R&D Radio: Lara Tiro of Rebel CPG — The PB&J Framework, COGS, and How to Scale a Food Product the Right Way

0:02Did you hear that? That's opportunity knocking. We've been building something big. Introducing Opportunity Knocks, a new campaign giving startup CPG brands exclusive direct access to submit to leading retailers, distributors, investors, media, and more. Here's how it works. On Fridays, a new submission window opens exclusively for active Startup CPG email subscribers. Each campaign features a custom form tailored to that partner. Share your brand story, products, distribution, and traction. Startup CPG delivers your applications directly to the partner's team. Some campaigns include a live fireside chat so you can meet the partner and ask questions directly.

0:44To get every drop, subscribe at startupcpg.com slash OK. That's just the letters O and K. Today's drop is live and it's with Whole Foods Market UK. Ready? Go. Go subscribe. Go submit. Good luck.

1:18So many entrepreneurs, they fall in love with their product. And I get it, right? I've done that. I've been there. And when they go to market and they don't understand that cost structure or their supply chain ecosystem, I call it the Pac-Man because everyone needs a piece of the pie. And so that gap will catch up to you. So you got to know your numbers. And if you don't, you can't price properly. You can't negotiate. You can't scale without bleeding the money. I know. I'm like, I feel like a parrot. But it is what, like, it has to be said. I mean, the product has to taste delicious and it has to make sense as a business.

1:52Otherwise, it's a hobby. But those things have to be true. Hey, everyone. This is Adam Yee, food scientist and podcast host of Startup CPG's new podcast section, R &D Radio, where you interview food scientists and product developers and what they do and how they can help you build your CPG business. Today, I'm interviewing Laura Tiro from Rebel CVG, a food scientist with over 20 years of helping food businesses build products that are profitable, compliant, and ready to scale. She has supported brands and processors in baking, frozen foods, refrigerated products, plant proteins, and other value-added food categories.

2:30Laura is known for her practical leadership approach and strategic clarity, helping businesses avoid costly missteps as they scale. In addition to her advisory work, she serves as a mentor and advisor within accelerated education programs, supporting founders and processors with guidance on product development, packaging, labeling, commercialization, and go-to-market readiness. What I really liked about this episode was Laura's framework for developing and maintaining a sustainable food business. She calls it her PB &J framework. You'll also learn a lot of things about raspberries and frogs and a new ingredient shaking up the sauce industry.

3:06Enjoy this episode with Laura. You're going to learn a lot.

3:13Welcome back to R &D Radio. I'm your host, Adam Yee. And today I am talking to Laura Tiro from Rebel CPG. Welcome on the show, Laura. Hi, Adam. Nice to be here. I'm happy to be here and talk about my company, my consulting company, Rebel CPG. Yes. And we've met through podcasting, I would say, right? I have a podcast. You have a podcast. Who doesn't have a podcast these days? Well, we like to call it a foodcast. Hmm. Okay. Why is that? Because all we talk about is food and food science and food tech, anything food. So it's a different type of podcast. Yes. A foodcast. I guess mine is too. Yeah.

3:51I'm creating a niche for us. Yeah, of course. Definitely. But this is more about a podcast about your business. So with Rebel CBG, you are a consulting firm. You're on the product development directory. when people find you, we kind of want to see if there's, you know, some synergies behind that. So that's why I love this podcast because I got to talk to just really awesome personalities that you can't get through a spreadsheet, right? True. Agreed. Yes. So I'd love to start this podcast with just a general consensus of who are you and how do you get started in product development, Laura? What a long-winded answer I have, but I make it short and sweet.

4:26So my name is Laura Thirow. I'm a food scientist. I'm a founder of Rebel CBG. We're a commercialization innovation agency. And as Adam mentioned, I have a co-host, a podcast called Munching on Molecules, where Christine Farkas and I get to geek out about food science, culinary innovation with some very passionate builders and entrepreneurs, innovators in this industry. Adam was on episode 28, the guy with the podcast voice. Yes, I remember the podcast voice, Adam Yee. But yeah, so we've been having so much fun. And so the how did I get started in product development? Like a lot of our food product development professionals and innovation professionals in this space, it's not linear.

