Hi everyone! I hope you’re all staying healthy.
If there’s one thing I’ve taken away from this crisis, it’s how much we took for granted basic goods and services. Empty grocery shelves, closed barber shops, and inaccessible doctor’s offices are among a few examples.
The scarcity of certain products, especially in niche or high demand categories, creates an opening for entrepreneurs. I want to be clear, crisis profiteering is abhorrent and anyone who participates in it will be prosecuted in my recently created ‘Founders Court’. Trials are held in my condo and mandatory minimums apply.
That being said, you putting your labour to work to make products that people need at competitive prices is a good thing and, if delivered through a low-contact channel, can be a productive contribution to flattening the curve.
I know that starting a business can be really intimidating. But in my experience, writing down each specific task makes the whole endeavour seem way more manageable. That’s what I’m going to try to do in these newsletters.
Quick note: this week’s idea is going to be a physical product but I’ll try to alternate between physical and digital products to keep things interesting.
Over the course of the year I'm going to brainstorm a bunch of different ideas. This one, in particular, might not be right for you, but my hope is that in each letter, you learn something about my process that you can apply to whatever idea you end up pursuing.
Lastly, I love feedback so please send over any thoughts on the content, and if you found any value in this, please sign up to the weekly newsletter:
Okay, with the preamble over, I’m excited to present to you the first One Week Startup idea: Vegan Baked Goods.
Why?
Great question. Seems like a such a simple business but, at this time of crisis, I’m a strong believer that these are the best businesses to start because they address real needs and generate immediate revenue.
I like the vegan baked goods business for a couple of reasons:
Selection of healthy snacks was limited to begin with, and the crisis has only worsened the problem
People eating poorly while in quarantine are in search of healthier options
You can sell this online. Direct-to-consumer grocery products are particularly compelling in a market that doesn’t want to interact with traditional grocery stores
Starting small is easy (you can make it all from home), and you can scale up quickly through contract manufacturing if the idea takes off
Niche audience makes your customers easier to find
Good margins on the product
How we’re going to test it?
The goal of this exercise is to see if a vegan baked goods business actually works. To do this, you need to validate if you can make and sell enough product to prove that there’s a market. After that, you can invest more time and money into the project with confidence that you’re on to something.
Before you begin, it’s good practice to list all the assumptions that we presume true for the business to be a success. Here’s what I’ve come up with:
That you can make the product
You can design the brand and package the product
You can sell the product
Customers value the product
You can make money from the product
If you can validate these assumptions, you have a real business.
It’s also crucial to set a goal that you can measure yourself against. In this case, I think that selling 50 units in a week is very achievable and a good starting point.
Resources
Below are detailed descriptions of every task, but if you’re looking for a simple list of what needs to get done, check-out this worksheet. On the first tab is a task list and the second tab is a template for your sales outreach tracking.
Let’s start with what you should be working on for the first two days...
Day 1-2 – Product (approximately 1 day)
Pick A Name
So you’ve decided to start a vegan baked goods business – great! – now you need to pick a name. Lot’s of good resources out there on how to choose a startup name (here and here). I’m going to go with ‘Sustainable Snacks’. Don’t think too much about this – the product matters much more than the name so spend your time on that. Perfect is the enemy of progress.
Products
This is the most important part. The quality of your product is going to make or break your business. It doesn’t matter how nice your IG is if your product is trash. So let’s take it seriously.
You have to pick the products that you want to start with. For the sake of simplicity I’m going to choose a 12-pack of vegan brownie and a 6-pack of chocolate chip cookies. A quick Google search brought up a number of recipes, here’s a few that look delicious:
Your costs will vary depending on which recipe you go with, but the upstart expense should be less than $50. To determine pricing, take a look at what similar products on the market cost and price comparably. Goal is to generate the highest possible margins while still being competitive with similar products. You’ll get a better idea of the cost of production as you experiment with recipes.
Remember, the goal of this exercise is to see if people even want to buy your product. If the exercise is successful, you can revisit pricing for the next batch so don’t obsess too much over the numbers.
