#134 How to Make and Scale Your Product with Jamie Valenti-Jordan, Catapult Commercialization Services Part 2

We are just as excited as you are to share the second part of Jamie Valenti Jordan’s episode –  How to Make and Scale Your Product.

In this episode, Daniel Scharff and Jamie Valenti-Jordan take a deep dive into the intricate process of finding and collaborating with contract manufacturers (Comans) for startups in the consumer packaged goods (CPG) realm. From sourcing to negotiation, production runs to quality assurance, they unravel the complexities and challenges inherent in the CPG production landscape. 

Discover valuable insights on building relationships, fostering transparency, and navigating the dynamics between brands and manufacturers. Whether you're a seasoned entrepreneur or a budding CPG enthusiast, this podcast equips you with actionable strategies and expert advice to thrive in the competitive world of consumer goods. 

Tune in now!

Listen in as Jamie shares about:

Choosing/Finding Contract Manufacturers (Coman)

First Production Run

Maintaining a Good Relationship with the Coman

Quality Control and Sensory Evaluation
Challenges in Manufacturing

Logistics and Supply Chain Management

Operational Best Practices

Strategic Planning and Forecasting

Consulting Services Offered by Catapult

Episode Links:

Catapult Commercialization Services Website

Jamie’s LinkedIn

Don't forget to leave a five-star review on Apple Podcasts or Spotify if you enjoyed this episode. For potential sponsorship opportunities or to join the Startup CPG community, visit http://www.startupcpg.com.

Show Links:

• Transcripts of each episode are available on the Transistor platform that hosts our podcast here (click on the episode and toggle to “Transcript” at the top)
• Join the Startup CPG Slack community (15K+ members and growing!)
• Follow @startupcpg
• Visit host Daniel's Linkedin 
• Questions or comments about the episode? Email Daniel at [e-mail]
• Episode music by Super Fantastics
  
  

Creators & Guests

Host

Daniel Scharff

Founder/CEO, Startup CPG

What is The Startup CPG Podcast?

The top CPG podcast in the world, highlighting stories from founders, buyer spotlights, highly practical industry insights - all to give you a better chance at success.

Daniel Scharff
So now let's say, okay, I understand kind of my requirements now and I'm starting to reach out to, you know, I think in our startup CBG slack, we get people asking all the time like, hey, anyone know a good coman in the east coast that can kind of do this and hopefully they get some recommendations. I know this is a service that you guys offer as well. Like, yeah, we'll take your requirements and we can conduct that search for you. There are also a couple of lists out there that you can kind of think, you know, fiddle has one or rodeo, CPG has one, that are just lists of Comans. You can get them from some of the Coman and copacker trade associations as well. What do you think happens though, if brands are just kind of like starting from scratch?

00:44
Daniel Scharff
Are they just googling around and kind of cold calling?

00:46
Jamie Valenti Jordan
Yeah, if I was a new brand, I'd start with those lists, and when those lists fail, I'd Google, and when those googling failed, then I would turn to an actual paid service. As someone who offers a paid service, I can tell you that it's hard to get a hold of some commands. And one of the reasons why it's hard is they're getting anywhere from two to twelve calls a week from new brands and they can only onboard, let's say one or two a quarter. So they're inundated with these groups and they don't know how to tell the difference between them. And they don't have websites half the time. Literally, like 50% of them don't have websites. So what people who are in the business do is they will call the coman and they'll say, hey, can you do this?

01:30
Jamie Valenti Jordan
And they say, no, we don't really do that here. And you say, don't get off the phone yet. I have a question for you. Do you know someone who does? And if you ask those questions and you build those relationships over time, that is when you can go out and find groups that wouldn't normally be on the 10th page or 85th page of Google where you have to go sometimes to find them. So what they do is they give you the cell phone number of Billy, who's the third shift maintenance manager, who happens to know the owner, who is the one who decides whether or not they bring in a new brand. The owner doesn't have a cell phone. I don't know why, but he doesn't believe in email either, right?

02:11
Jamie Valenti Jordan
So he's got a secretary who prints off his emails and puts them on his desk every morning and he hands writes out a response. This really happens today still, right? So finding those groups is going to be hard. That's why I would say start with the generally accessible data and then move into a paid service if you really can't find these folks, because the paid services were literally paid to have those relationships and have those already set up. And they take our phone calls because when we call, we're representing business and that they care about. The problem is not everybody who calls a coman is ready for a coman. And so they get burnt out, they get jaded, and they stop taking phone calls from people they don't know.

03:01
Daniel Scharff
Yeah, that's a pretty cool perspective. And I like to hear your kind of order of operations where you're saying, yeah, try these other things first. I think for me, having worked to find Comans top source was basically asking other brands, hey, who do you work with? Do you love them? What's better than that? Like, yeah, this is kind of a similar product and they're saying they love working with them. And you know how sour things can get with a coman, unfortunately. So if somebody is saying that and they're working with them, that's great.

