[00:00:10] Ray Latif: Hey everyone, I'm Ray Latif and you're listening to the Top Podcast for the food and beverage industry, Taste Radio. This is Episode 228, which features an interview with Errol Schweizer, a longtime industry insider, trendsetter and entrepreneur, who is highlighting issues of food justice, sustainability and food labor as the co founder and host of a new podcast called The Checkout. Just a reminder to our listeners, if you like what you hear on Taste Radio, please share the podcast with friends and colleagues. And of course, we'd love it if you could review us on the Apple Podcasts app or your listening platform of choice. There are parts of this interview that might make a few listeners uncomfortable. Errol Schweizer knows this and he's fine with it. To confront issues of systemic racism, labor inequality, and cannabis reform and how they're affecting the food and beverage industry, he believes that people have to hear unsettling stories and statistics. As disconcerting as they are, his goal is to motivate action and change. It's one of the primary reasons that Errol co-founded The Checkout, a podcast that spotlights diverse voices and stories from across the industry and discusses solutions to create a more just, equitable, and resilient food system. A 25-year veteran of the food industry, Errol is a former vice president of grocery for Whole Foods, where he spent over a decade bringing dozens of innovative and disruptive brands to market. Within his role, he helped expand availability of non-GMO and organic products, advance fair labor standards, and champion the benefits of sustainable agriculture. Since leaving Whole Foods in 2016, he's been an active advisor to and director of food companies and retailers, including Good Catch, Fairway Market and Good Eggs. He's also a passionate advocate for the legalization and safe use of cannabis and sits on the board of dispensary chain MedMen as a co-founder of cannabis-infused beverage brand Mood 33. As part of this wide-ranging conversation, Errol spoke about how he evaluates opportunities to align with food and beverage companies, why he once received death threats at Whole Foods for expanding access to a food category, and his belief that there are absolutes about the drug war, racism, and their impact on cannabis-based CPG products. He also explained why he advocates for a $20 minimum wage, the importance of unions in protecting workers, particularly during the pandemic, and how his belief system is incorporated into his role as a host for The Checkout. Hey folks, it's Ray with Taste Radio. I'm on a call right now with Errol Schweizer. Errol, how are you? Good, Ray. It's great to be here. It's great to have you on the show. Thanks so much for being with us. Given that we are living in the strangest of circumstances these days, in every which way, normal life just doesn't exist anymore. And I know I miss a few things about what it, quote unquote, used to be like. But what do you miss most about normal life?
[00:03:03] Errol Schweizer: Honestly, probably just going to grocery stores regularly and eating out occasionally as we're pretty strict in our house. My wife's immunocompromised and she's also an essential worker. So the rest of us are being extra careful and are really just trying to quarantine, ride this out. And then when we do go out, we're in full mask and PPE. As my parents contracted COVID-19 early on, they live in the Bronx and having experienced firsthand what they went through, we definitely want to keep that out of the household as long as it's virulent. It's crazy as somebody who's been in retail for so long to not have stepped foot in a store in several months, but I figure it's a sacrifice that it's well worth making in order to survive.
[00:03:51] Ray Latif: Yeah, you're not the only one who hasn't stepped foot in a grocery store. I haven't either. And it is sad because you know what? It was interesting. I did a podcast interview with Lee Robinson.
[00:04:00] Errol Schweizer: Lee was among my last hires at Whole Foods. I brought him onto the global team. How about that? Yeah, good man.
[00:04:08] Ray Latif: And we recorded an interview in April, but prior to that, I was chatting with him at the fancy food show, the winter fancy food show in San Francisco. And he had mentioned that he really likes shopping online. He doesn't really love shopping in store. And I was like, I love shopping in store. I never, I'm never going to buy anything online. I'm never going to buy groceries online. Yeah. Yeah. Little did I know that would change pretty quickly.
[00:04:27] Errol Schweizer: Yeah. I'm not a big online shopper either, even though I've been a big proponent of it. Like obviously a lot of people dug it before COVID and now it's necessary post COVID, but it's highly, highly unsatisfying.
[00:04:40] Ray Latif: Yeah, there's something about it that's just, I don't know. I think there's just this tradition of being able to choose. I'm one of those weirdos too that like goes into the back of a shelf and like picks out like the third products, the third package instead of the first package that's in the front. I don't know, probably because I think a lot of people touched the first product in the front. I don't know, I'm a weirdo like that.
