Gather-ing New Routes To Market

0:00What's the latest in frozen breakfast? which brand is up for sale, who acquired Cool House and The Urgent Company, and how emerging brands should approach retail expansion.

0:21Hi everyone, I'm your host Carol Ortenberg. On the NOSH podcast, we go inside the business of natural, organic, sustainable, and healthy food. Today, we're discussing some shutdowns and sales of notable CPG businesses. And we'll hear from Mia Medina, the CEO and founder of sales consulting organization, Gather Brands, about the different pathways to national distribution that emerging brands can take. Joining us today is reporter, Adrienne DeLuca. Hello, Carol. Hi, Adrienne. And editor in chief, Jeff Kleinman. Hey, thrilled to be here. There is one category of the store we have to start by discussing.

0:59It's seen a ton of innovation recently and that's frozen food, breakfast in particular. In the past week alone, I caught up with Capello's regarding their frozen biscuits launch. And then we also had stories about both Bonza and Brazi Bites launching waffles, which as our resident Gen Z, Adrienne, I think ties into a popular social media trend. I was asking you about this. I think you told me I was behind the times though. You're a little bit behind the times. I hate to inform you. I've been waffling things via inspiration from social media since I was probably in middle school. You know, mozzarella sticks, mac and cheese.

1:36I was a good dad about a dozen years ago and I bought my son a waffle iron with the book, Will It Waffle? So I think it's not just social media, it's actual dinosaur media. Media, media, okay, fine. So the book probably started this whole Will It Waffle hashtag now, But, you know, in my mind, this dates back to like BuzzFeed, tasty video kind of days. That's when it first, you know, crossed my screen. A surprising number of things will waffle, though. As I just listed, mozzarella sticks and mac and cheese might be my top two. Adrian, could you waffle seaweed? Or, I mean, millet, yes, you could make a millet dough.

2:23But I wonder, could you waffle seaweed? I don't know if that would work. See, I'm picturing as long as the seaweed's not dried already. Yeah, I'm going with that as a subject. Wouldn't it essentially create like a seaweed waffle crisp? It might burn. I'd have to look into the chemistry behind all of this first. I didn't realize you were a chemist, Adrian, too. This is new to me. For most of these questions, though, it's not will it waffle, but should it? Should it waffle? And I guess how well will it waffle? I think it's more of a pass-fail grade on that. It either waffles or it really does not in my experience.

3:04Yeah, or it should or it really shouldn't. Wait, what waffled badly, Adrian? I tried to stuff, I forget what the dough was, but something with like essentially a Hershey's chocolate bar, but it made the dough part of burnt chocolate. It was just disgusting. I think I actually ended up throwing out the waffle maker because of it. Like you just couldn't get that stuff off. Yeah, if it's capable of burning, melting and burning a liquid, like if you were to take, you know, peanut butter and jelly and try and waffle that, it would sear your fingers with fried, side burning jam. Apparently Brazi Bites has been following the trend.

3:54They said they were inspired by TikTok and saw that folks were waffling their Brazilian cheese bread and that inspired them to launch a line of waffles in cheesy blueberry and homestyle. The last two have no cheese in them. I should be very clear in stating. Tell me they call them cage waffles. I think that's a missed opportunity. I don't believe so, but hopefully they'll take that under consideration. They can't anymore. I've trademarked it. Cage Waffles TM. In the time we've been sitting here, paperwork's been filed. He's fast, guys. There's been some editing of time. Well, I know our sister site, Brewbound, has their tagline of asking if their hosts are buying another round.

4:41So I guess on our podcast, we should ask if you're checking out, how do you guys feel about cheesy Brazilian waffles? Are you checking out? I think I check out once. That's my impression of this product. I love the idea. I think, you know, back to my tasty video comment earlier, you could probably come up with some fun recipes that utilize a savory waffle. But am I going to be buying those regularly for breakfast? Like probably not. I believe I have eaten this. I think it's on the menu over at Pagu, in fact. Was it good? Yeah, of course it's good. I don't know. I'm not a sweet eater. So this got like, I was really excited about this.

