Building Brands: The Reality of Market Expectations
In this episode of the Drink Up Live Podcast, host Sam Anderson (Speaker A) welcomes guest Adam Smith, an operations expert and founder of Alias Advising. The conversation opens with light‑hearted personal anecdotes about family names and a historic pool hall owned by Sam’s grandfather, establishing a casual, storytelling tone. After a brief sponsor shout‑out (Bev Assets, Jay Williams, etc.), the hosts dive into the core challenges faced by emerging beverage brands. They debunk the common belief that a new brand can scale to market dominance within 9‑12 months, noting that most brands face high failure rates and unrealistic timelines. Sam highlights the steep cost‑of‑goods (COGS) pressures, citing typical aluminum can costs of $1.50‑$1.65 and the resulting need for retail prices around $14.99 to stay competitive, forcing founders either to reduce COGS or operate at a loss for the first few years. The duo then outlines a data‑driven sales activity model: Frontline Beverage, a joint‑venture between Frontline Beverage and New Line, deploys about 100 sales reps who each carry a “bag” of six brands and are expected to make 20‑30 pitches per week. They stress that activity (pitches, tastings, displays) must be paired with activation—working the distributor and the on‑premise accounts—to avoid the common pitfall of “distribution without activation.” They discuss broker turnover, the importance of sticking with a broker long enough to open the first “inch” of market penetration, and the need for measurable conversion metrics (e.g., 1‑2 accounts per 30 pitches, 20 % reorder rate). A significant portion of the conversation turns to manufacturing constraints. Adam explains that lids and tabs are produced as a single unit at aluminum facilities such as Ball, with raw aluminum sheets stamped and the tab added as a secondary application. Customizing lids—such as aligning tabs with branding or adding new features—would require slowing down the high‑speed production line, potentially costing millions of dollars in downtime. Sam and Adam discuss the chicken‑and‑egg problem of securing major customers (e.g., Molson Coors, Coca‑Cola) before a manufacturer would invest in such changes, and they propose reaching out directly to Ball or industry experts like Joey Gamer to explore feasibility. The conversation also revisits product opportunities like “Safety Sip,” a patented plastic ring that prevents hand cuts when opening cans, and broader market trends toward malt‑based RTDs, low‑ABV beverages, and alcohol‑infused confectionery. They explore regional co‑packing strategies to reduce freight costs, weighing the benefits of local versus centralized production and the operational complexity of managing multiple facilities. Throughout, Sam and Adam exchange practical advice, anecdotes, and occasional humor, emphasizing that building a brand is a marathon of consistent sales effort, data‑driven adjustments, and strategic partnerships. The episode concludes with a recap of key takeaways: realistic timelines, rigorous cost analysis, disciplined sales activity, and the importance of activation and data in scaling a beverage brand.
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Which is good, man. It's kind of good with the role. Good morning, everybody. Welcome to Drink Up Live Podcast. It's just my good friend Adam Smith. And by the way, Adam, I know I've told you this, my mom's maiden name is Smith. Yeah. So we're probably related somewhere. I don't know if your family helps.
I'm sure we are. I'm sure we— that's hilarious. Well, my, you know this, my wife's last name, her maiden name is Johnson. So that was the joke that she was going from like, the 3rd most common last name in the world to the 2nd or some shit when we got married. So yeah, it's just generic names all around.
Yeah. Anderson, Smith, Johnson.
Uh-huh.
We, uh, I don't even know what, uh, nationality Smith is, but my grandfather, Council, was a Smith. But welcome everybody.
Council Smith.
What's that?
His name was Council Smith.
Council Smith.
That's badass. That's a good name. Anyway, go ahead.
He was, uh, he was badass, man. I, I can tell you he was, uh, on a pool hall. In Bradenton, Florida called the Bradenton Recreation Center. And he made hamburgers and sold beer. And you know how he won that? He won the pool hall, by the way. He didn't buy it.
I assume a fight.
So they went out in the back alley and the guy was getting ready to retire. So I think it was like 7 guys went in the back alley and they fought for the bar and council.
That's amazing. Yeah, that's amazing. It sounds like your retirement plan, Sam. You just go back to doing what grandpa did. You run a pool hall.
You know, I actually had a dream to do that. My Uncle Lawton actually, um, uh, ran it for several years and eventually sold the pool hall to someone that wanted to dress it up and make it all fancy and stuff. And it happened during COVID And guess what happened at the pool hall?
Oh, it shut down. Sure.
It shut down. It doesn't exist anymore, which is really sad because he was known as the, the Hamburger King of Bradenton, Florida. Matter of fact, Pittsburgh Pirates would go in there and, uh, You know, have hamburgers. So, and then the attorneys from the courthouse across the street would go in there.
Sure.
Oh, but the stories that the pool hall could tell you. And then he had like this, like, uh, in the front where he had like different things, like his whistle from World War II or this like, like jar with a rattlesnake in it and rattlers and coins and all this kind of cool stuff.
Sure.
You know, counsel's like, if you want some chili, a beer and some chips, great. You know, it was not messing around, right? But people had a nice business, but he wanted in a fight, you know?
And it's hilarious.
So maybe we should just talk about like some of our sponsors real quick and we can kind of get in it this morning. Sorry to digress. Uh, I always have to call out Jay Williams. Yeah, we love, we love Jay. And, and, uh, you'll always, even if you don't want to sponsor us, we're just going to make you sponsor us. So, but, uh, we love Free Bird and everything that, uh, Jay represents. But, and then, uh, calling out Alicia Vargo, my business partner and owner Dismiss recording. We'll continue on a new track. All right, cool. You're on a new track, but thanks Bev Assets for sponsoring us today. Bev Assets helps customers or helps suppliers find distribution and customers and many more things. And then Adam, Alias Advising, Operations Expert, right? What do you do?
God, I tell stories. The short version is funny. I was talking to a gentleman about this this week. We had a good conversation. He was actually a an introduction from our friend Tiffany Putland over with Smart Start, her and her husband Kurt. So, so hello Tiffany. And if you don't know her and Kurt, I suggest you do. They're good people. Yeah, it was just a referral from, from her. And she said, hey, you know, I think you guys, you know, you might be able to have an interesting conversation. And we are, we had a first one and we've talked a couple more times, but I'm talking to this gentleman, his name's Eric. And he goes, I feel like you're underselling yourself.
And it's a nice thing.
'Cause I, I don't really ever wanna oversell myself. So yeah. Uh, and, uh, I was like, well, the short version is, you know, operational project management for beverage, but the longer version is, you know, the glue, the adhesive, the bridge, the link, whatever you wanna call it. Right? Like all this shit has to work together. And I'm not saying I'm the best at it by any stretch, but, you know, I've been around the block enough times. I have friends like you. And so the connections make a little bit more sense in my mind than I think they do for early stage brand owners. And so. That's what I do, right? I help with the ops. And then, you know, if you need a, you need a link to Sam or you need a link to Ryan and Rocks and all the things that they do outside of ops, but including ops, or God, who else you need a link to, you know, the Eric Martindales of the world or the Josh Arringtons or the Nate Culls. I mean, the list goes on, but that's what I do.
You're a connector. Yeah. Which is awesome. And I guess we should call it Rocks and Ryan. We invited him here today, but I think he said he had a softball. Yeah, I don't, I don't think he's playing softball today with this weather, but possibly.
