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START
Tom: Tom here.
Michael: Hey, Tom, Mike Senoff,
here.
Tom: Hey, how are you doing?
Michael: I’m good. How are you
doing?
Tom: What we are in, if you want
to take a look at our site ever,
snackcheese.com
. We sell string cheese,
also snack cheese through
convenience stores nationwide,
and what I’m interested in doing
obviously is marketing our
product better. I have all the
contacts. I have all the people
I want to get in front of, but I
want to write the kind of
advertising and marketing that
will get their attention.
Right now, we’re like a little
fly flying around their head
that they want to just slap and
get right of. We’re not getting
their attention, and our
competition is Kraft and some of
the big boys like that.
Michael: How long have you been
in business?
Tom: Twenty-four years.
Michael: Well, I’ll tell you
what I’ll do for you. I’ll take
you through a process, and I’ll
see what kind of hidden
marketing assets I can uncover
out of your business. It will
probably take about an hour of
uninterrupted time on the phone.
I’ll do it for free. It won’t
cost you anything. All I ask is
let me record it, and use it for
my other listeners to show them
how to uncover hidden marketing
assets.
Tom: Sure.
Michael: Would that be all
right?
Tom: Sure, that would be fine.
Michael: I’d love to do it.
Tom: The other thing is if you
had any interest of helping me
market this, that I’d be happy
to pay you with profits.
Michael: Okay, well, I’ll tell
you what. I’d be able to give
you an answer to that after I
take you through my analysis.
Tom: Because I’ve hired other
companies, spent $6-$10,000 and
got nothing for it.
Michael: I believe it.
Tom: They’re going to be able to
– it would be like turning on a
faucet on the profits, and I
noticed reading all this stuff
about marketing, everybody
thinks their business is special
and unique, and I found with
these other people that we got
to the point where they weren’t
able to help us.
Michael: I’m sure there are
little nuggets within your
business that are very hard for
you to see because you’re in. It
takes a fresh perspective from
the outside looking in.
Tom: And, even before we talk,
if you want, I’d even send you
some samples of the products for
you to look at.
Michael: That’s not necessary.
Well, let me ask you this, would
tomorrow be good for you?
Tom: Tomorrow would be good.
Michael: Where are you located?
Tom: Minnesota.
Michael: You’re in Minnesota.
I’m in San Diego. I could take
you through this process at ten
o’clock tomorrow.
Tom: You wouldn’t have a problem
if I conference called in my
partner?
Michael: No, your partner can be
on the phone, too.
Tom: I’ll just put him on the
line first and then I’ll call
you.
Michael: Okay, I’ll call you ten
o’clock my time tomorrow, and
we’ll do it.
Tom: Okay.
Michael: Okay, looking forward
to it.
Music
Michael: I had a call from a
gentleman who’s in the cheese
distribution business. They
package one ounce and two ounce
string cheese. Do you know what
string cheese is?
Richard: Yes.
Michael: He had called me
looking for some marketing help.
He had told me he had some
experience with another
marketing consulting company
called YK marketing, and another
one called IB Marketing
Professionals or something, and
I’ve set up an appointment with
him to take him through the
Opportunity Analysis Worksheet.
And, I wanted you to give me
some advice or anything I need
to focus on when I call this
guy. He’s in Wisconsin and I’m
here in San Diego. So, we’re
going to do it over the phone.
He’s going to have his partner
Alec on the phone as well. What
should I be looking for and what
do I need to keep in mind before
I do this?
Richard: The most important
transfer of feeling that a
client prospect wants to get
from you, Michael, is that can
you solve this problem? So, as
you open up the opportunity
analysis, you want to expose the
problems. You want to expose any
frustrations that the client
has. You want to expose, sounds
like this one has frustration
with previous consultant groups
and you need to get that out and
discuss it a little bit, and
take time to listen. So, that’s
why the opportunity worksheet
starts out with “Are they okay,
but they want to do better?”
“Are they stagnant and no
growth?” “Are they declining?”
And, you’re asking them, “Tell
me where you are now.” And, so
you just listen to them, and you
begin to sense what their
problems are and their
situation. Then, the opportunity
asks, “Would you like more
growth? How much more?” And, I
turn that into, “Where would you
like to see yourself, Tom? Where
would you like to see your
business?”
Michael: What if he says, “I
want 1,000 percent growth”?
Richard: That’s understandable,
but what we might want to do is
break it down into a little bit
more realistic goals, and
listen, I’m not saying that
that’s not possible, Tom, and
we’ve had clients that have had
1,000 percent growth. But,
before I answer that and tell
you whether or not we can get
it, what I really need to do is
kind of see where the money is.
So, that’s why about the first
15 minutes needs to be that
listening. It needs to be
hearing their frustration, their
pain. It needs to be hearing
what their goals are and what
they’d like to see happen.
Michael: What if they start
getting ahead into some of the
things I’m going to be asking
them on the other several pages?
Richard: Then just say, “We’ll
cover that. Let me ask you this.
Where would you like to see
sales next year?” And, then take
them right back to it. You
really want to do that because
the key to being a successful
marketing consultant is to be
able to solve their problems, be
able to hear and understand the
situation, and then customize
the application of the system to
solving that problem.
So, there are seven sections to
the marketing system, but the
solving of their problem might
involve all seven. It might
involve a couple. It might
involve several. You don’t know
yet.
Michael: So, you’ve had clients
that may be implementing four of
the seven steps?
Richard: That’s right.
Michael: In the conversation,
they’ve already told you that
they’re doing direct mail, and
you get to that step. Do you
skip over it or do you say,
“Okay, you’re already doing
direct mail”?
Richard: Yeah, then you want to
find out if it’s been effective,
because my system teaches you as
a consultant how to make direct
mail effective. I just met
recently with a prospect that
sends out 10,000 coupons in a
mailer and didn’t get anything
back. So, I said, “Well,
something’s wrong with your
mailer. Maybe it’s the wrong
target group. Maybe it’s the
wrong message. Maybe it doesn’t
have a Unique Selling
Proposition.”
So, you can begin to address the
issues that way. They might be
doing some of these things, but
they’re not executing it right.
So, your step might be simply
doing it right. So, you have to
find out if they feel good about
the return that they got, about
their effort they’re making.
That’s the first part of the
opportunity analysis. You’ve got
to be good then at being able to
tweak the steps of the system to
meeting their needs and their
situation.
Now, so that’s the first task as
a consultant. The second is you
have got to be really good at
identify what we call hidden
marketing assets, and that’s why
it’s called the opportunity
analysis. I want to find out
what opportunities there are
with this client to make him
more money. That’s what they
really want. They want to make
more cash. They want to make
more sales. They want to make
more net profit. They want to
make more profit margins. They
want to free up working capital
that might be spent on things
that aren’t working. Maybe
they’re spending money on a
salesman that’s not performing
and you can recommend
eliminating that salesperson and
putting the money elsewhere.
The second skill that you really
want to develop as a consultant
is identifying these hidden
marketing assets. The reason for
that is that’s what
differentiates you from these
other guys. They went and tried
the Y2 Marketing. They don’t
concern themselves with finding
these hidden marketing assets.
The IB Marketing Group, they
don’t concern themselves with
finding these hidden marketing
assets. So, you’re going to be
able to tell your prospect that
in the next 45 minutes now that
we’ve taken 15, I’d like to take
the next 30-45 minutes to see if
I could find you some money, see
if I could find you some
opportunities for more sales,
more growth, more profit, and
I’m going to do it by seeing if
we can identify some hidden
marketing assets that you
already have built up in your
business. So, I’d now like to
take you through some questions
that will help me determine if
these assets are there, and if
they are, we can make more money
with them without having to
spend money on traditional
advertising approaches. Does
that make sense Tom?
Michael: Yes.
Richard: So, that’s his go head.
All right, so, Michael, you’re
telling me that you’re going to
see if I have some opportunity
in my business already through
these hidden marketing assets so
I can make money there instead
of spending more money on
traditional advertising. That’s
right.
So, you’re clearly communicated
your uniqueness. He needs to
really understand why you’re
different. If he doesn’t, it’s
going to be a tougher sale. So,
this opportunity analysis really
is the way you demonstrate your
uniqueness.
So, as you go through that, you
look at number one – USP, EVP-Extra
Value Proposition. Right under
there, it says, “Look for
underpromoted USP including
owner or staff expertise,
competitive advantages, price
leadership, differentiation,
focus, competitive
disadvantages, unique products,
guarantees, unique benefits,
services, et cetera.” Those are
the hidden assets you’re seeing
if he has.
So, the questions there are
designed to see if those assets
could be making more money. Why
should people do business with
you? Do all of your customers,
prospects and staff know that?
Why? Why not? If they think they
have a USP, is it being well
integrated into all marketing
efforts including the staff?
So, when you ask an owner, “Why
should people do business with
you?” And, he can’t tell you,
that shows you that there’s a
hidden marketing assets. If he
says, “Well, I don’t know if my
customers really know or my
prospects know or my staff
really knows what we sell?”
there’s your hidden marketing
asset.
So, that’s step number one. If
the answers to those show you
that he’s just not really
packaged his uniqueness in any
way, and it’s not being marketed
at all, you need to tell him
that, “Well, then, Tom, it
appears from this first question
that we’ve got some opportunity
to make some money because we
can determine a Unique Selling
Proposition for you, and that’s
going to help you attract more
prospects, close more prospects,
and get more money from your
customers. Does that make
sense?”
Michael: So, you want to
summarize it appears that we
have some money laying on the
table.
Richard: That’s right! You
definitely need to help him see
money all along the way. So, the
formula is ask questions to
identify assets, help him see if
those assets are leveraged
better they can make him money.
So, you’re on to number two in
the opportunity, and that’s
where you’re looking for a low
closing ratio. You’re looking
for subpar salespeople. You’re
looking for no follow-up of
inquiries. You’re looking for
upselling opportunities. You’re
looking for packaging
opportunities, for current sales
averages, staff allocation of
time. Those are all marketing
assets. He’s never thought of
them that way. You have to help
him think of them that way.
So, you ask him, “What’s your
average closing rate?” Well, if
he says, “I don’t know.” that
tells you as a consultant, you
have an asset. Or, if he says,
“Well, I think it’s about two
out of ten.” Then, you can say,
“What would happen if I
increased that to three out of
ten? Can you see how much more
money that would make you?” If
he says, “Yes”, then you’ve
showed him the money.
He might say, “Well, I’m a
destination store, so everyone
that comes in here buys my
cheese.” “So, your closing rates
probably 90 percent.” Well, see
then you don’t have much of an
asset there. So, you need to
recognize that may not be as
much money for them.
Michael: Okay.
Richard: That sometimes happens
especially with stores that are
such with product that people
are going there because they’re
already decided they’re going to
buy. They’re destination stores.
You want to ask him if they’re
following-up on leads and
inquiries, finding out if their
sales people are really not
doing their job or not because
that’s an opportunity, that’s an
asset. So, then you determine if
step two could work for them.
Three is past present
perspective customers and right
under it, it says, “Look for a
customer base that is not being
worked that might have inactive
customers or lack of a database.
