Mitch Jacobsen - The Energy Tea That Was Born Out Of A Friend's Near-Death Experience

On this episode, we’re joined by Mitch Jacobsen, P.Eng., Co-Founder & CEO of Rviita, a Calgary-based energy tea brand packaged in lightweight, resealable spouted pouches. 

Mitch went from petroleum engineer to beverage entrepreneur after a friend’s energy drink-related near-death experience. He walks us through the hard-won lessons of product development as a CPG newbie and why he chose to vertically integrate early and build a custom filling line. 

We also get tactical on distributor relationships in Canada, how to prep for buyer meetings, and channel strategies for Costco and Amazon.

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Episode Highlights:

 🍵 The “why” behind Rviita’s tea-based energy and low-sugar formulation
 🧪 Early R&D mistakes and how a bad taste test improved the product
 🧴 Why a spouted pouch (and how it became a moat)
 🏭 Building a custom filling line - costs, headaches, and speed advantages
 🔌 When vertical integration makes sense (and when it doesn’t)
 🛒 First retail commitments, buyer outreach, and meeting prep
 🚚 The Canadian distributor landscape and how to be a great partner
 💸 What distribution really does to your margins
 🏬 Costco realities: packaging, sampling, and velocity expectations
 🛍️ Amazon playbook: positioning, reviews, and ops basics
 🎨 Brand identity and packaging design choices that drive trial
 👥 Internal vs external resources as the team scales
 📈 CPG trends Mitch is watching next

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Table of Contents:

 00:41:10 - Rviita intro and origin story
 02:37:22 - The early days of R&D and formulation as a CPG newbie
 03:31:13 - Mitch’s two core product requirements
 04:10:06 - Ranking dead last in a friend and family taste-test
 05:53:26 - The path to a unique packaging form factor
 09:32:06 - The decision to vertically integrate early
 10:24:23 - Building the custom filling line, the pros and cons
 12:35:17 - Recs for early operators considering going vertical
 15:17:22 - How investors view the vertical integration decision now
 15:22:04 - Brand identity, packaging design
 18:04:00 - Getting the first retail commitment
 20:00:09 - Mitch’s cold call approach for buyers, how it’s evolved
 21:13:08 - Buyer meeting prep
 22:33:27 - The distributor landscape in Canada
 24:49:03 - How to be a good partner to your distributor
 26:20:17 - A distributor’s impact on margin
 27:17:25 - Costco
 30:25:29 - Amazon
 34:47:22 - Internal vs external resources
 36:20:10 - Trends Mitch is tracking

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Links:

Rviita – https://rviitalize.com/
Follow Mitch on LinkedIn – https://www.linkedin.com/in/mitch-jacobsen-p-eng-89277649/
Follow me on LinkedIn – https://www.linkedin.com/in/adam-martin-steinberg/ 

For help with CPG production design - packaging and label design, product renders, POS assets, retail media assets, quick-turn sales and marketing assets and all the other work that bogs down creative teams - check out KitPrint.