03:31
Daniel Scharff
And I think conversely, you might hear some really horrible stuff about a coman from someone working with them, but it's just great to get those kind of options and then starting to go visit them also, because even if you're not so technical, you can learn so much by just seeing there and feeling the energy with them and who's meeting with you, how much do they actually care about your business and how clean does the place look and that kind of stuff. What are some of the tips that even somebody who doesn't have all of your knowledge could actually pick up on if they went to visit a coman?

04:09
Jamie Valenti Jordan
Sure. Absolutely. So one of the most important things is obviously to get the tour of the facility and truly kind of understand what all is moving and going on there. It's meeting the people. Where are their priorities? If their priorities are talking about their truck the whole time they're taking around the plant, rather than showing you how things work, they're probably not paying attention to whether or not the quality records are being filled out correctly. Right. The other thing to do is learn how they're going to assemble your product, you know, how to build it on the bench. You're going to learn from them how they're going to build it at scale.

04:49
Jamie Valenti Jordan
If it doesn't look the same, have them explain why it's the same one of the things you can do and learn from these contract manufacturers is how different processes scale in different ways. For example, the worst scalable thing you can put a product in at the beginning is a blender. The reason why is it's putting so much force into chopping and mixing. It doesn't scale because scaling a blender, the horsepower of the motor has to scale in a cubic fashion. So not just squared, but cubic fashion in order to get the same amount of power out of a scaled up version.

05:31
Jamie Valenti Jordan
So when you've got a small vessel on top and a small motor, the motor is going to be much larger than the vessel when you get to a larger scale, to the point that it's ridiculous and nobody builds them because you soak up more power than the Pacific Northwest. Right. So anyway, long and short of it is like, walk around, see how they operate, where do they store things? Are they keeping the allergens properly marked? Can they show you where they keep records and how those records are shared with the people they're working with so that you can look at them and say, hey, I see we had a problem with a consumer complaint. Can I cross reference that to an actual batch? And from that batch, can I figure out what might have gone wrong? Right.

06:21
Jamie Valenti Jordan
Can you go all the way back to, oh, well, this is a weird lot number for this particular ingredient you put in there. You didn't put it in the batch before. The batch after. That lot number is not sequential with the other ones that are in your system. Why did you have that different lot number? Oh, well, we put rye flour instead of wheat flour. Oops. Well, now you've got a huge problem. You got the entirely the wrong product out on the shelf. You got to recall it, things like that. You need to be able to get to that quickly before a consumer consumes your product and is turned off to it forever or better likes it better than your own product.

06:57
Daniel Scharff
Okay, I actually just have to tell you this story. This is pretty funny. I've gone and visited a couple of different comans, and were at one facility, and this product required a tunnel pasteurizer to preserve the product, which is, for anyone who doesn't know, basically a very high temperature. I mean, almost, I don't know, like an oven. JV will probably correct me, that's a bad analogy. But it goes through this thing, it heats the product up very high, and that's a kill step, right? So it kills whatever microbials or whatever could be in the product and gives you the shelf life and comfort. Around the product stability. And so it was a beautiful facility, and it was almost weird that they were interested to talk to us with our kind of lower minimums and growing brand.

07:53
Daniel Scharff
And then we asked a question about the tunnel pasteurizer, and he's like, yeah, but it's right over there. And then he touched his face and head in kind of a weird way as he was talking about it. And I really believe in trying to read people through. If I'm talking to somebody and they do that, if they touch their arm or their head while they're talking, I know, I'm like, okay, it doesn't mean necessarily that they're lying to me, but it means that there's something that they're not super comfortable with about what they're saying. And that's worth trying to understand.

08:23
Daniel Scharff
And I remember saying to my coo, like, hey, if we move forward with them, just take a note of that because we should probably ask a lot of questions about that specifically and try to figure out what's actually there, why they're not so comfortable with it. And then ended up, I think, not really moving forward with them. But then, only later, this was like, I don't know, eight months later, I had actually seen a brand running with them, and I met that founder later and I was like, oh, yeah, I think I was just there and I saw your product there. And the person was like, yeah, let me tell you, they have a huge problem with the tunnel pasteurizer. We had to throw out a bunch of product. I was like, ha. There it is.

09:06
Daniel Scharff
So I think even if you're not a technical person, you can kind of pick up on energy and cues from people and you'll just get the sense, hey, this person knows what the f they're doing. They really are asking the right things and they're dialed in on this, and I can't imagine them getting it wrong versus, I don't know, this prop. Maybe they're just trying to grow their business and not so focused on the quality of what they're churning out.

09:31
Jamie Valenti Jordan
Yeah. So I think one thing to remember in all this is if you do get to the point of walking through a facility, it's because they probably like you already given the number of calls that they get, they're not going to invite everybody out there because they'd be running tours all day long and not making any money. Right? So if they're going out there, they already like you to some extent. They're likely going to roll out some level of red carpet for you. There's a little bit of a dog and pony show because they're trying to convince you who has a product they believe in that you are worth working with.