Well, I was going to say there, uh, that whole part of the country is just, I mean, it's funny because everybody, you know, we get on the, I know this happens to you. We get on the phone with people and they're like, how's it up in Minnesota? I'm like, it's fine. Like, isn't it cold? Yeah, but we have all the toys for dealing with it.
Yeah.
You don't.
It's a daily occurrence here, man. I mean, matter of fact, uh, I think when it gets, when someone says, I'm like, it's 25 today, I'm going to go for a walk. I'm like, what? I'm like, yeah, it's like a balmy 25. I'm going to be out there. Uh, going, uh, uh, for a walk. Well, let's get into it. Uh, again, uh, Robert, good morning. I did do the video that will post around 12 noon today, by the way, to talk about, I don't know, his FOTL. I can't remember what you, what it was, but you can, you're probably going to reply back to me. But yes, the Pirates in Bradenton, Florida, a lot of history there, by the way. When I played baseball in high school, to let you know, a lot of Pirates actually coached us. They'll let you know. They would come over to our school and work with us. And I wasn't a great baseball player, so don't let me lead you to believe that, but I tried first base, outfield, and I was a pitcher and a catcher throughout my life from all the way from Kiwanis League to Little League. And then I obviously played tennis all my life. And then I went back to baseball my freshman year in high school for about a year and gave it a go, but that was the extent of my baseball career. So—
More than mine was.
This morning, um, Adam, I posted a couple things out there. I don't know if you saw it, but, uh, um, I wanted to talk about something that's been on my mind. It's about when brands come to market, we're getting in a little bit today. They all expect, or many expect that they're going to scale it and sell it in about 9 months to 3 years. Um, and it's just not reality. Maybe some do. I mean, certainly some brands punch through.
Mm-hmm.
But then it's just, just not a reality. And also there's a high failure rate with brands, but I wanted to talk about some ideas there. And then the second piece I'm going to talk about operationally from your standpoint, you know, when a brand comes to market and it goes into a can or a bottle, you know, the distillate, the whole bit, because this last week I've been talking to a lot of people. We do like these, uh, 1-month to 3-month sprints. Alicia and I do, we do these commercial plans. Matter of fact, there's a few people I need to connect you up with. And I get into the cost of goods and it's really fucking scary. So I'm looking at can prices and can prices like $1.50, $1.65. And then I start to equate that, you know, put that in like $1.50 times 4.
Uh-huh.
Then there's a distributor margin, there's a retail margin, and then there's a competitive set on the shelf. I'm looking at the damn can at $1.50. And I'm looking at this founder. I'm like, look, you gotta be $14.99 to be competitive on the shelf. And they get pissed. Like, I can't do that. I'm like, well, I don't know what, you're not gonna probably get a chance in the marketplace if you're not at that price. So you gotta put the, either get your cost of goods down or you gotta plan to lose money the next 2 to 3 years to get your volume up to meet the market.
Mm-hmm.
Not saying that there's not people that punch through, then they throw the Tip Top cocktails at me. Like, well, Tip Top's at, you know, this price. I'm like, yeah, it's a specialty item and it's a small can. I said, go small then. Do something different in the marketplace. So I wanted to kind of get into like cost of goods, cans. Matter of fact, one came up last week. We've actually connected you with this client actually. Um, she had some cans out of New York. I'll just give you a hint to who that is.
Oh, I know who you're talking about.
And, uh, you know, she does have a date on it. Thank God. 'Cause we want to move those cans. Right. But then she was trying to decide, is it good for a year, 18 months? You know, the whole bit, what happens with that. So I wanted to kind of get into that. And then the third piece of, we could talk about, um, you and I have talked to Jared Lane. I invited him here today. I actually invited a few people, but everybody turned me down.
That's okay.
So strike 3.
Yeah.
Robert, strike 3 for, for me. But anyway, Safety Sip. I want to talk about Safety Sip a little bit. I just want to get into it a little bit. He is still battling. To get that thing rolling, you know he's talking to you know I'm in a group with him and and I'd love to help him anyway. But basically what safety sip is we'll get into it. But basically this gentleman made like this plastic ring that's food grade. I think as a matter of fact, I just cut my hand. But you go to keep you from cutting your hand. What I just did, by the way. But to for safety. So when people there's a lot of there's people he cuts pretty minimal, but it's actually pretty cool. But he puts it on the lip and then also on the thing, and he has a patent to it, and he's trying to find someone to actually produce. this safety sip for safety. So I just, I'm curious on that. So maybe we get into it, um, in terms of the, the flow here. So why don't you ask me some questions about my first subject about how brands are built and I'll, we'll reverse and I'll ask you questions about operations.
Does that work? Yeah. Well, so I think, and it's, it's funny, my, my version of this, and I think this tracks, I hope it does, is like, especially, I think, I think I've had enough coffee now, so I'm a little teed up. I think in all aspects of the business, but especially in sales, right? There's this, and you correct me if I'm wrong, but there's this assumption from brand owners that like, for example, if you put, 'cause we were talking about this a little bit before we got on, if you put a scope in front of them that said, you know, I, Sam, or I, Sam's team, commit to, you know, having this many conversations a week. Visiting this many stores a week, doing this many samplings a week. Like that's very trackable and measurable, uh, deliverables, right? Like that's a, it's not sexy, right? It's very day in, day out grindy kind of work, but it's a, it's an actionable plan. On the flip side, if you were to write a scope or anybody in your shoes that says like, hey, we're going to get you in X number of accounts in 30 days. That's sexy as hell. It also sounds exactly like the, you know, one weird trick fat loss bullshit that you see online, right? There's no magic bullet. There's no magic pill. There's no like, hey, do this one thing and then all your problems will go away. But I think brands, and I'm putting words in your mouth, I think brands take that same mindset into working with somebody like you. And so I guess my question that comes to that is like, How are you looking at reframing the way you have conversations with people to try and set that expectation early on?
Yeah, so let me take that, but let me do a shout out. First of all, Jennifer Howe, thank you so much for joining. That just made my heart warm. Bring them some questions. We're here every week, Jennifer, and I need to get down to Orlando and break bread with you again soon. I'll be at NBWA soon as well. And then Robert, obviously, thank you for joining us as always, and we'll get into some of your commentary. But to answer your question, um, we were talking about it earlier. When I started this journey 3 years ago as an entrepreneur, the conversation was much different than it is today with many of the clients that we talked to. I was probably the person that told them what they wanted to hear. Okay.
Sure.
Oh, sure. I can get you in 30 accounts in 30 days. You know, we would look at these KPIs and that comment does a disservice to the client. We can have a— so the difference is we can totally get to 30 accounts. You know, we can do like 0 to 3, 3 to 6, 6 to 12.
Fine.
So, so the conversation now is it's about activity and you said it, it's about conversion. So we, we actually created a company, um, called Frontline Beverage with New Line. Paul Henson owns New Line and Alicia and myself do BevAssist. We created a joint venture with about 100 sales agents across North America. But it's about activity. It's about pitches and it's about actually going out in the wild and sitting on a bar stool, going into an account, getting a pod, a display menu. So when we talk to our clients now, we're like, look, our partners, our sales agents, we like to call them partners. They go out in the marketplace and they pitch your brand to that packaged liquor store owner, that manager, bartender, you know, so on and so forth. So we talked to them about activities. We promised them 20 to 30 pitches a week. You know, and then, and those pitches are pitching for a pod. A display, a menu case.