Transcript

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welcome to shelf help today we're speaking with Mitch Jacobson the founder and CEO of Revita a tea based honey sweetened better for you energy drink based out of Calgary Mitch started after seeing his friend experience a pretty serious health scare which he may touch on here in a second Prada or Revita Mitch spent about I think about half a decade or so in in the oil and gas world before jumping into the world of entrepreneurship definitely excited to jump in maybe first off just for the listeners miss that that aren't as familiar with Revita maybe just give us a quick little land in terms of origin story why behind the brand core products you guys offer and maybe just a few places that people get their hands in them and then we'll go from there absolutely well thanks so much for having me Adam it's an honor to be here so yeah my name is Mitch I'm the CEO the janitor and sometimes even the receptionist here at Revita Energy Tea it's a clean energy drink in a flexible beverage pouch so when I was in my mid twenties I was working downtown oil and Gas Calgary here kind of the Houston of Canada sometimes we call it and I was an energy drink addict I was drinking these things all the time in the afternoon to get me through work and I was starting to experience adverse health effects from these which was kind of ironic cause when I was in my really early twenties my best friend at the time ended up having a minor heart attack that we ultimately attributed to energy drinks fortunately he's okay he made a full recovery but the combination of these things was really the lightbulb moment for me Adam like what the heck is in these energy drinks and is there a healthy alternative so I went and looked everywhere on the market for something with natural ingredients wasn't carbonated was easy on my guts because energy drinks were giving me heartburn and stomach aches and those types of things couldn't find it anywhere so even though I had no CPG experience I started messing around in my kitchen and ended up formulating the Queen better for you energy drink that we have today we're carried in most major retailers across Canada hoping to expand into retail and into the US next year but you can find us on Amazon both Canada and the US we ship to Canada and the US from our website and then in Canada here we're in Costco so we Safeway loblaws pretty much all the the major chains love that cool talking about formulation product development for a minute so I imagine it took find the formulation process that really worked and you know I don't I don't want you to give away any any trade secrets but just kind of curious what the kind of the key variables you're playing around with the final version that you felt like was right you felt good about bringing that one to market and how many batches it took to get you there yeah absolutely Adam it took a lot more than I was expecting so when I started like I said I had zero CPG experience like I didn't even know where to begin so my first step was googling how do you start a beverage company that was step one step two was messing around in my kitchen I was matching caffeine pills together and mixing it with tea and coffee and all sorts of things figured out pretty quickly I had no idea what I was doing so through my research and those Google searches I ended up finding a food scientist which I didn't even know that was a profession but I called he's cold called a whole bunch of food scientists across Canada and the US most of them laughed at me effectively when I told them this idea but I did find one that was willing to work with me so I put them on retainer at the time and we just started going back and forth with the formulation process so I didn't really know I had some guidelines but I I didn't know what the end product was gonna look like out of the gate so I wanted it to be natural I didn't want to use any artificial ingredients I wanted it to be non carbonated cause carbonation was always screwing up my guts I was using energy drinks as a pre workout sometimes carbonation just didn't appeal to me so I figured there's gotta be other people that feel the same way so really natural ingredients non carbonated was kind of the the first two guidelines that I wanted to use and I wanted it to be low sugar so I wanted it to be ideally sugar free we ended up we're 30 calories now we use organic honey instead of like stevia or erythritol well yeah the it took I thought it was gonna take you know three or four months maybe a couple of trials back and forth with this food scientist it ended up taking over two years at them so the very first batch of samples I got back from this food scientist I'll never forget it still working my downtown job Calgary Alberta get home from work one day and there's this beautiful FedEx box on my front porch I'd spent like $20,000 at this point you know in in food scientist and set up startup fees and I got samples of this drink I think it's gonna change the world I had all my friends and family over that weekend to do a blind taste test of my drink cause I wanted to try and get non biased feedback as much as I possibly could ended up being dead last in that blind taste test our business partner at the time wrote it tasted like battery acid so that's where that's where we started from dead last in the blind taste test so got a pretty rude awakening really early on went back to the drawing board changed a bunch of ingredients you know I was trying to use some complicated things early on like branched chain amino acids and I was trying to make it more like a pre workout drink but we dropped that pretty quick because we figured out it was gonna be pretty difficult to formulate with it and really it was just an iterative trial and error process you know we try one thing it wouldn't work try the next thing it wouldn't work I ultimately ended up landing on organic honey as a sweetener so got a really nice unique taste profile from that and then well natural caffeine from tea cause we experimenting with a whole bunch of different caffeine sources