[00:05:03] Errol Schweizer: I am too, I never pull the first thing off the shelf. I don't know how long it's been there and if they've been facing it, I'm assuming then the fresher stuff is towards the back. Totally. Retail nerd. You know, the other thing that I really miss is just employees, like cashiers, stockers, like folks that are like, for me, part of my extended family going in and saying hello. especially since I shop in local co-op and a couple local stores and occasionally the farmers market, it's like part of the community for me. That's something that I really miss. I'm very grateful that I can do curbside and that folks are essentially risking their lives to serve the public and in retail. I'm very grateful about it, but I do miss going in. Hopefully at some point, that'll be a thing again. I don't agree that it's a long-term trend. I think we're going to have to come out of this and still have these social opportunities, whether it's buying, selling in-person stuff. We're going to have to figure out a way to be humans again and not these essentially extensions of these applications and algorithms.
[00:06:11] Ray Latif: A hundred percent. It's interesting you mentioned that because there've been a lot of Trader Joe's customers that have been asking, okay, when are you going to do curbside pickup? When are you going to do some sort of direct to consumer or e-commerce shopping? And I think the last note I heard from their management team was that they're not. because they've invested so much in their employees that they feel like there is going to be a time when we get past COVID and it's going to make them stronger as a team.
[00:06:43] Errol Schweizer: To an extent, yeah, you got to understand they also run a very tight labor budget. Their expenses are very low per store. That's how their margins, hence their prices, are very low. And they've had a lot of labor strife. They've had a lot of employees complaining about you know, lack of hazard pay or PPE in various stores. So it's not been smooth or easy in stores either for them. And I just wonder if there is just a provincialism or a sort of like cultural conservatism, too, that they refuse to do this, you know, and they just don't see that in their their worldview, as well as the fact that it involves investment, it involves changes to your operations, it involves changes to your staffing, it involves, obviously, creating that experience online, which is not easy. So I think there's a lot more to it. So I don't really buy their reasoning, even though I have a ton of respect for what they've done as a retailer.
[00:07:38] Ray Latif: For sure. Well, we're talking about a lot of the negatives. I mean, well, it's true. I think, you know, it's, people can look at the current circumstances and say, okay, it's all bad. And frankly, in my opinion, a lot of it is.
[00:07:51] Errol Schweizer: Well, it's catastrophic. I mean, you have a government that has let 200,000 people die unnecessarily, and you fly into Iceland, you know, and they swab you up, give you a test, put you in quarantine for a few days. And if you're clear, you're free to roam. I mean, this isn't like, Really, it's not rocket science. It's basic epidemiology and health care. It really just speaks to the low level of priority that our current culture and our current presidential administration puts on public health. For me, I find it disgusting. It doesn't have to be this way. I do think that folks in the business community, I think we've been too passive about it. I think we've allowed it to proceed while still figuring we could adapt business. You know, there's there's blood on the streets. People have died. Family members have died. I mean, just having watched how close my parents came and then, you know, just being grateful that they made it through. And, you know, we've lost so many other folks. And then also the fact that so many people have died are. not only lower income, but black and Latino, there's a class and race dynamic to it as well that, you know, when I hear the word essential these days, I translate it in my mind to expendable. And that's the way I feel that culturally we're treating so many people who are being exposed to this. And it's, I think a really dark time in how this whole pandemic is being handled in this country. And especially when you compare it to most other countries in the so-called civilized world. It's astounding, and I really hope that we come out of this in a way that we reconsider our collective agency and responsibility as a people to take care of each other, frankly.
[00:09:29] Ray Latif: It is astounding. I think that's the best word to describe it. It's unfortunate that public health has become so politicized, you know, as you mentioned, as of the date of this podcast, you know, over 200,000 Americans dead as a result of contracting COVID. It's such a sad thing to think about. However, you know, in some ways people have come together.