Experiment
For all you bakers out there, this will be the easiest part. If you’re like me, it’s by far the toughest. Go to your nearest grocery store and find ingredients to experiment with. Now, I know it can be tough to find ingredients right now but try your best. Side note: I’ve been finding that cultural grocery stores (Portuguese, Korean, Chinese) are well-stocked.
What you want to do is come up with a formulation that ensures consistency so your customers get the same product every time they purchase. Consistency is crucial for building trust with your customers. Once you get a recipe down, in a social-distancing way, give some samples to your friends to get their feedback. Make adjustments and repeat till you’re happy with the final product.
The only caveat I’ll add is that you’ll want to test the product for shelf stability. To stop this from slowing you down, place your products in a ziplock bag while you’re doing everything else in this guide to see how long it can stay fresh for. It’ll like be around 5-10 days.
Day 2-4 – Brand + Logistics
Logo/Colours
Okay, you’ve got a name and a great product. Now it’s time to work on your brand identity. I can’t stress enough how important your brand is. Remember, anyone can do what you’re doing. Your brand is what’s going to differentiate you from everyone else. Beautiful packaging, a well designed Instagram and carefully worded copy is what will sell your already delicious product.
For brand, you have two options with this. You can either contract a designer, which will cost you between $200-$500 for the logo and packaging. Or, you can try your hand at Canva – an easy to use online design tool. I’d recommend trying the free version of Canva first.
But before you even get to Canva, you’re going to want to figure out what your brand colours are. Your colours, as well as the name, are the most important components in your brand. They should reflect you and what you want the brand to represent. To discover the right colours for your brand, try this Adobe Colour tool – it’ll help you develop a brand palette.
When you’re happy with your colours, head to Canva and play around with the logo design tool till you land on something you’re happy with.
Here’s what I came up with:
Packaging
Once you’ve got the logo, you’re going to need to figure out packaging. Since we’re just starting out, you’re not going to want to order a big batch of custom designed packaging. You will want something that can: 1. Keep your product fresh, and 2. Look great. I’m also a big believer in eco-friendly businesses and encourage you to prioritize sustainability in your packaging.
To start, I’d recommend a sealable ziplock pouch. I like this because the ziplock enclosure will keep your product fresh and you can easily customize it with labels.
I’ve collected a few options below:
Labels
For the labels, you will ultimately need two – a front cover and a back label. The front will have your logo and the name of the product, and the back will include ingredient and nutritional details. But for expediency sake, start with just the front label. You can provide a list of ingredients in a print out that you include with the product.
Like the logo, you can contract a designer or try your hand with Canva. If you go with Canva, make sure you’re using the right dimensions for the label. For a 8oz, you’re going to want 4" x 3.33". On the Elevate Packaging site, they recommend which sized labels you should use for each of their pouches.
Couple of options for printing, I use StickerMule and find them to be affordable and fast but there are a bunch of other options. StickerMule will show you a preview of your label before you get it printed so you can ensure that it’s properly sized and positioned.
Social Media
The next piece of the brand puzzle you’re going to work on is your social. You're going to want to make accounts on Facebook, Twitter and, of course, Instagram. Instagram is going to be your main channel. You’ll need to do a few things with this:
Play around with a one-line description of your product for your IG bio
Search for imagery that you can use to fill your grid with
On copy, you want it to be simple and highlight your core brand proportion. For example, I might use: “Delicious vegan goods made from the finest local ingredients”. My main positioning is to highlight that my product are vegan and made from local ingredients. You can play around with that depending on how you want to position your product.
For imagery, you need to think about what you want your brand to represent. When you know what you want the ‘visual identity’ to be, try using Unsplash to find royalty free photos.
Product Photography
You will, ultimately, want to a professional take product photographs. In the meantime, try taking some on your phone. Here are some good resources on how to take great DIY product photos:
Growing Your Instagram
Once your Instagram is live, you want to check-out other accounts that may have followers who match a similar profile to your customer. In my case, that would be Toronto vegan foodies or health and wellness professionals. Go to their accounts and start following their followers. Whoever you follow will likely check-out your account and consider following you back. This is a great way to get the word out about your new business.
Website
Okay, I know you’ve been working hard and learning lots of new things. You’re making great progress and we’re almost ready for launch. One last thing you need is a website. Luckily, this is pretty straightforward.
