Product Improvements Without Breaking the Bank
Featuring: Founder of Princeton Popcorn Company, Robert Ralph aka Farmer Bob
On Episode 26 of This is Small Business and the seventh of our This is Small Business Minisodes series, Andrea continues her discussion on product iteration but this time we dig deep into how you can work on different versions of your products without breaking the bank. Founder of Princeton Popcorn Company, Robert Ralph aka Farmer Bob, talks about how you can iterate without needing to create an entirely new product and how to mitigate any financial losses that might pop up from failed experimentation. Join Andrea as she jots down key takeaways from this delightful conversation that will leave you feeling satisfied and ready to start experimenting.
[00:00:00] Robert Ralph: My definition of product iteration would be obviously creating other forms of your product. And for me it's maybe a little bit more simple than other companies because my core product is a popcorn kernel. And it's just like, how can I iterate off of that? Well, packaging is the number one thing for me that would describe my iterations.
[00:00:22] Andrea: Okay so how you define product iteration is different -- it really depends on your business. But one question on everyone's mind when they want to experiment with product iteration is: Do I have enough money? So let's get into that.
[00:00:37] Host: Hi, This is Small Business, a podcast by Amazon. I’m your host, Andrea Marquez. This is one of our TISB Minisodes - shorter episodes for those of you who want a quicker binge. On this episode we'll be talking about how you can iterate a product without breaking the bank with the founder of Princeton Popcorn Company, Robert Ralph who also goes by Farmer Bob.
[00:01:00] Andrea: Tell me a little bit about Princeton Popcorn and how it came to be.
[00:01:05] Robert Ralph: Well, Princeton Popcorn is a vertically integrated popcorn producer. So what that means is, yours truly Farmer Bob, plants the seeds, raises up the crop and then harvests it. And then after harvesting it, we clean it and condition it and package it. And American made packaging by the way, and then, uh, distribute it to the store. So I like to say we're seed to store. And we do it kind of the hard way so that we can keep control of the quality at every single step of the way. It's somewhat unique that that's done that way because most people specialize in one segment of that production. But being new to farming, I figured that I had to go direct to consumer, and the only way I would be able to survive in my opinion or my thought process, was to have a really excellent product.
[00:01:50] Andrea: So you carry a couple different iterations of your product, could you talk about how and why you decided on those iterations in particular?
[00:02:00] Robert Ralph: I initially started with a one pound and a two-pound tub, and then I graduated to an eight pound because people wanted larger packages. I have a 50-pound bag as well sell a lot of those. But then I also got into the six pack of one pounders, which is a surprise seller for me, and it is a really good gift item. That one was born out of financial reasons. My initial plan when I set out for Princeton Popcorn was to plant the seeds, raise it up and harvest it, and then pop it, flavor it and package it and sell it ready to eat, already popped popcorn.
So I had a few things that I stumbled on getting to the pop flavor and a package part, and I was lamenting that fact to a friend. And by the way, I don't have any investors. I don't have a bank loan. You know, I don't have millions of dollars, so I have to be very careful here. And I was getting to the point where it harvested my first crop in 2019, and I couldn't quite get the pop flavor package up and running. And one of my friends said, [00:03:00] well sell the kernels. So I thought well, you know, I do need some revenue cuz I've got a lot of money sunk into this, so I need to get some sales going. And I ordered one- and two-pound tubs and when they got delivered I took 'em off the truck with my forklift and one fell out and it happened to be this little tiny tub. And I thought, oh, that's cute. They sent me like a miniature sample of some of their product, the packaging company. But actually it turned out to be the one pound. I just didn't know it was gonna be that small. And I thought to myself, I can't sell that. Like there's no way I can sell that. I'm embarrassed to sell something so small. That's, that's one pound? But I just bought 4,000 of them, so I've had to do something. So I did the one pound and the two pound, and I will tell you, I sent like a dozen of each up to Amazon for FBA. And I thought, well, if they don't sell in six months, I'll call 'em back.
Well, at any rate, as it turned out, those things sold like the same day, and I was really surprised. So right there, I had a one pound and a two-pound iteration of the same exact product, [00:04:00] and it wasn't even what I was originally intending. So a lot of times I think you just have to be willing to pivot and just do what you can do. Deal the hand that's dealt to you or you know, pivot whenever you can. And then, I ended up getting the eight-pound idea because it was just more economical for customers and they really liked the product and they, they didn't want to just keep buying one-pound tubs or two-pound tubs. So that was a different scenario. The customers ultimately they're in charge. They'll tell you what to do.
[00:04:30] Andrea: Am I right to think that you knew that you'd arrived at the desired result because it was selling or were there other factors that played into you knowing that?
[00:04:38] Robert Ralph: Certainly the sales matter but also customer comments. So people can be very, um, since they're doing it on the internet, very revealing and unguarded on what they say in a product review or email directly on my packaging, I say, Hey, here's my email address. Email me if you have any problems popping it, okay. So, it's what they say and what they don't say. If you don't get any feedback of like [00:05:00] “this packaging is too small or it's too hard to get a scoop into,” or comments like that. I tried to think 'em out as best as I could to make sure it's good packaging before it goes out there.
