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An opportunity....?

Hey all, don't fear, this isn't an ad. Actually the salsa in the photo is no longer made for the public. The ladies in this pic are friends of my wife and I, Deidre and her daughter Krista. That guy in the middle figures into the story, but I'd like to make sense of all this for ya before I involve him.
 
Anyway, Deidre made a Mexican salsa that will rock your nation, named it after her Grandma Frutosa (whose original recipe it belonged to), and after getting her company off the ground hired Danny Cash to pack it for her. This isn't the hottest of the hot, a simple habanero recipe, so warm enough, but the flavors! She made a mild, medium, and hot, like a lot of salsa vendors, and was growing, slow but sure. My wife went with her to represent the company in Albuquerque last summer and brought CASES of the stuff home. One day at one of Danny's store showcases where Deidre and Krista were hawking their salsas and hot sauces (a jalapeno red, a green chile limon and a smoked jalapeno), the guy in the photo happened to walk in and tasted her hot salsa...and immediately ordered 11 cases and more to be sent to friends. He told it was the best he'd ever tasted (I thought he made his own brand ?) and even told her that she could use this image free for marketing!
 
I know that a lot of you are into the really HOT peppers, but this recipe is just dam good. Reason I bring this up: a couple months after this pic was taken, Deidre decided to fold it up. Just quit. She said she wasn't confident enough to invest what was necessary. Broke my little heart. That was more than a few months ago, but recently we found that her recipe was still being produced and sent to the guy in the funny hat, without her knowledge. He likes it that much (doesn't he make his own?). The wife and I are now in deep negotiation as to whether we will buy the company from Deidre, hire her as a representative, and keep Mr. Gibbons floating in Green Chile Salsa. It appears the plant is already tooled for production...
 
Any entrepreneurs here think it a thing? 
 
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Wow Great story. Sounds fantastic but he's still just one man a Rock God of a man but none the less. How were her overall sales before closing. Just be careful my friend. Hope you have the Best of Luck. Maybe Lucky Dog  or Salsa Lady will weigh in they are the True experts.
 

salsalady

Business Member
Not sure what you are asking about other than..... do we think that, based on your story, the sauce is worthy of investment?
 
 
Well, without having tasted the salsa, I'd say 'yes'....
 
Gibbons may have his own products, but , as a sauce maker myself, there are TONS of sauces my family and I love and buy repeatedly.  I only make a few sauces, and there are sooo many other great tasting sauces that are different from what I make.  And I do buy cases of sauces from my peers in the industry and I do give them away.  Sometime in AnySoldier packages, sometimes to friends and family,  and I always try to have a new assortment of sauce to take to our annual Chileheads Campout to share.
 
Having a hot sauce entrepreneur like the sauce is a big endorsement.  Beyond that, you have to look at all the numbers and see if they work using an established co-packer.  There seems to be some other things going on that need to be addressed privately with those involved and not on a public forum. 
 
Good Luck and I hope this family classic recipe can live on.
 
 
 
PS- 75% of sauce and salsa consumers are mild/medium heat levels.  The extreme chileheads that hang around here are in the minority...  and that's why we love 'em all the more.... :cool:
 

The Hot Pepper

Founder
Admin
Whooooaaaaa Nelly. Billy Gibbons likes it. You need more than one customer. Don't build a business based on one famous person's testimonial. You need to get it out there see what the people think! 

(Or sell it to him ;))
 

salsalady

Business Member
Good Point, Boss. 
 
 
If you do get to the point of serious negotiations, get some cases of the best selling item, get out into the public and offer samples. see what people think.  If they can be totally honest,... and not your friends and family who don't want to hurt your feelings by saying something sucks...get some feedback. 
 
salsalady said:
PS- 75% of sauce and salsa consumers are mild/medium heat levels.  The extreme chileheads that hang around here are in the minority...  and that's why we love 'em all the more.... :cool:
 
Depends how you define mild/medium. By the definitions of the world as a whole, "hot" has a pretty good market going I think. Only thing is we're not hotheads, we're superhotheads and that's a hell of a lot more niche.
 
Aside from likely having the warped idea of "hot" we all tend to develop over time, I'm sure salsalady knows best but my general understanding is that Tabasco and weaker hit a wide market of casual consumers who'll use a little occassionally. Stronger sauces of Scotch Bonnet and Habanero or those with a slightly more unique green or smokey flavour (these are still special to some) will see more avid consumption because their customer base are more into chilli but they're less in number. Then we get the Red Savina and above stuff. Stuff that outperforms the public image of what humans can eat. That image exists for a reason as, as SL says, we are the great minority there.
More niche still are the specialist sauces that are maybe a little less hot, made with interesting and unusual peppers. These often require insider knowledge to appreciate their value so aren't as simple to get into as a basic Ghostie.
 
Furthermore, people don't expect quite as much heat from a salsa as a sauce so, while a 3.5 on my scale might be what I consider "supermarket hot" and a 4 the absolute mass market topper, your hot salsa might be better off as a 3. Again though, I'm not the expert on buisness here.
 
salsalady said:
Good Point, Boss. 
 