5:07It's very long winded. But my love of food started even before I knew food science was a career. Like I think a lot of us, you know, we were good to the Food Network, Alton Brown's Good Eats, Unwrap, those shows. I was obsessed with how things were made, not just how it tasted good, but why did it taste good? So when I was accepted at the University of British Columbia in 2000, I started as a double major in science and art. And my roommate at that time, Kathleen, was like, all day you talk about food and obsess about food and beverages. So why aren't you in food science? I'm like, what the heck is food science?

5:41So that was the nudge I needed. I switched faculties. I landed in this program. At this time, they had a program called Food Market Analysis. So it was a combination of food science and economics. They don't have that anymore. It's a master program, a master's of sciences program. So it was a combination that really shaped how I think, thought about this industry, because, you know, it's not enough to like make something great and taste delicious, inspire and delight, but it has to make business sense. Right. Which is why I chose, OK, I got to major in economics or at least understand the basics.

6:13Right. And, you know, when I started in the industry, my first foot in that industry was not glamorous. A lot of the jobs available at the time was quality assurance, food safety, and HACCP. I really loved it. So I spent my first job grading organic eggs at this tiny local farm. I drove a golf cart. I had a dog named Toto who ran with me. And then the night shifts, I was working for a raspberry farm, a processing plant. They made jams. Oh, they process all the raspberries, made them into jams, and sent it to one of the big guys. But yeah, I was processing or helping with pest control, HACCP, making sure that I was working alongside the CFIA Canadian Food Inspection Agency Inspector.

6:54But yeah, so I built my career in food safety and quality. And then that was the foundation. That foundation is everything, right? It doesn't get celebrated enough because it's what really keeps those products and shelves and brands out of recall. And then I eventually moved into product development for a commercial bakery. And that's where it all began. And yeah, then I started my consulting company, Rebel CPG, in 2021. So yes, been 20 years working in the food manufacturing industry, just working with a lot of food entrepreneurs, building incredible products. And when they hit that wall and trying to scale up, that's where I come in.

7:33That's where I love helping and supporting. Love that. To track a little bit on that, you mentioned working with eggs and raspberries, which is a commodity, right? And I'd love to get a little bit of a snapshot of that because I think a lot of us, especially in kind of the CPG space, we don't really focus on buying like, you know, the raw commodities or we don't really think about it. I'd love to understand like just the amount of work it goes into, like make sure these eggs or raspberries are of good quality, so to say. Yeah, I mean, I'm honestly OK with the raspberries at that time they had it was very early on.

8:06The raspberries get poured on the line. It goes through what's called a shaker table. So it shakes out all those twigs. The frogs, the only frogs on the line. Frogs? Really? Yes, because it's coming straight from the farm. How big are these frogs? Oh, they're tiny little tree frogs. Really? Or bush frogs. Yeah. So let's do harvest season is when this plant operates because it's coming straight from the raspberry harvest season. And they come in these like plastic tubs. So they get dumped onto the shaker tables. The shaker tables shake it off. And then you see the little frogs coming out. And then there's these ladies on the line grating.

8:37but you know at the time they just installed a laser eye sorter so it was able to grade the raspberries according to different types of grades you know depending whether the a b or c i don't remember if it's that's for raspberries but for potatoes for sure so yeah so it goes through graded through that and then it gets cleaned and washed what's called the tsunami eco lab wash and then it gets goes through the whole process making it into jam i don't want to spend too much time on that but that's like on the commodity side of things right it goes through that grading process here in Canada it's a little bit different than the US but than the United States but yeah every most commodities get graded yeah and if they don't hit grade then typically that's what you don't see in the supermarket you get those misfit vegetables and fruits yeah I think someone told me like baby carrots for instance is a great example of like misfit carrots that get grounded up into like these crunchy, delicious snacks.

9:34I have recently, I've been doing this over the years, but replaced like my salty chips and snacks with baby carrots because I really like the crunch, for instance. But that's actually an ugly vegetable innovation that I don't think a lot of people know about, right? That is true. Actually, yes, that's the other passion of mine is a lot of these vegetables, because they don't make grade, and even during the harvest, a lot of these fruits and vegetables get 20 % of it don't hit the grade. So it's left out on the field. So there's so much opportunity in white space to make use of, we'll talk about that in trends, but like, you know, food waste and food repurposed.