5:26I could go for a cheesy waffle way more than like a maple. I did not grow up liking waffles. I hated French toast. it was just all too sweet for me to enjoy. No, Adrienne, I'm making you sad here. I feel like I can sense your disapproval. Yeah, we're just so different. That's all. You just talked about waffling lots of things with cheese. I'm saying I love cheese. This sounds like we're... It's less your love of cheese and more of your dislike for sweet things. I like a balance of both, an overbalance of both maybe. Like I said, I've had it and it's very good. Well, beyond the taste, I thought all of these launches from Capello's, Brazi, and Bonzo were interesting because they're special diet brands and they're offering gluten-free baked goods that are also high in protein.

6:14And given that gluten-free is just so pervasive at this point, I sort of wondered if maybe you need another nutritional benefit along with gluten-free to really stand out as a product from a nutritional point of view. I don't know. I mean, they are marketing themselves as high in protein and gluten-free. And quite frankly, if you're dealing in a frozen breakfast item, your major concern is convenience and time. You don't nuke up a biscuit unless you're trying to get out the door pretty quick. And there's a point at which you're just trying to check the box and being able to eat the same kind of comfort food that everyone else is that'll conform to your diet.

7:04I don't know how many plus, plus, pluses you need for a frozen breakfast. You raise a good point, though, Jeff, because Brazi Bites had actually launched and since discontinued in favor of the waffles, a microwavable gluten free breakfast sandwich. And part of the impetus behind that was they found that consumers wanted something even faster than they could get their, you know, frozen cheese bread or empanadas or pizza bites. So we'll have to see how they respond to a waffle that may take a little more time than microwaving a sandwich. I think what's been interesting is there's been a big boom in microwavable biscuit sandwiches in the past few years.

7:50And I think that it's great that there are gluten-free options for it. I'm wondering when some person is going to go even beyond that and do like a beyond meat breakfast sandwich with beyond sausage. Could it be a brazi beyond? In other gluten-free frozen news, though, Adrian, this week, another player is up for sale. Adrian, you covered that news. First of all, before Adrian speaks, I just want to say, where else are you going to find a podcast that says, in other gluten-free frozen news, but the Nosh podcast? You heard it here first. Other gluten-free frozen news. It's not just gluten-free. It's not just frozen.

8:45It's gluten-free frozen. Ooh, what about gluten-free frozen walking tacos? they're plant-based too we could go with some plant-based although the cheese i guess makes it not plant-based all right so what's the news adrian in this in this hot category in this very unique space of ours this week cauliflower foods announced they are heading to auction next month they are selling all the business's assets including you know production equipment inventory trademarks domain names the whole thing a bunch of they said there was a bunch of inventory so i'm just picturing like heads of cauliflower maybe who knows as of right now their website everything is marked as sold out so i don't know exactly what inventory we're getting but yeah they have you know tried a few different things to make the business work over the past few years updating packaging, kind of moving away from that keto gluten-free set we were just talking about, more to the low-carb position that seems to be resonating with some consumers.

9:56They've acquired their co-hacker. They've acquired some outside brands. But apparently, that was not enough to make the business work. Well, that's too bad. I mean, there were two really good sort of cauliflower crust pizzas that came onto the market at about the same time and I think both of them if I'm not mistaken Carol have seen some declining fortunes I don't think we're through with cauliflower crust though I think it'll be back someday maybe as as a breakfast toast. Maybe as a waffle. You know, I have spoken to Gail about this. I think she talked about this at Nosh Live that during COVID, it was hard to be a cauliflower pizza brand because everyone just wanted comfort food.

10:47But she said the business is, you know, has regained a lot of that momentum. And certainly they've expanded into other cauliflower based items. I think there's some pasta, chicken nuggets, chicken tenders, just like Will It Waffle, I guess there's Will It Collie. I don't know. Will It Flower. Yeah. Will It Flower. There we go. Adrian, you referenced that cauliflower was up for sale. It's that one of their loan providers has them up for sale. I think we should just clarify for listeners that this is not like an auction that's being done to fine buyers for a really solid exit return. It's kind of a forced auction, the result of lenders calling the note and the company having to sell and basically go under.