Are there cross-selling
opportunities in the business?
Are there back-end opportunities
to sell? Are there are
reactivation opportunities?”
Those are all the assets.
So, in the series of questions
under that are to help you
determine if he’s working his
customer base and database like
he should. If he says, “Well, I
know I’ve got probably a
thousand past customers I
haven’t talk to.” You need to
say, “Well, that’s a marketing
asset.” So, in step number
three, we’re going to implement
some marketing to reactive those
past customers, and so can you
see then how we might be able to
get more money for you? And he
then sees that.
So, each step you’ve got to help
him see money. Show me the
money, because if you don’t show
him the money all along the way,
then you’re not making your
sales, and if you’re not closing
trial closing along the way
because all of a sudden he might
say, “Well, no I don’t see
that.” Then, you’ve got to go
back and maybe ask him again.
Maybe he’s doing his database
very well. Maybe he’s got it on
computer, he’s reactivating.
He’s getting as much money as he
can. He’s got a good turn of
customer, frequent buyer program
in place, and there may not be
much opportunity. So, you might
not then propose that as a step
for him, and the same with
alliance opportunities, the same
with media, the same with
community.
I will say this that steps five
and six – Media and Community –
are probably going to be less
used by clients who are
motivated by your ability to
generate sales without media.
However, they’ll come into play
if you’ve got a client that
already maybe does a good fair
media, but it’s not working. So,
the asset is media that’s not
working.
For example, under media, it
says, “Look for the different
media they use. Do they have an
objective? Do they use the media
for strengths? Do they budget
enough to be effective? Do they
spray and pray or do they reach
the right market with enough
frequency? Is their message
compelling or is a donation
confused with advertising?” So,
you’re going to see if the
opportunity is media that’s not
working.
Community is where they might be
a company that needs to get out
in the community more by doing
demonstrations, by press
releases, by seminars, by
advanced marketing.
Michael: So, I was going to ask
you, in the community, would
free publicity come under that?
Richard: That’s right, and
that’s really gaining momentum
is the PR, but not all companies
are built that way. A lot of
owners don’t want to go out in
the community. It’s not built
that way, or they may not really
have newsworthy products and
services that are going to get
press release.
So, that’s the summary of the
opportunity analysis. Does that
help you?
Michael: That helps me. That’s
good. So, I’m just going to
follow along. I’m going to
listen. I’m going to always be
closing after each section. I’m
going to show him the money, ask
him does he see how uncovering
these assets can put more money
in your business. So, I’ll be
closing all the way through, and
if I’ve done my job right, and
after I end the call, he’ll call
me back and hire me at least for
one step.
Richard: That’s right. Now,
there is a part of the
opportunity analysis that is
there for a reason, and that is
you might be able to get a
client to agree with you all
along the way verbally. Some
prospects might need you to put
it out in writing and help them
to see it, and that’s why this
opportunity analysis is built
the way it is. You might be
finished after the first seven
pages which covers all seven
steps, and verbally you may have
done the job and the client
says, “I see money. Let’s start
with step one.” He might not be
there, yet. You might need to do
some more selling. You might
need to be more visual with him
instead of just verbal.
So, that’s page eight through
ten of the opportunity analysis
where you take them through some
key ratios, and help them see
the three ways to grow their
business. Some are going to
respond to this, other aren’t.
Michael: Okay.
Richard: You have to be good at
knowing if this is important.
Michael: It’s not mandatory to
use this. It all depends.
Richard: No, because you might
have sold them. You don’t want
to oversell.
Michael: From your experience
taking people through the
opportunity analysis, what
percentage do you ever have to
get through the numbers and the
three ways to grow business?
Richard: Very rarely.
Michael: Because you’ve done
your job.
Richard: Verbally.
Michael: With the questions?
Richard: Yes, or I’ll say
something like I did earlier. I
said, “What’s your current
closing rate?” and, he says,
“I’m two out of ten.” You say,
“Can you see how three out of
ten would make you more money?”
See, he already sees it.
However, there have been times
when I’ve gotten down to the
three ways to grow because it’s
a nice little worksheet, and it
shows you that after you
implement the steps of the
system that you recommend –
let’s say you recommend four out
of the seven to this cheese
distributor – then, you put in
there project sales increase as
a result of the implementation
and you would put $100,000. Then
you would put in there the
investment for project. So, your
total investment let’s say is
$10,000 for the four steps.
Well, $10,000 into $100,000
gives them a net profit of X
amount of dollars. So, his
return on investment is X.
Michael: Okay.
Richard: And, you’re helping him
see an ROI – a return on
investment. When he looks down
there and sees $100,000 coming
from $10,000, that might help
you close the deal.
Michael: He may be willing to go
one step with you, and if you
want to continue to sell more
steps, you can use this.
Richard: That’s right.
Michael: At a later time.
Richard: That’s a good point. He
might not be sold, and as a
consultant you need to be ready
to do that. At times, I will
say, “Now, listen if I don’t
perform on step one you can
retire. You’re not tied to all
four steps. To get my guarantee
I’ve got to do all four, but if
you don’t want after one you can
let me go.” So, that does give
you a lot of opportunity then to
sell steps two, three and four
later.
Michael: How am I going to
articulate my guarantee with
them?
Richard: Okay, he’s going to ask
you that. He’s going to say,
“What do you mean by your
guarantee?” And, you’re going to
say, “Well, I’m proposing here
four steps, and I’m proposing
$2,000 a step. So, that’s a
total investment of $8,000. I’m
going to guarantee to you that
after the implementation of
these steps in the period of
time that we agree on, that
you’re going to get back at
least $8,000 in new profits or
new sales from the steps that I
implement or I’ll keep working
the marketing system at no
charge until you’re completely
satisfied. That’s my guarantee.
I’m going to make certain that
you feel that your investment at
least is covered and no other
marketing consultant offers that
kind of guarantee. You’re not
going to find it form your radio
guy, your newspaper guy, your
direct mail copywriter. You’re
not going to find it from an ad
agency. You’re not going to find
it from anybody except from one
of my trained consultants.”
Michael: Okay, great. All right,
I’m ready to do this. I’ll let
you know how it goes.
Richard: Great.
Michael: I appreciate it.
Richard: Good luck to you.
Music
Ruth: Gourmet Products, this is
Ruth Ann.
Michael: Hi there. This is
Michael Senoff. I have an
appointment, a call with Tom.
Ruth: Please hold.
Tom: Tom here.
Michael: Hey Tom, it’s Mike
Senoff here in San Diego.
Tom: Hey, how are you doing?
Michael: I’m really good. How
about yourself?
Tom: Not too bad at all.
Michael: All right. Do you have
some time this morning?
Tom: I do.
Michael: Okay, and are you going
to have your partner on the
phone?
Tom: All I have to put you on
hold. I’ll give him a call and
then I’ll put both of us on.
Hold on one second.
Michael: Sure.
Tom: Okay, Michael I have both
you and Alec on the line.
Michael: Hi, Alec how are you?
Alec: I’m good Michael. How are
you?
Michael: Good. Nice to meet you.
Alec: Nice to meet you, too.
Michael: And, Tom, it was nice
meeting you yesterday. I know we
didn’t talk much. I want to let
both you guys know, Alec, I had
discussed with Tom – I made an
agreement. He had contacted an
associate of mine and mentioned
that he was possibly looking for
some help in some marketing for
the string cheese business, and
I told him I’d be willing to
consider it if I could talk to
you guys and take you through an
analysis worksheet that I have
in front of me, and it will help
me identify what you guys got
going, where you’re going, where
you want to go, and based on
that, I may be able to give you
some help, and maybe I won’t.
But, I’m sure it will be a good
learning experience.
Tom: Okay.
Michael: Okay, great. Well, what
we’re going to do Alec and Tom,
this worksheet that I have in
front of me is going to help me
isolate hidden marketing assets
in your business, and it’s going
to help me determine specific
marketing projects to optimize
and leverage those assets for a
better growth of your string
cheese business. Okay?
Now, I don’t know how much I
told you yesterday on the phone
about who I am or why we’re even
talking today. So, let me tell
you quickly a little bit about
what I do.
What I do and what my company
does is I work with business
owners, people like yourself
helping them to maximize their
marketing success. Most of my
clients are small and medium
sized companies with sales under
five million dollars a year.
Now, I work in a unique
marketing approach. I look at
all of your marketing assets,
and I find ways to leverage and
optimize your success from those
assets you already have in
place.
Now, because I’m trying to
leverage existing marketing
assets you already have, we can
often realize dramatic and
profitable growth without having
to invest a lot of money or make
a lot of significant changes in
your business operation. So,
what I’d like to do with you
today is take a look at your
business and see where you are,
where you’re going and how
you’re getting there, and see if
there might be some ways that we
can help your business grow.
Does that make sense to both you
guys?
Tom: Absolutely.
Michael: Okay, most businesses I
work with fall into one of three
different situations – number
one they’re either okay but want
to do better, number two they
are stagnant and there’s no
growth, and number three they
are declining. Tell me where you
are now.
Tom: A.
Michael: Doing okay but you want
to do better?
Tom: That’s correct, Alec?
Alec: Correct.
Michael: Would you like more
growth?
Tom: Absolutely.
Alec: Sure.
Michael: How much more? If you
could quantify it in a
percentage from what you’re
thinking in your head – of
course we want to grow to the
moon, but let’s-
Tom: We expect to grow with a
new product that we’re going to
add-on this year, 70 percent
this next year, but we’d like to
grow as much as actually five to
ten times.
Michael: Now, are you talking
about you expect with a new
product?
Tom: Yeah, we’re going to add-on
a two ounce product. Right now,
we sell a one ounce product.
This will be a two ounce. We
take it back to our existing
customers, resell it to them in
a two ounce. It will be the
exact same thing, but we sell
twice as much.
Michael: Why don’t you just give
me a summary of your business?
You are in the-
Tom: Snack cheese business. We
sell one ounce string cheese
natural. This is mozzarella
string cheese, natural
mozzarella string cheese,
smoke-flavored. We sell one
ounce Colby Jack cheese, one
ounce cheddar cheese, and one
ounce Pepper Jack cheese.
Michael: And, these are in the
little packets that you would
find at a point of purchase
display in a-
Tom: Convenience store cooler.
Michael: And, you have the one
ounce right now?
Tom: Yes, and there’s 24 one
ounce pieces in a box. It has a
header display on it, and
sometimes they even rip it off
and it just sits there with the
cheese.
Michael: Okay, and you believe
because of this two ounce
product, this is going to help
you grow?
Tom: Yes, it will.
Michael: Okay, well we’re going
to talk more about that. First,
what I’d like to do is I’d like
to ask you this. Why should
people buy your string cheese?
Tom: Very simple, it’s the best
product on the market today in
the string cheese. We have a
world champion cheese maker.
Michael: Tell me where you’re
located.
Tom: We are located in Pine
City, Minnesota is the home
office, and we market
Schneider’s Cheese which is in
Wisconsin.
Michael: Is your geographical
location have advantages for
cheese manufacturing?
