What do your friends and family think about your product? I would test the waters before jumping into something like this as a recession would mean people cutting back on things like sodas.
this post was submitted on 28 Nov 2023
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No. If you're asking here this vaguely, no way.
I mean I’d get all my ducks in a row and like i said, start small and order a few batches just to test the market to see if its a good idea or not
Its a very though but also fulfilling industry. I am/was new to it and have a marketing background. At least marketing is a major pillar of any F&B brand. I also know where I am weak (sales, distribution, supply chain) and hired a consultant to fill those gaps.
It can be a pretty long process too. For instance, I signed a formulation agreement with Flavorman to formulate 3 carbonated sodas in December 2022 and finished in August 2023. Typical costs are about $5-$8k per flavor.
During that time, starting working on brand, trademark, some legal reviews of claims and nutrition facts, certifications, sourcing suppliers, website, SEO, found co-packer, UPC codes, can printing. Also got setup on Amazon so it’s ready when I have production.
Recruited a small panel for feedback and also did a small run to start with user generated content and photos. Also created a nice branded sample box and booklet for sending to distributors and retailers when I go live.
I am super excited as my very first pilot run will be on 12/13. Producing 500 gallons of each flavor so about 15k cans. This is considered a very low volume and most co-packers won’t even work with you. I am starting with D2C through my website and Amazon.
With all that, I am in about $60k.
Then in spring, the expectation is that I will land at least one decent distributor (I have a target list with about a dozen in NE) and maybe a retailer. If that happens, I will need to do another production run and likely about 2000-5000 gallons per flavor. That is a much bigger investment. I am holding off on investor money as long as I can.
This is a bit long but I’m living it right now. Lots of tasks but just take it one step at a time.
I have a strong family history of diabetes and hate diet soda. Wanted to create a great tasting zero sugar soda and discovered allulose. Thrilled with how our final formulation came out and excited to bring this to market. Wish you the best of success as well.
First, wow! Congrats on taking the leap! The soda sounds awesome. When it comes out let me know, I’ll try to pick up a case.
Thanks for all the information! The price per flavor is also super good info. I’d probably start with three as-well!
Yeah I’m actually starting the process of creating the “brand” before getting the drink so I know what more of a directions I’m going and also get started more on the business side first(trademarking and creating a logo/website; all still new to me).
Also dang, i didn’t realize 15k cans wouldn’t even be close to enough haha. Investor money would suck(eating your profits directly) but its grow the biz and also get you more money in the long run too(which im sure you know).
Best of luck to you! Would it be okay to reach out during the process if I have questions?
Feel free to reach out. I am happy to share from my journey. 15,000 cans is basically 5000 per flavor. Or about 420 cases per sku. Margins get way better with volume. Normal MOQ’s of real production runs are about 200,000 per sku! That is basically a full truck. So when you print cans normally, that is the volume you deal with. You could order the 200k cans and do a couple production runs to help. The cost per can for 15,000 for me is about $1.30/can. (I will lose money on each case i initially). At full ramp production, cost drips to about $0.55-$0.60 for me. For instance, regular offset printed cans like a Coke can might cost $0.10. But with low volume, you have to use shrink wrap cans or digital printed cans. Those are closer to $0.35. Oh… I learned all about can lids too such as 202 LOE vs CDL. I wanted gold lids which turned into a hassle. One nice thing about this business is due to the timeframe, you can sort of pace yourself especially if you work full time. Ince you go live, it will likely take more time. But for now, website, branding, formulation, are less time dependent.
Amazing comment. Congrats on your progress! I have an interest in developing a product in the F&B space but am having difficulty figuring out where to start. What kind sources did you use for research purposes to determine what steps you needed to take?
Can you Market a "Drink Business"?
What do you know about it, so intimately, that you can convince anyone they need it?
One of the greatest lies of this world is that "Water is Boring".
And yet we add some caramel color to make it look like it was aged in a barrel, some fizz, and call it Coke.
So, what PROBLEM does your business actually solve? You might need to spin your answer to make it make sense, but you still have to answer the question, if you want to create Customers.
Yes! Drinks are awesome
Starting a soft drink business is a huge challenge and can be quite risky, especially in such a competitive market, even if you're passionate and have a unique drink idea. However, your $50,000 budget for creating the drink, marketing, and initial production is a good start. Participating in local events and getting your drink into local stores are great ways to build your brand. And the beverage industry is competitive and challenging, so careful planning and adaptability are key. Success isn't guaranteed, but your passion and a well-planned approach can make a significant difference. I recommend to give this article a read. Best of luck! https://www.cuppa.so/post/turning-your-big-idea-into-a-reality
Typically, slotting cost starts at $100 for entry into one brand name retailer. That’s after you have all startup cost, and can ensure to keep your slot packed.
Realistically, that’s closer to 200k to even start.
At 50k, you are bootstrapping like 5 hour energy.
It can be done, but you’d have to create so much direct to consumer demand that you can even get meetings with distributors to even get them to consider making an order.
They like to start with a small order of 1 million usd at minimum ( at least in my area) and then more the next month.
If you can’t fulfill that or future orders you won’t be doing business with them.
At your budget, you are direct to consumer.
I also, already have home made beverages that would do great in market, however I don’t have 200k to get it going, nor would I attempt a 50k direct to consumer launch.
Not unless it was literally 50k to burn with a lot more money flowing in.
If you're asking "should" you are not ready. You should know if you should or shouldn't.
Secondly, no one needs another beverage, however, so what's your credibility in selling products? Whats the value proposition of yours?