Ian Kelleher, who co-founded the organic CPG brand Peeled Snacks and grew it to become a nationwide enterprise, was a pioneer in the healthy, mission-driven food product industry. In 2018 he founded his consulting firm, 2nd Quest CPG, which works with food companies to provide strategy, sales, recruiting, and product development support.
Kelleher is scheduled to speak on a panel called “Selling to the Channels: Understanding Specialty Stores, Grocery, and Foodservice” at the Scale Up Saturday workshop at the Winter Fancy Food Show this Saturday at 10 a.m. The all-day event is designed for makers to learn about growth strategies and financing options. Package prices range from $99 - $149 for members and $199 - $299 for non-members. More information can be found here.
Kelleher will be joined on the panel by Matt Caputo, founder of Caputo’s Market & Deli, and Mike McMahon, director of grocery at Bristol Farms.
Kelleher recently spoke with SFA News Daily about his plans for the presentation and his insights on the specialty foods industry.
Can you share some details about what you plan to discuss in the session?
One of the privileges of my professional career is that I haven’t been siloed. I have been blessed – or cursed—to sell to an incredibly wide array of channels, including foodservice, grocery, convenience, club, military, international, micro-markets. I don’t know how to dig incredibly deep into Safeway—there are people who spend their entire careers just doing Safeway—but I have a bird’s eye view of just about everything.
If you pan back far enough, you start to see some patterns. Selling to a club store is very different from selling to a specialty store, which is very different from selling to convenience. So this session is hopefully trying to arm founders, and sales teams and entrepreneurs, with what the distinctions are and how to tailor their message for a specific audience.
A lot of people think they have to sell, they have to send the message, they have to deliver the goods, for themselves. The macro point is that, no, as a salesperson, you are trying to help the buyer. You have your goals, but if you can’t help the buyer, then you can’t help yourself.
What are the particular challenges that specialty food makers face in pitching their products to retail buyers?
I can think of three main problems. An inevitable one is, will I be able to speak the language of the buyer? Specialty food company founders come to this industry with their passion, and typically from the beginning they may not know the lingo, the standards, the basics of what is expected in this kind of presentation. Obviously the Specialty Food Association takes on a big challenge by helping to basically educate people.
Another big challenge is that they don’t have, or understand, the financing required for actual trade marketing. You don’t need to spend money everywhere you go. There are ways of finding channels where you don’t have to raise a ton of money to sell your products. But if you don’t understand what a buyer is expecting, if you don’t understand how much money you need to put behind your products, and you don’t understand what margin you are going to get out of it, you are coming into it with a major deficit.
The last point is getting out of your own way. A lot of people think their message, and their brand, and their passion, is the most important thing. And for so much of the time, for an entrepreneur, it is—when you are marketing, when you are raising money, when you are inspiring teams. But when you are in front of a buyer, you are second banana. That’s a challenging step for a lot of specialty food manufacturers and entrepreneurs.
You were one of the pioneers in the healthy CPG category. How has that segment evolved in the time that you’ve been in the industry?
When we started, there was no infrastructure for it. There was so little out there advocating for it, and the consumer understanding wasn’t there. The road is paved now. That road runs through Whole Foods and UNFI and KeHE, and really when I started, that road was much less defined. I feel like me and the rest of the class of better-for-you brands were all paving the road as we were driving it. It was pretty exciting times, really.
One big thing that has hit our industry is a progressive sensibility amongst consumers to try new trends, and to judge them. In the early and mid-2000s, we had to make our case from whatever soapbox we were standing on, and scream as loud as possible in empty rooms, to say, “Organic is important! Real food is important! Nutrition is important!” Consumers weren’t completely ready to listen yet at that point. Now the consumer base is there, and looking at trends, and paying attention to what food companies are trying to put into their bodies. So, the consumer base is trained.
Lastly, there have been exits. When my wife and I started the company, there were so few exits in healthy food, but starting in 2007, you had Glaceau Vitaminwater, and Stacy’s Pita Chips, and Sahale [Snacks], and other brands that were telling the story, that were starting to get picked off. These brands were making positive exits—not nearly enough for the manufacturers and the entrepreneurs, but there was enough to keep the money coming, and keep investors betting on us entrepreneurs. Thank goodness, because we need a lot of money in this business.
What are you most looking forward to at this year’s Fancy Food Show?
I love the trends you see, and I love the friends that you see. This is my 20th year in the industry, so I love to see people who have started new enterprises, and people who have shuttered enterprises, because that is part of the deal in the food industry. Also, this will be my first Vegas Fancy Food Show, so I am looking to see the difference between it and San Francisco.
And, at every show, there is one trend that stands out. It’s been coconut water, it’s been pomegranates, it’s been bone broth, and I am sure there is one this year too. I am always interested to see the category that has way too many players in it — those are always interesting.
One thing I am not looking forward to: I am always very careful about what and how much I eat. I have such trouble just walking down the aisles, going, “I’ll have a little bit of this, a little bit of that. Ooh, there’s some hot sauce! Ooh, there’s some tapenade!” I am not looking forward to not having the discipline and self-control to not eat everything.
Related: (included) Cohort to Take Part in Supplier Diversity Pavilion; Scale Up Saturday: Fund Your Future Preview.