Tom: Wisconsin cheese is known
as being one of the top cheese
making places in the United
States.
Michael: Why?
Tom: Because it was originally
where cheese making started out.
Michael: How many years ago?
Tom: In the 1800’s.
Michael: Really?
Tom: Yes.
Michael: Was it one of the first
in the United States?
Tom: One of the first in the
United States. In fact, one of
the oldest cheese factories I
believe is still in Wisconsin.
Michael: Really? Where cheese
making was born?
Tom: Yes, correct. String cheese
got its first start also there.
Michael: Now, were there better
cheesemakers in Wisconsin
because they’ve been practicing
it since the 1800’s?
Tom: Yes, also I think what they
do is they brought the Old World
techniques from the old land.
Michael: Where’s the old land?
Tom: Well, Europe, Europe
Countries, Germans and Swedes
and Norwegians and that type of
background.
Michael: Did a lot of those
Europeans immigrate to
Wisconsin?
Tom: Yes.
Michael: You have the history
all the way-
Tom: Correct. Schneider’s is
obviously a German background.
Michael: Schneider’s is a
manufacturer?
Tom: Schneider’s manufactures
and we do the marketing for
them.
Michael: Are you doing exclusive
marketing for them?
Tom: Yes, on their one ounce
product.
Michael: So, you’re not a
manufacturer. You’re a packager
and marketer of snack food
cheese, correct?
Tom: We market. We wholesale
distribute. We warehouse it. We
ship it from the location.
Michael: But, Schneider’s is the
source, the manufacturer.
Tom: Yes, correct.
Michael: And, they do all the
different flavors?
Tom: That’s correct.
Michael: Okay, let’s get back
into why should people buy your
cheese.
Tom: Because it is the best
product. It is also a healthy
product.
Michael: Why is it the best?
Tom: It’s the best product
because of the way it’s made.
Michael: And, tell me about
that.
Tom: The ingredients and the art
– cheesemaking is an art just
like winemaking is, and they’ve
won world champions for making
the string cheese.
Michael: What’s important about
making the cheese that makes it
better?
Tom: Number one is the
ingredients which I’m not privy
to myself personally, and also
the way it’s made so that when
you take string cheese apart it
strings like little fine angel
hairs, and that’s one way you
can tell freshness and quality
of string cheese. There’s nobody
with any better.
Michael: Seeing the strings is
one of the attractive things to
the end user?
Tom: Yes.
Michael: Rather than pulling it
apart, and it breaking in half.
Tom: That’s right or just biting
off the end of it. Some people
do eat it that way. Anybody who
knows string cheese, the flavor
is enhanced when you string it.
Michael: So, when you’re pulling
it apart that’s where the flavor
comes out?
Tom: That’s correct, the better
flavor.
Michael: Now, in the
manufacturing of that, that is
an art?
Tom: It’s an art. It’s called
extruding.
Michael: Bear with me. If I seem
like I’m asking a lot of
questions, there’s a method to
my madness. So, bear with me.
Tell me a little bit about the
manufacturing process of string
cheese.
Tom: About the only thing I can
tell is obviously it has to have
the right culture to start to
make string cheese, and once it
gets to the curd level than it’s
compressed and it goes through a
special machine that extrudes
it. All mozzarella cheese that
you put on pizza is a bit
stringy even if you had a five
pound block. It will string
some. But, then the extruding
method which pushes it through a
tube and comes it in the fingers
about the size of your index
fingers, that’s what causes it
to elongate or to string for the
cheese, and after that, of
course it’s hot. At that point,
it goes through a cooling
method, and then it gets cut and
it goes into a salt brine where
it picks up flavors and it’s
fresh and it goes to packaging
from there.
Michael: What’s a cheese
culture?
Tom: How would you explain that
Al?
Alec: A culture’s a bacteria.
It’s a recipe that the factory
specifically has and they’ve
perfected over the years, and
it’s synonymous with their name.
Michael: How many years does it
take to develop a culture? Do
you think?
Tom: I do not know.
Michael: Is this almost like a
formula for the taste of the
output of the cheese product?
Tom: It is, but there’s a
certain culture for every kind
of cheese. So, there’s a culture
to make string cheese, a
different culture to make Swiss
cheese, a different culture to
make cheddar cheese. Now, within
that culture, there’s also extra
ingredients that they will put
in to make string cheese from
Schneider’s taste different than
string cheese from Kraft.
Michael: Okay, so, your
Schneider’s string cheese comes
from the same culture, but it’s
flavored differently for your
different flavors.
Tom: Not just different flavors,
but for the different recipes.
The culture gets it start at the
beginning of the cheese, getting
to make it string cheese. Say
they make mozzarella cheese, at
that point what they add into
the ingredients make it change
flavor.
Alec: It would be similar –
here’s a good illustration.
Tom: It’s like beer.
Alec: Or, like bread. All bread
starts with flour, but you can
have French bread, different
kinds of whole wheat bread. It’s
the different ingredients and
how and the proportion that you
put into it that makes it a
different kind of bread. It
tastes considerably different.
Michael: Alec, but do you have
any idea of how a cheese
manufacturer like Schneider’s
comes to this one culture to
decide “This is the culture.”
There could be multiple cultures
that produce different tastes.
Are they testing this culture?
Alec: Absolutely. It had been
done years ago.
Michael: Do you know how many
years ago?
Alec: Making string cheese now,
what Tom, 25 years?
Tom: Yes.
Alec: So, in those early days
when they were experimenting and
building this so to speak-
Tom: But, I don’t think culture
determines the flavor as much as
it gets it started.
Michael: That’s okay. Go ahead
Alec because this is important.
If they’ve been making string
cheese for 25 years, they’ve
been testing and working with
this culture to get it right.
Alec: Well, getting it right and
getting it to the taste or the
flavor or the way they want it
to be the best.
Michael: Okay, then once they
have, then they preserve that
formula, right?
Alec: Absolutely.
Michael: So, that culture, and
once they’ve got it nailed down
to where they believe that that
culture produces a cheese that
tastes excellent.
Tom: I would change the word
“culture” to the word “recipe”.
Michael: Okay, recipe. So, once
they have that recipe down, it’s
preserved. This is their
signature – this recipe.
Tom: It’s gone on to be world
champion.
Michael: And, it’s able to be
duplicated at any time, correct?
Tom: Yes.
Michael: Isn’t that what any
cheese manufacturer or brewer is
trying to accomplish, that world
class taste, but it all starts
from that recipe, right?
Tom: That’s correct.
Michael: So, to get up to that
recipe, what kind of work do you
think Schneider’s put into
investing dollars invested to
get to that actual recipe so
they could output their
signature award-winning
Schneider’s cheese? Do you have
any idea? Could you speculate?
Tom: Even if we speculated, we’d
probably be just out of thin
air.
Alec: It would be a guess,
Michael, because realistically,
in the production of any new
product, it takes a lot of trial
and error and guesswork to start
with, although they’re educated
guesses, to arrive at that
specific. When you put it into a
contest that would be national
or local cheese testing, that’s
when you start seeing what the
public likes and what awards you
win.
Michael: And, Schneider’s has
done this all, right?
Alec: Heavens, yes.
Michael: And, they’ve been in
business since when?
Tom: They’ve been in business
over 50 years.
Michael: Is Schneider’s one of
the original?
Tom: They’re not the oldest, but
they’re one of the older ones,
yes.
Michael: Okay, tell me about
some of the awards they’ve won
over the years.
Tom: World Champion String
Cheese. World Champion Cheddar.
Michael: I think I saw it on
your site. Was that ’96?
Tom: It was.
Alec: Actually, if you look back
to several years that they’ve
won or come in second.
Tom: They’ve won many times.
Alec: Many, many times.
Michael: Who are they up against
in these competitions?
Tom: Everybody who makes string
cheese.
Michael: Okay, so were these
awards based on their string
cheese only?
Tom: String cheese and cheddar.
Presently, they don’t make
cheddar though. They just make
string cheese right now.
Michael: How many string cheese
manufacturers are there?
Tom: Probably 50.
Michael: Here’s an important
question – do your customers and
prospects and staff know about
what we’ve talked about, the
history, the culture, some of
the process of what goes into
it, all the awards?
Tom: No.
Michael: They don’t?
Tom: No, some did, but mostly
no.
Michael: Why not?
Tom: To most people, that’s not
important. To the customer that
we sell to, the convenience
store chain or the sandwich
distributor, they’re mostly
interested in making money. If
it tastes good, that’s all they
care, and they go out and sell
it. Now, if it tastes good, and
it’s a good quality product they
feel, packaged nice, it looks
nice, and how can I make money
on it.
Michael: But, those sales are
driven from the end user who
buys it right there at the point
of purchase, right?
Tom: Correct.
Michael: I don’t remember what
it says on your box. I looked at
the site yesterday, but what I’m
trying to point out is there may
be reason for that person when
he’s up there paying for his gas
or what have you, and he sees
that string cheese and he says
the Slim Jims and the beef
jerky. There may be a compelling
reason to give them right on
that box for him to grab the
cheese instead, and that’s
called the Unique Selling
Proposition. That’s a reason
why, and it takes a lot of work
to get to that, but what I’m
getting at I don’t know what you
have now, but we may be able to
come up with something more
compelling to get them to reach
in their pocket and buy your
string cheese at the point of
purchase. Okay? Because that’s
what’s going to drive the sales
is your end user. Give the guy a
reason why when he’s paying for
his gas to choose your cheese
over the Slim Jim.
Tom: Or, sometimes they’ll buy
both.
Michael: Or, sometimes both.
Tom: See our sandwich
distributors for example, will
sell a sandwich and then they’ll
pick up a piece of cheese that’s
sitting right next to it to go
along with it. If we’re in the
store, people will buy it. Our
problem is getting into the
store – getting the chain to
take a look at us as to why they
should take this product in.
Alec: You’re calling that a
Unique Selling-
Tom: Proposition.
Alec: Proposition?
Michael: It’s called a USP – a
Unique Selling Proposition. It’s
called a reason why. Now, I’m
just looking at it right now
from consumer to product, and
we’ll definitely talk more about
your existing problems of
distribution.
Tom: That’s the reason why
someone should buy it.
Michael: Right. So, let’s move
on. Tell me about your current
prospect to sales process. Your
market is the convenience store
market. Tell me who else is your
market? Who are you selling it
to right now?
Tom: Are you talking about the
end user right now?
Michael: No, I’m talking your
convenience stores. You’re
packaging them. Where are you
shipping these?
Tom: To the sandwich
distributors, the people that
sell the cold sandwiches.
Michael: Okay.
Tom: We’re selling to small
little distributors that sell
your meat products and cheeses.
Michael: Are you doing it just
regionally?
Tom: We’re nationwide.
Michael: You’re nationwide.
Tom: And we sell to the
convenience store chains like
the 7-11’s of the world, but we
do not sell to 7-11.
Michael: Do you have any idea
what your average closing ratio
is if you could quantify it in a
percentage? If you had ten
prospects who call or who
enquire, how many of them will
end up buying? What’s the
response rate to a phone enquiry
or marketing effort?