First, you need to buy a domain. I use Namecheap. Then you’re going to make a Shopify store. To get started, make an account and pick one of their free themes. If you want to get fancy you can buy one too but it’s not necessary as we test out the idea. Make the page as simple as possible – a home page and a page for each of your products. You can sell your products individually or in packs of 5, 10, whatever. Connect the store to your domain, setup payment processing using Stripe and you're off to the races.
Shipping
This is important! Ultimately, you’ll automate this but for the sake of testing, you may opt to do home drop-offs of your product. This limits your exposure to post offices and ensures quick delivery for your lucky first customers. It’s a bit extra hustle but, especially now, feels very worth it.
Putting it all together
Make your first batch of product, apply labels, and package your products in your branded bags. It’s real. You’ve done it. You’ve started a real business.
Day 4-7 – Selling!
Congratulations for getting this far, you’re amazing! You’ve poured your heart and soul into your product, designed a brand that reflects your personality, and now you’re ready to start selling. Where do you start? Here’s the deal, we want to sell 50 units of baked goods – that’s enough for us to determine that there’s a real business to be had. Start with low hanging fruit and work your way up the sales channel. Remember, you only have a few days to test it so you better move quick.
Friends and Family
This is the easiest channel to sell into. I know it can be intimidating to promote your new business to those closest to you, but I promise you it’ll be okay. They’re your friends and family, they support you and, in most cases, will be happy to purchase your product.
Start by creating a spreadsheet with everyone in your network you want to contact, include columns for preferred channel (FB, IG, Email), and if you’ve contacted them or not, and whether they’ve purchased so you can keep track of your progress.
To make it easier, I’ve put together a sample message for you to send to them:
Hey [NAME], Hope you’re staying healthy! I know healthy snacks are hard to find now so I started to sell some vegan baked goods. They’re delicious and made of local ingredients. I’m selling them here if you’re interested – would really appreciate your support! [LINK].
See how easy that is. Send, send, send – you will get sales. You might even close all your 50 sales through this channel.
Personal Social
Use your own personal social to promote your business. Share your business’ IG on your store, make an announcement about your new project, just get the word out there! You never know who might be tuning into your content and a few of your followers might be then perfect audience for your new vegan baked goods business.
Communities
Every business needs to find their audience. In my case, I have a few hunches on who that could be:
Toronto vegans
Fitness and health conscious snackers
Try this for yourself. List out all the different groups who might be interested in your product. Once you do that, try to think of where these people are online. For example, I found this Facebook group for Toronto Vegans – perfect! I’ll write a post to announce the launch of my new vegan baked goods business. And we’ll see what happens.
The important thing is that you make a list of all the different channels where your audience could be and try reaching out to them (see example here). You’ll quickly learn where works and where doesn’t, and this will inform your marketing longer term.
Day 7 – Review
Wow, you’re amazing. You should be so proud of yourself for making it this far. Regardless of whether this project was a success or not, starting a business is no easy feat – and you just did it!
Now, you can sit back and do a deep dive into what happened. I’d ask yourself a few questions to get things going:
How much did your sell?
Which channel did most of your sales come from? Friends and family? Your Instagram? A Facebook group?
How was production? Was it easy? Hard?
Can you scale up production if you had to meet increased demand?
Did people like your product? Give your customers a call!
What were your biggest roadblocks? Can you get around them?
What did you learn?
Let’s assume your brownies were a hit, what’s next?
Scalable production: You’re going to have to figure out how to scale up production. For the time being, that might be making bigger batches in your home. Longer term, you should look into hiring a contract kitchen and co-packer.
Set-up additional marketing channels: Get your email marketing up and running, have professional product photos taken and consider buying paid IG and FB ads.
Explore new channels: Chat with your local coffee shop and health food stores to see if they might be interested in stocking your baked goods.
I really hope you found some value in this. I love helping entrepreneurs so if you read this and you’re stuck on something or have a question – please reach out! You can get me at: brettchang@gmail.com.
And feedback! I love feedback! If there’s something you’d like to see in this, let me know.
Alright, that’s all for this week but I’ll be back next Monday with a new guide. Stay healthy!
Brett