10:04
Jamie Valenti Jordan
And so you're going to meet with team members and you're going to review systems and you're going to look at their documentation, you're going to walk their line, you're going to see how they're operating, and then you're going to sit down and talk with them about who's in charge of what aspect of moving forward, who's in charge of the contract, who's going to be ordering the ingredients, who's going to be receiving them, how is it getting shipped out, what are the priorities and understand why some of those terms are. For example, one thing that always throws brands is you have to ship the product off site within 24 to 48 hours or something like that. They don't have storage for your product. They're using all of their footprint inside the building to make more product.

10:45
Jamie Valenti Jordan
So it's in their best interest to get it off and get it going quickly. So that's why they're asking for those types of terms. So I think that really drops a lot of those barriers if you can understand their perspective by walking through their space.

10:58
Daniel Scharff
Yeah, really helpful. So when you reach out to a coman, they're going to ask you the same kind of questions no matter who you're talking to. And it's intended to understand, do they have the capability to run the product in the format with the recipe that you're requesting? I kind of like the approach of putting everything they could possibly ask you into a Google Doc or Google sheet and trying to share that with them rather than trying to resend them to each of them, because you're going to adapt it over time based on questions that you get from them. But one of the biggest things they're going to ask is about your volume.

11:33
Daniel Scharff
And I think a lot of brands kind of try toe the line between, I want this to be a business that they're excited about, so they will work with us and feel like they're going to make money with us versus I don't want to over promise something and have them be pissed at me later. What do you recommend with brands in terms of the forecast they're giving to comans?

11:50
Jamie Valenti Jordan
Well, I mean, the first preference would be to give them an accurate forecast, but we all know that those are contradiction in terms. So I would go one level deeper than that, rather than say, hey, I'm going to get 200,000 units this year and a million units next year, I'd break it down and say here's how I'm going to do that. That will give them confidence in the numbers or tell them that you don't have confidence in the numbers. Right. And either way you really just want to be transparent with your contract manufacturer and say, listen, I could tell you that I could be 200,000 next year but I don't know yet. Here's my plan. I'm hoping it works the way that I want. Here's what I'm going to do. Right.

12:33
Jamie Valenti Jordan
They're already under an NDA if you're talking to them at this level anyway. Right? So at the point that you're going through and saying, hey, this is where my numbers are coming from, you don't have to worry about them stealing their stuff because it's not their business model. Right. So I would say share that with them about why you're confident the why is more important than the actual number on some level. Right. Because if they look at it and say, actually we think you're underselling by about a factor of two. Great, then let's plan on that. I appreciate your confidence in me. I hope I can execute against it. Let's go ahead and move forward with a contract that splits the difference for right now from a required minimums and otherwise. Can you help me get there? Right.

13:15
Jamie Valenti Jordan
In many cases they have resources in some way to help you out. It's not direct resources, but they do know people. Right? They know distributors that probably can take your product and move it because they've given other people, other brands to that distributor and they help move it. So they're going to try to help out because it's in their best interest for you to sell your product as quickly as possible so that you will come back and order more so that they can run more of your product and make more money coming back to the negotiation piece.

13:43
Daniel Scharff
I think sometimes you can be effective negotiating at different tiers. Right? So like, hey if I sell this much, if we produce this much then it would be this price. But if I can get to that next level, then it drops down to x amount. Do you see that usually even negotiated at the onset or would that only be kind of like second year, third year type negotiations?

14:05
Jamie Valenti Jordan
You could definitely put it in the front end by first building that model that we talked about a while ago. Right? Do it on a shift costing. Right? Hey, I'm going to pay this much for all of these units up to this level. And then we will flip over to a more efficient model so that we can then do that tier pricing. You can build your own tiered pricing. You don't have to wait for them to build your tiered pricing. So I'd say if you're interested in that type of model, propose it. Some contract manufacturers will not go for it. Why? Because they don't want to deal with that complexity. And that's the reality. Some will do a sliding scale. Right.

14:46
Daniel Scharff
And just a quick plug for Jamie. I've had my team work through that kind of a model with him before, and I think it ended up saving a bunch of money just to figure out how to have that discussion with them. In a numbers based, shift based, those kind of savings are real. Everyone, I think, is always like, hey, these are our costs year one, but they're going to go down on a per unit basis to this. And we got our packaging numbers down. But that is how you do it. Yeah, start selling the volume and then negotiate with them based on volume and efficiencies, and then you can bring your tolling costs down by a really significant percentage. And that is how you get on that important path to profitability. So let's say then, okay, I've reached out the right way.