Tom: There’s probably 50 percent
that have some interest,
wouldn’t you say, Al?
Alec: Or more.
Tom: More that have interest,
but sometimes they may have a
competitor’s product or actually
I think more of it is, in some
cases, it’s like we’re like this
fly flying around their heads
that they don’t want to give us
the time of day.
Michael: The people who do give
you the time of day and make an
enquiry, let’s say they called
your office.
Tom: They don’t. We have to call
them.
Michael: Okay.
Tom: We hardly get anyone who is
actually going to call us.
Michael: Okay, so you’re doing
the proactive. Could you give me
an idea if you called ten
prospects, how many can you get
to try it at least?
Tom: We can send samples to and
give them a shot, I’d say we’d
probably get eight or nine of
them that will actually take
samples and take a look at it.
Michael: Well, that’s easy
because samples don’t cost them
anything, right?
Tom: Right.
Michael: How many of those
people that get samples will
come through with an order?
Tom: What’s a good guess, Al?
Alec: I would say, and part of
this is going to enter into the
time factor-
Tom: Takes a year.
Alec: Yeah, we’ve had it where
we worked on a guy for a year or
longer sometimes before they
actually want to bite the bullet
and take us on. I’d say we have
a real good shot. I think the
percentage is higher than I want
to give it credit for. I’m going
to go low. I’m going to say
30-40 percent.
Michael: Someone inquires. You
offer to send the sample. You
send the sample. Then, what
happens? Do you follow-up?
Tom: Telephone call.
Michael: Consistently everytime
with every prospect you send a
sample out.
Tom: Absolutely.
Michael: How long do you wait?
Tom: Less than a week sometimes.
I want to make sure I call them
up a lot of times and make sure
they got the product. Or
sometimes they’ll say, “No, I
haven’t got it yet.” “Well, I
shipped it, blah, blah, blah.
We’ll talk to you in another few
days.
Michael: Sample-wise, what are
you sending out?
Tom: A box of each flavor.
Michael: A box of each flavor?
Tom: Right, plus a little door
rack to show them how they can
display it.
Michael: So, you’re sending them
a 24 box of each flavor?
Alec: That’s correct. Five
flavors, so they’re getting 144
sticks or something.
Tom: No, they’re getting almost
500 sticks.
Michael: And, you’re sending
that out for free.
Alec: Yep.
Michael: So, what does that cost
you?
Tom: About $30.
Michael: Thirty bucks. How many
would you say you’re sending out
a week?
Tom: New prospects, lately we
haven’t sent any out.
Michael: Does it get expensive?
Tom: It’s not because of the
expenses. It’s because you run
out of prospects to actually
you’re going to get a hold of.
Michael: Okay, so you send it
out. You follow-up a week later,
and let’s say they still don’t
buy. Are you waiting for them?
Tom: They’re just going to taste
it and try it.
Michael: So, they’re not going
to put it and see if it sells?
Tom: No, not at all. They’re
going to be talking to their
people, they’re buying people.
Alec: The salesguy, the truck
driver whoever’s going to be
distributing it saying, “How do
you think this product’s going
to do?”
Michael: So, you follow-up with
a call a week later, and then
what? Do you follow-up with
another call?
Alec: Yes, especially if the
objection’s that they’ve
presented, a lot of times they
have questions and need more
time with their people. So,
yeah, there’s many phone calls.
Michael: Who’s doing all the
phone calls?
Tom: Al or me.
Alec: I generally do that.
Michael: When you call them, are
you pretty much saying the same
thing everytime to each
prospect? Do you have it
scripted?
Alec: I definitely don’t say the
same thing everytime. It is not
scripted. It depends upon the
customer because we’re dealing
with large corporation. We’re
dealing with Mom and Pop
operations. Depending upon who
you’re dealing with, I will vary
it.
Michael: From what you’re
telling me, you’re doing
outbound telemarketing, and
you’re using the phone for
follow-up, and this is the only
way for follow-up right now.
Alec: No, there’s times when we
are following-up by visiting
them, actually going to the
front door, walking in the front
door and making appointments to
see them, and even cold calling,
“We’re in the neighborhood.
We’ll send you the samples.”
Michael: So, this is only after
you send the samples?
Alec: No, sometimes when we’re
traveling on the road, we will
just stop and cold call. Hey, we
found a new name right here.
You’re in a convenience store
somewhere in Pennsylvania. You
run in there and see a sandwich
maker you haven’t heard of
before. You read their label,
find out where they’re at, and
make a point of driving by their
location and run in and hope you
find them, and many times I
have.
Michael: Okay.
Tom: A number of sales like
that. You have samples with you
that you drop off at the spot.
Alec: Right on the spot.
Michael: All right, let’s move
on. The past, present and
perspective customers – I want
to ask you. How much does each
customer, an average customer
spend now? Let’s say out of
those ten you’ve got three
people that say, “All right,
let’s do it.” Can you give me
some kind of quantitative idea
of what an average customer will
do? They’ve got the samples, and
then let’s say, “Let’s give it a
try.” Tom, what are they going
to do?
Tom: Our largest customers spend
about $200,000 a year.
Michael: $200,000 a year.
Tom: And, our smallest customers
are probably in the neighborhood
of $5,000 a year.
Alec: Five grand, yeah.
Michael: Five grand a year.
Tom: It’s a range between that.
Michael: And, what about on an
initial transaction.
Tom: Initial transaction we’ll
sell them as little as one case.
A case is $30. We try to get
them to take eight cases because
we take the eight smaller cases
and put them in a bigger box to
save on shipping. We put
Styrofoam around it because
cheese has to be cool.
Michael: Could this transaction
be improved? Any ideas?
Tom: Well, yeah, we do. For
example, we sell a chain, many
times we’ll sell them out. It
depends upon the customer. If
the guy is a small one man route
and he has 200 customers, he’s
obviously going to get a small
amount. If it’s a convenience
store chain like SuperAmerica,
they start out with five
locations, we’ll go into all
five locations. The pallet
you’re looking at is about a
$3-4,000 sale, and if you have
five locations that’s a $15,000
sale.
Michael: Okay, so from your
experience, if you can get them
to put it in their stores,
what’s the experience been?
Tom: You’ve got them.
Michael: Is there any attrition?
Tom: Yes there is. We’ve got the
competitor with the two ounce
product that’s taking away three
or four customers in the last
year.
Michael: What’s your competitor?
Tom: In this case, it’s called
Cheese Pleaser.
Michael: And, that two ounce
product has caused you guys to
come out with a two ounce.
Alec: Because what happens is
the truck driver who is not a
salesman who is simple a
deliveryman gets a percentage
many times of the take of what
he sells.
Tom: The sandwich truck driver.
Alec: So, the sandwich truck
driver who is delivering
sandwiches delivers a box of our
cheese. If he delivers that same
box of cheese and it’s a two
ounce product for the same
number of sticks, he sold twice
as much. He made himself twice
his money for doing the same
exact work.
Michael: So, he’s pushing both
string cheese products.
Alec: Yes.
Michael: Do all your drivers
have multiple string cheese
products?
Tom: They’ll probably average
three flavors. They’ll average
probably string cheese, cheddar
and Colby Jack I think is our
three largest flavors.
Michael: What kind of commission
is he paid?
Alec: The Mom and Pop guys,
they’re a little higher. They’re
working in the 25-30 range where
a bigger company is probably
giving them ten percent.
Michael: Of the gross sale?
Alec: Yep.
Michael: That’s a pretty hefty
commission.
Tom: They after DSD, which is
direct store distributor, they
work on 30-40 percent. That’s
the sandwich customer.
Michael: So, you really don’t
have any kind of contact with
this driver, do you?
Alec: Very limited to none.
Tom: That’s handled by the
sandwich company owner and their
sales force. They have their
weekly meetings or whatever they
have. Like the example of Made
Right where, Al how many times
have you been out?
Alec: I’ve gone down there. I’ve
met with the drivers. I’ve
driven with some of the drivers.
I was at some sales meetings
where I’m in front of all the
drivers and push the product.
Michael: Do you give them an
incentive to push your cheese
instead of the others?
Tom: They don’t have two. They
only have one.
Michael: They just have one.
Tom: Yes. None of these will
actually carry two. They’re
going to carry us or nobody.
Michael: What percentage of your
business is the driver
responsible for getting the
cheese on the counter?
Alec: A good portion.
Tom: Well, yes, it is in the
sandwich companies, but it’s
completely different when you
have a convenience store.
Michael: Okay, so with your
sandwich companies, what
percentage of your business is
the sandwich companies?
Tom: Right now, it is probably
40 percent.
Michael: Okay, since we’re on
that, what’s the other
breakdown? What percentage of
the larger chain accounts?
Tom: The larger chains, well, we
lost SuperAmerica last year to
the two ounce. We’ll get them
back which I’ll expect once we
get the two ounce. That will be
$200,000 a year right there.
They were our largest customer.
Then, you’ve got the other – the
sandwich companies 30-40 percent
Al?
Alec: A little low on that.
Tom: It might be 50 percent.
Then the rest are just small
distributors and convenience
store chains. But, we don’t have
any large chains right now. Do
we Al?
Alec: No.
Michael: Okay, so, you’ve got no
large chains right now. So, you
have mostly your sandwich
distributors.
Tom: And, then small
distributors that are anywhere
from one man to they might have
three, four, five guys.
Michael: Now, are your profit
margins – where are you making
more money on this? Sandwich
guys or the small distributors?
Tom: More on the sandwich guys,
the small guys.
Michael: Because why?
Tom: Because why?
Alec: Less cost of distribution
in between. In other words, the
mark-up for the sandwich guy
because you’re doing – the
little man is limiting his
percentage of distribution to
five percent, ten percent. The
distribution cost of the little
guy’s 25-30 percent.
Tom: And, our price difference
is not really a lot between any
of them. It’s not huge. It might
range to 10 percent at most.
Michael: If we could give these
drivers a better incentive,
which it sounds like you’re in
the process of doing – you have
a two ounce cheese product –
they can make as much. That’s
going to hopefully bring up the
sales because they’re going to
push that because they’re going
to put more money in their
pocket over the other two ounce.
Tom: They’ll do twice as good.
None of our sandwich people are
handling a two ounce except one.
Right now, we lost Mom’s to the
two ounce in Texas. Otherwise,
all the rest of our sandwich
people only have one ounce. What
we will do is just really go
back and resell them now on the
two ounce. Once we have it,
we’re going to go out and call
all these people.
Michael: Okay, so that can be
improved, and that’s what you’re
working on, right.
Tom: Exactly. We’re already
doing that. We have to meet more
customers, i.e. more sandwich
customers or we need more
convenience store chains and
that’s probably our biggest
focus, as well as we know that
if we could somehow capture the
interest of the schools
nationwide. Schools as well as
all of the sports venues – all
of the stadiums, any place they
play professional sports.
Michael: Do you guys maintain a
database of prospects and
customers in a computer?
Tom: We have all of our
customers in the computer, yes,
and one of our biggest database
for is actually we have a
directory of convenience stores
and convenience store chains
that we update every year.
