On Sampling

Since I'm planning to use sampling as my main marketing tool, I thought this quote from a completely unrelated article in Brand Autopsy was relevant:

Brand Autopsy:

If you are going to sample a product, make sure the sample tastes good. Samples that taste good will manage to enhance the marketing performance of the product you are selling.

I Pitched Tim Draper

The truth of the matter is that old ideas die hard. When I read that Tim Draper was asking for people to pitch their billion-dollar idea on Always On, I couldn't help but write about ScribeCenter.

For those that don't know, ScribeCenter is was a digital dictation and transcription management solution for attorneys. It took up a whole lot of my waking hours for a period of almost two years. I brought together a group of four other individuals to perform the coding, architecture design, and corporate operations. I also built a pretty strong advisory network composed of people in the industry. We even had a fully functional prototype (except for the actual audio capture portion). ...So what was the problem? Unfortunately, it was the wrong four people. Things ended up imploding when the developers and architect were laid off from their full time positions.

ScribeCenter served as a great learning experience. I was sad the day that I dissolved the company and I still think it has legs. Who knows, maybe I'll get a call from Tim.

Low-Carb Potato

Chad Hutchinson, a University of Florida researcher, is working on a project that will bring a low carbohydrate potato to the market by next year's harvest.

staugustine.com Local News: "Low-carb Tater"

Chad Hutchinson of the University of Florida is in charge of the low-carb potato project. He said for the past four years he's been growing potatoes from the Netherlands in Hastings that have 30 percent fewer carbs than standard baking potatoes. He said the potato is not genetically enhanced in any way, and it's a European gourmet potato that's known for its taste.

The best thing about this is that the farms participating in this project are right here in Florida. I contacted Chad to discuss the possibility of chipping these potatoes in our stores. He said that these are not traditionally suited for commercial chipping because of their high water content and low gravity. After explaining that they wouldn't be mass produced but would be processed in a much smaller scale, he agreed that we could experiment with these to see how it worked.

Chad was also very helpful in explaining the potato market here in Florida. He says that there is a line called the "Sebago" that is similar to the Atlantic (apparently a traditional chipping potato) that has great flavor even if it's not the best candidate for large-scale chipping operations. This line is available for 5-6 months in Florida and can also be sourced in Maine for the remainder of the year. After I mentioned that we will be using Snowden and Norwiss potatoes, he advised that Snowden can be bitter at times depending on where it's harvested.

As a side note, check out this image of a blue potato grown right here in Florida. Chad says that the staugustine.com article mistakenly used this image for the low-carb potato. The real low-carb potato has a yellowish color. Regardless, can you see yourself snacking on a bucket full of these babies!

I was very happy to have picked up the phone to track Chad down. He seems to be a fountain of potato knowledge and I'm sure he'll be a great resource in the future.

Trivia on a chip

Procter & Gamble announced that it will be printing trivia questions, designs and other fun facts on the face of its Pringles potato chips. I think that's brilliant! I already find myself turning over the caps of all of the Snapple drinks to see what Fun Fact lay underneath.

Business Day: "Trivial pursuit - on a chip"

The Cincinnati, Ohio consumer products giant said it was using a "revolutionary" technology for the designs, which will include fun facts and animal designs as well as questions and answers from the Trivial Pursuit game.

"This technology is the first of its kind in the US to be used on food," the company said in a statement.

"The technology uses food coloring and doesn't alter the delicious taste of this popular snack."

The company is teaming up with Hasbro, which makes the Trivial Pursuit game, and will use 2,400 trivia questions and answers from six different Trivial Pursuit Junior categories randomly printed on the potato crisps.

I'm Not Alone

Apparently the spot that Food Network ran on the Chippery has been responsible for more than just my response to the company. I just stumbled accross this article from the Detroit News that describes the Michigan's licensee's story. Here are a couple of good quotes from the article.

Firm's fresh method rolls out the chips (Detroit News):

Since March, Chips to Order LLC has supplied fresh chips to a half-dozen parties and distributes 1,000 bags a week to 14 convenience stores. The chip-making equipment Burnstein uses is not much bigger than oven ranges found in most restaurants.

“It’s a healthier, fresher chip,” said Burnstein, a former Web site owner. “With today’s society, that’s what people are looking for. There are people who will always want a 99 cents bag of chips, but there are plenty of others who want a fresh bag of chips that are made within 24 hours.”

Right now, the chip-making operations are at Maxwell’s Carry Out & Catering in Farmington Hills, where Burnstein goes through about 3,000 pounds of potatoes every week filling orders.

Joel Freeman used to sell 30 bags of Frito Lay chips a week at Maxwell’s. He now sells 120 bags a week of Chippery chips, which he introduced just three weeks ago, he said.

“People come in just for the chips,” said Freeman, who is a franchisee.

It's nice to see a positive response even if it's in a different setting or venue. At this point, it's great reading that others are taking the plunge into this relatively new business.