15:33
Daniel Scharff
I found my dream coman. They're interested to work with me. Now, what's that going to start to look like as you start preparing for your first actual production with them, and what are the ways to get it right? I know probably everybody appreciates the importance of having a good relationship with the coman, but how do you really make sure you start doing that right from the beginning? Because you're going to need them. It's never gone perfectly ever for anybody in history with a coman. And so when stuff goes wrong, how are you relating to them the right way so that you're having a productive relationship?

16:07
Jamie Valenti Jordan
Exactly. So I think this is why it's a relationship and not a transaction, because you need to be aware of the ebbs and flows of production and what that looks like. So that starts all the way back to the original phone call where you're calling them. But as you go through the process and build that relationship and build the links between your two businesses, there's things like sending over your formulas as the NDA is signed, along with samples for everybody on their team. Probably like a case of each flavor or something like that. Nothing huge, but enough that it's more than they need so that they can get the rest of the office staff on board with bringing this new account online. Right. Simple little relational type, things like that.

16:51
Jamie Valenti Jordan
Then as you get into it, they're going to look at your ingredients and say, okay, this is the ingredients you're presenting to us. We are already sourcing this type of sugar. Is this type of sugar okay for you? Yes. Send me a sample. I'll evaluate it in my product and make sure that it's right. Anything you can do to simplify their operation makes them like you more so. If they don't have to stock a special type of sugar just for you, great. That helps them out substantially in making their products more efficient and scalable, and they can move on to the next person's product because they don't need to stock another thing. So you will go to them with a gold standard formulation that has all of your industrially sourced ingredients.

17:35
Jamie Valenti Jordan
And the first thing you're going to do is retrofit some of their ingredients to your product and see if it works. If it doesn't work, don't authorize the alternate. Alternates are things they can interchange as needed. Based on what they have on hand and based on ordering quantities and things like that, they can get better of a costing. So when you authorize an alternate, you say, either one's fine. You guys pick for any one of a number of reasons, and you're giving them the autonomy to run their business the way that they want to. So that's perfect. That's a good relationship building tool right there. That helps them to really believe and love your product and own some level of it so that they can feel like they can help you out in the long run. It's pretty amazing.

18:19
Daniel Scharff
Sometimes when you're getting an ingredient, you're like, oh, of course, it'll be the same. Like, yeah, I'll check it. And then it completely changes the taste or feel or something of the product. Pretty wild, but I mean, great to be accommodating if you can. And then on the other side, man, when I was going through organic certification and just basically whether or not the product could ultimately qualify forganic, get over that 95% threshold was just going to be dependent on whether or not we could find the right organic organic compliant ingredient and scouring the face of the earth for it and asking who knows who and then maybe finding some solution. And that's the only provider out there that has an organic version of this ingredient, but that actually just gets you over the threshold to make it.

19:07
Daniel Scharff
And if you hadn't done all that digging, you probably would not have an organic product.

19:11
Jamie Valenti Jordan
Yeah, exactly. I mean, if you can do all of that before coming to the Coman, that's going to help them out substantially to execute against what you need, as well as pull all that documentation. That documentation can take weeks. It can take months to get sometimes. So if you can pull that and provide it to them, if you don't know, I'm talking about things like 100 grams and spec sheets and organic certs and non gmo compliance, certs and things like that. Pull all those documents, have them ready to go if you can, or at least have a list of what you don't have at the point of working with calling the command and saying, hey, here's our formulation, here's our documents, things like that. That helps them really understand your product a lot better and saves them a lot of time and hassle.

19:56
Daniel Scharff
Yeah, okay, cool. So, yeah, let's say, hey, we're getting to that first production run. Fortunately, all the ingredients have arrived to the coman, which, by the way, I really encourage everybody to triple check because often it doesn't. And then you realize you're one ingredient short right before the production is supposed to actually happen. It might be your fault, it might be their fault, or you're missing a tray or secondary packaging or whatever, or it's at the warehouse and it didn't quite make it over to the coman. But let's say everything does actually arrive there and you're running like one. Would you recommend for people to go for the first production, and if so, what are they looking for and what do you think their experience is going to be like there and what should they be paying attention to?

20:42
Jamie Valenti Jordan
Absolutely, 100%. Go to the first run, assuming your coman doesn't for some reason not want you there. I assume that they will want you there because almost all of them do. You do want to be there and you want to do more observing and record collection and things like that. You want to stay out of the way of their production team. So if they are actively trying to put product into the kettle to get it all blended together, do not have your face over the side into there. Listen, follow directions. In general, keep your hands behind your back. That's the trick that I use when I go into plants, and I've been in probably 100 different plants, I keep my hands behind my back unless I have a reason to use them. Whether that's carrying a notebook around and taking notes. Sure.

21:30
Jamie Valenti Jordan
Using my hands to climb up and down a set of stairs, because that's the safe way to do it. Absolutely. But otherwise, you don't need your hands over the side of a vessel where they could get upset. And now they have toss out your batch and start all over again. Right. So, in general, stay out of the way. Observe. Observe. Everything smells, colors. But really, what they're going to be most interested in having you there for is quality checks along the way. Hey, look over the side of this kettle. Is that supposed to be that color? No. We got to double check stuff real quick before we push it any further and put it into cans. And now you've paid for packaging for a product that doesn't meet your quality standards. Right.