tea was ultimately the one that made us feel the best and there's research showing now that tea contains amino acids that can prolong the positive effects of caffeine it's a long winded answer to your question but it took a very long time and a lot more money than I was initially expecting unfortunately that seems like a common story yes you always think it's gonna be easier than that it is in reality always well I know that the brand is is now packaged in in the flexible pouches which is definitely pretty unique and the beverage market it says say the least and from what I know you landed on those pouches after a formulation taste and and or I think I read it was maybe like some rust issues with the can which I think is maybe related to that first taste test and why it was lassi I'm curious like how that just tell me a bit about that journey that ultimately LED you to the pouches yeah absolutely so when I first visualized starting an energy drink brand of course I thought it was gonna be in a can'cause all energy drinks are in cans and I originally went down that avenue I had a can design we were looking for can contract manufacturers I had a Serendipity's meeting about a year into this R&D process where I ran into a gentleman who helped launch monster into Canada and I'm telling him my idea and I showed him my designs and he looked at me and he's like I'm gonna tell you the cold hard truth like you probably won't even last six months like how in the world are you gonna compete with the big energy drinks like you don't have a chance like you're not your can design looks very similar you're not differentiated and this was pretty disheartening for me cause I'd spend a lot of time and money on design on this can but I went back to the drawing board and I thought okay if I put a healthy energy drink in a can and it's just sitting on the shelves next to other energy drinks and cans how how am I really gonna make it stand out how am I gonna get the consumer to perceive it as better for you and not just another energy drink in a can so I started looking at glass bottles and different options I had a engineering background I'm an engineer by trade so I was also looking into what's the most environmentally sustainable packaging type and in my research I kept this flexible beverage pouch kept popping up as a really low carbon footprint takes less water and greenhouse gases to to manufacturers compared to other packaging types and nobody was using it and so I thought well wouldn't that be cool cause it's gonna solve two problems for me one it's gonna be environmentally sustainable I'm gonna check that box but two if I put this thing in a pouch I'm gonna be totally differentiated and I'm gonna kind of own that space and in the energy drink aisle and so that was kind of some of the decision factors that ended up leading us down to the pouch what I didn't know is because nobody's doing it there's no stock pooches so I had to custom design our own pouch we have a pattern now but it was a lot of R&D work back and forth designing this thing and getting a packaging company that could actually produce it for us yeah interesting now that you've been in the market with it for these pouches for a while like now at this point what do you what have you found if you like are the biggest advantages and on the flip side any any drawbacks you've found at all so the greatest advantage is kind of like what I just said it really differentiates us like if you look at us on a shelf your eye is drawn to this thing because no one's ever done a pouch like ours it really stands out so it's drawn it's driven a lot of trial that way so it's been our greatest marketing asset now on the flip side because it's so unique the manufacturing is a nightmare so we ultimately ended up having to build our own manufacturing line which I never planned for I wanted to use contract manufacturers when we started I had no interest in doing manufacturing now we do everything in house so great marketing tool but a real manufacturing headache yeah fair enough fair enough see I know you mentioned you initially engaged a co packer when you're working on the cans and then you pivoted to the pouches when probably it sounds like probably out of necessity in house I'm I'm I'm curious in terms of the there's like you know the the filling portion but there's the also the portion of actually producing the actually like liquid formulation that's actually gonna go in the pouch was were you also doing that internally or was everything being done in house yes we initially started with a co packer for both so they would blend brew our our liquid and then fill it into pouches but it was effectively lab scale quite a slow filling machine they could do like you know maybe 20 30,000 units a month which pretty much gets you get one big retailer and you've outgrown them so that's what happened we worked with them for the first couple years of our business but outgrew them very quickly also had a bunch of quality challenges with our pouches we looked all over Canada in the US and there is companies that can fill pouches but not our specific pouch type we have a very unique spout so it's a a 22 millimeter spout which is totally unique to the market so no one had a filling machine for this thing so there's a couple companies that said well we'll call back for you but you gotta buy us a filling machine and at that point I thought well why not just buy my buy myself a filling machine so we do everything in house now so we blend the liquid and then we fill it into the pouches so yeah you you mention you you engineer and actually built that filling line and I'm kind of curious I imagine it definitely took you know a good chunk of cap ex to actually get that built out like what did that part of the process look like yeah it was brutal Adam so the the first couple years of our business we were running this thing out of my garage so this copacker would ship pallets to to my garage effectively and we were distributed out of there which was it was great it was a lot of fun I was in you know my mid late 20s at the time no overhead you know hand