Low-Carb Losing Steam

This whole explosion of low-carb foods has seriously worried me with respect to how the Chippery will be received. This may not be good news for Atkins lovers, but finally, some good news (for me at least)!

Low-Carb Losing Steam (washingtonpost.com - free registration required):

The nation's appetite for low-carbohydrate foods seems bottomless, judging by the many low-carb products showing up in supermarkets and the new menu items at restaurants and fast-food chains. And when Krispy Kreme Doughnuts Inc. recently announced slowing sales, it put part of the blame on low-carb diets.

Yet the mood at a recent Washington conference on the business was bleak. Sales of low-carb products have fallen sharply at independent and health food stores, and some longtime industry insiders say a shakeout has begun.

I always reasoned that there are plenty of places that aren't offering low-carb foods that seem to be doing very well. This at least calms me down a little. I may still end up offering a low-carb bagel chip that can be seasoned to order if it ends up tasting good and is well received as a special.

via carb wire

Mall Lease is In

I just received our first view of the mall's lease document via email from the landlord's attorney. Quite a hefty document. This thing weighs in at a whopping 65 pages with a couple of other pages thrown in an additional file as attachments to the lease. The majority of the business terms are in a "Data Sheet" that's just two pages long.

I obviously haven't read through the whole thing yet, but I've already found a couple of issues that we're going to have to work on. The first is that the Commencement date was moved to November 1st from October 1st. It gives us more time, but it's not what I planned. Hopefully, I'll go through the rest of the document by tonight and confer with Jim to see what we can do.

Trans-fat-free French fries

Is this a sign of things to come. The fast food industry may soon be rolling out trans-fat-free fries from Slimplot Foods. This may be a good thing in that it will raise consumer's awareness of the benefits of staying away from foods cooked in oils containing trans fats. Chippery uses non-hydrogenated oils to cook the chips in.

USA: J.R. Simplot launches trans-fat-free French fries : just-food.com News:

Simplot said it had developed Infinity Fries specifically to address health concerns associated with trans fat, also known as hydrogenated fat. Infinity Fries are made with 100% non-hydrogenated vegetable oil. They also have lower saturated fat than traditional fries

What's Next

So now that the ink is dry on the Chippery license agreement. I have to gear up to open the first unit. The plan is to open up in The Mall at Wellington Green on or before October 1st. Before this can happen, there are a slew of things that have to get done. Here's a short list:

• Negotiate final terms of mall lease


• Store design


• Mall and Health Department Plan Revew


• Permitting


• Demolition


• Construction


• Installation of Fixtures and Equipment


• Hire staff and take care of other administrative tasks


• Training


• Pre-opening marketing and publicity


• Health Department inspection and occupancy certificate


• Grand opening!

Each of these items is a world unto themselves. I'll be expanding on each one in future posts.

Biometric Scans in Restaurant Biz

Small Business Trends writes about an interesting article about smaller restaurants using finger print recognition in their operations.

Update: After trying to go back and read this article again, I found that the Ohio.com site requires you to register your email, name, home address, social security number, first pets name, etc. in order to access their content more than once. Huge annoyance!

The Deal Is Done

As I mentioned previously, Geoff (the President) and Ernie (the CFO) from the Chippery paid me a visit this week in order for us to get to know each other better and get our previously rocky negotiations back on track.

The guys flew into Miami International and drove up to the hotel in Boca on Monday night. I picked them up at 8 AM on Tuesday because Monday was my wedding anniversary. We had breakfast and talked about strategy, company history and our backgrounds until about 10 AM. It seemed clear to me that these guys didn't have a clear understanding of what the company's focus should be. From the beginning, I saw that the company was trying to avoid operating as a full franchisor for a number of reasons. Not the least of which was cost. They now have a full UFOC which I'm half way through digesting but they haven't registered with the numerous states that require registration. In Florida, this isn't much of a problem. The fact that they have a UFOC for review and that they comply with the SEC guidelines for Franchisors allows them to fill in a simple exemption form and pay $100 in order to do business in the state.

A good example of the lack of clarity for the company's future came in when I asked where they saw the company in five years. Geoff started answering while Ernie excused himself for a second. When Ernie got back, I asked him to answer the question and the two answers were 180 degrees apart. This may be because Ernie isn't in the office full time, but I think it's a clear example of how they operate.

After breakfast, I drove us to Wellington to meet with Jim. I drove around the town a bit to show the incredible amount of development that's going on over there and then all the way around The Mall at Wellington Green. The mall is huge, so it's very impressive. It was clear that the guys were awe struck. We walked in through the food court entrance and took some time to look around. Geoff struck up a conversation with the guy behind the counter at Ben & Jerry's. It turns out he was the owner. His spot is perfect for a snack; about 190 sq. ft. and he's doing roughly $300K in gross sales per year. He did say that his first two years were rough. That's understandable, the mall was brand new then.