Michael: So, these are
prospects.
Tom: Right.
Michael: How many customers,
buying customers do you have on
your database right now?
Tom: We have in the neighborhood
of about 75.
Michael: And, all of those are
active?
Tom: Correct. There’s probably a
database of an additional 25-30
that are not active.
Michael: Inactive. Where they
once customers?
Tom: Once, yes.
Michael: What about, Alec, all
of the prospects you call on?
Are those in a database?
Alec: Yes.
Michael: At what point do you
give up on these guys?
Alec: We always keep calling
them back.
Tom: Even if it’s only once
every six months. Casey’s for
example, a convenience store
chain, I’ve been talking to the
buyer every six months for the
last five years.
Michael: Okay.
Tom: He has a competitive
product and he says, “I have no
compelling reason to change. The
price is about the same. The
product is about the same.”
Michael: Back to the USP we
talked about.
Tom: He has no compelling reason
to change.
Michael: He has no reason.
That’s that what we want to work
on is give him a reason to buy.
Tom: The two ounce is going to
be one compelling reason for him
to change.
Michael: Okay.
Tom: It’s different now. That’s
one thing that’s going to add
on. I think for all our
convenience store chains that
will also make a difference
because now rather than making
25 cents on a sale, they can
make 50 cents for the exact same
thing. Instead of a 59 cent
retail, it will be a 99 or 1.09
retail. Any customer, the buying
public will spend that 99 or
1.09 just as easy as they will
49 to 69 for the one ounce
piece.
Michael: Okay. So, Alec, the
people you are calling back and
Tom the people you’re calling,
you’re not using any mail to
contact these people. I mean,
have you considered using the
mail?
Tom: We have, but we haven’t got
the right piece to put together.
Michael: Okay, you don’t know
what to say?
Tom: That’s correct. The company
went two years ago, Al, with
Richard Smith and Y2K Marketing.
That was supposed to help us
accomplish this, and never ever
got us-
Michael: You could never get a
USP. You didn’t know what your
compelling reason to send them
is.
Tom: We got all kinds of
information, but he still never,
ever got it totally put
together.
Michael: So, you did work with
YK Marketing?
Tom: Y2K Marketing.
Michael: Tell me what happened.
How did you originally hook up
with those guys?
Tom: How did I find them Al?
Alec: You heard them on the
radio out of Minneapolis.
Tom: That’s right and I went to
a seminar, and of course that
was to get you in the business
to market Y2K Marketing, and
that was like a $40,000 thing to
get in their business and become
a marketer for them. Well, I
wasn’t interested in that. I was
interested in them to market to
me just like I’m talking to you
about.
Michael: Right, so what did you
do? You found one-
Tom: We had a guy here. He came
up and I said, “Listen, I’m not
interested in paying you a lot
of money to give me a bunch of
stuff that doesn’t work.” I
said, “I’ll give you small
upfront money and I’ll give you
a commission of sales.”
Michael: And, did you do that?
Tom: I did that, but he never
got any sales. He never got the
thing finish, did he Al?
Alec: Never even finished it.
Michael: So, you met with him
one time.
Tom: No, lots and lots of time,
ten times because it’s surveys
and everything else, but he
never ever got it – part of the
reason I think is because he
wasn’t making any money on his
whole business. Don’t you think,
Al?
Alec: Yeah, he ended up getting
a job somewhere else.
Tom: He got a job at a computer
company.
Michael: What kind of money did
you put down with him?
Alec: We put down six grand with
him.
Michael: Just that one time.
Tom: One time, yes.
Michael: And, you were going to
pay him a percentage for sales?
Tom: A percentage of increased
sales.
Michael: Yeah.
Tom: We’d be more than happy to
if we seen sales.
Michael: Absolutely. What did
you guys agree on percentage
wise?
Tom: What were we going to give
him? I think it was three
percent, wasn’t it Al?
Alec: Yes.
Michael: So, you had no results
whatsoever?
Tom: Correct.
Michael: Did he implement
anything for you?
Tom: He did not. We can’t hardly
get a hold of him on the
telephone.
Michael: So, you paid your six
grand, and you were like, “Come
on”.
Tom: That’s right.
Michael: And, that guy
disappeared on you?
Tom: He’s there, but like I
said, he’s with this other
company now working for them
almost 40 hours a week. What
time does he have?
Michael: Yeah, you didn’t ask
for your money back?
Tom: No, we didn’t. Probably
should have. I guess we’re too
easy going that way.
Michael: All right. Let’s move
on. Let’s talk about alliance
opportunities. I want to look
for relationships that you could
potentially have with other
businesses particularly in your
own database. So, you already
described once, but I’m going to
ask you to do it again. Who are
your customers?
Tom: Go ahead, Al.
Alec: Who are our customers? The
number one customer I think are
children, youngsters, teenagers,
who know the product and know it
well, and mothers that go into
the convenience stores with
their kids or they go in there
to get gas. They know the kids
like it and buy it for them.
Michael: Have you guys seen any
data or studies on the string
cheese market who the end user
is in a hardcore factual data?
Alec: Negative, I haven’t.
Michael: You’ve got convenience
stores nationwide and you’ve got
the small distributors who are
distributing to-
Tom: They’re all convenience
stores.
Michael: You’re national. Where
would you say a majority of your
customers are geographically?
Are you spread out all over the
country?
Tom: All over, yeah.
Michael: So, you’re not favoring
your area.
Tom: No, the fact is we do less
in my local area here than we do
in other parts of the country.
Michael: Who’s the guy doing the
buying?
Tom: The sandwich customer – the
people who distribute sandwiches
would be our number one industry
group that we sell to. If you
put all of our sandwich people
together, they buy the most of
any one group.
Michael: So, I’m clear –
sandwich distributor is a
sandwich manufacturer who goes
out and distributes their
sandwiches for resale to-
Tom: The convenience store.
Michael: Convenience stores, got
it.
Tom: You go down to your
neighborhood 7-11.
Michael: You see them all
wrapped up. That’s right.
Tom: Deli Express.
Michael: Yes.
Tom: Deli Express is the largest
nationwide.
Michael: They’re in 7-11, aren’t
they?
Tom: They are. They’re
nationwide. It’s one customer
that we have not sold to.
Michael: And, they’re
nationwide.
Tom: Correct.
Michael: So, how many plants do
they have? They’ve got to be all
over the country.
Tom: It’s right here in
Minnesota in my back yard.
Michael: Their main one?
Tom: Yes.
Michael: So, they’re doing all
their preparation.
Tom: I do not know that for a
fact, but it wouldn’t surprise
me. Then, they freeze them and
then they go nationwide.
Michael: Oh, so they are
freezing them.
Tom: They are freezing them.
Alec: Oh yeah, Deli Express
freezes.
Michael: All right so this is
the big boy. Now, what about the
smaller ones? How many are
there?
Tom: We have the rest of the big
ones already in the United
States.
Michael: How many are there out
there of the smaller ones?
Alec: Well, we know that there
are three good, four good sized
companies out in the US that
make sandwiches. You’d be
surprised how far these guys
cover. When I say good size, I
mean they’re running 40-60
trucks on the road. Then there’s
the next step down of smaller
from 10-25 trucks, is probably
another six or eight in that
neighborhood.
Michael: So, in that category,
how many accounts are they
distributing to?
Alec: Truck represents roughly
100 accounts.
Michael: You could estimate each
truck handles 100 retail
accounts.
Tom: 100 to 125, yep, plus they
go there once a week.
Michael: They go once a week,
not any more.
Tom: Yeah, the big stores they
go to twice a week, even three
times a week if they have a
place that’s really huge.
Michael: The one you just
described had 40 trucks. So,
you’re looking at 4,000 retail
points, and then one under that
20 trucks about half that, and
then what’s under that?
Tom: Yarnell’s would probably be
an example, maybe he has only
three or four trucks.
Michael: You said you’ve got a
couple of the larger ones right
now?
Tom: Yes. We have other big
ones.
Alec: We’ve got a guy in
Tennessee that’s got 50-60
trucks. We’ve got a guy on the
west coast that’s got 40 trucks.
Michael: How many retail outlets
would you guess your cheese is
in right now?
Alec: Probably half of those
because you have to remember
that a guy has 100 accounts that
he’s call on does not mean the
cheese is in at 100 places.
Tom: Yeah, we probably have 50
percent coverage.
Michael: Why isn’t 100?
Alec: Some of there are kiosks,
smaller places that there’s
enough space to put more
products in.
Tom: Because they have to be
refrigerated.
Michael: Oh, they do have to be
refrigerated.
Tom: Oh yeah, they have to be
refrigerated.
Michael: So, are they always
displayed in a refrigerated
environment?
Tom: Yes.
Michael: Oh, they are?
Tom: Yes.
Michael: So, they’re not sitting
right at the counter.
Tom: No, they’re not. No, they
always have to be refrigerated.
Michael: They’re always
refrigerated. So, that’s going
to limit your coverage.
Tom: That’s correct.
Michael: Because there’s a lot
of place you’re calling on that
have no refrigeration.
Tom: Or no refrigeration area.
Their store may be so small they
have a little bitty small
refrigerator up on the counter
with maybe 25 sandwiches and
there’s no place to put the
cheese.
Michael: Okay.
Tom: So, these truck drivers are
delivery boys rather than sales
people. If we could train them
which we tried to do like with
Made Right, we’ve improved, but
some of these guys are dumb as a
box of rocks.
Michael: And, when you’re
training them, what are you
trying to get across to them?
Tom: Tell him Al, because you’ve
done most of it.
Alec: Actually ride with them,
go in there, meet the manager,
show them how to display the
product, how to sell the
product, explain to them how
it’s manufactured so they have
some background and
understanding what the product
is, and then showing them how to
use the advertising that we
provide at point of purchase
with the box itself. We have
door racks that we invented. You
just put it on.
Michael: A door rack that goes
on the inside of the
refrigerator?
Alec: Yes, so that when you walk
by a cooler door you can see the
cheese actually sitting in the
window.
Michael: And, are they using it?
Alec: Some are, some are not
depending upon-
Tom: Overall it’s been pretty
good.
Alec: It’s been pretty good. I
would say that’s been a success.
Some stores don’t like it
because you block the view of
ten rows of Coca-Cola.
Michael: So, your cheese could
get lost in the refrigerator.
Alec: Yep.
Tom: Because the people who know
the product, they go there and
buy it. If we can get on the
shelf and stay on the shelf, we
sell, period. Every store will
sell a minimum of one box a
week, and usually like your
supermarket here in town,
they’ll sell six, seven, eight
boxes a week. So, it depends
upon the store where it’s
displayed, but the worse case
scenario, they’ll do a box to
two boxes a week.
Michael: So, you’re focusing on
a certain obvious market right
now. Let’s talk about what other
market and you mentioned a
little bit, sporting events.
What other markets have you or
do you suspect may be great
potential markets?
Tom: School.
Alec: Lunches, it’s got to be a
hot one. They know all about the
product.
Tom: Kids are our customers. So,
schools would be huge if we
could just figure out a way to
get into the schools.