bombing cases to retailers it was great wasn't a lot of pressure we were making progress but then we start shorting retailer orders cause I can't get enough from my co packer I look everywhere else for another co packer nobody can do it for me so now I'm at this real crossroads in my business you know we've done a small seed round at that point just friends and family a couple hundred thousand but now you know I'm looking at building a manufacturing line and it's well over $1 million in in capex to build this thing and not only that but we gotta move out of my living room we gotta get a lease you know now it's not just a hobby business anymore it's it's the real deal now and there's you got to sign personal guarantees and there's a lot of financial pressure so it was a big change two years into the business but when got bank loans signed those personal guarantees raised another small I guess you could call it like a pre seed round it's help finance the the capex for building up the production line and we went to work building this thing took way longer and cost more than we thought it was going to initially but it's truthfully saved our business it's brought our our it's significantly improved our gross margin and being able to have control over our supply is such an asset when you get customers like Costco that we got this year if we were trying to juggle that with a contract manufacturer I think it would have been a nightmare where is you know Costco comes to us they need an emergency order delivered next week well we can just run on the weekend or we can run a night shift so being able to bring all that in house was the greatest business decision we ever made but also the hardest and it came with a lot of trials and tribulations yeah can imagine it sounds like you felt like it was the right calls which is which is great for other operators that are considering going down a similar path for for whatever reason maybe they've got a unique packaging form factor like you or maybe some formulation they feel like they don't trust anyone else to do for whatever reason they they're seriously considering going down this path of you know building out their own in house production line a few kind of recommendations you might have for something like that and a few things to watch out for other than maybe obviously like it's gonna cost a lot of money yeah so I think the first thing and a mentor actually told me this I didn't believe him but he was right whatever your initial time and cost estimate is double it because that's it's probably gonna cost twice as much and take twice as long as you think it's gonna take that's pretty true there's there's just little things you don't think about unless you have a lot of experience in this hire an engineering firm to help you we hired a local engineering firm here that helped us put together the drawings for the facility and make sure that pipes are sized correctly like even though I'm an engineer I wasn't specialized in that so we would have had a lot of screw UPS and a lot of hiccups if we didn't hire an engineering firm and then go and raise money just doing bank financing is is really challenging it's gonna put a lot of strain on your cash flow so I think you wanna make sure you go out and you you raise the capital you make sure that you have the cash in the bank to be able to float yourself through that period of building out the production line as like for instance you know we ordered a filling machine we thought it was gonna be here in December of 2022 well we didn't even get it till December of 2023 things get delayed there's gonna be supply chain issues it's probably gonna take longer than you think it's gonna take so you wanna make sure that you have enough cash in the bank to be able to float yourself through that period I'm curious like what's now that it's already built out and everything is is going yeah absolutely so I think initially some of our investors were pretty weary can you guys actually pull this off but now that we have it working and it's functional and our gross margin profile is totally different than when we were using a copacker we get a lot of compliments from investors now telling us that they don't see a gross margin profile for a young company like us like they never see that cause it's really difficult when you're contract manufacturing you're losing a lot of that margin the fact that we have control over our own supply now we own all of our ingredients we're not getting a contract manufacturer to do that and taking 10 10% in the middle so they love it and they see it as a huge positive and then we're not doing it right now but we also have the ability to co pack for other brands so it's a possible secondary revenue stream down the road which helps I think de risk things for some investors so overall it's been a massive positive and I would say it makes it a little bit easier for us to raise capital compared to some other brands our size that's great that's awesome talking about visual identity packaging design a bit I'm not sure if you read that book Ramping Your Brand which is seems like everyone at CPG talks about about I love that one thing he talks about is like how his views like premium pricing crystal clear promise versus I think he called it like featureitis I know you said you had that initial version didn't look great then you went to the next iteration whichever you wanna speak to like and that context thinking back to that design process and building out the brand identity what were kind of those key variables that were top of mind for you and maybe another way to look at it whether you work with a freelancer agency like what do you remember was it the key things that were included in that brief that you gave them yeah I don't know really good question first I love that book it wasn't out when I started but I sure wish I would have read it back I wish it was available back it would have saved me years of of mistakes but I definitely made that mistake when I first launched the featureitis mistake our packaging looked totally different than it is now it was a lot more complicated