Mm-hmm.
I don't have a crystal ball though.
Mm-hmm.
In terms of what's gonna happen, but what I can guarantee you is that you're going to get communicated every week who we talked to.
Yeah.
What account we went to and what the outcomes were. And then that data's gonna aggregate. And as a team, we're gonna start to make decisions. Also can guarantee you that we'll look at your current pricing strategy, who your competitive set is, what you're currently selling, and determine, okay, where are you successful and not successful? Where you're successful, those are the places we you target. And then the final thing, I'll guarantee you this, is where you win, where you're winning, let's go back and win there more because distribution doesn't matter. It doesn't matter if you don't activate it. So many people get distribution with a distributor and they disappear. Drives me nuts. I'm like, now that you have distribution with the distributor, you got to go work with the distributor and you got to go work the market. And if you do those things, work the distributor, work the market, one account at a time, one barstool at a time, you're gonna grow your brand. You won't be in the 90% of the brands that fell because you've worked your brand. The reason 90% of the brands fell is because you don't work it. Anyway, does that answer your question? I went too deep.
But, um, no, no, it, it, it totally does. And I, I think, um, it, it, um, and this is kind of, and I'm not trying to get us into the second tier prematurely, but, but I think it blends into, uh, the COGS conversation. And so like, for example, I spoke to a Minnesota brand, um, who I know, you know, um, but for the sake of letting them deal with their, their hurdles, not problems, everything's good. Their team's great. Uh, they're wonderful people, but there, there are hurdles and challenges, right? Um, in private, but they shall remain nameless. Um, had a call with them this week with, um, another local group up here and they were kind of what, you know, it's a father and son team and, and, uh, the wife's involved as well, but they were kind of walking us through some of the, the struggles they were having. And, and I said, well—
See how Adam thinks when he thinks he looks the other way, by the way, he's thinking deep about this whole thing. So give me, give me a look at the camera.
But they, uh, they, it's a good reminder. They were saying that they, uh, they were having issues, you know, they, they had done a big production because, uh, distributor had said they were gonna take on X and then that deal fell through. And so now they've got all this product and they're sitting waiting on it. Right. And trying to get it sold through. I got looped into the conversation because they were like, well, you know, maybe it's our COGS, maybe it's operational things. And the more they tell me the story, I'm like, guys, don't get me wrong. Like, I think you have a little bit of opportunity in your COGS, but your COGS actually look pretty damn good. I mean, they're, they're south of a dollar. It's a non-alch brand, so it should be, but they're south of a dollar.
Holy cow. Yeah. If you're south of the dollar, you can play in the arena, man. You're, you're ready to, you're ready to go. You're at bat, man.
Um, you know, and so, and that was my, my comment to him. I was like, guys, you're, you're south of a dollar. And, and, you know, maybe that doesn't include free fills. Maybe it doesn't include freight, but I mean, you're right there. You're flirting with a very, a very doable COGS. Um, so, but you're telling me you're in all these distributors, you know, from, from here to, you know, neighboring states, but I'm not hearing that you have a team to go support those distribution channels. So high level, Dial it back, go pitch it yourselves, stay hyperlocal, go get into more on-prem accounts, you know, non-alcoholic bars and restaurants, offerings outside of just fucking Diet Coke. It's a simple answer, right?
Yeah.
But again, that's not the sexy answer, right? That's not the, well, we're going to go open 3 new accounts tomorrow.
Well, everybody wants to go play in the ocean and there's a river and stream sitting out there that you should go sit in that there's so many accounts and I always talk about him, Adam Corner. Adam, you should come on, man, and, uh, talk to us. Uh, he's a wonderful person. I've talked to him a few times, done some business with him, but Adam built Car Bliss in Wisconsin and he did it one account at a time, one zip code at a time, one city at a time, one community at a time. And then he went to the state and he outsells Tito's. I don't know if it's 2 to 1 or 3 to 1, but he outsells it. And the reason he was able to do that is the accounts that he goes into, he activates those accounts.
Mm-hmm.
He doesn't just go get some blanket distribution. You know, you know, index, you know, go ahead. Sorry.
So I want to ask you, because it'll be good selfishly, it's good fodder for me. The people that are listening might already know this, but say, say, you know, Alk or non-Alk, I'm talking to Joe Brand Owner.
Yeah.
And they're a one-man band, or maybe it's them and their partner, but it's hyper small team. What's a good Like from your perspective, what's a good metric if you are, you know, the sole salesperson or, you know, the, your partner, your spouse, your son is the sole salesperson. Like what's a good metric for number of conversations to have a week? Is it 30? Is it 10? Is it 5? And I know there's a lot of variables there in terms of, well, are you talking to on-prem, off-prem? Who's the, you know, are you talking to the general manager? Are you talking to the bartender? But Just generally speaking, if somebody asks me like, well, okay, I'm happy to go out and pitch it myself. What kind of volume do I need to be doing to get some real traction? Like, what's your perspective on that?
I learned this in insurance sales, by the way. Volume of calls, the more you do, the more are going to convert, right? So it depends what your target is. Insurance, we'd make 300 calls a week, 300 calls.
Sure.
Just dialing for dollars, man.
Hello?
Hang up. Hang up. No, no, no, no, no. Yes, I'll take an appointment. It's relentless and you gotta be relentless cuz most people don't want insurance until they need it, by the way.
Sure. Yeah.
That's another, we can get into that later on. But I say insurance because I think the number's 30. It's 30 calls a week. That's why at our Frontline Beverage, we have, we ask our reps to make 30 calls a week cuz that's gonna convert anywhere from probably low number, 1 to 5 accounts that say yes.
Sure. But I think, and this is, so this is why I ask, right? Cause I've, my, my, my, I got to quit turning. Also, I'm not trying to lay like one of your French girls. My hip is still giving me hell. For those of you who've been following my saga.
We'll go through the exercises. We'll do a podcast and I'm going to talk about how we can do that.
With my PT. Yeah. Yeah. But no, my, you know, and this goes for me, this goes back to, um, you know, Best Buy days selling retail or, or radio days and promo team shit. The rule of 10, you know, you talk to 1,000 people, you're going to have real conversations with 100. You talk, you have real conversations with 100, 10 of them are going to move on from there. You know, if there's an intermediary step, those 10 that move on, you're going to close one, right?
It's statistics, man. It's baseball.
Right. Like it's, it's highly conservative, but to your point, right. You know, most, I'll use e-commerce. Like I got a buddy that works for PetSmart and if he converts, if he converts 3 to 5%, Online sales, that's a fucking killer of a day.
Yeah.
And I think people lose that perspective because they think, oh, well, it's in person. If I go talk to you, no different than in my world, people think, oh, well, I told the co-packer to do one thing one time. They should remember it perfectly for eternity. That's adorable that you think that's the way the world works. It's never been, nor will it ever be. But, you know, you go talk to 30 accounts a week and I'll come back to that in a second. And you convert, you know, what's that, 10, one of them, that's 3%. It's not fucking bad, right? No, not at all. So A, that. B, I think that's the other piece I want to call out. And I would love, you know, if you have more background or context here, 30 conversations a week, rough math at an hour of conversation, that's damn near a full-time job. It is a full-time job by the time you factor in your drive time from account to account. Right. And so, so I guess from your perspective, is that something where right now, like, are you guys setting that line that transparently with folks where it's like, hey, to do 30 accounts a week, that's somebody's full-time gig?