We made our way over to the soft play area and met with Jim. There we started showing them the spot from a distance because we didn't want the existing tenant to get freaked out. The spot really is very good. This is why it pays to surround yourself with people that can get things done. Without Jim T., the management would never go for what we're doing.

After a bunch of pictures were snapped, we started walking around and parked ourselves in some chairs in one of the side corridors. We started talking over some of the business points that bothered Geoff and Jim went off to see if he could get us a conference room in the management office. When he called to say he got one, we moved the conversation up there. To make a long story short, we negotiated some points, but the terms of the agreement were pretty much what I had submitted to them prior to their trip. We wound things up in the conference room in under an hour and headed to Two Jay's for lunch.

After seeing Jim off, I drove the guys back to their hotel room where Ernie and I sat down to craft the language for the agreement. We brought Geoff in several times and had a few back and fourths until all the terms were documented. This took us up to around 5:00. I ran off to get the document printed and told them I'd be back to pick them up for dinner at around 6:30. I wanted Alex (wife) to take a quick look at the items that had changed but she agreed that they were all ok. I missed the kids during the day. This was pretty much the only time I saw Stephanie and Danny awake during the entire day.

When I got back to the Hotel, Geoff and Ernie were having drinks by the pool. We singed the agreement and had a toast. What a relief!

I drove them by The Town Center Mall in Boca before heading to Mark's Place at Mizner Park. We had a lovely dinner and talked about all sorts of things. I find that many of the business folks I entertain are enthralled by the story about how my family and I came from Cuba. It really seemed that they enjoyed hearing me tell it.

Blogger Relaunched

Congrats to the Blogger crew. They just relaunched a great new interface jam packed with new features, templates and that great new blogger smell! Stopdesign has a great write-up of the entire project

Update: It's only fitting that I choose the Mr. Moto template from the excellent selection of standard-compliant templates that new blogger provides.

Forbes.com: Motorola's Hat Trick

The few of you that read this probably know that I, along with roughly 120 other engineers, techs, factory support folks, program managers, etc, worked on Motorola's Triplets program. My facility was the primary integration site for both hardware and software for all three Triplets phones and is still working on two spin-off projects based on the same architecture. You also may know that we were all laid off just after the triplets received ship authorization. This is the kind of stuff that really ticks me off!

Forbes.com: Motorola's Hat Trick:

"The new V-series (V300, V500 and V600) clamshells were among the top-selling phones nationally during the first quarter for global system for mobile communications (GSM) carriers. The new phones are also credited with tripling Motorola's (nyse: MOT - news - people ) first- quarter net income and boosting its worldwide market share."

Open Source Business

The BusinessPundit touched on an idea that I've discussed with a few friends. His thoughts are slightly different than mine but along the same lines. Should business owners be more open about the underlying details and issues of their business?

I'm not sure how open I would be about an existing business with complete strangers, but I think it's my duty to share what I've learned with anyone in my network that is going through similar experiences. Personally, I've tried to build a network of trusted business advisors that I turn to for help in dealing with things that throw me for a loop. One of my earliest mistakes when I was evaluating new business ideas early on was to keep the idea to myself. I thought that if I told anybody anything about it, it would surely be stollen along with the millions that I was going to make off of it. I think the majority of people don't have the drive that it takes to pursue even excellent ideas on their own... even when you hand them the concept and explain it in detail. That doesn't mean that you can't get good feedback from these people. They may love to talk about business opportunities, but not necessarily pursue any of them :)

An entrepreneur knows that the only way that things happen is if you make them happen. I now find myself throwing out business ideas into conversation just to see other people's reaction.

Accountant Selected

After a few interviews, I've decided to go with Louis Cohen from Caler, Donten & Levine here in West Palm Beach. Lou is a two-time University of Florida grad (like my wife and I) and comes highly recommended from our attorney. They've already set me up with their base quickbooks file that's tailored for the restaurant industry.

Extension

I called up my two-clicker in Libertyville to find out if I was going to be extended through him or if I had to move to a new group to stay until September. Turns out he's willing to extend me until then and I'll be reporting to someboday up in Chicago. Sounds like I'll have plenty of flexibility to get things done for The Chippery.

150 Years of Potato Chips

I can't believe that I let this little fact through without mentioning it. It's been 150 years since the first potato chips were fried by George Crum, a chef at Moon's Lake House resort in Saratoga Springs, New York in 1853.

This article also says that Frederick J. Meyer, the guy that owned the first large-scale potato chip production line, killed himself after selling it to H. W. Lay & Company. This article details the history of Red Dot Potato Chips.

Franchising Takes Root

Florida Today ran an interesting article on franchising. It describes the level of detail needed from a franchisor's side and, for me, points out how far away from this the guys at The Chippery are. I think that in the end, I'll probably be the one that goes through the trouble of doing all of these types of details - POS system, accounting system, inventory control, job descriptions, policy and procedures, etc.