when we would explain the product to people instead of just saying it's a better for you energy drink I would have this long convoluted it's an energy tea and we has amino acids from caffeine from tea and all these different features of the product and at the end of the day doing enough demos and customer surveys now the reason people buy this is not because of the hundred features that I could list off it's because it tastes good and it makes them feel good it gives them an energy boost they felt better than other energy drinks so I think now we're really trying to simplify our brand messaging and make it a little bit more mass market I think when you had will it's on he talked about that too it's getting away from being a niche brand and being more of a mass market brand cause if you wanna be able to have an exit one day and you wanna be able to really scale and grow your business you have to effectively become mass market so now when we think about our messaging and our package design we're really trying to hone in on what's that poor problem that we're solving thinking wrapping your brand he calls it your high stakes consumer outcome and for us it's better for you energy effectively as if I had to boil it down so yeah we definitely made that mistake early on like we just worked with a designer that we knew but now you know if I could go back I would have worked probably with an agency or someone more experienced in CPG that could have helped walk me through that process and really understand what problem we were solving yep that's super helpful for I think other other operators that are a bit behind you that are starting to go through that process yes everyone makes that mistake I definitely sure for sure in terms of retail and and go to market I think I read you guys are in like thousand 2,000 or so doors across Canada you can tell me if I'm wrong there but what was the what was the first retailer that you got to take a chance on the brand yeah so it's it's kind of two local Calgary ones so there's a retail chain here called Calgary Coop it's about 30 some stores in the Calgary area it'd be similar to like a what would it be like in the States like a Safeway type of account and then we actually do have Safeway here that was our our second big chain that took us on yeah I just cold called their head office one day explained who I was asked for the beverage buyer and I don't know if the receptionist was just having an off day or what but she gave me the beverage buyer's number I was able to get a hold of her and we got a meeting in office this was just before covid times there where you could still meet people in person in in early 2020 and was able to to get a meeting explain the product our barcode didn't even work at the time I remember she went to scan it to check and didn't work so we had to get new packaging with barcodes cause I used the wrong format but it was it was really grassroots just calling trying to get in front of people trying to get them to trust me telling them I would do whatever it took to to make sure this was a success and she uh must have had an off day too cause she she gave us a yes and gave us an opportunity and we did all the demos and everything we could do to get it moving in that first store and that ultimately LED us to getting into Safeway in Alberta here as well which is our next big retailer and then just grew the brand from there that's great I'm sure I'm sure it's evolved like now I think I'd rather like you know that cold calling buyers has has been a big part of getting in a lot of doors I'm sure the cold call script evolved and got honed in over time and you know the more recent times when you found like the script that really work what you don't have to get it word for word but like what is your your most recent cold call script kind of kind of look like or what are the main bullets included let's say yeah for sure well I think early on when you're not in any retail stores it's a lot harder so you have to be maybe a little bit more aggressive and actually pick up the phone and and call people because you can't tell them oh well I'm in these 500 other stores and I'm seeing good performance so I think in the early days it was more focused for focusing on the the features like a little bit of the featureitis but also just letting building that relationship showing them like I would go into a retailer and if they showed any objections I'll be like I will guarantee all the sales if it doesn't work I'll just buy it all back like that would use I would say things like that and just to get an opportunity in the store now I would say we focus a little bit more on the data as we've gotten more sophisticated we know these buyers are looking at the data we know they understand their set very well so we can go and say here at X Retailer this is what our velocity is this is how we help them an incremental sale to the to the category this is how we're gonna help you so I think what it boils down to is how can we help that buyer they want to see more sales in their 6 foot set in the energy drink aisle so how are we going to solve that problem for them that's really where I tailor my I guess cold emails or or cold calls around that yeah yeah that makes that makes telesales evolve like that over time a brand should kind of have in their tool belt to pitch buyers obviously data sounds like the main thing but yeah anything else that kind of jumps out as you're thinking about between you book those meetings and leading up to the meeting question Adam so the first thing is understand who your buyer is I try to learn a little bit about them LinkedIn is a beautiful tool for that try to understand what do you think some of their pain points are and then we always develop a custom presentation it's typically five to 10 slides for every buyer I don't always use it but I at least have it available so if I'm on the team through the zoom call I can say hey I got this quick presentation and then the next big thing is I keep it quick you know these buyers they're their whole day is presentations they're getting pitched by everybody so