Yeah. So we put 6 brands in a Rep's bag.
Okay.
So that when they're out in the wild, we call it, in accounts, they're working full-time, they're working it. So we're like, come participate in a bag.
Right.
And we'll pitch you and we'll convert that and we'll share with you the outcomes of what's happening in the market.
Sure.
We tell our reps, by the way, hey, if you're not hitting 20 to 30 accounts, because we do put the 20 in there purposely because there's some, um, account some weeks that you may have to do tastings, longer drive or whatever.
Right.
If you're not hitting that threshold, you're not gonna convert fast enough, right? So we tell our reps, we expect you to do this. That's our agreement we have with our reps.
Sure. Sure.
And look, and we say clients will stick around if you're actually creating activity and you're getting results on the board. Now, the hard part is a client doesn't like to hear 1 out of 30. That, like, when they see, like, the, they see that spreadsheet. No, no, no. They didn't like the price a whole bit. They start to get like antsy. They're like, what do you, what are they doing wrong? You know what a lot of clients do? They fire the broker and they go to the next broker.
Sure.
Yeah. They fire the broker and they go to the next broker. And I want to talk about this for a minute.
Please.
Bothers the shit out of me. Stop firing the broker and going to the next broker. Stick with the guy you have because when you start, the first inch is the hardest inch to open up the door.
Yeah. Yeah. Well, and I, I think about, I mean, there's, our industry is full of analogies and I'll, I'll try and make this one make sense, but I think it's, it's the, again, you see that, you see similar things. I won't say they're the same, but you see similar things in ops, right? And I'm, I'm going through this right now and I'm not saying that You know, and nor are you, I want to be abundantly clear. We're not saying that if a broker or a co-packer or a partner is abundantly underperforming, that you should stick with them indefinitely. That's not what we're saying. Right.
I'll explain myself after you get through your thought, but go ahead.
But what we are saying, and I'm so glad that you brought this up, is the, is the like, well, they didn't do it perfect the first time. Well, they didn't, their, their yield, you know, in my world, their yield wasn't 98% the first time through.
Right.
How'd your kid do the first time you tried to teach him algebra?
Or ride a bike?
Or ride a bike or fucking do anything. Like, it's a baby. Your brand's a baby. Your product's a baby. Everything's in its infancy. And so if you're coming out of the gates expecting, like, again, hey, 30 accounts, I expect you to close 27. Bye.
Yeah. That's what we talked about is like, you know, if you're having those discussions and your gut tells you this is the right stop, just, just stop the conversation and say, hey, we're not the right stop. for you, but they have those expectations. But back to this inch and open up the doors. My point of the broker, I was trying to write a story about this, but it's like, it's the first inch is always the toughest inch. Then the second inch, the second broker comes in and it's up, up a little bit more. Then the third broker comes in and it goes from, you know, 3 inches to 1 foot. And then the fourth broker shows up and blows the door wide open. They get the reward. I'm not taking away from the final broker to the first broker.
Sure.
What I'm saying is the first 4 or the first 3 that hit there did the job and they need some credit too. Because when you're a baby and you're new to market, no one knows who you are. So the first broker's actually introducing you to the market. Hello, this is Adam's Fine Juice, 12-ounce can. Boom.
Yeah.
They're like, I don't want you. 13. I shit you not. Sorry for the cussing, but you made me just bring it out of me. Tito's. You know who Tito's is?
I've heard of them.
13. I leave Kellogg's and come back to Breakthrough Beverage Group. And I was the director of trade development and I was so excited about Tito's. This guy named Eric Barham was the VP of Tito's. I'd met Bertito Beverage. I'd seen his stuff in Delta Magazine. I'd go out in the market and think, we're going to just build this thing like that, man. We're just going to, we're going to rock and roll it the whole bit. I tell you, every account I went to, what do you think they told me?
Too expensive.
No, I don't know what it is. I'm selling Grey Goose. I'm selling Absolut. I don't, I have Smirnoff. I don't need Tito's. Thank you.
Bye. Sure.
Fast forward to today. Tito's is the top brand in the world, the world, right? But that guy was resilient. He hired brokers to get distributors to pay attention. Sorry, distributors, because what brokers do is they actually go in the market where the distributor's not. They, they go and they farm it. They seed it, they water it, they build that account, and then the distributor starts to pay attention. And then it just, it starts to cascade, right? But my point is Tito's. Tito's was new once too. He was a baby. And we had to tell Tito's, this is how it works. You're going to get a lot of nos before you get a yes.
Do you, do you think, and this is truly just me, uh, brainstorming, but like, we've talked before on this show and I've mentioned it, it's been a minute, but I watch a lot of the like, The Food That Built America, and they talk a little bit about beer brands.
History Channel. Yes.
Oh my gosh. Yes. Do you think it's, it's maybe there's a little bit of like a learning curve or a hangover effect in place? What I mean is like, you go back 100 years. I'm not saying there weren't still big brands, but it was, it was innovation was more of a novelty, right? Like, For obvious reasons, technology was, was improving at lightning speed. Products were getting safer, things like that. Right.
Yeah.
Do you think there's a little bit of like a hangover learning curve of just people? You talked about, um, people thinking like, oh, well, I have a brand. Like people are just going to know about it. Yep. Maybe 100 years ago when there were only 4 brands on a shelf, but that's not the world of today. Does that make sense?
Go walk the beverage aisle and RTDs, right? You're just one among 100. No one knows who you are and the consumer's coming in and they're going to walk the shelf really quick. They're like, they're looking for a price, you know, and there's proof of concept for most of those brands isn't there yet. Yep. Just not.
Yep.
It's just not real. But the problem is you see things like George Clooney or Ryan Reynolds that, you know, they come out with this brand and they think, or Michael Jordan with Sincero. You know, the whole bit, or, you know, uh, P. Diddy, you know, with Ciroc or whomever. Right. But the point is, is they all think I'm a celebrity, so I'm gonna go viral. Or they all think, well, if I get distribution at Southern Glacier Wine and Spirits, I'm just gonna automatically come outta the gates and be in 100 states and my job is done. It just doesn't work that way.
Sure. So, so let me ask you another question. So going back to Say I'm a brand and I go, all right, Sam, like you're going to put me in that bag of 6 brands and you're going to have 20 to 30 conversations a week. Again, from a contractual standpoint, like how long should I be committed to that plan before we sit down and take a real in-depth look at updating, changing? Like how long do we need to let it ride before we start making adjustments so that we have a good enough sample size to understand what we're doing?
I think it depends on the circumstance, uh, you know, in terms of the investment, also in terms of the market you're in.
Sure.
Distributor. I mean, I think there's a lot of unknown variables in that. I don't think there's one right answer, but I'll tell you that we look at things 0 to 3, 3 to 6, 6 to 12. Okay. Um, we also meet with our clients within that program through Frontline Beverage at least twice a month as a business manager. Okay. We also communicate with them on their dashboard weekly. And we bring the, the, the, um, sales agents or our partners to a meeting with them at least once a month. So there's a discussion always happening.
Yeah.
So within that discussion, that team or that supplier can make a decision based on the feedback they're getting. We certainly can be part of that discussion with them. 'Cause they're gonna learn a couple things. One is my price is too high. My price is just perfect. My product doesn't taste good. Uh, I don't have enough room at this point, but I'll get you in the menu in the spring.