10:11There's so much cool opportunity when it comes to upcycling food. Like what can you do with this waste that's out on the field that don't hit grade? There's some cool things that you can put use in food and finish products. Yeah. A hundred percent. Yeah. And I think with the commodity angle of this, I think more people do it than people realize, right? Like, you know, you mentioned eggs, right? And I don't know if you ever like grown or like had friends with chickens or have chickens, but sometimes they make eggs that are kind of weirdly shaped, right? And you never see those in the grocery store, but those do get processed, right?

10:40Yeah. I mean, yeah, there's jumbo eggs or extra jumbo. There's large. Yeah. I buy my eggs from a farmer here and I always get excited when I get two yolks in the egg. I'm like, yes, deal. Love that. Laura, I'm just curious. for your business then, what do you generally specialize in or what have you noticed most entrepreneurs come to you with what type of problem? Yeah, so at the very core of what I do is bridging that gap between that great recipe and that retail product. So I really specialize the concept to commercialization. It's the commercialization part that I love. Like I love that messy middle.

11:12I love boots on the ground during a pilot trial, first production runs, getting the brands ready for that. So they have their benchtop formula ready, but how do you optimize it for a contract manufacturer or for a line. Say maybe it's working in the commissary kitchen at the moment, you're selling at a farmer's market, but you really want to scale up and grow. You're getting the sales, you proved out product market fit, now you have to scale up. So that's what I love doing, especially on the formulation side of things, packaging and labeling compliance, and then even process. Like yourself, I used to work at a granola manufacturing facility was a contract manufacturing yes yes where we learned a lot about slabs cold slab and in roaming con bar yes and you're in canada right i'm in canada yeah yeah because the guys i work for were also canadian as well french canadian specifically so i just find it funny all this bar manufacturing canada yeah i don't know why but for some reason we're up here we love our bars so i yeah so talking about bars and equipment i'm a bit of an equipment geek like I love VFF, vertical form fillers, Junifax, HPP, map, packaging.

12:24And so those are the kinds of things that really excite me. And so that's what I love working with my clients is understanding those equipments or even process lines or steps that help your product scale. Because that's really half of the battle of scale up, right? And then my second love is teaching. So I always teach my clients and I also teach accelerators and incubator groups is that they need to master. Here's my thing. I'm playing around with this, Adam. It's called PB &Js. So the P, the PB, this is what I tell them. You need to learn your PB &Js. The P is the product, of course, the packaging, the pricing, and the process.

13:00And then the B, you look at it with the lens of the brand, the buyer, and then baseline, which is essentially compliance. So that's your P's and your B's because, yes, product is essential, right? And, you know, when you're moving from commissary manufacturing, a lot of the formulas I've seen is recipes. It's teaspoons. It's a pinch of salt. It's like use the orange scoop. I'm like, oh, gosh, does not cut the orange scoop. The orange scoop. I've never heard of that term. Oh, the orange scoop. Yes. Interesting. All right. Yes. You have to convert it to weights. You have to calculate by percentage, right?

13:37Because cups don't account for the density. Like it's a huge difference when you're moving from one facility to another. And then, you know, that packaging P part, it's not just a pretty label, right? The packaging is a container, contains, it protects. You know, it's also in true shelf life, communication and consumer utility, like all at once. So I think that's the other underappreciated part of the P's is the packaging because you have to run it in parallel when you're working on your product, your formulation. and when I was working at the little potato company potatoes are very sensitive to light we really invested in the packaging and making sure that really helps the product you know not just like from a formulation point of view but again commodity right really helping ensure that integrity yeah you know you gave me a funny story about like packaging right like some people give me like oh we should do a shelf life it's like is this the final package you're going to use it's like you need to give me the packaging before we consider a shelf life test because if you have a different package, it's going to be all for naught, right?

14:36Because different plastics have different, you know, oxygen barriers, different metals have different moisture barriers. There's just tons of things with the packaging that's like inherently important for storage, right? Yeah, you could run a whole masterclass, packaging 101, really, right? I mean, I went to Bemis University out in Wisconsin. If you ever get the chance, Adam, you should go to Bemis. Yeah, Bemis. So they're a film manufacturer, packaging manufacturer, and they host, I don't know if they do it still, but I'm sure they do. It's education classes on packaging. Bemis University in Wisconsin.