[00:09:49] Errol Schweizer: Well, there's some amazing things that have come out of it. Yeah, no doubt. I mean, Arundhati Roy, the Indian writer calls it a gateway. The pandemic is a gateway. And what does she mean? I mean, you see, um, folks starting up mutual aid organizations to feed each other, feed themselves. Obviously, the pandemic coincided with this really intense uprising around police accountability and social justice in this country and racial injustices. There's an incredible amount of consciousness and just community building that's come out of it as well. On the other hand, just looking in the food industry, organic food sales continue to grow, non-GMO and ethically sourced food sales still continue to be in demand. And I think it's unfortunate that junk foods and snack foods and all this stuff that so many of us were trying to shift the industry away from for so many years have, I think, seen a temporary blip. They've come back for comfort and convenience. But some of the long-term macro trends over the last 10 years, including innovation, I think are still viable. But within, I think, a new social justice context, I think people are now talking about the lack of not only representation, but governance and ownership being so skewed towards Mostly white and mostly male folks in the food industry as opposed to you know when you look at this country It's getting younger and more diverse more gender fluid We as a food industry don't actually look like our customers We don't look like the country as a whole and I think it's created an inflection point and it's still it's still early on you know, I think I'm seeing a lot of black squares and hashtags and what I still consider corporate virtue signaling, and not enough substantive change. Just seeing how you can have these cops let off in this Breonna Taylor case in Kentucky, yet she was on the cover of Vogue, and there was music videos about her, and it's almost as if we're able to capitalize on the pain of black people during these circumstances, but not give them the substantive changes they need to be full citizens and fully live in freedom and safety in this country. I think we still got a long way to go, but I have seen conversations, I'm starting to see some motion that really just wasn't there before. It's just, once again, just a shame that it takes this level of crisis to really push the envelope.
[00:12:20] Ray Latif: Agreed. You know, the commercialization of the Black Lives Matter movement has been, I guess I'll just use this word, interesting to see. And I think, you know, corporate speak is something that the marketing departments of many corporations I'm sure are aware of. I just don't think they know how to address it.
[00:12:38] Errol Schweizer: They don't, and they've benefited so much from the very corporate-friendly policies, whether it's the tax breaks or the deregulatory environment. I think we're a little insulated from that in the organic and specialty food world. You look at like $60 billion in commodity subsidies that the Trump administration has doled out to his mostly white, large-scale farming Mostly in the South and Upper Midwest, his constituency, it's almost like he's bribing them because of all this trade war nonsense. We're a bit insulated from that since so much of what we sell and buy is organic and specialty and non-GMO. somewhat distanced from that. But anybody who is selling corn syrup or processed corn ingredients has benefited from that. And like I said, the tax breaks and other deregulatory policies, folks have benefited from this in corporate America and the food and beverage industry to an extent. And so I therefore think besides the need for more diversity and the need to redistribute some ownership and profit as well. I think in the beginning of a generational shift and how that is going to be dealt with by the general public and how that is going to have to be handled by corporate America. It's going to have to go well beyond the marketing departments. We're going to have to think about boards of directors and ownership At that governance level, we're going to have to think of who's in the executive suites, and then, of course, we're going to have to really consider what folks are getting paid and how they're treated day-to-day in the supply chain. I had somebody on my podcast who mentioned that 7 out of 10 of the lowest paid jobs in America are in the food industry. Those of us who are in the food industry who have P&L responsibility, who have our fingers on the trigger of cutting purchase orders or working with suppliers or scheduling operational shifts, a lot of that is on us, and a lot of that is on the big food corporations that really suck a lot of the wind in this country, the Tysons, Cargills, JBS, Smithfields, the big food distributors, Cisco, US Food, the big natural products distributors, the UNFI, CNS, and then you have the big retailers too. I think we have to take more responsibility collectively as an industry, as individuals in that to really reconsider and make some changes or else these crises are going to keep repeating. This is not going to go away. We're going to have to start getting used to living in crisis and not just the social justice stuff, but this latest set of crises have been climate change, climate related. It's affected everybody, whether it's air quality or farms literally burning down, This is something that we're not going to be able to market our way out of. Sorry, I didn't mean to go off the deep end there, Ray. Don't hold back, Errol. I think there is no business as usual. What you'd consider normal in this post-recession era after 2010 is gone. It's gone as of March 11th. But I think the continued compounded effects of not addressing the root causes of climate change and not figuring out how to adapt agriculture and food production, food distribution in a climate-friendly way have caught up to us.
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[00:16:56] Ray Latif: Well, you have a lot of perspective on the issues you were just talking about. I mean, you had been a top executive at Whole Foods for many, many years. So let's go back to that for a second. You know, can you talk a little bit about your history in the food business and in particular, your career at Whole Foods?