Uh-huh.
So it comes down to timing.
Uh-huh.
We, we, when we sign an agreement with our clients, it's a 1-year agreement. And the reason we do that is because we don't want disruption. You gotta think about, Alicia always says this, this is a relationship business.
Mm-hmm.
People buy from people they like. They're not buying from your brand or Frontline. They're buying from that sales agent.
Mm-hmm.
Because they trust them.
Mm-hmm.
They're the ones that are opening up the doors. They're the ones that are sitting on the bar stools. They're the ones that are out in the wild making it happen. So you gotta give them a year.
Yeah.
Now, to be realistic of, you know, you're, you're 0 to 3 and there hasn't been one box sold. That's a discussion we just gotta say, okay, this isn't working. Either we go to the rep and say, hey, look, this isn't the right brand for you. Sure. So those discussions absolutely need to be had because I actually firmly believe if you do the math, because you're the math guy, If you're hitting 30 accounts a week, times 4, times 3, how many accounts is that?
360.
Okay. So look at that, the brain math. 360. And if you're converting, um, 1 account for every 30, call it 2, how many accounts is that?
So if you're converting 2 accounts for every 30, right?
Yeah.
So every 30 is 360 divided by 30 is 20. No, Jesus. See, now you're putting me on the spot.
360 divided by 2, isn't it?
Well, so 360 divided by 2 is 180.
Yeah.
So divide that by what?
4.
So 45?
So by, by 3, by, by 4 by 3.
Yeah. 45 to 60.
Yeah. So within 3 months you should have opened up 45 accounts. If you're doing your job as a, as a, as a sales partner agent, you should open up 45. The volume of that, the velocity, I don't know that. We're going to learn that too, because then that's the next tranche of data you got to look at. Okay. I've opened up 40 accounts. Did they order once? Because this is a very important, uh, what I'm going to say right now, the 45 are not doing repeat. They're not doing reorders. So of the 45, how many of those are converting to a reorder? Because that's when you start to really win.
Right. Yeah.
I opened up 45, but of the 45, how many have reordered in that 3-month timeframe?
Yeah. Yeah.
I think it's around 20%, by the way. So let's say 10 are reordering. So in 3 months, I got 10 solid accounts. Those are gold, right? All right. So 10, 20, 30, 40. Within a year, if you have 40 accounts reordering your brand year 1 and they're reordering and let's say you have average velocity of 2, do that math now.
Uh-huh.
Right? I know, because you, you, you're scientific, right? So if you do that math, That's pretty damn good launch. You might've said, I always ask brands, I'm like, how many accounts are you in? 150? You know what my next question is?
Mm-hmm. I do.
What's the next question?
What's your velocity? What's your sell-through? What's your reorder? Some version of that.
Yeah. My next question is how many have reordered? And oftentimes they say like half of that, 50%. So the other 70 of the 150 or 75, Don't matter.
Huh?
The ones that are reordering, that's where you want to go play. That's gold. That's where you want to build up. So we work with brand like in Kentucky. I love this brand's going to go viral, by the way. Will, William Brown and, uh, his, his brother Alex and, um, uh, Amy and, and, uh, uh, Guilford, their, their dad. I love 'em. We're getting 'em into Georgia. They opened up 170 accounts. Like about 70 or 80 are reordering and they know their data, the whole bit. And they actually know where they're winning. So I'm really excited about this brand because they know their data, they know where they're winning and they opened up 170 accounts in one year. But it's just what we did the math just now.
Yeah.
Because they went out and they worked the market. So anyway, I'm so passionate about it today. We got to get into operations the last few minutes, by the way. So we're going to get off this, my, my, my pedestal.
No, man. I think it all, it all ties together, right? Like the song remains the same. It's just got a little bit of a different beat to it.
So like, oh my gosh, a little Led Zeppelin, brother. Okay.
Okay. I mean, but no, I mean, uh, operationally it's, it's, so I, I threw something up the other day about this. Like, um, the, um, the, the conversation that I had that, that I'm referring to was, um, a gentleman saying that he, he was discouraged by the fact that when he talked to some of these larger CPG firms, it was, it felt very cookie cutter. The word he used was car wash, right? It felt very car wash to him of like, hey, they're just trying to shove me through this process. And if I don't fit that process, they're not interested in working with me. In fact, they're quite verbal about telling me why it's never gonna work, period. Which, fine, I guess. Right. But the point there was like, even as an ops guy, even as somebody who tries for safety, if nothing else, to live in the very black and white sections of our business, like you have to be at least willing to come to the table and have the conversation if you're in my shoes of, okay, like, how are you trying to be innovative? Because as long as it's safe and as long as it's you know, not going to put anybody at harm, fuck it. Let's have a conversation. Right. You know, I make the joke all the time of people ask me, hey, do you want to start a brand? No, man, I sell the shovels. Well, I can't make money selling shovels if people don't go digging for gold. Right. So like, I got to be willing to entertain those conversations. And then everything we just talked about still applies, right? You know, you talk about cost of goods, the, the, and we've mentioned this on the show before, but I talked to brands all the time. Well, my, my co-packer, my tolling feed, like they just, They got to bring that down. Do they now? Right? Do you have any forecasting? No, we're way too early to have that.
Uh-huh. What if you don't have a clear mind, a destination or a goal? That's a problem right now. Like, you got to do a forecast.
Uh, you know, so, so, okay. You don't have forecasting. Well, have you looked at your formula? Have you talked to your co-packer about ways to make blending that formula easier? Well, no, like that's our formula. They just need to do it.
Okay. Hey, just put me in a can. I'm going to go viral. It tastes really good and we're rolling.
So it's, I mean, it's that. And then yeah, you get into the COGS, you know, the forward-facing COGS piece of it, right? And it's the, again, it all blends together. It's where I started, right? Like people love to talk to me and most people are pretty nice and pretty understanding, but they're like, well, you know, that cost of goods doesn't really give me a lot of wiggle room. I'm like, Correct. Well, how am I going to factor in a distributor? For the first 2 years, you're not. Like, again, for the hyper small folks that I'm often talking to, right?
No, I tell people all the time, I'm like, you know who's going to be the salesperson? You are. Yep. Matter of fact, you know, one of them he's working with, he's out of New York, Dejour. And I'm talking, you know, talking to Dejour and looking at his cost of goods and stuff. I'm like, hey, look, you're going to have to be at this price. I think he, you know, I think he's thinking it through. Now they're like, you have to go get your distributor. I'm like, well, how am I gonna do that? I'm like, we're probably gonna have to go get your wholesale license, by the way, your federal permit.
Uh-huh.
Wholesalers have a federal permit, by the way, everybody out there listening.
Uh-huh.
You can do that in New York because one of our other clients, you know, is actually, she has her federal permit.
Uh-huh.
She can wholesale anywhere, by the way. And she's a wholesaler. We're hiring Georgia to help her with their inventory. But maybe I introduce her to Dejour, by the way, and maybe she can help them or whatever. It might be an opportunity to help her help Dejour, the whole bit. But, you know, day-to-day cost of goods are pretty high right now.
Well, and that's, so that brings up the other thing and the other woman you're referring to, if I'm, if I'm picking up what you're putting down, we had a, we had a very honest conversation and it's, again, it's what I have with folks all the time where I said, I'm, I always preface it with this. I always preface it with, I'm going to say some things that emotionally you're going to have an issue with. That's okay. Right.
