Sandro Roco, founder of Sanzo, had worked in several different industries—nuclear engineering, investment banking, and tech—before he started his sparkling water company specializing in Asian fruit flavors. And while all that experience was helpful, he found there was a steep learning curve within the food and beverage industry.
On this episode of Shopify Masters, Sandro shares some lessons he learned along his three-and-half year journey running a sparkling water company.
1. Spend more time on product, rather than strategy
Sandro says the development of a new food and beverage product can take months or even years, and many new founders get attached to perfecting the launch strategy, instead of working on the product.
“Try to get the product and the package right first, at as minimal cost as you possibly can,” Sandro says. “And then when you have that, get out into the trade shows, get out into farmer's markets, get out into natural and specialty food markets, pour samples …get that initial feedback and then go back and have that inform new packaging innovation or product reformulations.”
He suggests taking an iterative approach that prioritizes customer feedback, similar to the way people in tech approach building a digital product. “I think a lot of folks who aspire to create food and beverage concepts just don't go through this process,” Sandro says.
2. Use existing datasets
One of the pros of going into the food and beverage industry is that there’s easy access to sales information, which you can buy through companies like Nielsen, IRI, and SPINS.
“In the world of grocery, there is actually a very robust data infrastructure for what's selling in consumer goods where you can actually see,” says Sandro. “[Ask], ‘Hey, at Whole Foods, at Sprouts, at Safeway, at Albertsons, at Kroger, what are the brands that are selling well and what are the flavors that are selling very well?’”
But Sandro warns to not follow the trends too closely. He thinks it was an advantage for Sanzo to be one of the first to use flavors like yuzu and lychee, which weren’t as popular when he started the company.
3. Learn to work within the existing grocery system
Sandro says it was a humbling experience to learn the ins and outs of U.S. grocers, which can be full of inefficiencies. But understanding the system can help you expand distribution.
“It's almost like a modern day miracle that our grocery stores offer the level of selection and curation [that they do] ... for how disparate the underlying systems are,” Sandro says.
4. In-person connections are important
Sandro firmly believes that food and beverage communities are built in real life, not online. He encourages entrepreneurs to get out to their local grocery stores and have people sample the products.
“It can be daunting, especially for folks who may be less extroverted or less used to talking to people one-on-one, but the power of one-to-one interactions, especially post-COVID, I don't think can be understated,” Sandro says. “People really get a ton of value when they taste the product and meet the maker.”
5. Find ways to maximize your capital
It’s no surprise that food and beverage is a capital heavy business and Sandro found it very difficult to scale without investment. He used one strategy to make his capital go further. He started trading his knowledge of online marketing in exchange for a contact for a distributor or a manufacturing partner.
“I really didn't have the luxury of being able to make mistakes with money. And so how can I trade my time for monetary value in ways that help build the business?” Sandro says.
To learn more about how Sandro was able to harness the increasingly mainstream interest in Asian culture into demand for Sanzo, listen to Sandro’s full interview on Shopify Masters.