[00:17:13] Errol Schweizer: Yeah, it's funny, I've done a lot of different things in my life in addition to food, but food is something that I've been directly involved in consistently now for 25 years, maybe 26 at this point. I started in food service in order to pay the bills when I was in college. I went to public university and so it helped with the Paying the tuition and expenses and i flip burgers i was a deli clerk i was a line cook line server i wash dishes i mop floors i was told i was not very Good Catch mopping floors but i was really Good Catch cooking burgers made pizza etc you name it. I also worked in a little food co-op in college for about three years. We had this volunteer run 2,000 square foot, cost plus 10, little store on campus that sold the main vegan, vegetarian options of the day back in the mid-90s. But pre-silk, I'll say that. I remember when silk first came out. It was a revelation. I was vegan in the 90s, so do the math on that, you know? And then post-college, I graduated with a biology degree, decided not to go pre-med, wasn't really cut out for grad school, and just started working at farmer's markets, did CSAs. I worked in a lot of community groups, including I was active in the community gardens struggle in the late 90s, early 2000s in New York City, which is actually where I met my wife. Worked a whole bunch of other food service and retail to not be named. None of it was very fun or fulfilling. Almost accidentally found myself at Whole Foods. Figured I'd give it a try while I was still trying to figure out what I wanted to do. Ended up sticking around Whole Foods for over 14 years, I think. So I started out as a stock clerk, overnight shift. I could put out 7,500 cases an hour like anybody and figured out how to buy and order for the shelves. Eventually made it to an assistant manager position, moved around the country. I was in Florida and then in Texas. And then was kind of recruited by my old friend, colleague, and boss, Perry Abinante, to run the New York region, to go up to the Northeast and help open those stores as the buyer and then as the regional coordinator for Whole Foods. And then I guess I did a good job, figured out how to make that region profitable. So I moved to Austin to work on the global team, ended up being there for seven or eight years. A good chunk of my time with Whole Foods was running these really large merchandising programs. We had 80 categories at the time. Between dairy, frozen, bulk, and grocery, we had easily 500 or 600 suppliers we dealt with regularly and well over 1,000 that we had to deal with annually. Whole Foods at the time was a wonderfully chaotic, decentralized cluster of of amazing creative regions that we spent a lot of time corralling and building consensus in order to create national programs. In that, there was some magic. We launched a lot of really cool stuff. We launched Vital Farms. We launched Beyond Meat. We launched Calafia. We discovered and launched Sigi. We launched Suja. We launched So many products, those are just like tip of the iceberg. And we did a ton of category management at the time with very rudimentary data, spreadsheets, Excel, duct tape, and bailing wire. And managed to stay profitable and grow sales. I mean, I think when I came into the department, it was probably a little over a billion. And by the time I left, we were close to a $5 billion department at 33% of store sales. And we had increased our gross margin by 250, 300 basis points. For us, it was also about driving the trends. For me, I came out of the organic co-op world, and I wanted to mainstream organic and non-GMO. I wanted to mainstream ethical sourcing. And so we tried to not only grow the absolute dollars in these product attributes and certifications, but we wanted to grow them on a relative basis in terms of the dollar share and increasing the overall spend for consumers. So by the time I left Whole Foods, non-GMO verified was like 80 plus or maybe 90 percent household penetration across the U.S. So it expanded well beyond Whole Foods, but Whole Foods was a great launch pad. And also, you know, we created these pretty rudimentary promotions programs and nonetheless drove a lot of volume, and we negotiated hard with suppliers on cost of goods, but we also created a lot of quality standards. We worked on quality standards such as grass-fed dairy and pastured eggs. We did eco-scale home cleaning products. We did tuna sourcing standards in partnership with Greenpeace. We worked on a variety of fair trade and fair labor standards, which I think is probably my one area of disappointment. I actually don't think that they're rigorous enough. We worked a ton on kosher, and we worked a ton on halal, which is the first time in my professional life I got death threats for catering to our Muslim shoppers. As you know, I grew up in the Bronx. I had Muslim friends growing up. I didn't think it was a big deal, but in some parts of this country, it is. I kept some of those wonderful comment notes after we had partnered with an amazing brand called Saffron Road to mainstream halal and start recognizing Ramadan in the same way we recognize Christmas and Hanukkah and Passover and Easter. And we did