Yeah. We hung out with Mike Levison too long, man. He just tells everybody what it is, man.
Well, you know, so, so a great example, right, is I see a lot of brands that'll use, that'll use cane sugar. Okay, great. Sugar's not overly expensive by comparison to some, comparison to other materials, right? But if you're using a substantial amount of it, like it can add to your COGS, fine. And so I'll tell people, hey, you could look at something like sucralose, right? It's a more cost-effective sweetener. It's, it's got a higher potency, so on and so forth. And I preface it with that emotional comment because people hear the word sucralose and think, oh, it's bad for me. Yeah. You can feel that way. A, do your customers care? Yeah. And B, especially when you're making an alk beverage, alcohol is also bad for you. Like who, what? Right. Or, you know, even in the healthy side of things, like a younger gentleman I'm working with in the DC area. He's in New York now, but you know, when he brought his original formula to me, he had a bunch of organic juices in there and he was really interested in using organic juice. And I was like, hey, again, you're going to have an emotional reaction to this, but I'm just telling you something to think about. And I said, you're not making an organic product. You're just saying made with organic juice. He goes, yeah. And I was like, you know, you could be saving like $2 to $4 a pound on those juices as raw materials if you just use non-organic stuff. Right.
And he goes, yeah.
Really? I'm like, I don't care. It is your call, but that's the math, right?
I know. And here's another brand for you and I'll remain nameless, but you, you kind of work with them and we're trying to get them into Georgia. Uh, I was, I was going to come up to, um, the place. I'm just talking tongues here, but anyway, I just, it was just too cold and they got the flu running around here. Uh, but anyway, um, they want to go into Georgia and I guess they've gotten to, or they're going to get their, um, Down 10%. And I think they're exploring malt, which I think absolutely love because literally our partner in Georgia can get them into 3,000 convenience stores like that. And it's a real conversation they really need because it's more about the branding. People, I don't think, please call me out. You guys can text me or whatever. I don't think the majority of consumers are actually looking at the back of the can saying this is spirit or it's malt-based. They're looking at the brand and does it taste good and is of good quality? So if you can have a margarita or a rum and maybe a malt base, you're gonna open up a whole new world in terms of cost of goods. Or if you go low ABV, I just talked about it last night about the ABV, uh, and actually posted about it this morning. Low and no alcohol is really growing right now. It's a small percentage of the business.
Sure.
But it's a place to go look and hunt cuz people are like, okay, they're drinking based on occasion. They might have a full strength cocktail as their first cocktail, then go to You know, with tea as their second cocktail. So just from a cost standpoint, if you have this cool brand, which we, the brand we're talking about, why not go to mall and get into 3,000 convenience stores?
Yeah. It's, I mean, the same, similar, similar conversation, even, even sticking in spirits with, um, again, the, the group that we were talking about in New York, she's using real rum right now. And I said, have you considered GNS? And, you know, of course her response was, eh, really like using, you know, Real rum. And I was like, okay, that's, I'm not saying that's wrong.
I don't think the consumer cares.
A, that, and I don't have the answer, but it's a question worth asking. And B, I'm like, your can doesn't say made with real, wherever it's Jamaican rum or whatever it is. So either start marketing it or let it go. Right. Yeah. Yeah.
No, those are, so, I mean, I can imagine the conversations you have operationally. Have you had any breakthroughs? Do you have breakthroughs often where people are like, yep, The alarm bell goes off and says, you know, Adam, you know, you're right. Let's go that direction.
You know, it's a good question. I think what often happens is, again, people have been very kind and receptive to my questions. I haven't gotten anybody telling me to, you know, pound sand, but normally, and even Ryan, I think can echo this point, you know, with Rocks, like normally when we have these conversations with people, it's, I hear you, but I want to try it my way first. Okay. That's honestly, that's 99% of the time. That's what happens. And then I would say for the people that have the funds and the patience and all the things that you have to do to try it their way first, we've got, I mean, Ryan and I have a couple of folks going through this right now where we're like, was that, was that painful? Did that not feel great? Do you want to try it our way now? Right. And not in trying to be a smartass. I get that I have a Cheshire grin, but like, just in a like, hey, We saw how that worked out. You willing to give ours a shot?
Do, I know you'll do this. Do them a favor. The next client that comes on and says, I had 5 other clients that said the same thing. And out of the 5, 4 of them failed and it costs them X amount of dollars. So I'm telling you, it's a mistake. And that's what you're paying me for. Your gut may be saying that, but I'm telling you, this is what you need to do. And I just want to be really clear that you're going to spend $100,000 doing these cans and all this stuff as an experiment. And we have something we know that works.
So that's why you hired me here?
Listen to me.
I had a, uh, so I have to share this with you. I don't think we've caught up on this. So where did I meet her? She was a referral from Chris over at Red Boot, Chris Slenga, our friend Chris. So he'll send me some leads from time to time, just to folks that he knows aren't quite ready to work at that scale. And, uh, so I was talking to this woman in Iowa. She owns a Like a tea and herbal supplements shop. Right. And from what I could tell online, like fairly foundationally organized business, right? Like website looked put together. She's telling me she's going out to farmers markets and she does a good amount of business and both online and in store. And I'm like, okay. And I asked her what she wants to do. And she tells me about this herbal tea that she wants to make in a can. And I mean this in the nicest way possible to the Danielle Gosses, And every other mother of the world, please understand, I am not saying that you can't also start a brand because clearly it's been proven that you can.
Oh yeah, that's a big brand.
Yeah. But every time we talked, every time I talked to this woman in Iowa, um, either she would miss the call and then email me and say, hey, sorry, you know, my, my baby wasn't feeling well. So on, we'd be on the call and the baby's just crying bloody murder in the background. Right now, 'tis the season, illnesses are going around. Again, this is not a commentary on her as a mother or anything like that. What it is commentary on is I told her straight up, I said, hey, these are the things you're going to have to do. And you can tell me, I have the time. My husband has the time, even though we have the kid. And if that's your answer, fantastic, let's go. But this is me telling you, it's going to require a lot of your time. It's going to require a shitload of your money. So unless you have both of those things able to give and still live your life, I would strongly recommend that you think about putting this on the back burner. And we probably had 2 or 3 calls and they peppered me with questions. And then we get on the 3rd call and we get on the 3rd call. And I said, okay guys, like we've talked a couple of times now. We've gone over a lot. I know it's been a lot to digest. Where do you want to start? And all they said was, we really appreciate your time. We appreciate how honest you've been with us. We just wanted to let you know that, that we're going to continue selling it at the farmer's market and kind of doing it small scale for now. Until we can save up a little bit more money and then we'll call you.
That's great. I mean, I think that's really good. Can I shift for the last 10 minutes on a couple of things?
Yeah.
I do want to get to safety systems for a few minutes.
Yeah.
I do want to get to confectionery candy that has alcohol in it. I want to get your opinion on that, by the way. And I want to make an introduction because I think there's something we can work on together on that piece. But I want to talk the first thing first for a few minutes. It's a couple of minutes. If we go a little long, it's fine. I'm just curious and this might be good for some people. The cost of freight is going through the roof. So when we move brand, matter of fact, I'm getting all these freight quotes from our friends at freight companies all over the country. I don't know why they're going up. I suspect, and I won't go political, why they're going up, but they're going up.