11:44It's what some might call a fire sale. Some could call a flower sale. It's something that's happening to a lot of brands. I was speaking to the CEO of a fast growing carbonated water brand a couple of days ago, and he made it clear that it's a really tough environment for a raise right now. And And if your fortunes are sinking and if consumers aren't willing to spend when you've already taken some pricing or if your costs are going up, it's hard out there. And good luck, everyone. Can one of you give me a little more detail on why they had so much trouble toward the end there? I'd love to, Jeff.

12:38While we don't have full details on exactly what happened from the company acquiring their co-manufacturer back in 2020 to their recent acquisition of frozen fruit brand Mikey's, it was pretty clear they were trying to fill some time in their production facility, get a little bit more out of that arm of the business. We heard from their majority shareholder back in March when they acquired Mikey's, who explained that was the reason behind that acquisition. And they were trying to fill line time with Mikey's, and they just haven't been able to attract more people. And if you can't run those machines at a certain level of efficiency, it's expensive to own.

13:25Hey, Carol, I heard one of our favorite companies has a new house. You're right, Jeff. This week, Cool House and its parent company, The Urgent Co., were sold by perfect day to a food tech company that will soon be known as Super Lattice. I love that name, Super Lattice. I think you could name a cat Super Lattice. Super Lattice the Super Catus. It is a great name. I say it will soon be known as that because currently it's undergoing a reverse merger with a publicly traded health IT company. And as soon as this merger is complete, they're going to divest all the health services that this company works in, change the stock ticker and be known as Super Lattice.

14:12And the whole goal is to build this platform of plant-based and better-for-you snacks. They're particularly going after the school channel, getting into cafeterias. They see the work that California and New York is doing around improving school lunches as a real sign that there will be a lot of money to be made in that channel. And in fact, they announced yesterday that they are launching Puff Twists under the Brave Robot brand, which used to be an ice cream brand. And, you know, I think they have a little help there. One of their executives, get ready for this, was the founder of the Twisted Cheeto.

14:54So he's got a little background in snacking. You know what happens if you eat too many Twisted Cheetos? What? You get super fattest. Jeff, you're killing me today. I can't. You know what happens if you eat too much plant-based ice cream? I knew where this was going. Super flattice. Jeff, we'll have to see if there's as much opportunity for revenue growth as there is for puns. I don't know. You have a lot of puns in hand, so they'll have a lot of ground to make up on the revenue side. But I mean, if not, they can license the name. We should start a new waffle brand called that. Why are we starting a waffle brand called Super Lattice?

15:38Because waffles are like lattice work. Oh, no, that makes sense, actually. Yes, right? You didn't mean that. I was thinking along those lines. That's why I said yes. Super Lattice would be great. It could be part of your garden setup. Ooh, maybe it shouldn't be a waffle. It could be like a new chicken wire to keep out the bunnies. I'm really struggling with that this year. If anyone knows. Oh, lattice. Yes. It's, yeah, but this is super lattice. It's like much better because my current lattice is not doing anything. It's more than lattice. Well, you know why? It's because the bunnies are attracted to your, go on, say it.

16:21You can say it. Super lattice. I've only, I had a super caddis to scare the bunnies away. I can loan you one. She's super fattest too.

16:36she might eat them though guys you are slaying me with the puns today well i'm sorry now that you're dead let's get to the interview i spoke with mia medina the founder and ceo of gather brands a sales organization working with primarily women owned and run emerging brands and mia made our nosh notables list this year and she and i sat down and just talked about what does the retail environment look like for brands? How should emerging brands be approaching distribution? As well as if some of the programs for women-owned brands are making an impact and affecting long-term change in the industry.

17:17Well, Mia's a great person, really like her company, and I'm always impressed by her super sales apparatus. And with that, let's get to it. Hi, Mia. Thank you so much for joining me today. Hi. Thanks so much for having me. Super excited to be here. Well, to start, I want to hear a little bit about what was the impetus to launch Gather Brands? Well, in full transparency, I launched it after my position was eliminated during COVID with a previous employer. No better reason than to launch a brand. Sounds like a good time, pandemic plan. And some people cut their bangs. You started a whole new company.