Alec: Besides the fact that it’s
nutritious and has a lot of
beneficial things that meet all
the schools –
Tom: It’s got calcium in it.
It’s good on protein, low on
carbs, low on fat. It’s just an
excellent product for the kids,
for their teeth. There’s all
kinds of ways you could-
Michael: Do you know if any of
the schools are selling string
cheese?
Tom: Yes, some schools are.
Alec: We have one college that
we know-
Tom: Kent State, you’ve probably
heard of it in Ohio.
Michael: Yes, they’re selling
your string cheese.
Tom: Yep.
Michael: Are they moving a lot
of it?
Tom: They’re doing very good.
Alec: They’re doing well, yes.
Michael: I mean, how many small
accounts would equal the sales
of an ideal supermarket account
or a college like that?
Tom: I don’t know how you’d even
figure that out, because we sell
to the distributor who goes out
and sells anywhere he wants to,
i.e. any convenience store
customer he comes across. So,
there’s hardly any way to
quantify that.
Michael: Inside that convenience
store, where your cheese is, can
you think of any other products
that you could partner up with
those companies to help get your
distribution?
Tom: That’s why we went with the
sandwich people.
Michael: That’s just one. I
mean, the ice cream people could
be one.
Tom: Because they’re
refrigerated.
Michael: How about the beef
jerky people?
Tom: Well, we’ve already
partnered with them, but they
have no refrigeration, and some
of our distributors are beef
jerky people who will just put
the cheese in the cooler of
their vehicle for the day, and
then they’ll put it away at
night. They won’t sell it all
day long.
Michael: What other type
products are in the refrigerator
there with your cheese?
Tom: There’s Pepsi and Coke, and
it’s impossible to talk to them.
Michael: Any other smaller
companies like yourself in there
that’s doing pretty good.
Tom: Not that we have found.
Michael: But, there’s got to be
companies who are making inroads
into the convenience stores just
as you are. A good possibility.
Let’s say you had a young Red
Bull drink, and they’re making
great distribution, whether it’s
in a local geographical area or
whether it’s national, just you
could get someone and do a joint
venture. You could have the Red
Bull company rep cheese and
maybe as a favor, you guys can
trade customers and you could
rep their Red Bull. I know that
may not be something you want to
get into, but what I’m saying is
if you could get a Red Bull
distributor to endorse your
cheese and even pay them a piece
of the action or whatever they
get in. If they’re already in
there, they already have the
relationships. They’ve made the
phone calls and followed-up to
get those accounts. You’re
leveraging off all their assets.
And, Red Bull is just a
hypothetical example. But, I’ll
bet if you go to some
convenience stores and look
inside those coolers and look
what other kind of products and
ask yourself, “Could we do a
partnership with them? Could we
leverage off their existing
assets? Could we trade leads?”
So, that’s just one idea.
Tom: Texas is the largest states
in the United States as far as
when it comes to the number of
convenience stores. We’ve got
this book in front of us that
tells exactly what chains, who
the grocery store wholesaler
that delivers it. We have all of
that. What our problem is we’ve
got to get something compelling
in front of them to take a look
at us. Once they get it in, they
love us. We just got to get into
their store. We can sell to
every person in the United
States via the website, but how
do you get them in, how do you
get them to buy?
Michael: It’s going to be a lot
easier to sell the end user the
consumer who’s eating it, and
then force the distribution so
they’re going to the store
saying, “Do you have this
cheese?”
Tom: Right.
Michael: And, the same thing by
selling to 7-11’s, that’s going
to force distribution in with
the larger distributors because
people are asking for it. What
other markets where you talking
about, the colleges?
Tom: The colleges and the sports
venues.
Michael: All right, tell me
about the sports venues.
Alec: Go to a Packers game or go
to a Buffalo Bills game. All
these guys are sitting in their
seats. They’re going to eat
cheese.
Tom: All we’ve got to do is get
it in there. We can sell it to
them – let’s take a two ounce,
for example – we can sell it to
them and make money at 50 cents.
They can turn around and sell
that thing for three dollars at
a sporting event.
Michael: For a two ounce, and
are any of the sporting events
selling it?
Alec: I saw the other day
watching the Packers game-
Tom: They probably do at the
Packers.
Alec: Sargento’s, the official
cheese of Lambeau Field
Michael: Sargento’s in there?
Tom: Yes, Sargento doesn’t make
one piece of cheese. All they
are is a buyer and a package and
a wrapper.
Michael: Where is there cheese
coming from?
Tom: All over.
Michael: Sargento’s is all over.
Tom: Wherever it’s the cheapest,
and they do not make it and
they’re about a $500 million a
year company.
Michael: How is the quality of
their cheese compared to yours?
Tom: It’s not as good as ours.
There’s not a huge difference.
Michael: How fast could you
grow? Could you handle the
manufacturing for that much?
Tom: Surely. Our factory is
about a $30 million a year
factory, but if we wanted to
have ten cheese a week, they can
do it.
Alec: No problem.
Michael: Let’s say if you could
take that account away and land
that – what’s that stadium
called?
Alec: Lambeau Field.
Michael: How much cheese do you
think they’d move through there
during a season?
Alec: 55,000 fans there every
week when they play.
Tom: So, you’re looking at eight
times a year though.
Michael: What are your margins
on this stuff?
Tom: We work in the neighborhood
of 30 percent.
Michael: That’s your gross?
What’s your net? I mean after
all the expenses and all that?
Tom: Oh, I don’t have my tax
papers from last year, but it’s
in the neighborhood of, what
would you say Al, 85 percent?
Alec: I was going to say seven,
but yeah.
Michael: Okay. So, you said
you’re doing a million a year in
gross.
Tom: Yes.
Michael: So, last year, what are
you taking home net out of that?
Tom: Well, you take five to
seven percent of that. That’s
50-70,000. I mean that’s after
everybody’s paid salaries.
Michael: Are you guys equal
partners?
Tom: Yes.
Michael: So, you are splitting
that net.
Tom: Yeah, that actually just
stays in the company. We receive
a salary.
Michael: Okay, so you’re taking
out a salary also. Okay, are you
doing any kind of advertising at
all?
Tom: No.
Michael: None at all.
Tom: Where are we advertising?
Alec: Any kind of advertising.
Tom: Our advertising I guess
would be on our door rack and
our website.
Alec: We have our website.
Tom: Our website, right, that’s
what I said.
Michael: Okay, you’ve got your
website. Is your website getting
any traffic?
Tom: Not much.
Michael: Not much. Who designed
it?
Tom: It’s a company we have
that’s actually out of Costa
Rica.
Michael: Okay, so you’ve got
your website. Have you done any
Search Engine Optimization or
anything like that?
Tom: The fellow who put the
website together did all that
for us. We don’t know how to do
that.
Alec: We have done some
pay-per-clicks and we have done
some things help us to try and
figure out-
Tom: To drive people to the
site, but we still-
Michael: Are you getting any
sales off the site at all?
Tom: Very few. I mean, total
sales off the site in the last
year is about ten. We have
everything in place to sell. We
have the boxes to ship them in.
We have frozen deals that go
along with the cheese to keep it
cool so we can ship anywhere in
the country. We’ve got
everything all put together
because he said it would sell,
and so far we haven’t had any
luck.
Michael: Is the cheese market
where you are, is more cheese
consumed there than anywhere in
the country or is it just known
for the-?
Alec: Generally speaking, I
would say that cheese in the
whole US is up every year, more
and more and more.
Tom: We’re penetrating less than
two percent of the market
nationwide, and you take even
the Kraft and the Sargento’s of
the world, there’s a huge market
yet out there. You’ve just got
to get in front of these people.
Michael: So, who are the big
players – Sargento’s and Kraft?
Tom: Sargento’s, Kraft,
Shriver’s does some. It drops
off to smaller people from
there.
Michael: Community marketing,
are you doing anything local to
boost your image in the
community?
Tom: No, our community doesn’t
even know that we’re here
because we don’t sell anything
to the community.
Michael: You don’t do any kind
of donations or group
sponsorship.
Tom: There’s no upside for us
for doing it.
Alec: I tried it a little bit. I
did something here locally, gave
some to local groups and things
like that, but-
Tom: It doesn’t do anything. Our
customers are the convenience
store chains, the grocery store
market, and that’s huge in
itself, and we clear a price
where we can even sell to one of
those. But, again, because we
have a small product line and
Kraft has 100 products. So, when
they put in all of their sliced
cheese, and all of their other
products, their string cheese
just goes right along with it.
Michael: You’re doing no direct
mail at all to any of your
potential customers.
Tom: Correct.
Michael: Have you thought about
it?
Tom: We have. That’s we have
been researching and trying to
find out more ideas and
marketing.
Michael: You just haven’t found
out what to say.
Tom: That’s correct.
Alec: That’s the issue that when
you’re thinking about marketing,
direct mail – learning to find
out where that niche goes to
rather than just blanket
marketing, send out tons of
sheets, who specifically should
we target.
Tom: That’s just what we read so
far, the Jay Abraham stuff that
you’re better off to market to
some small niche than you are to
put it in USA Today.
Michael: That is generally a
problem with a lot of people who
want to market their product.
They don’t do any direct mail.
They don’t do any advertising.
They don’t do any marketing
because they don’t know what the
hell to say. Right now, you’re a
commodity competing against
another two ounce cheesestick on
price and size. It puts you in a
terrible position when you’re
competing on price and when
you’re competing on size. That’s
why I’m developing a Unique
Selling Proposition, and it
could be done for any company.
There’s a specific way to
develop that. There’s a process.
There is a way to develop a
Unique Selling Proposition for
your string cheese. It’s not
something I can do over the
phone right now, but I think
just from some of the questions
I’ve talked to you about, if you
could develop that do you see
how then you can continue to do
some other things like the
direct mail, like possibly some
advertising in some ways, even
maybe some community marketing.
You still have a marketplace
right in your own community that
needs to eat, and I’m sure
there’s a lot of people who eat
string cheese.
Tom: Right, but that’s already
taken care of by the big boys.
If you’re going to market to the
local area, whatever money you
put in there, is actually just
wasted money because it’s not
going to come back to you. We
don’t have a distributor that
actually distributes.
Michael: Well, you know there’s
huge food companies you’ve heard
of Omaha Steaks, right?
Tom: Yes.
Michael: You can get a steak at
every damn supermarket in the
country, but they only market
through direct mail. Have you
ever gotten any of their direct
mail?
Tom: Sure I have.
Alec: I have had some of their
steaks not too long ago.
Michael: And, their steaks are
damn good, aren’t there?
Tom: We can sell our cheese the
same way.
Michael: And, that’s just one
way through direct mail. When
you get those direct mail pieces
from Omaha, believe me you
should save them because their
works of art, their direct mail
sales letters, and they send
them to you quite often. Don’t
you get them every couple weeks?
Tom: I don’t get them that
often, no.
Michael: I still do, and they
are selling you on the quality,
and they educate you about the
beef. I remember getting one of
their letters, they tell you all
the different types of steak –
what a porterhouse is, what the
shoulder is – and they teach
you, and when you teach your
customer about something, you
build a relationship with them.