 
If you do get to the point of serious negotiations, get some cases of the best selling item, get out into the public and offer samples. see what people think.  If they can be totally honest,... and not your friends and family who don't want to hurt your feelings by saying something sucks...get some feedback. 
hey anyone reading my post think i had that covered. Boss is stealing my thunder hahaha
 
 
but recently we found that her recipe was still being produced and sent to the guy in the funny hat, without her knowledge.
 
SO he already has them making her recipe - then why do you think it is worth buying the recipe from her if he could just buy the made sauce directly from them (avoiding paying your portion of the sale) and is already doing so how are you going to stop them from doing the same in the future ( can you prove he is using her recipe or will they just say it is his recipe and can you afford to get in a court battle to prove it ?)
 
Sounds like the recipe is already being produced without her knowledge so buying the recipe from her would seem to be asking for problems since you don't know what kind of arrangement she entered with the current company that is already using her recipe for others. 
 

The Hot Pepper

Founder
Admin
oldsalty said:
hey anyone reading my post think i had that covered. Boss is stealing my thunder hahaha
 
Guess you fell behind. :lol:
 
Fantastic input, folks, and much appreciated.
 
I used the pic with B. Gibbons mostly to express the quality of the product, I certainly am aware that he's just one guy--A lover of the salsa and a bulk purchaser yes, but just one guy. Nobody who loves salsa didn't think this was at least one of the best they'd eaten, me included, and that's more the motivation to consider acquiring this company than any other, though yes, it would have to prove sustainable in the market. Like I said, the wife and I are only talking between ourselves at this point. 
 
Yes, there are issues that I can't comment on, at least don't think I should, I'm not sure of any legal "ownership" of those salsa and hotsauce recipes that can be enforced one way or another. It hasn't gone that far, and being that Deidre has more or less closed up shop on the brand, for all I know, that's the end of it. If we decide against the purchase of Grandma Frutosa I fully intend to put my order in with Billy.
 
We do have sales trend numbers, my wife is an accountant and Grandma Frutosa was a client. She has ALL the figures, from the moment the first jar came out of Deidre's own commercial kitchen. She was paid, in fact, with cases upon cases of product. The stuff goes into virtually everything I cook, and I AM the cook around here. When she has time she'll dig those stats up and I'll share.
 
I don't have any delusions folks. This is an exploratory endeavor at best, and we have yet to convince Deidre to come on board. But this salsa is amazing, it's the hit of every gathering and party we host (lots of those!!), and we live in the Land of the Great Bland White Sauce!
 
Thanks for the great input, and please don't stop. One day I may be offering you guys and gals a free jar to sample (just pay a simple shipping and handling fee... ;) ).
 
http://www.bfgsauces.com/
 
OK, now we know--He has a line of sauces, *looks somewhat limited*, but interesting. Also no salsas of his own. I'd like to try that hot sauce and see what he thinks "just right" for a Texas boy might be... :hell:
 
 
*ok, I take that back. Didn't check his Zombie line...*
 

SmokenFire

Staff Member
Moderator
Business Member
I'd find out the status of the co packer and what deal/contract she (frutosa) made with them.  Did the copacker have it written in that he could make the salsa for others or is he skirting the terms of the contract for money?  
 
You've got the numbers for sales, but if you don't have exclusivity for the original recipe (and total control of who makes it and for whom) then your path to sales and profits will be different.  Right now it seems like the copacker is sitting on the recipe and making it at their leisure for their own profit and I would think that even if Frutosa quit the biz her original recipe should be hers alone.  

stettoman said:
http://www.bfgsauces.com/
 
OK, now we know--He has a line of sauces, looks somewhat limited, but interesting. Also no salsas of his own. I'd like to try that hot sauce and see what he thinks "just right" for a Texas boy might be... :hell:
 
That being the case then perhaps the best/quickest path is to partner with him, add the Frutosa salsa lines to his line/branding and then market both under his name and the original name.  Either way finding out the ownership of the recipe and the terms/conditions of the copacking contract are key.
 
SmokenFire said:
I'd find out the status of the co packer and what deal/contract she (frutosa) made with them.  Did the copacker have it written in that he could make the salsa for others or is he skirting the terms of the contract for money?  
 
You've got the numbers for sales, but if you don't have exclusivity for the original recipe (and total control of who makes it and for whom) then your path to sales and profits will be different.  Right now it seems like the copacker is sitting on the recipe and making it at their leisure for their own profit and I would think that even if Frutosa quit the biz her original recipe should be hers alone.  

 
That being the case then perhaps the best/quickest path is to partner with him, add the Frutosa salsa lines to his line/branding and then market both under his name and the original name.  Either way finding out the ownership of the recipe and the terms/conditions of the copacking contract are key.
Yes, we have our homework cut out for us, including convincing a reluctant owner to deal with us. She and my wife have been best friends since the third grade, but the girl can be stubborn. And we won't/can't do anything about the copacker without her cooperation, unless she has a specific contractual clause to facilitate. I think at the very least we can squeeze that info out of her.
 
