling it directly to like you said, the bigger box, a bigger store with like they're, I don't Know what profits they're doing, but mine's like, I'm doing 800 drops in stores. And those VIN machines with way larger.

They'Re doing that like every four months.

Yeah, four months. And you make 200 bucks and they're happy.

Yeah.

So it's just crazy that no one thinks about this business. And that's why I made a YouTube, because I had enough people asking me. I was like, you know what? I'll post on this.

We're gonna link to your YouTube for us. Okay.

All right.

We're gonna link to it. Dude. What? Like you frame it against vending machines and my brain is melting right now. It's like, what? Like, I'm sorry, every vending machine guru out there, like, selling a course. But this is, this is better. Like, this is objectively better. You don't have to buy a $3,000 machine that breaks where you need a thousand dollar credit card reader on it where you have to replace the snacks all the time. Where, where, like, you, you might lose the location where you're going to have to test 12 different locations to see which one works. Like, it's just better. And I've interviewed vending machine guys, an ATM guy, a guy in San Diego. It can be a great business. Like, I'm not cutting down the business, but I'm saying when compared with this, this is better. It just is.

Yeah, because with those VIN machines, like you said, are like three grand. And then you have the card readers and you have the swipe fees and all that. I don't have any fees. I don't, I don't accept. I don't do card payments. I don't do none of that. And where I put my product is on displays that my manufacturers give to me for free. So where I'm putting the product is free.

My gosh, this is so good. All right, what's the, what's the how to guide? How can people copy you? How can they get in this business? Like, how can they avoid headaches that you weren't able to avoid?

I would say the big one. Everyone, when they, they want to start this, they want to reach out to these Walmarts and targets and stuff. I would tell everyone, I was like, just stay away from that. That time can come. Right? But preach your independent everything. Like, I do hardware stores, I do lumber yards, liquor stores. Just focus on independent and, and find a really good local product. Like, if you have a good local product, it's so easy to sell these independents because you're like, hey, this jerky's from Billings. It's local. Supporting local. So, like, yeah, that sell is the easiest. Everyone always wants. I've had people reach out, like, hey, I'm trying to sell Frito Lay, or I'm trying to sell Coke. I'm like, I try not to compete at the beginning with these big companies because you're just going to compete on price. Right? Like, and they're going to win in the. They have that money, they can drop the price. So you want to be something different?

Um, yeah.

And I. If I told anyone to start, I was like, just find something local and find a few stores, drop a display and just start small. And if it doesn't work, never. Like, I've. I've opened up pretty much any kind of account you can think of. I've done auto parts stores. There's local ones. And I think, try everything and see what works.

Test everything except drugs. Now, now, this may be an ignorant question, but if I'm driving by a gas station and it's branded as, like, a Shell station, right. Or as a BP station, is that independent? Because it doesn't say racetrack or QT or whatever. Or is that kind of a big brand?

Yeah. So I'm happy you noticed that, because a lot of people think because it says Shell gas station, it's corporate. It's not like there is some chain accounts that will have Shell as all their stores. I always look. I kind of ignore the gas and I look at the store. Like, when I'm. When I was first building this route, I was going on Google and I was zooming in, and I'll just sometimes even do the map view and walking around the store, and I go, this is independent. Like, you could just tell it doesn't have. When you know your area, you know, like, town pump, or you know, these companies that are chains, and you're like, okay, Jake's gas station's not a chain. Like, so, yeah, it doesn't matter about the gas. Just look at the actual store.

Anything else that beginners can do to be successful to get their first account to go from zero to one. Like, what is. What is something people can do to increase the likelihood of getting that first account? Because that's going to be the hardest.

Yeah, the first one is the toughest. I remember my first day moving here. I moved here, I got the house, I bought the house or whatnot. I was all in. And I remember driving in my truck with my trailer, trying to get my account the first day. And it was stressful. But once you get that first one. The. You have like the biggest relief. You're like, okay, I'm doing the right thing. And pretty much what I did was I would add two sell sheets. I had a sheet that had all my prices on it with all my products. And then I had like, like a one pager. Pretty much like a fun pit page I printed, I made. It wasn't fancy and it was like number one gummy worm. Cheapest pound bag of jerky. What? Just whatever facts you wanted to put on there. Because when you're selling it to these stores, if you just flop your big product list at them, they're going to be overwhelmed. They're not going to actually pay attention. Yeah. So you just give them, you give them the one pager that has some fun photos. And I always tell them, okay, let me go grab the product. Now that's the best part about having it in your vehicle is you're putting them on the spot that second they don't have no time to change. So I'll just be prepared. And don't feel bad when you get your first. No, I mean you're going to get several nos. And now I feel like I'm numb to it.

What's like your no rate. You walk into 10 stores that could be potential customers. You give them as good a pitch as you ever gave them. What percentage of them say no at where you're at today, it's gonna be different for a beginner. But today.

Yeah. So at the today I've hit a lot of the stores and they've already gave me the notes. So I'm not revisiting those all the time. But at the very beginning, I would say four out of ten would say yes. And. And maybe some weren't right away. Right. Like some do take. So how I would set it up is I would. I had that list of stores, I would hit those stores even if they didn't say yes yet right there. I put them on Tuesday. I hit this store every other Tuesday and I kept following up every other Tuesday even if I sold them anything or not. And usually the second follow up is usually when you get them.