a whole bunch of other stuff like that as well. And I'm still good friends with many of the folks that I worked with. We had this really incredible dysfunctional family of grocery and purchasing geniuses and passionate missionary activist individuals who really made some cool stuff work and have either stuck around Whole Foods or have moved on. I call it the Whole Foods diaspora. There's so many of us that have moved on and are still working in the natural products and grocery industry that keep in touch and have this sort of unofficial fraternity and sorority, having been through what we did together. It was a fun ride at Whole Foods. I left in late 2015, early 2016, when the winds were changing. I felt I was out there on a limb. saying, hey, I don't like the way some of these things are changing. I was very unhappy with the layoffs at the time. I wasn't happy with some of the new management that they had brought in from more conventional backgrounds. And we mutually agreed to part ways and see other people. And I haven't looked back. It's been great. In that time, I've managed to be a board member, co-founder, advisor, consultant, probably to about 25 or so companies and counting because I get bored easily and I like to work on new stuff. But I also, I like to maintain long-term relationships. So for many of these companies that I've worked for, Postal Foods, I've been with them for three or four years in some capacity. And it's been really fun because I've learned a lot about governance and ownership. I've learned a lot about manufacturing and supply chain. I've learned a lot more about retail. I thought I knew everything when I was at Whole Foods, but I knew everything about my job at Whole Foods. You know, there's things that I didn't know. about merchandising and supply chain and financing and operations that I had to step out of that role in order to learn. Luckily, there's an amazing community in the food industry, folks who are willing to not only give me advice, but bring me on board to organizations and have me stick around and implement some of the projects and work. It's been a wonderful, fun ride. In addition to that, I've stayed really active on food access and healthy food issues, working with non-profits that train organic farmers and focus on food justice. Obviously stayed involved with a ton of social justice work. As you know, my work in the cannabis industry goes back 20 years. I helped create a campaign that legalized Eventually, decriminalized and legalized marijuana in New York State called Drop the Rock, and I've stayed involved in the modern cannabis industry now as well, including Herbal Distribution, Moot 33, and MedMen. So, yeah, it's been fun, and I've managed to make a living and not have to compromise myself in the process, for which I feel extremely fortunate.
[00:25:38] Ray Latif: That is a great position to be in for sure. If you are making money and doing it on your terms.
[00:25:43] Errol Schweizer: Yes. I feel it's an incredible source of privilege and I have a ton of gratitude about it. So yes.
[00:25:52] Ray Latif: You mentioned the board of director roles and advisor roles, and I'm just looking at your LinkedIn profile. It looks like you have about a dozen or more current roles as a board member or advisor, including some consumer brands. You mentioned Moo33 and MedMen, but in terms of food or beverage brands, you're involved with a couple. How do you evaluate opportunities to align with a particular business or organization? Because there's only 24 hours in a day, and it seems like you're a pretty busy guy.
[00:26:22] Errol Schweizer: Yeah, I like to stay busy. I have a couple of filters. There were three filters I had, and now I have a fourth filter. So the first three filters are, do I like the people? What's their vibe? I mean, it was similar when I was at Whole Foods, when we were hiring people. We finally realized, no matter how smart or talented somebody is, are we going to like them? Because we're going to be on a 10-hour cross-country road trip with them every day of the week. So it's the same thing with companies. If I'm going to work with them in an executive your governance capacity. The second is, would I feed the stuff to my kids and myself? It has to be something that meets my own personal standards and tastes. Then objectively, number three would be the types of certifications and production processes. Am I comfortable with it? Would it represent me well? Would I represent it well? Then my fourth one, which is new, having learned the hard way is, do they have cash? or what's their debt position? What's the P&L look like? I sometimes now I'm a little, I dig in a little bit more to the finances before I dive into something, because you can't be a super person. You've got to make sure that you're aligned with folks on what the financial position is and opportunities. And I've definitely jumped in headfirst to things that were, you know what, I couldn't fix and we're tough. And while I learned a lot, may not be what I want to do in the future.
[00:27:49] Ray Latif: Was the reason that you jumped in because these companies were aligned with a particular philosophy or mission that you were drawn to?