And I would LOVE to do bidnezz with the Gibbons bunch. It would mean going to Texas on a more regular basis!
 

salsalady

Business Member
Most copackers have non-disclosure clauses.  It may include something like -if the client closes down shop, the copacker can use the recipe as their own- or -recipe is property of client at all times-  you definitely need to find out what's going on with the copacker making the sauce for someone.  Maybe it was a limited run just for BG for personal use.  Cash is a pretty stand up business person, can't see him making the salsa and selling it without permission.   Again, we don't know the facts, can't be putting out too much speculation.
 
salsalady said:
Most copackers have non-disclosure clauses.  It may include something like -if the client closes down shop, the copacker can use the recipe as their own- or -recipe is property of client at all times-  you definitely need to find out what's going on with the copacker making the sauce for someone.  Maybe it was a limited run just for BG for personal use.  Cash is a pretty stand up business person, can't see him making the salsa and selling it without permission.   Again, we don't know the facts, can't be putting out too much speculation.
I have no doubt that there's an agreement between them, and knowing Deidre, she may not even be aware of the entire scope, or may have forgotten some of the aspects of it. The last thing I'm thinking, even considering I don't know Danny Cash at all, is that he's doing anything outside the scope of their agreement. We have to assume that he is above board, and none of you here who are familiar with him give me any reason to think otherwise. My only intent in this endeavor is the possibility of salvaging  and marketing a wonderful brand of epicurean delight that totally deserves a place in the market. That means even if Mr. Cash is still going to produce that specific recipe for an established client.
 
My wife will weedle the necessary documentation, then we'll go from there. You're absolutely right, we won't speculate beyond that.
 

salsalady

Business Member
Also, it may be something like...the client ordered 80 cases but the batch ended up as 90. I've heard other situations of a surplus of sauce being private labeled and sold by a 3rd party with full agreement by all parties.

If you really love this salsa and believe it needs to continuye, go for it. It may be that the original mistress of this sauce just doesn't want to deal with the public and all the stress of festivals and weekly farmers markets, taxes, licensing,legal contracts...


It is daunting and not for everyone....
 
Deidra loves travel, had the time of her life in Albuquerque last year. But I can't argue the stress marketing might have on her. I'm a musician, a PEOPLE PERSON, so I'm made for it, and both my wife and I believe 120% in the quality and flavor of the stuff.
 
salsalady said:
If you really love this salsa and believe it needs to continuye, go for it. It may be that the original mistress of this sauce just doesn't want to deal with the public and all the stress of festivals and weekly farmers markets, taxes, licensing,legal contracts...


It is daunting and not for everyone....
The lady is a really tough sell. Been working on her since my last post and...por nada. I think the best we can do is weedle her Grandma's recipe out of her and consider doing a start up...I know she wouldn't compromise with the copacker regarding fresh hand-selected ingredients. Even with her suppliers practically local it made her sauces fair pricey, but the stuff is ambrosia.
 
Then again, I am a better than just good slumgullian chef. My garden salsas boot mahooty, maybe it's time to do some cookin' of my own... :idea:
 
Sheesh...I wish I would've seen this thread 6 years ago. Deidre has always been one of my favorite customers...and THAT SALSA...so good. I wish someone would've reached out to me, or maybe someone did. Billy has been a friend since 2009 and yes, he absolutely fell in love with that salsa. All three heat levels that we packed for her (with an NDA), were great. We'd never sell a batch of any of our customers' recipes to anyone else without an agreement in place.

Note: I'm the one who took the picture!
 

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Sheesh...I wish I would've seen this thread 6 years ago. Deidre has always been one of my favorite customers...and THAT SALSA...so good. I wish someone would've reached out to me, or maybe someone did. Billy has been a friend since 2009 and yes, he absolutely fell in love with that salsa. All three heat levels that we packed for her (with an NDA), were great. We'd never sell a batch of any of our customers' recipes to anyone else without an agreement in place.

Note: I'm the one who took the picture!

Hi @Danny Cash , you and I chatted a year or so about Deidra and her products, and the coincidence is uncanny, because the campaign started up again over Christmas to get her rolling again. My daughter has a post on FB asking for encouragement for her "aunt" Deidra to call you. We and the family have her talked into at least a one run batch, just for family and friends, but if we can get her to agree, this salsa needs to make a comeback. We've moved to CO Springs ourselves, and I grow varied and sundry mid-to-high heat peppers, mostly to make a chokecherry-Rocoto jelly.

Just sayin'; don't be surprised to hear from her sooner or later, we first need to work on re-startup funding!

BTW, we've been here a year and I still haven't made a trip to your store!!

And for the record, I was misinformed regarding anyone stealthing her recipe, she told me this herself, and six years is a long time for this old cat to remember where I got it from...
 
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