You become the expert on cheese
in your industry where you
educate and teach the end user
about all the intricacies and
the manufacturing of string
cheese, and I’ll give you a
perfect example.
You’ll hear if you read in Jay
Abraham’s, you’ll hear about a
guy named Claude Hopkins. Claude
Hopkins is the father of modern
advertising, and he’s the one
who brought Schlitz Malt Liquor
to the number one. This was back
in the late 1800s, early 1900s.
There were tons of beer makers
already and Schlitz was
certainly not number one until
Claude Hopkins took them on as a
client. Claude Hopkins went to
go visit the factory where they
made the beer and he was walking
a tour of the factory and he saw
the room where the mother yeast
was, like we talked about the
culture for the cheese, and he
saw how they steamed the bottles
and how the water came from
these artesian wells. He asked,
“Do your customers know about
this and how beer is made?” They
said, “No, it’s not important.”
He goes, “It may not be
important to you because you’re
a beer manufacturer and all beer
manufacturers know about this”,
but the end consumer knows
nothing about string cheese or
nothing about beer.
This is what he did. He educated
the consumer about the process
of how Schlitz malt liquor was
made and how it was pure and how
the water came from these
artesian wells, and how the
mother yeast was produced over
500 years and 4,000 experiments,
and he quantified it and he
educated the consumer about
Schlitz beer and then the
consumer forced distribution and
it became number one in the
industry.
Well, you can do the same thing
with your cheese. What’s common
and ordinary to you, a guy in
the string cheese business,
isn’t important to you because
you’re in, but to a guy like me
who knows nothing about string
cheese, boy if you could educate
me and teach me some things
about why your string cheese is
better and the fact about the
culture, and some interesting
things about the culture, what
took almost 280 years to
perfection and your cheese comes
from Wisconsin, and because I’m
just giving you an example, and
because the mineral content in
the water where they make the
cheese gives the – you’ve got to
dig these reasons out through
research, and it’s doable. Then
you’d have some compelling
reasons for the end consumer,
and Claude Hopkins talks about
it. It’s always easier to force
distribution through the
consumer than it is dealing with
all these damn distributors.
Tom: Right, then the best way to
do it ship directly to them.
Michael: You can certainly,
certainly build a business all
through direct mail. The bottom
line is you want to sell cheese.
Tom: Definitely.
Michael: It sounds like what
you’re doing right now, you’re
getting some success but it’s a
struggle.
Tom: We have a long way to go. I
mean, the potential is huge. For
example, even this fellow you
were just talking about. If we
could get something even to the
buyers of the convenience store
chains to look at us different
than anybody else out there, we
could figure out a way to do
that, we will get into much more
chains like 7-11s.
Michael: Right.
Tom: And, the Casey’s of the
world.
Michael: So, what you’ve got to
do and to find that, you know
who you’ve got to talk to?
You’ve got to talk to the
buyers. You’ve got to talk to
their frustrations and what are
they looking for when they
choose a distributor for a
cheese product, what makes their
life easier, what problems are
they currently having that if
you could solve would make you a
good candidate. What problems
can you solve for these buyers
and for their distribution? And,
that’s just a matter of instead
of calling on new customers,
start calling on buyers maybe
not even in your areas or maybe
for competing products and ask
them these questions and see if
you could determine what
problems you can solve for them.
What problems do they have
everyday being a buyer? What do
they look for? What makes them
decide to choose one product
over another? And, you may find
some answers there, and then if
you find the problems, if you
can solve them, you might have a
real advantage right there.
Now, if you can get that
information, and that just takes
digging. It just takes calling
on them and doing some work, and
it’s something our consulting
clients do, they can find that
out for you. If you can take
those problems and articulate it
in a letter, and then you can
buy every damn buyer in the
country and you’re talking their
language because you’ve got the
problems from other like-minded
buyers.
Tom: Which buyers do you pick
the brains from?
Michael: You want to find your
prospective buyers. Who would be
your buyers? And, you want to
talk to them. “Five minutes –
can you help me out? Can I get
your opinions on something? I’m
not trying to sell you anything.
I’m a cheese distributor. We
manufacture a one ounce and two
ounce snack cheese product, and
I’m doing some research on
composing a letter that I want
to send out to people just like
you. Before I do it, I want to
ask you some questions, what are
you looking for when you choose
a product that goes in for
distribution?” You just ask them
right out. Most people will be
willing to help you out if you
just ask them. If you ask ten of
them, you’re going to get five
that will help you out because
people like helping people out.
Do you know what I’m saying?
If you can identify what these
hot buttons are and what the
problems are and solve them for
them, then you have some real
competitive advantages, some
real unique things to offer a
buyer over another company. Yes,
you could build a direct
marketing business. It’s doable.
If you could make it work, let’s
say you send out 1,000 letters
to your potential prospect,
whatever that may be – a
sandwich distributor or the
grocery store chains, whatever –
you can make it work on a small
level and it pays out meaning it
brings in more sales than the
cost of the direct mail
promotion. You can get a letter
out for 50 cents to each one of
these prospects.
Tom: In this case the prospects
wouldn’t be the sandwich people.
It would just be for the
customer homeowner.
Michael: You could choose
whatever you want. Now, it would
be too expensive to sell
directly to the homeowner. I
mean, for a direct mail, but you
could do direct mail to your
buyers, to your prospects that
way. You probably at this point
couldn’t afford to use direct
mail to sell your string cheese
to the end user unless, if you
look at what Claude Hopkins did.
What he did very successfully
was he forced distribution. So,
he would do an advertisement. He
would test an advertisement.
For instance, back in those days
they were selling the patent
medicine. So, it was like an
elixir that you drink and it
cures all these problems. So, he
would do a magazine
advertisement, like a full page
ad offering a free sample of his
product, and he would coupon it.
So, you’d take this coupon into
your Ralph’s Grocery Store for
your 100 percent free sample of
your cheese. So, you can sample
it that way, and it can all be
measured because the coupons
will drive the public into the
stores, and you forced the
distribution.
You contact the stores and let
them know you’re doing some
regionally advertising in X
Magazine is going to have a
coupon for our cheese, and you
force the people into the stores
to get their free sample of
cheese, and you’ll hopefully
hook them that way. That was one
really effective way he built a
lot of big companies.
Tom: You’ve got to have the
cheese in there before you can
put the coupon out right?
Michael: That’s right. It gives
the store the reason to put the
cheese in there because you’re
going to be driving all this
traffic to their stores.
Tom: I see.
Michael: So, you’re forcing
distribution. You could test it.
You’re forcing it through the
end user for a coupon. This guy,
I’ve got some stuff on my site
you can study. This is how this
guy built businesses. He forced
the distribution through
couponing, getting the people
into the store. The store owner
knows that if you’re giving away
a free sample of cheese, that
that person in the store has a
good chance that he’s going to
buy other stuff in the store.
So, it gives him a reason to put
the cheese in the store. Do you
see what I’m saying?
Tom: Yes, I understand that.
Michael: That could be tested on
a small level, and this is how
he would do it. He would test it
on a small level, and then once
he would determine a test, he
would just go national from
there.
Tom: So, then if you give them
one piece, they’ll buy a couple
more.
Michael: That’s right. You have
to be careful of your offer, but
that’s right. Many times, you
could – he had a guarantee. I
don’t know the specifics of how
it did it, but that’s a ball
park, and he did it very
successfully.
Tom: What do you think about
driving them to web? Trying to
get people to buy off our
website like where we’re at
right now?
Michael: For the end user, the
mom at home with kids. The mom
with kids – I have two young
kids, and believe the mother at
home with kids and a husband
working or even a single mother,
50 percent of those single
mothers don’t have time to sit
in front of the computer and
order their cheese. They need to
go to the grocery store and get
everything else. They’re going
to buy it there. But, I don’t
know. Your website may offer
some good support to generate
distributors by having a
presence on the Internet for a
string cheese distributor.
There’s nothing wrong with
having a website and having
great content, the history of
cheese, free downloads. You can
generate accounts, and having a
presence will definitely help
you. I don’t think you’re going
to get all these sales from moms
waiting to sit down in front of
the computer and buy cheese from
your website.
Now, it’s good to have. Let’s
say you get some media, let’s
say you get some free publicity.
Let’s say – and I’m just
thinking off the top of my head,
okay, this doesn’t have to make
perfect sense, but let’s say
your cheese is guaranteed to
lose weight, or double your
money back, and let’s say
someone picked that up as a news
story. “Cheese distributor in
Wisconsin guarantees you’ll lose
weight on their string cheese or
double your money back”, and
let’s say that’s picked up as a
news story and it got on the
news, and let’s say AP picked it
up, and there are ways to get
free publicity. That’s just one
angle, but you’ve got to do
something newsworthy that the
AP, Associated Press, could run
a story, but that could happen.
You’re going to want a website
because in that press release
you send out to all the media
outlets, you’re going to have
your website in there, “To take
advantage of their guarantee, go
to
www.snackcheese.com .” You
want to be prepared for that.
So, your web presence must be
ready in case you land something
like that. And media, free media
is also a great way to promote.
You’ve just got to come up with
something unique.
Tom: What do you think about
writing some kind of copy that
will catch the eyes of our
buyers like these convenience
store chain buyers?
Michael: You want to get your
pitch. You want to get your
Unique Selling Proposition, the
reasons why these buyers should
buy from you and that takes
research and work to develop
that, but once you have that you
can it and that Unique Selling
Proposition, if you’re marketing
to buyers, should always be the
same, in your sales letters, in
the way you answer the phone, in
the way your sales reps call on
them, on your invoices, on your
voice on-hold recording. That
Unique Selling Proposition, that
message, that compelling reason
why these buyers should buy from
you rather than these other
people should always be the
same. It could be, “We don’t use
pesticides in our cheese.”
Pesticides, what the hell is
that? Do you mean other cheese
manufacturers use pesticides?
What if you could do some
research on Sargento’s or Kraft
and find something out in their
data on their manufacturing
process that you could take
advantage of and leverage?
Sargento’s uses water from the
Hudson River. Do you know what
I’m saying?
Tom: Yes.
Michael: It takes work and
creativity, but those are things
are out there. You just have to
dig for them, and I’m just
talking off the top of my head.
Let’s say, I don’t know where
the Hudson River is, but let’s
say you knew that Sargento’s
filtered the water from the
Hudson River, and say three
years ago there was an oil spill
in the Hudson River. I mean,
you’ve got the great media.
Sargento’s cheese uses polluted
water to make their string
cheese. We use water that’s been
purified five times, and you
talk about your water process.
Something as simple as that gets
attention, and then oh by the
way, if you want to try our
cheese, and you put in the
Unique Selling Proposition, go
to or call. Do you know what I
mean?
Tom: Yes.
Michael: There’s all kinds of
ways. It just has to be done,
and sometimes when you’re in it,
it’s hard to see it. You need
someone with a fresh
perspective. Unfortunately, you
had a bad experience with your
Y2 guy and a guy who never did
that.
Tom: Did you ever hear of IPA?