one of the ways we try to really stand out is I'm not gonna give them a 45 minute long presentation going through every part of my manufacturing I have a quick and I tell them this this is gonna be five to seven minutes I don't like long presentations I'm not gonna put you through through through one this is how I'm going to help you this is how I'm going to expand sales in your set so I think keeping it as concise as possible I know is really appreciated and then really think about how can I solve the a problem for this buyer this this buyer wants more sales and they want to bring incremental people to the category so we really try to focus on how we're gonna help them with that yeah yeah that makes a lot of sense another part about you know what is the the distributor landscape look like in in Canada and I guess from what you know about the US market are are there any big differences between you know the US and Canada in terms of distributors and the distributor landscape so I guess for perspective like the entire Canadian market is less than the California market fair but this massive geography I'd say it's very similar like we have unified it's like the US is a unified here but there's like you know 2 main unified distribution centers where I don't even know how many there are in the US so I believe the US is a lot more regional and fragmented as compared to Canada that's my understanding anyways the grocery market here is dominated by two big players there's the Empire Group which is Safeway Sobies and then loblaws which is like superstore and then all the loblaws stores I think they have more than half of the market share in the grocery business here in Canada so it's just a lot less players it's a lot less regional there's a lot less distributors so it would be your distribution strategy for one state in the US would be probably somewhat similar to what your distribution strategy might be look like for all of Canada or half of Canada so we've chosen the route of of using more of the smaller regional distributors like we you know have we used to have a Western Canadian and Eastern Canadian distributor now we just have one their name is John Lucaniel they do a great job for us they're a little bit smaller than some of the big players but they have you get a little more love from them cause they have less brands they're a little bit more reps you can develop a relationship with them instead of just being a number in the catalog so that's been one of my biggest learnings I like working with smaller distributors that have between maybe 100 and 1,000 brands instead of like 20,000 skews really getting to know the sales reps because our product is unique and if those sales reps don't understand our story and they can't sell it into a grocery manager we're not going to have nearly as much success as just being found in a catalog that's been my biggest learning and I think we're going to have that same strategy when we venture into the the US market is is picking some of those smaller regional distributors how have you found working with those smaller regional regional ones at least as the best way to partner with them absolutely you have to help them do the work you can't just expect to ship your product to a distributor and then it your product be sold you have to provide them with marketing support you have to provide them with demos in store support so we try to take a very we really do look at it as a partnership so they're not just like a courier to us we're not just shipping them our product and then expecting them to sell it we're gonna be actively involved in trying to get them listings and then we we did this more in the early days but like I would go into stores and write orders for that distributor sometimes even for some of their other brands like I just meet up meet the grocery manager you know get an order for a Vita be like hey do you need any other products from this X distributor that we're using and then send it in like that's how actively involved we are now we have brand ambassadors in the major cities in Canada that go around they do demos they talk to the managers they help write replenishment orders for these regional distributors and then developing a relationship with the actual individual sales reps in each region so getting to know them on a first name basis calling them seeing how we can help them sending them swag free samples promotions spiffs those types of things to really incentivize them to help sell our product so I'd say it's it's definitely it takes a lot of work on the brand side but having a smaller regional distributor that has more of those resources to work with you and a few less brands to to sell that's been the strategy that's really helped us grow in retail across Canada that's great that's super helpful he said he I tell earlier stage brands they should expect about a 30% impact to margin what do you what do you feel like brands should expect in terms of margin impact when when partnering with a distributor yeah I think I saw that exact post Adam and I would tend to agree so I think in the yeah in the early days you're budgeting you should budget about 30% if you want to use some of the bigger national distributors sure their margin might be 2018 to 22 somewhere in there but then you're gonna have to hire a broker you're gonna have to do more of your own in store so you're gonna end up probably netting out around 30 or 35% anyways yeah so I'd rather just give a smaller distributor a little bit more margin to play with but get a little more support from their in store sales team so I think if you're a young brand I'd budget 30% maybe you could get it down to 20 to 25 but I think 30 is gonna be pretty safe out of the gate yeah okay in Canada I believe they're definitely kind of the dream retailer for some but they're also different a lot of ways and yeah tell me about that journey of getting on the shelf just in terms of getting that first buyer meeting getting that commitment and kind of all the steps once you got that commitment leading up to that successful launch yeah absolutely Adam Costco is the dream