Right.
So if you're moving something from Washington to Georgia, I mean, some of our partners or distributors have to take in truckloads to get the freight down. And it's just not sustainable. So is there an opportunity around co-packers around the US? Like we have partners like Earl Giles, Griffo Distillery, Dragon Distillery. I'm getting ready to work with Mason Dixon. It's out of Pennsylvania with their RTD. And we just, we're starting to understand these like co-packers, distillers, the whole bit. Is there an opportunity rather than making a brand in Minnesota, is there an opportunity to actually make the brand in the West, make the brand in the Southeast, same formulation, same brand. But rather than having one central point where the brand is made, basically make the brand in the region where you're selling the brand to save the cost of freight. Is that, is that, is that something there with that? Is that an opportunity?
Oh God. Yes. And, uh, and I'll, I'll try and keep this concise and brief because this is a question I get asked all the time. Uh, and shout out to, uh, to Max and Karina with the Mad Lemon crew, because we've discussed this, um, with them. Um, uh, yes, but I always encourage brand owners to think about it through a couple lenses. Like, for example, if you've never produced anywhere, you've never made your product yet, and you're looking at where to produce it, right? Absolutely. If you can find somebody in your backyard that is going to be, you know, a local or regional producer that's really close to you, of course that would be fantastic.
Do that first, right? Build, build your market. Yeah. Got it.
Yeah. That said though, if you live in a place like a Southern California or a Florida or New York, what you may run into is that their minimums are too big, their costs are too high, so on and so forth, just because they are. That doesn't mean you shouldn't produce there because again, to your point, you're still saving on freight. For example, especially this time of year, I just shipped a full trailer load from Chicago to Vegas with insurance, with freeze protection, with 20 pallets. Technically it was 16, but 20 pallets for $4,800. Now that works out to, you know, a few pennies a can, I think, which if you can do it isn't atrocious. But again, if you can do it, if you're producing at those volumes, if you've got the money to ship full trailer loads at a time, so on and so forth, right? But the flip side of the story is often where I end up finding people is they'll, they'll be producing somewhere in the Midwest and they'll be like, hey, we love our Midwest co-packer. They're great. But now we want to open up this other market and we want to look at a California, a Florida, a Pacific Northwest Forever. I'm like, okay. And again, I'm not saying that it's a hard no. What I am saying is you have to understand that that's 2 different facilities that you have to make sure are in lockstep.
Yeah.
And so you can think about it like sports teams. You can think about it like your family, but you know, if each facility has 20 employees, that's 40 people that you have to make sure know your product inside and out, upside and down, left to right. And they know exactly how to run it. And somebody's gotta be managing all those conversations. And then you've also got, and I hear this from co-packers constantly, brand will come to a co-packer and go, hey, we're producing somewhere else and we wanna come make some product here with you. And they'll go, give me a quote on this volume. And it's a smaller volume than they make at their, their primary facility.
I got an idea that I'll share with you later.
And the—
there's a huge opportunity here.
And the, you know, I know, you know where I'm going with this, but, you know, the co-packer will go, okay, sounds great. And they'll give them a quote and the brand will say, that's far too high. I could never make it for that price. You've got to, you've got to bring your numbers down. The co-packer goes, and then I get calls from the co-packer where they're like, am I crazy? Is this price absurd? And I look at it and I go, no, Seems competitive. And they go, well, the brand's telling me it's crazy. I said, how much are they asking you to make? They tell me, I said, how much do they make at the other place? And this is where the co-packer is usually like, well, I don't know. And I'm like, if I had to guess, it's probably double or triple what they're asking you to do.
Right.
So that's the other thing is when brands start to think about producing in multiple spots around the country, if you can't feed each bucket the same amount, you're going to have varying costs. And that is not the co-packing facility's fault. That is yours as the brand to resolve.
That's, that's a great thing. I think there's a, there's a business opportunity to help brands that we'd love to explore with you on that. All right. So I'm going to shift to 1 minute on confectionery booze candy. So I talked to this woman, I'm going to work with her. I'm actually going to introduce you to her too, because I think this might be like up, uh, is it the food ops guys? Is it, uh, Ace and Johnny? Johnny. I think there might be something there too, because so she's actually in like 42 states. She does everything online. Um, and, uh, basically the Texas ABC told her that she's not alcohol, but yet when you eat this candy, it's like 60 proof. Okay. And they've built a hell of a business actually. She's gone viral on like YouTube and TikTok and the whole thing.
We used to, so I'll share a quick story here. So in high school, the town I grew up in, we had a lot of Russian and Ukrainian families in town. And I don't know where they got them. I don't know if they were, if family members were shipping them to them in Iowa. I don't know if they knew somewhere locally they were sold. I have no fucking clue. But in high school, if you knew who to ask, they would have little chocolates with vodka in them. Yeah. And they'd pass them out. And so you'd get, you know, you catch a buzz midway through the day because they're handing out candies. And at first they were fucking with us, just giving them to us, not telling us that there was vodka in them. Yeah. Right. And then it became the like, okay, teachers didn't know for the longest time. And then everybody kind of caught on and, and, you know, they put a fucking lid on it. But yeah.
This one's a little different though. This is like a gelatin kind of deal. Like, uh, like it's like there's no, So it's all like, she has no liquid. Yeah. So she's doing it in her kitchen with her daughter and her mom. It's 3 of them.
Okay.
Right. They're shipping all over the country. So I want to actually, you know, get, you know, get a scope of work with her and then I want to introduce her to you, AZ, and Johnny, because I believe that she can go like in a Total Wine and BevMo pretty much overnight, but she has to build it to scale. So she had a point, right? You know how I always talk about it, test it, build it, scale it, sell it, or keep it.
Right.
But so at the point, she's at the point where she's at the skeleton phase. She's proof of concept. People are ordering her. She has like a million followers. Like she's, she's the real deal, but you're not going to be able to go to total nationwide in your kitchen, right? So to be able to take that formula and actually replicate and get out there. And the cool thing is, according to what she's learned, this is confectionery.
Yeah.
It's not like, it's not controlled. You don't, you can go direct. I'm like that, which is really interesting to me, um, that she can do that. But she's applied to Shark Tank. She's continuing to try to get on Shark Tank. It's pretty cool. So I'll connect you with her. So this confectionery candy, I think there's an opportunity and innovation in our business and the wine, liquor, and spirits business is, remember we talked about occasions?
Mm-hmm.
Well, this is an occasion. I'm at the kids' soccer game. Or, you know what, I'm at Thanksgiving dinner. I'm just going to eat my bear here or whatever and chew it up. And I have 3 of those. That's the equivalent of 3 shots. And she has an edible shot glass, by the way, which is like, you know, kind of some cool stuff. So anyway, that's super cool. The last couple of minutes, just, I want to get your opinion. So I'm on this group and I don't understand why people aren't taking advantage of this yet. I think he's close.
So I, and I, I mean, I'll jump in 'cause I've talked to Jared a couple times now.
Yeah.
All opinion on the, the product itself, the, the value in it, all that aside. And I can touch on that if you want me to. What I told him, and what I will echo here is I assume the tooling, like the manufacturing equipment.
Yeah.