22:12
Jamie Valenti Jordan
They're also going to want you to taste the product at the end to make sure that it is in fact, the product that you intended to make. So here's a finished container here, try it again. They're trying to do the quality checks because you're not going to be able to describe in words what the product is supposed to taste like and what the texture is supposed to be like and things like that. That takes over a decade of experience and sensory to be able to get to that point with apprenticeships and everything else. So at the end of the day, they're going to want you to validate that they did it right. That also then makes them feel good, because they've proven to you that they can do it right.

22:53
Jamie Valenti Jordan
And everybody gets happy and gets excited about the growth of the brand, and then the next day, they're going to pack everything up, set it aside and build somebody else's brand. It's what they do. So don't get upset if, like, hey, they're not super excited to work with you. With the eight emails you write the next day, they're on to the next thing.

23:14
Daniel Scharff
They'll respond in due time for that sensory part. This is a very high anxiety moment for me, is like you're at the coman, they've produced the first sample and now you're expected to taste it and give them a thumbs up or a thumbs. I mean, it's such a critical moment because they're about to, they've already produced it all, or they're about to hit go and go a million miles an hour producing stuff. So it is really important if you're a novice, let's say, and you've created this brand, you aren't like a super taster or anything. What do you recommend for people actually going through the tasting process to try to be as certain as possible about whether it matches their gold standard?

23:58
Jamie Valenti Jordan
That's a good question, because there's a handful of things to generally go through, and there's a whole nother podcast on that. Daniel. No, but I mean, at the end of the day, they're not looking for did we do it exactly right? It's. Do you think it passes quality checks? There's still going to be a micro test. There's still going to be other checks where it may fail and things like that. They just want to know in that moment, do you think it passed right? So don't get so caught up in your head about making sure that the retro nasal is exactly the way it's supposed to be. No one expects you to be that good at that stuff. They really want you to tell them they did it right or that you notice where they did it wrong.

24:47
Jamie Valenti Jordan
Those are the two most important things. I really wouldn't worry about it too much beyond that.

24:55
Daniel Scharff
That's very interesting to hear you say that, because for me, as the person responsible for a brand, I would be so paranoid that it could be a little bit, a millimeter off from really what it's supposed to be, and that would make it bad instead of good. And I mean, for sure, I'm a self admitted perfectionist when it comes to things like product, that it must be the best version of itself. But then I've been at a coman with people that I used to work with, and they're like, no, we must be here. And they're on the line and they're like, yeah, this is coming out just a tiny bit off. And it's because the piping here is actually longer than the piping at the last place we ran it. So the product is coming out differently.

25:35
Daniel Scharff
There can be pretty big variances depending on the volatility of the product. Like, maybe it's less likely to happen with something straightforward, but it sounds like, I mean, for me anyways, when I'm tasting it, I'm like, I have a whole sheet that has all the criteria. Like, I'm not just kind of tasting it and saying yes or no, but it's like, okay, does this have the mouthfeel that it's supposed to? Does it have the nose that it's supposed to? Does it have all of these different factors and kind of like scoring them, at least to give myself some kind of process to go through to do it in a structured way?

26:07
Jamie Valenti Jordan
What do you think? Absolutely. That's what I meant by it's an entire another podcast. I think it would be really interesting to the audience to know the different facets of sensory experience that people could evaluate their product on in order to be able to describe it more accurately. Yes, I've been through a lot of that for a couple of brands. And, yeah, I would say it's definitely value add to be able to go through that and be able to describe it descriptively, because then you can train their quality people to observe the different extremes of the scale and understand where the passing qualities are and where they're not. To go into further kind of development about where the qualities you may have come in. For example, the most common one is that they forget to purge their lines.

26:58
Jamie Valenti Jordan
So one of the things that they will do is they will store water in the lines between their kettles and their fillers. They'll store water in there because they just finished cleaning them out, and they had to push all the cleaning caustic out using water. So they'll leave it full of water because they don't have any way of, let's say, draining it. So what they'll do is they'll use your product to try to push that water out. Well, if they don't open the drain valve at the filler to drain that water out before your product gets there, now you've got a whole bunch of extra water in your product, which I've seen blow out sodium levels to the point that the label doesn't actually still apply to the product that it's on.

27:39
Jamie Valenti Jordan
And so now you're out of compliance that way, and it gets to be a whole nightmare. So there's a lot of tricks to the trade, and then every so often, you'll see something stupid happen. Like somebody stabs your 55 gallon drum of your flavor with a forklift, and you just look at that and you say, I can't believe that just happened. We can't run now today, and now I have to order more product. And no, the coman will pay for it. But it's hilarious because it does happen all the time. All the time. People stab. I had a $400,000 piece of equipment arrive one time, and they tried to offload it from the truck, and instead of putting the forklift where it was supposed to go, they put it straight into the sidewall of the vessel. $400,000 piece of equipment.