And then the sizes too. But I will emphasize that you don't know until you try. I was trying to get into the pop flavored and packaged and that was delayed. So I decided to sell kernels. Well, I realized I had a lot of kernel. So then I ordered in some 50 pound bags and then I packaged the popcorn into it and I sent those off to Amazon thinking much like the one and two pound, hey, if they don't sell, uh, take 'em back. It's a wild seller. People love that popcorn in the 50-pound bag. It's obviously the best value. It's a lot of popcorn. So that one was just literally experimentation, but I do know that my customers love it, and I guess I got kind of lucky. I will also tell you that I did iterate a four pounder. So I thought later if the one pounder and two pounder are selling, well, a four pounder, that'd be perfect. It was a bomb, it was the same exact packaging, [00:06:00] you know, just a larger tub. And it didn't sell for whatever reason people would, they skipped from the two pound to the eight pound, but they wouldn't buy the four.
[00:06:08] Andrea: Customers are specific. So how did you manage to get all of this done without breaking the bank?
[00:06:15] Robert Ralph: I didn't do 'em all at the same time. I started out with the one and two pound, but then it took me a while to get to the eight pound, and I will tell you that there, it, it's easier in my packaging to experiment with a one and two pounder than it was the eight pounder, the eight pound I thought about a lot before I committed to that. And the reason is, you could buy the tubs and the lids and then a certain number of labels and fill those and you could even pay a little bit more and buy fewer quantity. But even a pallet is like 2000 quantity of the two pounders is 4,000 of the one pounder. However, if I made a mistake, I would have a lot of bags that I'd have to figure out what to do with, and that either a mistake because it was the wrong size, like it's not gonna be a good product, or if I made a spelling error. [00:07:00] So I had that thing tripled, quadruple checked by everybody I knew, I was like, will you please pour over this and read every letter? That would be where that would've broke the bank. I mean, because it's a, a big investment.
So it's easier to experiment where you have less to lose. And the different tub size – it’s like the four pounder, you know, I ordered a pallet of those. I believe there was a thousand on the pallet, and I eventually sold through them and at the very end, I started doing some discounting on them. And just to move them and then be done with it. Just wipe my hands clean of the four Pounder. So, you know, just don't risk too much is what I would say in the experimentation phase. And then it's okay also to order fewer quantities, pay a much higher price. And it's not that economical, but you're in the experimentation phase, so maybe you're not gonna be as efficient, but you could figure out winners and losers. And then if you got one that you think is really, or it's proving out to sell really well, [00:08:00] then order big, try to get the per unit cost down.
[00:08:04] Andrea: I think that a clear tip here is don't break the bank quite yet while you're experimenting but leave room to experiment. And what I got from that as well was during the experimentation phase, it's okay to buy less of something like packaging even if it's more expensive. Because you still have storing fees to worry about and what you'll do with it if it doesn't sell. So, making sure that you get a good amount to test, but not too much and not too little, right?
[00:08:28] Robert Ralph: Yes. And give yourself some latitude too. You're gonna make mistakes. And you know, what if I had produced this eight pounder, for instance, and it didn't work. Okay. It didn't work. At least you know now. And if you haven't bet the farm, no pun intended, then, you know, you'll live, just lick your wounds, move on, and you're just that much smarter, but don't stop trying. You gotta keep trying and don't give up and allow yourself to fail on some of these things. You know, the Four Pounder was a great example. This six Pounder was actually the opposite. The six one pounder, six pack was a surprise success. [00:09:00] I'm thinking about putting three, two pounders together in a three pack and see how that goes. I, you know, I would presume if the two pound is our number one quantity seller and the six pack of the one pounders is a, uh, hot product, that a three pack of the two pounders would work too. But I don't know, I could come up and find out that that's a dog. Nobody wants it, but that's no big deal. I could retreat outta that pretty easy.
[00:09:22] Host: That was Farmer Bob, founder of Princeton Popcorn Company, talking about how to iterate your product without breaking the bank. As always, here are some key takeaways:
- One. Product iteration is different for every business. You don't have to create an entirely new product, it could just come down to quantity or even packaging. I loved Farmer Bob's idea to take inventory that he already has and sell them in a pack of six!
- Two. Keep a close eye on sales and customers. Ultimately, your customers are gonna decide what product stays and what goes. So, make sure you try to get feedback through comments or via email. [00:10:00]
- Three. Don't be afraid to experiment but also be really careful with taking risks. Maybe consider buying less quantity even if it'll be a little pricier. And this leads us to...
- Four. It's okay to fail. Put that into account while you're experimenting and make sure that you're not "betting the farm" on that iteration.
That's it for this episode of This is Small Business Minisodes, brought to you by Amazon. On the next episode, we'll be talking about merging your small business with another business to become medium-sized.
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Until next time – This is Small Business, I'm your host Andrea Marquez -- Hasta luego -- and thanks for listening!
CREDITS: [00:11:00] This is Small Business is brought to you by Amazon, with technical and story production by JAR Audio. [00:11:15]