This is our third November in business and each one has been slow in comparison to the other months. This year is no exception. It’s noticeably slower, especially at the shop. But I’m grateful for the calm. It’s been a much needed time of rest after the busy summer, the whirlwind trade show experience and the busy leaf peeper season. December, traditionally, has been the busiest month for us, so we are preparing for the storm.
Sales of our dough in stores is always higher in December, about a third higher than our next biggest month. People do a lot of baking around the holidays! Not only that, but a new distributor will be debuting our products in its catalog in December, potentially leading to sales in a bunch of new stores that we are not currently servicing.
Internet sales for the holidays were just starting last year when we opened our shop and debuted our ecommerce site on December 15, but we had a whole lot more orders than we expected last year. Now that a lot more people know about us, we kind of expect this year to blow last year out of the water on the internet. Then there is Dakin Farm, a local mail order company, that has put a box of our cookies into one of its tower gift offerings (click here). We really don’t know what kind of volume to expect from that, but they say they do most of their business during the holidays. And then there will be more customers in the store itself wanting to buy fresh baked cookies to take to a party or office event or whatever. We anticipate that all of these things together will make December a total blur, in the best possible way.
I try to have perspective about November’s “slow” sales. Just two and a half years ago we ended our first day at a farmer’s market having sold $127 in cookies and dough. This past weekend Paul delivered $1,800 worth of dough to just two stores in New Hampshire. We’ve grown a lot and “slow” has a very different definition now than it did two and a half years ago. And there are ebbs and flows in business and in life, and that is just ok.
There’s another sort of storm we are readying for other than the ho-ho-holidays. That distributor I mentioned that will debut our dough in December serves stores throughout most of New England. There is the potential for getting our products into hundreds of new stores. This sounds great, doesn’t it?? Well yes, of course. But it makes us worry about one of the most challenging aspects of our business right now, which is production capacity.
Currently one person does all the mixing for us. She’s a mixing superstar, doing about 1,000 pounds a week in 88 pound batches. Then the rolls of dough are all cut, wrapped and sealed by hand as I described in an earlier post. If this distributor starts ordering large quantities, we will have to do some serious scrambling to amp up production.
In anticipation of all this, we met with a possible co-packing company two weeks ago. For those of you who don’t know about co-packers, they are companies that will manufacture your product for you so you can focus on sales and marketing. There are an awful lot of specialty food companies out there that are built on this model. If you would like to learn more about available co-packers in your area, you can contact the National Association for the Specialty Food Trade (NASFT) (http://www.specialtyfood.com/do/Home). This trade organzation maintains a database of co-packing facilities. While it may not be all inclusive, it is a good start. Call them at 212.482.6440 and ask for the Member Resources Manager. When I first explored this option three years ago that position was held by Heather Paul (hpaul@NASFT.org).
We think co-packing will be the best way for us to grow since we don’t have large amounts of capital on hand with which to build our own automated packaging facility. The biggest hurdle to going down the co-packing road is that we will have to commit to making roughly 30,000 pounds of dough a month whereas we are only making about 4,000 pounds a month right now. How will we bridge that gap? I think, although I haven’t really had a chance to analyze this yet, that we will have to get to the point where we are making and selling at least 20,000 pounds a month ourselves before we can make the leap to co-packing with confidence that we can move the product fast enough.
So we are faced with the potential problem of how we quadruple production capacity in our shop before we make the leap to co-packing. I don’t have the answer now. It’s what I will be chewing on right after I finish chewing on my Thanksgiving dinner.
I will do my best to post in December, if I don’t, you will know why.
Have a Happy Thanksgiving everyone!!