28:32
Jamie Valenti Jordan
Yeah, we got it fixed, but still, we had, like, ten people shipped out there, so that's ten times flights and hotels and, yeah, it was a lot of money that went down the drain right there.

28:45
Daniel Scharff
Oh, my gosh.

28:48
Jamie Valenti Jordan
So you got to realize that happens in any manufacturing environment, whether or not it's your own or a contract manufacturer, and you just need to be aware that's going to happen and that people will make it right. And that's why you're paying them. That margin is so that it covers some of those mistakes when it happens. Because they're going to make it go away. They're going to make the problem go away, right? Yeah.

29:13
Daniel Scharff
Yes. If they agree that there was a problem, which they're not necessarily going to do easily, but yeah, I mean, even just like them using the wrong ingredient, they could use an out of spec ingredient or something and not check the date on it or something. I've seen that a bunch of times.

29:27
Jamie Valenti Jordan
Yes, it happens all the time. And your point about them not having all the ingredients before they're ready to start? Yes, they've checked it four times. It's been checked every week for the last four weeks. And then you get ready to start and there's an ingredient missing and you're like, how?

29:44
Daniel Scharff
Yeah, what can you do? It's like in their warehouse somewhere, maybe, or it's not. And they said it was, or it's the wrong quantity or something. It's less than they thought. And oh my gosh, so many things can go wrong. This is, I think, just one of the most manual parts of our business where you just constant checking and rechecking. And I know you're a really big fan of inventory management software that can help, especially as you're scaling to keep track of all this stuff. And we have a great partner, sin seven, that does that stuff for early brands. But you can track stuff all you want, but there can be just in person mistakes that happen. Someone says it's there, but it's actually not there.

30:23
Daniel Scharff
Or it's supposed to arrive and it goes to the wrong place, or the truck arrives and the place is closed. We're just going, oh, man. Even now I don't work at a brand, it still makes me very anxious to think about.

30:37
Jamie Valenti Jordan
My favorite is when the receiving guy knows that it's super important and so they take it, and rather than put it back on the pallet where it's supposed to go, they know how important it is. So they put it on their desk. But no one else in the facility knows to go check his desk. So we wasted half a day looking for this thing that was on the guy's desk because we said it was important.

31:06
Daniel Scharff
The other side of that is, I remember were running productions, we would find out about some issue and then it's like, all right, were talking about, hey, we could overnight this last ingredient there, but it's going to be a couple of. Maybe it'll get there if we don't. Or we can wait and see if they find it. Just send the thing. Like that couple of $100 is going to be way cheaper than if you missed this production run. Just do it. Don't even think about it. Like get the sure thing done right away. Learning for you for next time.

31:34
Jamie Valenti Jordan
Not only that, but you're going to run through both batches of whatever it is before it goes bad anyway. So why the heck not just order a second one, right? Yeah.

31:44
Daniel Scharff
While your ingredients are also getting older and who knows if they start running the line already and then, gosh, the stuff is just going to sit there and all go bad. Okay, cool. And by the way, I do want to do that separate podcast with you just on sensory. I would love to do that. It's so interesting about from when you're like the sensory process of when you're developing the product and trying to compare different formulas or formulae, and then also one, you're actually just trying to approve new ingredients and qualify them. And then to approving and qualifying new batches that come out, I think it's a super interesting and really important part of the process. So, yes, I will take you up on that.

32:25
Jamie Valenti Jordan
Okay.

32:27
Daniel Scharff
All right. So now you've done your run, getting your product out there to your warehouse or whatever, and wherever you're storing. Know, aside from the great scenario is great. You sell the product, do further runs, everything goes great. But where could stuff still go bad?

32:50
Jamie Valenti Jordan
Well, let's see here. Texas could freeze. There could be a small pandemic. There's so many places things can go bad. But let's say your product is sitting in a warehouse, they could pull from the wrong order of newer versus older product. And now you've got new product downstream in your supply chain and your old products aging out. There's still issues with as long as there's forklifts, there's opportunities to stab stuff.

33:24
Daniel Scharff
And pallet stacking and configurations can damage product, right?

33:29
Jamie Valenti Jordan
Well, not only that, but there's an interesting phenomenon that happens when you ship product in Georgia. So specifically, it is very humid in Georgia for a good amount of the year. And it's not just Georgia, it's just where I grew up. So I'll pick on them. But since it is so humid, they have to cool their warehouses. So what ends up happening is when they take product out of the warehouse and put it on the loading dock because it is colder than the environment around it. All the moisture starts to condense on it. That weakens the corrugate. That corrugate, which is their outer box, that corrugate will then warp and not hold up the strength, the level that it's supposed to, and your pallet will collapse. This is particularly true anytime you're working with target.