For something like that is not going to be cheap from a cost perspective, from a timing perspective, from a maintenance and repair perspective, from just a running it daily perspective from a speccing it out and making sure you have your tolerances understood for like, there's a lot of variables that go into that. And for something that, don't get me wrong, yes, people cut their fingers, their mouths, whatever on the lip of a can. But I don't know that the problem for the people that have the money to do everything I just said has risen to the level of them being willing to spend it there.
Got it. And then you have to do that tooling and everything you described. Copacker by copacker, facility by facility. And you start to do that math, it gets really expensive for the people on the other end. It's almost like they should develop some type of mechanism where they could go in and install it at no cost to that copacker.
Well, so it's, it could be that. And I think this is, again, this is part of the conversation I had with Jared. My assumption, just based on what I understand right now, it's like, think about it like a You know what the, you know, I know, you know, the XO ends, the resealable ends.
Yeah. Yeah.
Yeah.
Yeah. Yeah. Yeah. Yeah. Yeah.
So those are made that way at the end facility and then they ship as a finished end that can go onto a can at the co-packer. My assumption is that would be the goal for Jared for Safely Sip, which I would think is logical.
The, the problem is— So the top of this can, right? So this is a, this is a separate piece of this piece and it gets stamped on the thing.
Uh-huh.
The, uh, how does, uh, how does this work? Is that already, is already closed? Is it enclosed? Is the pop top enclosed on that when it stamps? No, it can't, 'cause they gotta fill it. No, they fill it, then they stamp this, right? So you do the fill, this is stamped in, it's already closed.
So the, the, this is real general and there's a gentleman on LinkedIn and I'm forgetting his name now, but he does a lot of really cool videos on the way that cans are fully produced. But like the can itself starts as a puck of aluminum and they use a water extrusion to draw it out. Right.
Okay.
Super cool. The lid is a single piece that's stamped from sheets of aluminum, and then the tab is kind of a secondary application, if I remember right. And somebody could please correct me if I'm wrong.
Oh, so the tab doesn't, so this isn't, it doesn't come closed like this is closed. It doesn't come closed like this. This is, this is the tab comes in at the facility.
So the, let me see if I can say this concisely. When you order lids from Ball, right?
Yeah.
They come fully done. Like you see 'em on the top of a closed can and they just get stamped and, and crimped onto the can.
Right.
What I'm getting at is when the raw sheets of aluminum come into like a Ball or a Crown or an Arda, right?
Yeah.
Those sheets of aluminum get stamped out with the base of the lid and then that tab gets added on as a secondary application. Right.
At the facility. So if you're at like Earl Giles or Griffin or Dragon.
No, no, Sam, at Ball.
Oh, at Ball. Okay.
Okay. Right?
Okay.
So the lid itself and the tab get combined together at the aluminum facility.
Well, so we should go talk to Ball and talk to them about the opportunity.
So here's, and this is what I've talked to Jared about. You're not wrong, right?
Yeah.
Ball makes, I'm going to say trillions of ends a day. I don't know, a fucking lot.
Right.
And so for them, like if I put myself in their shoes, having somebody come in off the street and go, hey, I want you to slow everything down to an ass-grinding halt to put this little piece of rubber, slow down one of your facilities, all of your facilities to put this little piece of rubber on there.
That could be millions of dollars, by the way.
It'll be millions of dollars in downtime just alone. And then who's going to buy them? Because they're going to cost more, just like the XONs. Right? So it's just like being a distributor for a product. If you don't have customers already lined up, who fucking cares? And I know that sounds—
So it's a chicken and egg problem, right? It's like, okay, so like, I know he's been trying to get like Molson Coors, Coca-Cola, you know, trying to get it maybe written in as like, um, like, uh, like it's a mandatory thing or whatever. And look, I'm in full support of Jared and I, again, I asked him here today to, you know, come talk about it. We'll get him on the podcast so we can talk about it. True. I mean, I believe in what he's doing, but you know, you're right. The car, you just gotta, the economics of that. I'm not saying it can't happen because I'm fully in support to try to help him create that moment. But you know, it'd be interesting to talk to someone, if someone at Ball is like listening to this, come on the podcast and talk to us about how it works. Do we know someone that could come talk to us?
So, you know who would be really interesting to talk to this, talk to about this? Joey Gamer. Okay.
Let's get him back.
So I think we should get Jared and Joey on the same show because I think Jared is probably going to echo a lot of what I've said, but he's going to be able to speak to a lot more of the details or a member of his team. Right. But exactly. It's the economics of slowing down a facility like that. You know, again, no different than, no different than I get the question all the time to this day. It's one of the first questions I got asked years ago and I still get asked now. Hey Adam, when we go to production, can we make it so that when the cans are getting the lid put on them, that the tab lines up with the front panel and our logo so that—
Yeah, yeah, yeah, yeah. This one's pretty close, by the way.
Right? I mean, it happens accidentally sometimes, but every— my answer to that question every time is, you have any idea how fast these lines are moving and how slow they would have to move and the sensors you would need to be able to see the artwork, turn the can, place the lid, crimp it?
Millions of dollars.
This is millions of dollars in time in slowing down lines to do that. If somebody's got the money to burn, be my guest.
Right.
Hey, in 10 years, you can actually see the label while you're drinking them. Yeah. So that's unfortunately, that's the hurdle for Jared.
Well, let's, let's, let's, let's arrange that. All right. So we went a little over, um, any closing thoughts, Adam, before we, uh, rock on with our day?
Well, A, thank you to, uh, to Coggs and Jay and Alicia. I'll answer your question in a second. And Josh. And where'd she go? There was another young lady.
Jennifer was here.
Thank you, Jennifer, the woman you called out. So Alicia, I will not be at WSWA.
She's the queen of beer, by the way, of draft.
Jennifer. Okay.
Yeah. She's well known in the beer community, a wonderful friend.
And I just connected with her. So yeah, Alicia, I won't be at WSWA. I'm keeping it a little bit lighter this year because I got some personal travel that's taking some funds, but If there's anything I could do to help you guys as far as presence there, answering questions, obviously I'm happy to. But no, closing thoughts. I mean, especially as it's frigid across the country, both personally and professionally, be patient, right? Like take your time doing stuff, do it right. Make sure you keep your pipes running. Don't let them freeze.
That's good. That's good. For me, for me, I just, uh, I felt like I wanted just a voice about the be patient is, I guess, the message. Trust the people that you hire.
Sure.
To actually build your brand. Ask good questions, align with them in terms of expectations, and make sure that if you're not comfortable with it, with the person you're talking to, and they're not comfortable with it, maybe that's not the right stop. And that's okay. But have the conversation upfront. Now, don't have it on the back end, have it upfront on the front end and put it all on the table in terms of what's expected in terms of building the business. What I can promise you is pitches and, you know, The number of pitches converts. I can't promise you what it's gonna convert to, but we can promise you that we'll give you the information, the outcomes of what we're doing. And I appreciate everybody, Jay Williams, Jennifer, Robert. Thank you so much, man, being here. Robert's weekend edition for Drink Up Podcast will break around noon today. So Robert, I did some editing on that, but I think it's gonna be really good. We'll call it The Melting Force and IQ. I will have to get those guys on the podcast with you, Robert. I know obviously Dave Martin, so I'd love to have him. And he actually is the one that talks about proof of concept, by the way. So that's Dave's whole thing. And he could walk us through what proof of concept means, but he's an expert in the space and understands how to get distribution and build customers. With that, happy Saturday, everybody. And we'll see you next week.
Thanks, everybody.
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