retailer and sometimes I gotta pinch myself that we got that opportunity especially being a younger brand so we happen to meet the Costco buyer at a trade show here in Canada if you can believe it he came to our booth we didn't even look at his badge initially so we didn't know who he was but you know we try to treat everybody the same at the booth and ended up having a really good interaction with him which ultimately LED us to getting a a small listing just in Western Canada here so we were in 20 warehouses in Western Canada which isn't a ton but it's it's really good for us and really good volume for a smaller brand and they are the dream partner you go direct to them but just like using a small regional distributor you have to provide them with a lot of support so we were doing a ton of demos we were attending the demos ourselves we were doing a ton of social media getting in all the Facebook groups for all the different Costcos amazing partner there is uh few opportunities that are more fruitful than working with Costco but you also have to really prepare yourself like our manufacturing line we were running that thing around the clock a lot of last minute production runs and then really making sure that we supported the the Costco stores with a ton of demos and marketing support yeah what other brands that maybe they just got that commitment from Costco they're planning for that launch where like a few things they should keep top of mind it sounds like not surprising demos are a big thing anything else that kind of jump jumps out that someone else should other brands should keep top of mind as they're getting ready for that launch 100% so really budget for the demos you know they can range anywhere depending on how much product they got to buy they can be between four and 800 dollars per demo so that adds up really fast when you start budgeting for that make sure you have you invest in a ton of inventory out of the gate so when we launched it sold a lot better than they were expecting in the first few weeks so we were getting these follow up orders really quickly without our normal lead time so if we were cope this is where I said if we had a contract manufacturer they might not have been able to pull it off very unlikely would have been able to pull it off without weekend shifts but because we do our own manufacturing in house we just worked around the clock we came in on the weekends we did whatever it took so I'd say make sure you invest in like ideally a couple months of inventory that's just sitting in your warehouse ready to go so that if things take off better than you were expecting you have it ready to ship and then really budget for significant trade spend to be able to support the stores and I don't think 20 spending 20% in trade spend especially initially is unreasonable at all cause those demos add up you're gonna wanna do things like running social media ads to promote sales in stores you're gonna wanna attend the demos yourself you're gonna wanna get involved in the Facebook groups and all that stuff really starts to add up so making sure that you have a budget to be able to support your launch yep I know Amazon's been a pretty big channel for you guys one of the the the the only market so or channels so far that you're sold in both Amazon Canada and then and then Amazon in the US I'm curious just from purchase patterns reviews anything else I'm curious have you found any big differences between the average Canadian versus US yeah so I'd say they're similar in a lot of ways I guess to to preface this we're not currently on Amazon Prime in the US just with the whole tariff challenges we decided earlier in the year to pull off of that for now makes sense makes sense hoping to relaunch maybe in Q4 here of of this year as far as the difference in consumers I think very very similar I would say in terms of the feedback that we get if anything I think we probably get more positive response from US consumers you're more of a tea drinking nation so especially in like the southern US where they drink their sweet tea we get a lot more comments about our products from consumers there so that'd be the one main difference that that stands out but I think very very similar between a Canadian and a US consumer yeah that doesn't surprise me um like two or three key variables that determine based on what you found so far that determine if a brand's gonna be successful on Amazon or not what are a few things that come top of mind I think your repurchase rate is probably maybe the the North Star that you should look at so if you register your brand on Amazon you can you can get your repurchase analytics so I think really making sure that your driving trial and then getting people to come back and buy your product as we both know it's virtually impossible nowadays to build a CPG brand just on trial you you really need repurchase if you're gonna have a sustainable business so that's a big one really monitoring your reviews I we've Learned so much especially from those early reviews and as much as it hurts to get some of the negative ones a lot of times that critical feedback can really help you improve so even some of our early you know feedback on Amazon has helped us improve the product over the years I'd say repurchase rate and then more on the advertising side your your a cost or your basically like your acquisition cost for advertising if you can keep that under 30% like you have a sustainable business cause definitely margins in beverage specifically where it's heavy to ship are pretty compressed on Amazon so if if you can't get your Acos down at a reasonable level it's gonna be really difficult to scale with advertising on Amazon it seems like running ads in Amazon is kind of a prerequisite requirement at this point pretty much from what I know I think like what I've heard is making sure you get your listings set up correctly including all the backend components the first time is super important as I've heard it just can be really challenging to go back and forth and fix any issues later I don't know if you've had that experience or had to learn the