15:09I learned so much from the team there. And they even have a pilot plant. So you can run your packaging. You can run map there. You can run all kinds of different laminates and film. See, equipment geek. I love it. Wisconsin has a really good barman fashion course too. Oh, that's right. It's the University of Wisconsin, the food science. Yeah. They also have a candy. Is it candy? Confectionary one. A lot of universities have really good courses. You know, you never know, right? Like, it's so weird. Like, Pennsylvania, it's an ice cream course. Yeah. There's just so many different unique courses out there in the world.

15:41So I love this. I love talking about, like, kind of this really interesting, you know, scale-up issues that a lot of these founders, you know, just don't know, right? Yeah. We have our own inherent knowledge, but, like, when you have people who, you know, make something out of their kitchen and they want to scale it up, there's just so much that goes into it, right? Yeah, I agree. talk about the PBs and Js, and I was listening to Brian Chow's episode. I am also a disciple of Stagegate. Side note, it was created by a Canadian, Dr. Robert Cooper in the 80s. But I love it because you know what? Yes, you said corporate, but we need structure because we're moving so fast.

16:22We're pivoting. We're experimenting. It makes sense to have structure. So I love that structure. You know, I always think that you need some sort of a kill, go, hold checkpoint. And then essentially it's a way to manage risk, right? Whether or not you want to proceed further on your next stage. And okay, there's less risk. There's less uncertainty. So, you know, when a client comes to me, I have to figure out, okay, you need to fill your project brief because that helps me get structured on what it is, what kind of support you need from me. And if not me, then maybe someone else. You know, we're all here in this industry to help it grow.

16:59100%. I'd love to hear some examples of like, whether it's stage gate or a really interesting problem that you were able to solve. Do you have a story of a product you worked on? Yeah. One project that really sticks to me is the work that I did with Megan. So she's a founder of Wholesome Yum. She's a health care worker. So she's a nurse, mom of two, and she's Vancouver Island raised. She's a foodie. She came to me with an idea that she'd been making this product at home. She knew it was good. It was tasty. All of her friends and family were loving it. But she wanted to turn this home kitchen recipe into something commercially scalable and food safe.

17:36So it was a completely different challenge because it was baby food, right? It was frozen. She was cooking beets down and making it into frozen packs. So the first thing I said, okay, we need a project brief because we need to spend some time on what your end goal is, right? Like those PBs and Js again. So even before we touch on that formula or like looking at a co-man, what are your gaps and needs? You know, what are your must-haves? What are the non-negotiable? What does success look like? And then from there, we worked at formulation, systematically scaling some of those ingredients because she was sourcing like from a grocery store, which is fine, which is fine for Benchtop.

18:15I'm okay with that. Happens all the time. It's just you can't scale with that, right? Exactly. You just have to ensure that you are aware of industrial suppliers or industrial farms that you can buy it from, right? But then like with scale up, you have to ensure that you're also not losing the taste and the texture profile that you fall in love with on the benchtop, right? So also making sure that it's nutritionally sound. So, you know, using a program like Flavor Studio, putting the recipes together, putting it into an NF, a nutrition facts panel, an ingredient statement. And also the most important thing is shelf life, right?

18:48How does, if it's frozen, does the packaging that we've picked out, does it prevent any ice crystals? Does it survive temperature variation? She was going to start a D2C. So like, let's drop that master case from a two-story building. Will those pucks break, right? I'm going to drive it in my car in a cooler bag in the middle of summer. Is there enough dry ice in the packaging for the product to still be viable and still safe? Because that's the most important thing. It's baby food, right? For baby food specifically, yeah. Exactly. Never straight line. There's always surprises. I tell them, you know, and then that ingredients always behave differently at scale, no matter what, like whatever you're doing, your little oven might not work like a rationale or like a bigger oven.

19:32And, you know, the texture changes. So be okay with that. It's not failure, it's process. So those are the kinds of puzzles I love. And like, I think you've said this before, done is better than perfect. You know, that's, it's a thing. It truly with innovation and product development, you have to be open to your formula changing when you scale, right? Something is going to go awry. I'm not saying wrong, but that means it's going to go right. It's going to change. Yeah, I mean, this is something I've actually been saying more and more often, especially with people who are just starting out, is like your product is going to change as you scale up.