34:22
Jamie Valenti Jordan
I don't know why, but target tends to just take cases of things and chuck them into the trailer. It's what it looks like when they unpack the trailer. There's no rhyme or reason to how it's in there. Pallets collapse and everything else, it just happens. So you really got to watch temperature, humidity on your supply chain, not just the weather itself. As you look at how to get your product into the hands of the consumer while it's still good. Yeah, there's tools and tricks around that, but that's, again, I think, somebody else's domain. Yeah.

34:59
Daniel Scharff
It is amazing to see how many things can go wrong. Even with pallet configuration. There are a lot of different ways that you can then put your product on the palette, which will have implications for how it can be stacked. I remember getting it wrong and then just looking at the palette, like, that thing does not look right. And then there were problems with the product because of it, and you're like, okay, well, we need to reconfigure the palette, which has implications, obviously, because you've submitted all those dimensions already to your distributors for how you configure product onto a palette. But just pretty amazing just how many things can go wrong along the way, and then the things that you'll have to do to figure out what exactly happened and how to fix it along the way.

35:40
Daniel Scharff
I would say, looking back from all the times that I was involved in starting product and creating it, one lesson, I would say is pay for the help early, because you're going to pay a lot more for later if you don't get it, like, oh, it's probably okay, we'll run this, and we don't need an expert involved in this first run. And then having huge problems a plague does forever because we just didn't necessarily know enough. Like, if I look at a pallet, I'm not going to see the things that you or another expert is going to see because you've seen a million of them, and you can easily just say, that's wrong.

36:09
Daniel Scharff
And so, man, that was one lesson, and I think the other was raising the flag as soon as you see it, if you see one unit, two units coming off the early lines and there's some weird problem with it, like raising the flag right, then like, okay, let's look at that lot code what happened? And just figuring out those issues early on and not ignoring them, I think can really save you tons of money and product issues down the line.

36:35
Jamie Valenti Jordan
If I could just make two comments about Pallets. One, always use perforated stretch, and two, never column stack. If you know what that means, great. If you don't know what that means, you'll learn the hard way what that means. The perforated stretch will keep your moisture down inside your pallet and the column stacking will keep it from falling over. Or if you column stack, it'll fall over.

36:57
Daniel Scharff
Column stack will just for everyone's benefit. So column stacking, is that just putting one pallet on top of another pallet?

37:02
Jamie Valenti Jordan
Or does that mean it's actually stacking the boxes the exact same way, right on top of each other, all the way up? What you want to do is turn.

37:10
Daniel Scharff
Your pattern 180 degrees, like every layers.

37:13
Jamie Valenti Jordan
So you want the load shared across all the different units, rather than just the load of the case above it going to the one below it. Because what happens is that the pallets, as much as they are designed to be flat, they're never flat. They always are distorted in some way. So now your columns are leaning out from each other instead of towards each other, and you're just going to lose product off the side that way.

37:35
Daniel Scharff
Okay, so let's say you work through all these issues and you're moving forward and getting things right. I know some brands that pretty early on and earlier than I would have expected were already looking for a second Coman. They're like, no, it's really important because, yeah, you could have a disaster with your coman and you are in trouble, buddy. They're like, hey, we can't run this for another 90 days and you're going to be out of product. Or maybe you get into a fight with them about a product quality issue and you're not even sure if they're going to keep running your product, and you could be out of market for six months or, I don't know, however long it took you to find the first coman and get going with them.

38:11
Daniel Scharff
So I have seen some brands try to diversify on the early end where I'm like, gosh, that seems complicated. It's going to take a lot of time for you to bring on a second one. But then there are others that need it for diversification or because it's just time to scale and you know, your coman's capacity and hopefully you're growing your brand and outstripping that pretty soon. When do you think is the right time to be looking for your second Coman?

38:36
Jamie Valenti Jordan
Probably about 180 days before you get in trouble.

38:43
Daniel Scharff
Mark that on your calendar. 180 days before your trouble date.

38:47
Jamie Valenti Jordan
Honestly, I would start looking for them when I'm starting to talk about running once a month with my existing Coman, whatever that looks like for you. And I can't tell you necessarily what size and scale you should go to without looking at your forecasting and things like that. Maybe you want one the exact same size. Maybe you want one that's ten times that size. I don't know. You want to look at the heat map distribution of where your consumption patterns are to make sure that you're targeting, hopefully a little bit closer to those areas where your consumers are. But at the same time, going with the right command is far more important than going with the close Coman.

39:33
Jamie Valenti Jordan
You will make a lot more money with the right CoMaN than worrying about a couple of bucks for shipping charges that it'll take to get from a great Coman that's further away. So that's my advice for you. If you're stuck in that quandary, go further away for the right.