hard way but what are some of the key things that a brand should watch out for really be careful with as they're getting their listings set up and that's a great point so we had that actually like issue and we launched so this was back in like 2020 when we first got on Amazon and I set the listings up myself to know what I was doing I wasn't using chat chat b chat BPT back then so I think I just googled some guides and I did make some mistakes and I think what could have what should have taken days to set up our listing ended up taking I wanna say like 6 months cause we had to go back and forth with the support team and I made mistakes with how the product was classified like getting an expert or really doing your homework and making sure you set up the listings correctly is really important so that might be something you wanna invest in hiring an agency or somebody to help you with so you don't go through that same it's those same issues that I tell with yeah totally that makes that super helpful too you know fairly early but when you think about resourcing I'm just kind of curious in terms of like how you think about frameworks you use or variables or factors come in place as you're kind of building out your your plan with regards to internal versus external resources I'm curious are there certain functions like I don't know influencer management or creative agencies packaging design production design that you always feel like you you've you've found like bringing in house whether it's if you view in house is like you know kind of like a full time contractor versus an agency yeah great question I think we're still navigating that I think the hub and spoke model that like will talked about with that Q Bar is where we'd ultimately like to get to yeah I think our core operations should always be in house so all of our manufacturing obviously we do all our own order fulfillment like anything to do with customer experience customer service we keep in house the things that we're outsourcing now would be package design so I think that's really important to have a third party that really understands it especially if you're someone like me that's more analytical and enjoys the numbers as opposed to being visual having someone that really like yourself that really understands that is gonna save you a ton of time because really the most important part of your brand is the packaging design that's your billboard and if you screw that up but it doesn't matter if you optimize everything else cause you're not gonna see the velocities that you could have with a proper design we've our marketing right now we are doing in house we've had some challenges with agencies I think a lot of young brands have that we've cycled through a a few so eventually we'd like to have like a meta ads agency and and agencies for Amazon advertising but we also need to be at the scale where we can afford to get a good one cause you do get what you pay for I think in that space so long when it answered your question but I think our core competencies will always keep in house but then things that are really specialized like packaging design marketing and like ad add spend that type of thing it makes a lot of sense for a young CPG brand to to eventually outsource that to a very competent agency yep totally I think that that's a I think that's a smart approach last question for you Mitch any brands or just trends in general across the CPG space that you're in the space every day I'm sure you're coming across a bunch of different stuff anything that's like kind of really piqued your interest or things you've started tracking that just got you excited at all yeah I think one of the the trends that's we're benefiting from and kind of had a hypothesis back in 2019 2020 when we launched the brand was that the market is gonna shift a little bit away from zero sugar to low sugar but no artificial sweeteners or nothing like stevia and erythritol and so we made that bet back in 2020 we didn't use the stevia erythritol root we use organic honey and fruit juice keep 30 30 to 40 calories I think you're starting to see that now with Poppy and some of these other brands is consumers are now getting away from the zero sugar and shifting more towards well sugar isn't necessarily a bad thing if it's natural sugar and there's low amounts of it so I think that's one of the trends that we're really excited about and I think we're seeing more and more brands kind of shift and develop around that trend yeah on that front I feel like you guys are in a good position I feel like honey sweetened things are only getting more and more popular to you so you guys are in a good good place from that perspective thank you well yeah Mitch what's a what's the best place for people to follow along with with you specifically and then also best place for people to follow along with the brand as well yeah absolutely so myself personally I'm most active on LinkedIn I'm not really on any other social media so just Mitch Jacobson Jacobson with the E N on LinkedIn and then as far as following our brand we're of course on LinkedIn as well but I'd say Instagram would probably be our main platform that we're we're most active on cool awesome Mitch appreciate it's been super helpful super insightful think people are getting a lot of value out of this um yeah appreciate the time um thank you so much it's such an honor to be here and I really appreciate you having me yeah likewise alright think that's the pod let's rewind back to those early days key tweaks you made between that first version and what are just a I don't know what's the take from like investors shifting gears a little bit really comes from brands having like one really clear I'm curious on the on that distributor side of things what have you found I saw some guy in the CBG space I follow on Twitter what from your from your perspective Costco's turned into a pretty big partner for you guys that's my next question like I think that's like a good dose of reality US Amazon consumer if you had some experience that talking about marketing resources for a bit I know you guys are still