Okay. What a good strategy for finding. So that's acquiring a customer for finding your first like food company. Would a decent strategy be to go to a big chain, like a big. Call it a racetrack. You go into a big gas station and you find what looks like a regional brand because you're not going to be competing with them. You're not trying to close racetrack. Find kind of like an independent or a regional brand there and then reach out to them from that because you know they're already in gas stations in your area. Is that a good idea?

Yeah. So what's, what's cool is like my first jerky. I started with. They sold some of those in the corporate stores, but they did not sell them in any of the independent stores.

And I'm sure they wanted to.

Yeah. So it gave me the, the, the feeling. I was like, you know what, sell it. Like this big corporate chain is not going to let this product that's not selling in their store. They're gonna already kick it out. So it gave me faith that if I brought it to the independence, it should just be just as successful.

Yeah. Okay. And I imagine it's a lot harder to find your first account than your first food company willing to take a flyer on you, right?

Yeah. The first account's always more tough because when you talk with these products, they're so excited and like, what's super cool Some of these companies are they want distributors like you, so they will do anything. My first jerky company, my second week on the job, I told them, I was like, hey, you want more accounts? Come get with him, come get him. And he, they shipped out a salesman and he opened up stores for me with his product. And I mean he didn't, it was just, he wants to sell. It was a market he wasn't in. So they went out there and he went out and sold a handful of stores and then I went and sold some and that, that's where the route began. Became.

That is beautiful. Dude, my brain is melting. This was like I had high expectations. You've exceeded them. Forest, you're incredible. You are inspiring entrepreneurs. How old are you?

34.

34 year old dad of two.

Yep. One more on the way. We're going to be three in a couple months.

So we're calling it three because it's alive in your wife's stomach right now. So yeah. 34 year old dad of three. You are contributing to this great country, America. You're inspiring people, you're contributing to your local community. You're doing a lot to be proud of. So I applaud you. Where can people find you if they want to learn more?

Yeah, so I have a YouTube right now. It's just cost wholesale and I just pretty much that YouTube. I think my second week starting, I was like, you know what, I'm just going to film my journey and you'll see if you ever look at it. My first video I'm in a little storage unit. And then I'm going, my little beat up trailer that had a hail, hail marks all over it, broken fender. And then now it went to a nice box truck. And then so it's kind of cool. You could actually see the steps. And then I have a school community. I gave it a whirl because I had enough people asking me how to do it. And I, as you can tell, I love talking about this. So if people want to start it, I love helping. It's a business. Like we talked about, the vending machines. Everyone wants to do that. I was like, I really try to push people. I was like, this is something you can do also. Anyone can do anywhere.

Yeah.

Because it doesn't even have to be like gas stations. I mean, you can sell. I know distributors that sell syrups to coffee shops. I know here in Montana. This is cool. You'll love restaurants.

Straws, napkins, whatever.

You'll. You'll love this business. I met this couple, I think they're 60, 65 years old, both. And. And they have a big trailer and they have a truck with a can camper on it. And they stay in that camper and they will go and they sell novelty stuff. They'll sell fishing hooks, they sell teddy bears, they sell made in Montana T shirts. And they travel and they spend the night in their trailer and they have the greatest time doing it. And they're dropping several thousand dollars off. They go every other couple months to a store, drop off few thousand bucks, never to see them again. And that's their business. They sell shot glasses, pocket knives, headphones. They're the novelty. And they're just the coolest older couple. And they just out there, just get in it.

That is incredible. Oh, I love business. Thank you, Forest. This was incredible. We'll link to everything and thank you.

No, I appreciate. I'm. I mean, like, I'm super excited about this because I know everyone says it, but your content. I love it. Just because everyone's afraid to pull the trigger on something. And sometimes I think people just overthink it. Like you said, like, yeah, I brought on a few brands and I post on my YouTube and people go like, ooh, that seems risky. Worst comes to worst, I never do it again. Like, it's just. Just do it. And it's so fun. I almost think I'm less of a planner and more of just a doer.

Like, no, that's. We're the same and oh, maybe they shouldn't. But those little one off comments that seems risky. Those just really annoy me because I think they're. They're almost out of jealousy, you know, like, they. They kind of don't want it to work for you because they're not following their dreams. Right. And if yours don't become fulfilled either, then they feel better about themselves, you.

Know, about not making.

Maybe I'm overthinking about it. Yeah, it's like, it seems risky. It's like you're like, dude, I. I know this business better than you, and it's not risky. It's calculated. Like, I know what I'm doing anyway.

Yeah. Because if you sell something to a store and it doesn't work, you just never do it again. I mean, and you made money that first time, like.

Yeah. Put it in your pantry and eat it.

I mean, I have so much. I have random products that I'm just eating all the time because that one didn't work. But you know what? It tastes good to me, so.

I bet you do. Well, let. Let me ask you this last question. What's your favorite jerky of all time?

Oh, this one's tough.

You have to choose.

I would have to choose. So I'm going to say I'm name dropping them. They're my best customer and it's called Ranch House Meats and Billings. And it is the best jerky. They make jerky sticks and like packs of them. And they have, like such unique flavors. I think that's what helped me so much. They have, like, Hawaiian pizza and they have. What else? Green chili. They just have cool flavors. And that's been my number one seller. And I would have to say that's my favorite. I'm name dropping them.

Ranch House, dude. Well, hey, we'll link to them too. We'll support them. Ranch house meat, singular.com. garlic pepper spicy barbecue. Teriyaki Original pepper inferno. Sweet and spicy. Love it.

Awesome.

Thank you, Forest.