17:56Yeah, I was kind of like, you know, pre-great resignation. So I didn't necessarily have a lot of choices at the time. But I will say, in all fairness, that working with emerging brands has been a passion of mine for, you know, for a very long time. I actually had been in the natural products industry for about 25 years. So it's something that I had always kind of wanted to do. But it just was the timing was never never seemed like the right time. So that worked. So we are a sales consulting agency. I don't necessarily usually like to use the word broker because I think that a lot of times they don't have such a great rap, but I will say, you know, we're kind of a broker and a VP or director of sales all rolled into one where we really partner with our brands and become an extension to their team.

18:42Now you do focus, not exclusively, on working with female-led and female-owned brands. Where did you see this demographic of brands struggling when it came to sales and distribution? A previous life, I was working on emerging brands for our distribution company that my husband and I owned. And what I learned was that women really create these amazing products out of purpose and passion. And a lot of times, really that missing piece is how do you get it on the shelf? And so there's a lot of nurturing and cultivation that goes into helping these brands grow and scale. At the same time, this industry is still, for all intents and purposes, an old boys club.

19:24And so the idea of creating this safe space for female-found brands to come and say, you know what, I don't know how to calculate my margin, or I don't know what the next steps are, it just made sense that that was who I really wanted to focus on and really help and really help grow. While purpose is important, though, those fundamentals are also just as important. So how do you kind of evaluate brands and ensure they're ready to take that next step with you, though? A couple of different levers that I look at, you know, do they have, I mean, this seems very remedial, but do they have UPC codes?

19:58We've actually had brands come to us that don't even have UPC codes. So it's like, OK, at that point, you know, and we do actually work with brands in an earlier stage. We can work with them to help get them sort of retail ready. But at this point, the majority of our brands are past that point. And so it's really finding out where they are in their process. If they're, I like to call them pre-retail, they might be doing 5 to 10 million in D2C business. So they've got a product that is absolutely resonating with consumers, but they might just haven't gone into retail yet. And then we've got some of those that are just early stage starting out.

20:33So it kind of depends on where they are in their process. We're definitely on that pioneering side of things. So working on getting into some of the regional chains that we've got within our portfolio of accounts that we work with, all the way up to national launches with Whole Foods and Sprouts. Going back to that idea of the old boys club, though, we certainly see a lot of programs at retailers that say they're designed to highlight women-owned companies or female-run brands. Do you think they've enacted sustainable long-term change that will have an impact on the industry? Yeah, I think what's very interesting, it's kind of twofold because there's the getting on the shelf aspect of it where it's interesting because in the natural and specialty industry where you would think that they would be much more forgiving for brands that have those types of certificates, they aren't.

21:24They're still requiring free fills. They're still paying the same for any of their advertising that they offer. conventional, however, is a little bit more forgiving where you can sometimes waive slotting fees or things like that. So that was really interesting when we started working with a lot of these certified brands. And then on the back end of it, I think, yes, the retailers are definitely working towards highlighting some of, you know, whether or not it's female found, you know, minority owned, that kind of thing. And we've done a couple of, you know, March is Women's History Month. So we have actually partnered with a couple of retailers instead Instead of, you know, a March Madness end cap, they're doing a woman, female founder end cap.

21:58And so we've partnered with some of our retailers on putting those end caps together, not just with our brands, but with other brands that they have in their stores. So I think they're doing a great job on sort of their consumer facing, but coming into their, you know, each of their platforms, they're not quite there yet. So what does need to change? What do you think would be some advances that would really help move the industry forward? Oh, gosh, without, you know, without getting into too much trouble. There's no time limit here either. We can beep out the retailer's name. Yes, I will say.

22:30I think that there does need to be some forgiveness where, you know, ad budgets, things like that. And that's not even just for necessarily minority or women, but emerging brands. Emerging brands can't afford these hefty, hefty, you know, ad fees that a lot of these retailers are charging. And then the other piece is on the distribution end of it, which, you know, I think that's probably a whole separate call in and of itself. and I don't want to get canceled from our distributors, but I think that there needs to be some forgiveness there as well. And I think for brands to really be able to partner with these retailers in these early stages, there's gotta be something put into place where it says, okay, this is how we're focusing on diversity and all of that.