International Profit
Associations or International
Business Association.
Michael: What did they do?
Tom: It’s similar to that.
Michael: They sell consulting
training.
Tom: Yes, $35-$45,000.
Michael: Wow! So, did you find a
consultant from them.
Tom: Once we started talking to
him, we fired him right away
because if you go online and do
research on them you’ll find
there’s a guy on there that
said, “Don’t use these guys.
Here’s what my experience was.”
And, we found that after the
fact. We spent some money with
him and then just stopped it
cold.
Michael: What kind of money did
you put down with them?
Tom: What did we put down with
them, Al? Do you remember? Five
or six grand, probably.
Alec: Was it that much? I don’t
think so.
Tom: Maybe it wasn’t that much.
Michael: Well, what’s different
about what I do is we work
strictly on a project by project
basis. Depending on what we do,
the fee is usually anywhere from
$1,500 to $2,500 per project. In
the very first project out of
all seven projects is the Unique
Selling Proposition. So, if it’s
something that you guys want to
talk about and think about it,
you could hire me, and I also
guarantee my results. If you go
through all seven steps of my
process, but you could hire me
to do the Unique Selling
Proposition for your string
cheese.
Tom: How would you accomplish
that? Will you do the research?
Michael: I will do the research.
I will do it all for you. I come
in and I present you a Unique
Selling Proposition that you can
use and you can take it from
there and include it in your
direct mail, in your media, in
your free publicity, and I do it
in a number of ways. There’s
four different things that I do,
and I won’t go into all of them,
but it has to do with
competitive analysis, meaning I
will call your competitors and
act as a customer. I will do
research on them. I will go to
their websites. I’ll see what
they’re doing. I’ll look for
news articles related to them,
and I will look for that thing
like the Hudson River example I
gave you, something that you can
hook, that you can grab. I can
do one for your buyers of your –
the chain store buyers, and then
we can do one for the end
consumer.
Tom: Would that one for the
chain store be the same?
Michael: No, it would be totally
different because it would be
based on what their pain is and
what their needs are.
Tom: What do you think of the
idea of taking the percent of
increased sales?
Michael: You know, it’s
something I don’t do initially,
and I’ll tell you why, I don’t
want to be married to anyone.
You don’t want to be married to
me. That’s why I do it strictly
project by project basis, but
let’s say I do the USP for you
and you’re happy, and we
continue on. Then we implement
the second step of the process
is implementing the USP through
all your processes meaning when
you’re calling on the phone to
potential prospect, that
potential prospect is going to
know about your USP. Let’s say
when you call and you say, “This
is Alec from String Cheese” and
when you get them on the phone,
you’re going to basically let
him know that Unique Selling
Proposition is everytime you
take a call.
Then if you follow-up with fax,
but on the fax they’re going to
see that Unique Selling
Proposition. They’re going to go
to your website. We’ll have it
on your website. So, there are
points when you’re touching your
buyer or your prospects that
they needs to see it over and
over again, and it’s need to be
consistent through all your
marketing. The second process of
what we do is implementing that,
putting that within your
existing processes.
Tom: So, you actually put
together the work that is done
to the sheets that would
incorporate the copy and
everything necessary to do this.
Michael: That’s right. The first
step is I develop the Unique
Selling Proposition for you.
Tom: That’s the first step.
What’s the second?
Michael: The second step is
integrating it into all your
systems. So, let’s say I
developed it and I come up with
it, and I do that through my
research and several other
processes, and I come up with
one for your buyer and one for
the end user. Then, the second
step of what we do is I work
with you guys to implement it.
So, on your letterhead, when you
send a fax to someone are you
using a fax machine when you
follow-up with customers at all?
Tom: Yes, sometimes.
Michael: On that fax, you’ll
need to have your USP. So, I’m
going to work with you to get
that done. I’m not going to do
everything for you. I’m going to
say, “Here’s the USP. Let me see
what your fax looks like now.
Let’s put it in copy on your
fax. Let’s include it in your
on-hold message.” When a
prospect calls you, do you have
an on-hold recording?
Tom: We do not.
Michael: That’s something easy.
Tom: We have the ability to do
that.
Michael: You can do that. So,
when you make that recording, I
can help you do that, we put
that Unique Selling Proposition
on the on-hold recording. You
can have scripts in front of you
so Tom, when you or Alec are on
the phone and you’re talking to
customers, you have the USP in
front of you and you make sure
you say that everytime you talk
to a customer.
Tom: Would that be similar than
to let’s say Ruth Ann when she
answers the phone to take an
order?
Michael: Absolutely. Ruth Ann
should be communicating that USP
everytime she makes a contact
with a caller or a client or a
customer because you want to
reinforce it in everything you
do.
Tom: So, that’s step two. What’s
three?
Michael: Step three is your
database, and you’re doing a
pretty good job of it meaning
you’ve got all your customers in
a database. Many clients don’t
even do that, and we help them
set that up.
Tom: We’ve got it all on
QuickBooks.
Michael: You’ve got it all on
QuickBooks. So, every prospect I
deal with it doesn’t necessarily
do all the steps. That’s why
it’s step by step. The next step
would be alliances. So, what I
would actually do is I would
implement and help you establish
some joint venture relationships
with some potential joint
venture.
Tom: We could basically skip
database for alliances.
Michael: Exactly. That’s right.
Tom: Five is?
Michael: Media. You’re not
currently doing any advertising,
but let’s say you wanted to use
direct mail. So, this would fall
into me helping you develop a
direct mail sales letter that
would go out to your potential
prospects. I’ve already
implemented the USP. So, that’s
going to be the meat or the guts
of it. I would actually compose,
create, write, do the
copywriting, edit and go back
and forth with you and get that
right, ready to mail.
Tom: That would be something
that we could use on a monthly
basis.
Michael: And, it could be a
series of letters. It may not
just be one letter. It may be a
follow-up letter.
Tom: Right.
Michael: And, the sixth is
community marketing, and it’s
something you don’t have to do,
but if we could come up with a
way in your community. You have
a hidden marketing asset being a
Wisconsin cheese distributor.
That’s got some real value to
people anywhere else in the
country. Wisconsin – you guys
are cheese-heads. Of course,
your cheese is going to be the
best, you’re in Wisconsin. Look
at the media in California. I
don’t know if they do – we see
the advertisements on TV for
California Cheese. They’re
pushing California Cheese.
Tom: I’ve seen them.
Michael: Is California Cheese
any better than Wisconsin
cheese? Who knows?
Tom: No, no, no, wrong answer.
Alec: Absolutely not!!!
Michael: Absolutely not? That’s
right, and tell me why? We don’t
use chemicals in our water, and
that’s just an example. Do you
see?
Tom: Yep, and then the seventh
after that is.
Michael: Is the direct
marketing? Handle and do the
actual mailing. It’s step seven
and the step five are similar.
It would fall under the direct
marketing.
Tom: I think Al would agree with
me that probably one, two, five
and seven, are most important
things to do first.
Michael: Well, you don’t even
have to worry about two, five
and seven. The most important is
number one. That’s got to be
done before anything else.
Tom: Right. How much time would
it take to develop that?
Michael: I spend about a month
on each thing. I’m not working a
whole month for just you because
I work with other clients. I
would need a month to come up
with step one to have your USP.
Tom: Okay, it looks good. Let’s
Al and I talk a little bit.
Michael: You guys talk about it.
Tom: And, you said that each one
of those are between $1,500 and
$2,500.
Michael: I would do the first
step for $1,500, and if you guys
are happy with the USP and it
makes sense and you like what
I’ve done and all my research
and analysis, then you can
simply move on. See, you’re not
married to me.
Tom: Good, that sounds good.
Michael: Sound good.
Tom: Yes.
Michael: Has this been helpful?
Tom: Yes, it has. Al?
Alec: I would agree.
Michael: Well, you guys talk it
over and get back with me, and I
really appreciate letting me dig
through your business, and I
think we’ve talked about a lot
of different things and I have a
lot better understanding of what
you guys are trying to
accomplish.
Tom: Okay, sounds good. Thanks
Mike, talk to you later bye-bye.
Ruth: Gourmet Products, this is
Ruth Ann.
Michael: Hi, Ruth Ann. Is Tom
available please?
Ruth: Can I ask who’s speaking?
Michael: Tell him it’s Michael
Senoff.
Ruth: Sure, please hold.
Tom: Hey Michael.
Michael: Hi Tom.
Tom: Hey, Al and I talked about.
We’ve decided to do the USP.
Michael: You want to do it?
Tom: Yes, we do.
Michael: Okay, great.
Tom: We like what we heard, and
I think maybe we can have a
relationship that will continue
on that will fire up our
marketing. That’s what we need.
Michael: I will give you my best
effort. I’ve been trained by the
best, and I think if anyone who
can do it’s going to be me, and
we’ll take it step by step.
Tom: The other thing is maybe at
some point down the road, if you
want to do a back end thing, we
can consider it.
Michael: I’m always open to
that, but let’s see how – we’ll
take this step, and based on
that, we’ll continue on. If you
like working with me, and I’m
producing results for you, we’ll
go to step two, we’ll go to step
three, and we’re going to have a
good relationship, but at least
we’ll have a chance to work
together and we’re not married.
Do you know what I’m saying?
I’m going to be on the phone
most of the day. I’ll get back
to you and we’ll do a little
gentleman’s agreement, and take
care of the money, and we’ll get
going on it.
Tom: Sounds good.
Michael: Bye.
Ruth: Gourmet products, this is
Ruth Ann.
Michael: Hi Ruth Ann, it’s
Michael Senoff calling for Tom.
Ruth: Sure, please hold.
Tom: Tom here.
Michael: Hey, Tom, Mike Senoff
here. How are you?
Tom: Good.
Michael: Sorry I didn’t get back
with you yesterday. Anyway, I
wanted to take care of details
and get going on this. You do
PayPal, don’t you?
Tom: We do.
Michael: Do you want to just do
it by PayPal?
Tom: We can do that.
Michael: That’s fine. All I need
is if you just give me your
PayPal email address, what I’ll
do is I’ll send you a PayPal
money request, and I’ll outline
what we’re going to be doing and
everything with that.
Tom: Can I just send you a check
overnight? Here’s why I say
that. They’re going to put a
direct addition for me today. I
might be screwed up with my
email and tomorrow morning at
seven, I’m flying to New York
and I won’t be back until
Tuesday.
Michael: You can mail me a
check.
Tom: I’ll just pop a check in
the mail if you give me your
address. I’ll send it to you
FedEx.
Michael: You can send it FedEx
that’s fine. Are you ready?
Tom: I am ready.
Michael: Okay, address 4735
Clairemont Square, #361, San
Diego, California 92117, and you
want to make it out to JS&M
Sales and Marketing,
Incorporated for $1,500. Get
that to me, and when are you
going to be back in town?
Tom: Tuesday.
Michael: You’re going to be back
Tuesday. I’ll call you Wednesday
because we’re definitely going
to need to talk some more, and
we’ll go from there.
Tom: Very good. It’s in the mail
today.
Michael: Good, have a good
flight. |