39:56
Daniel Scharff
I think, you know, Jamie, I'm going to wrap us up here. We've gone through so much drawing on your very vast knowledge. I always tell people, like, if you can stump Jamie with a question, please tell me, because I don't think I ever have at all the years that I've known you. So is there anything that you feel like we didn't cover that you would really want to make sure brands think about from that very early stages, whether it's about planning their product or their production, or just thinking ahead to what it's going to be like to year two or year three for their business.

40:28
Jamie Valenti Jordan
From an op standpoint, I think in the grand scheme of things, one of the things that you can do to kind of get ahead of things and think ahead is to. I'm stumped for a second. Yeah.

40:51
Daniel Scharff
Or if you want, you could answer it differently. Like, I could ask you, okay, if you were launching your own brand, what are the, let's say, top three things you would really pay attention to or something? You want me to ask you that instead? Okay, so, Jamie, you have worked with hundreds of brands to help them along their commercialization journey. Let's say you flip the script and you're launching your own brand. Can you distill, like, what are the top three things you're really going to try to get right from all of this experience that you have working across.

41:21
Jamie Valenti Jordan
So many of them? Absolutely. First thing is getting my formulation right. That is the basis that becomes the heart of all the things that happen after it. I'm going to look at what are my scaled up equipment options out there, and I'm going to use that and scale them down in order to test to make sure my ingredients behave the way that I want them to. And third, I'm going to look at my go to market plan and make sure that it's aligned with the partner that I choose to be my manufacturing partner.

42:03
Jamie Valenti Jordan
I want to make sure that everything's set up for success by looking all the way down the end to when my cash is going to come in, from my eventual sales, from the partners that I've identified by working through and making sure that I've got enough cash to cover all the purchases I need to make, and paying my contract manufacturer so I can get that product and walking it all the way back to my formulation and making sure that it is built to deliver the experience that my consumer wants from day one. That's how I'm going to look at my top three.

42:37
Daniel Scharff
All right, I'm excited to try the product that you launch. I'm sure it'll be very good. So, Jamie, just to close out here, can you let people know like, hey, what are all the kind of resources that you guys offer from catapult? I know there's a bunch of cool stuff that you guys send out, including your newsletter. What are good ways for people to follow along with you? LinkedIn or what's the best way for people to get in touch?

42:59
Jamie Valenti Jordan
Sure. Let's start with the best way to get in touch. So, LinkedIn. I try to post there a couple of times a week. Always feel free to follow me there. It's always original content. That's something I pride myself on. I'm not using AI yet, but follow me there. Also, come check us out on our website, catapultserve.com. That's C-A-T-A-P-U-L-T-S-E-R-V as in victor.com, if that strikes your fancy. You want to learn a little bit more? We're present in a few kind of mainstream trade publications and things like that these days, between food technology, we're getting into food engineering, a few other things. But at the heart of it, the best way to get to know more about us is to give me a call. My cell phone number is at the bottom of our website.

43:52
Jamie Valenti Jordan
On are or the next best way is to just reach out on slack on the startup CPG slack. I'm always in the operations channel. You should be able to find me. I'm the only Valenti Jordan on the planet other than my wife. So really easy to find. But yeah, I prefer usually kind of let's start with a slack or an email or something like that, or a LinkedIn. Use my cell phone as a last resort if I'm not responding to you. But as far as what the group does, we work with folks from the early stage of hey, I have an idea for a product. We say let's test it out in the market using data spins data. We then go through and do the product development.

44:39
Jamie Valenti Jordan
We've got 40 product developers, half dozen engineers to make sure that we're testing the product correctly for scale up. We do packaging, quality, regulatory, we obviously work with comans all the way through boots on the ground, through quality improvement and cost improvement, to getting your product into a warehouse and getting it ready for you to go sell. So yeah, we do a lot of stuff. We're always happy to kind of fill in and be kind of technical resources for you if you're interested.

45:07
Daniel Scharff
All right, so anybody who just listened to this now understands at least just the tip of the iceberg of the enormous amount of knowledge that Jamie has accumulated, especially around operations in this CPG world. So Jamie, thank you again for being just the most helpful member of our slack community. It is such a privilege to have experts like you who can just answer questions so easily and so consistently, just to help absolutely everybody, and especially doing it in a public way where everyone sees the answer and can learn from you that way, is incredible. So thank you for that. And I've had the chance to work with you personally with catapult, and it was absolutely how were able to launch more quickly and with much higher quality ingredients and finding the right people to work with.

45:54
Daniel Scharff
So definitely for anybody who thinks they could use some help, highly recommend following along with Jamie on LinkedIn and on our slack and having a conversation with them. And you can hear from him, he will point you in the right direction, even if it's not a fit to work with them. So thank you again, Jamie, it's great to know you because you've just helped so many people out in the community. So thank you and we will look forward to the follow up episode on sensory testing.

46:22
Jamie Valenti Jordan
Sounds great. Thanks so much, Daniel.

46:24
Daniel Scharff
All right.

46:25
Jamie Valenti Jordan
Thank you. Take care.