23:16They need to work a little bit harder on that. The fact that these fees do exist though, does that impact how you advise brands to go about their retail strategy? Are there things they can do to, you know, maybe work with a retailer around those fees? It definitely does impact how we work with our brands in that we make sure while we're presenting or prior to presenting to a retailer that our brands understand the exact cost of doing business with that retailer. So they can say, you know what, this one we're actually going to hold off on, or maybe we want to, you know, we're not ready for that one, you know?

23:51So, and then there are some retailers that are negotiable and it's actually funny. It's not even necessarily the retailer. Sometimes it's the buyer and, you know, there might be one retailer that has like these crazy slotting fees, but we know, okay, well, this buyer is super cool. And if we're like, Hey, you know, this is a minority on women owned, we know we can kind of negotiate that. And that's really nice when, when there are those, those opportunities, but for the most part, you know, we just want to make sure that they understand exactly what their cost of doing business is going to be for that retailer prior to going into it.

24:24I mean, not every brand can work with gather brands or a sales organization. So how do you kind of navigate those waters if you're doing it alone? Any suggestions? I think that I would absolutely prior to, you know, when a brand is reaching out to a buyer, I would absolutely ask all of those questions, not just, hey, I'm a great brand and I think I do really well in your stores. It's what does it take to participate with you and align with you? And I really want to partner with you. So what is the best way to do that? And oftentimes, you know, if a buyer responds to them, they might, you know, send over their their ad agreements and things like that.

25:03So they can kind of analyze it. I think so many brands now, though, unfortunately, are kind of like, well, I just want to get on the shelf. And so they're not looking at that. And then they're like, what? We didn't know that this was going to be required of us. And then that impacts getting off the shelf, right? Moving the product off the shelf, which is really the more important piece after getting on the shelf. Despite these fees, is there an appetite among retailers for emerging brands? I think so. I think that regionally, definitely, I think a lot of retailers want to be first to market with some of their local brands.

25:38some actually really want to see a story and they want to see a sales story that that it's going to move once they put it on on shelf but again it's kind of knowing who those you know ones are that want to be first to market and and that's that's the fun part because it's like you know again there's category review schedules and things like that that they adhere to but we know you know certain retailers it's like okay let's get this right in front of them because they'll activate it even though it's outside of category review so yeah there is it depends it's retailer by retailer for sure. So for example, you know, a Wegmans in New York, they really want to see a sales story and they want to see that a brand has proven traction in another retailer or region or something like that.

26:18And then I think we've got some of the more regional accounts. When you look at like a mother's market here in Southern California, they're really, you know, really excited about getting some of these innovative brands and wanting to put them on the shelves to give them a test and kind of be that first to market. Gelson's is another example that really enjoys to be first to market. So we want to make sure that we're showing them our brands as soon as we get them. Speaking of emerging brands, I thought it was interesting that Whole Foods announced their Leap Accelerator program, and they have two cohorts, one for sort of emerging, emerging brands and one for brands that are in a few of its regions, but Whole Foods sees the potential for them to go bigger.

26:59Is making that jump from regional player to national distribution that you kind of alluded to with Wegmans even really difficult to do? It's not so much that it's difficult. And Whole Foods is a little bit more specific. It's nice when you can focus on one retailer to do it with. So with Whole Foods, to go into three regions or four regions from one region is nice because you're activating the same distributor, just different distribution centers, right? Different DCs. So that's actually a great way to do it, assuming that, you know, freight is aligned and all of that good stuff. And, you know, but I think they're incredibly supportive as far as expanding brands out.

27:38Going national, you know, by way of distributor is not something that I usually recommend because you want to make sure that you're supporting opening DCs that, you know, what accounts are going to be pulling from them. Do they, are they already approved in there? Just putting product into a DC without knowing if there's going to be an account that it's going to pull from it doesn't do you any good. You're going to end up buying back the product that you ship there as it goes out of code. That's funny because we get a lot of press releases that are from brands who say, I just want to let you know we're going into KEX region.