20:05And it's something I like to build an early in because these are just the trade-offs you have to do, right? There's so many trade-offs you have to do with scaling a product that you just have to like, as long as you're comfortable with the change, I think it really does help you manage your business a little bit better. Exactly. And, you know, since then, if you look up wholesomeyum.ca, Megan has pivoted. And that's okay, too, right? Because these are startup founders. You're proving your product market fit. You're proving whether or not it scales. And what I'm more proud of is she's developed this solid foundation, right?

20:37Formulation discipline, process documentation, food safe. I'm like, if you can ensure food safe, I'm like a happy camper. And so I'm just so excited what she's building next. She's great. This beautiful beet pancake mix that's so gorgeous. And so like to me, the best thing that came out of this whole project is that she has this finished product in store. And honestly, that's what makes those spreadsheets worth it, right? I love it. As you can see, that's what gets me going. That's what gets me up in the mornings for joy. And the J in the PB &J is joy. Wow, yeah, I was expecting, like, where's the J part of this?

21:17I love that. Yeah, the J is joy. You got to have fun. If it's not like getting you out of bed and you're like, oh, I can't do this anymore. That's a sign. That's true. I agree. I 100 % agree. So there's the little J. It's a small J. Every job I quit is because I didn't have that joy. You try to quit. We have one life to live. That is it. So it's got to bring joy. Love that. So you mentioned a lot of really great, you know, acronyms, tactics, and stories. I'd love to hear just some general advice you give entrepreneurs. And I know we sprinkle a lot in this interview, but I'd love to hear some of the common facts and questions that you get asked when it comes to scaling their product.

21:55Okay. It is not about formula. It's not about taste. It's about cogs. Cogs, cost of goods sold. I always like to say get cozy with cogs. It's not sexy, but it's honest. You know, so many entrepreneurs, they fall in love with their product. And I get it, right? I've done that. I've been there. And when they go to market and they don't understand that cost structure or their supply chain ecosystem, I call it the Pac-Man because everyone needs a piece of the pie, right? That's funny. There's this Pac-Man. And so that gap will catch up to you. So you've got to know your numbers. Yep. Know your numbers.

22:32Yes. Know your numbers. And if you don't, you can't price properly. You can't negotiate. Yeah. You can't scale without bleeding the money. I know. I'm like, I feel like a parrot, but it is what like it has to be said. I mean, the product has to taste delicious and it has to make sense as a business. Otherwise, it's a hobby. But those things have to be true. And you know what, COGS, it connects to that bigger picture, right? You're doing the homework up front. You're doing the work. You're doing your back of napkin math. And you're encouraging for things to happen like earlier in the process. So when it's cheaper to make and it's cheaper to make those mistakes or things that can go wrong so that when you go further than the road, those painful and expensive changes, like it's less, right?

23:17That's true. Yeah. It happens, but it's less of a big pain in the butt. Yeah. I think I hear this like kind of dismissive excuse, like really common is that it'll be cheaper when we scale. It's kind of the most interesting excuse I get whenever I say, like, do you know your numbers? And then it's like, yeah, it's expensive now, but it'll be cheaper when you scale. I was like, yes, but also no, because you're also going to spend a lot more actually making the product, right? Just upfront money, right? Correct. So it's just a really, like, knowing those numbers and understanding just how cash flow works in a food business, I've been noticing is more and more important in your business.

23:53Mm-hmm. Yeah. And then if you want to get into retail, those margins are super tight. And then there's other different trade marketing stuff that you have to pay for. So, yes, as you scale, those costs are going to come in. It's not part of COGS, but it'll still be part of your business. So take into account some of the chargebacks, the retailer, you know, even like dealing with logistics and shipping, shipping out your product. There's so many things that you need to account for. I guess how do you tie that into a technical expertise, so to say? I do think I feel like a lot of the brands like do understand or like try their best to understand the numbers.

24:30But how does a food scientist help with that, do you think? It makes you more aware of the cogs, right? So you have to be aware of cogs, meaning ingredients or raw materials, your packaging and your direct labor, or if you're working with a contract manufacturer, the tolling. So if you're able to understand what the costing us is later on in the process, like with regards to the supply chain, then you can pull those levers with ingredients. You can negotiate with your ingredient supplier. You can negotiate with your packaging supplier. And then you can negotiate with your contract manufacturer, right?