[00:27:57] Errol Schweizer: Oh, yeah, yeah, for sure. I mean, anything that I'm doing, whether it's Good Eggs, which was a turnaround, which was well financed, by the way, and continues to be well financed. I love what they were doing. They had actually recruited me when I was at Whole Foods to run merchandising there about seven years ago or six, seven years ago. Luckily, I said no at the time. Because then they went belly up. And actually, I love turnarounds, because you don't have to start something from scratch. You already have a little bit of equity. And then obviously, that equity may be negative, but it could also be there's a lot of positives. And with Good Eggs, they have among the most rigorous quality standards, just wonderful people. I wish I lived in the Bay Area sometimes, just so I could order from them. And likewise, Fairway was a tough hole. I think the upside, the positive of Fairway is we managed to preserve 1,700 Jobs and help find folks another two or three hundred people jobs and other retailers but the debt was too high to overcome you know the creditors were too impatient. with management in terms of the turnaround. It was tough because Fairway for me, thankfully, is now owned by other retailers that I think are going to continue to service that market and execute to that brand. But executing a turnaround with that level of debt, honestly, is out of bounds. It's not doable. And I personally think that Companies should not be allowed to get into bed with investors that then throw all that debt on the company books while the investors cash out bonuses and stock options, which is what happened in the previous iteration when the family sold. the company to an investor group they threw all the debt on the books and so you know and the part one of the turnaround we ended up just trying to execute you know basic retail stuff and it was. You got this albatross around your neck with you know what the debt and so it was the same similar thing that i think happened with with earth fair to a lesser extent although they've they've also. relaunched that brand. And so it's a tough haul, especially for the employees to have to go through that. And, you know, Fairway just had and still has some of the most amazing retail employees, like old school, like these folks know how to run a grocery store. And it was it was really amazing to work among them. And then likewise, you know, working with a couple of brands like FarmerDirect Organic, which is essentially also a turnaround, and we're in a pretty good spot and selling, you know, organic beans and grains. And it's been hard, though, because you're relaunching a brand into a crowded, you know, set of categories you have to differentiate. And thankfully, there's been a ton of support from the retailers who see the brand proposition, you know, and the differentiation. You know, it's one of the few companies that is doing a glyphosate test by Health Resource Institute called Tested Clean, which, you know, helps determine if whether or not there's been any drift, you know, unintentional drift. And we're also looking at fair labor practices, and we pay price parity. We pay above the market price a fair price for the products, for the ingredients to the farmers. So those are a few of the highlights. And then other brands that I've been involved with include Good Catch, which is a really innovative, groundbreaking plant-based seafood product. I was on the founding team of that and helped formulate it and helped come up with the name and the marketing. I'm also on a newer company called Eat Good Fish or Good Fish, Inc., which is a salmon skin product. So, you know, for me, the ocean health and seafood sustainability going back to my days when I was working on tuna and seafood sourcing standards, super important. And then a company that I love, the founders, and I love the product, I've always got three or four jars in my cupboard, is Nutso. For me, it's like the only specialty nut butter out there. It's such a good product. And business has been challenging, but it's also going really well, and it's such a wonderful group of folks, too. I like to look forward. to working with people, and that's likewise. I work for a local farm-to-table e-commerce outfit here in Austin called Farmhouse Delivery. Really small, still in that startup phase, trying to figure out how they compete in a marketplace with HEB and Whole Foods. Just a wonderful group of people who are really passionate and committed to growing local food systems and growing organic farms and giving the customer a really good product that's been produced ethically.
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[00:33:31] Ray Latif: Going back to cannabis and being involved in a couple cannabis brands, you know, you mentioned that you were involved in addressing inequalities in cannabis legislation as it relates to the growth of packaged goods and packaged products that contain cannabis components. You know, we've seen a lot of interest take place over the past couple of years. Has your interest in the space been aligned with that demand or were you always kind of looking at opportunities?
[00:33:59] Errol Schweizer: Yeah, I imported hemp paper from Canada in 1996 when I was in college. I was a publisher, you know, publishing underground magazines. So I've been involved, you know, going back to the same thing with food, similar time frame. Look, you know, let's break this down. whether it's THC or CBD should be regulated in the same way that caffeine is, period. Anything else negative, anything else that is propaganda about keeping it criminalized or illegal is part of the racist drug war. It's about keeping black people and Latino people and poor people who want to buy, sell, use it, criminalized in jail or in the criminal justice system, disenfranchised from voting, et cetera. All right? This is like an absolute that I have. If there's any conversations to be had about the efficacy or safety, it has to start from the fact that the drug war is about maintaining racism. It's about maintaining a Jim Crow style regimen. And so if you take that out of the picture, what you're left with are pretty harmless ingredients that just make people feel good. And you're left with the need for reparations, because you now have millions of people in this country that were ridiculously disenfranchised, thrown in jail, had their lives turned over. And we need to reinvest in those folks' communities and help them start again. And in some cases, invest or give them equity in the cannabis industry, you know, just as part of that reparations piece. You know, for me, these two things don't separate. So I've attended a couple of conferences. It was actually a BevNET event. And I kind of, you know, said a few things about this to a room of mostly, it was like all white investors, you know.
[00:35:53] Ray Latif: The Cannabis Forum in winter 2019. It was great seeing you on stage and going at it. It was really great, actually.
[00:36:01] Errol Schweizer: Thanks. Yeah, appreciate it. I wore my favorite green sweater to represent cannabis. Anyway, for me, these things don't separate. It's a harmless ingredient that makes people feel good, whether it's CBD or THC. It needs a minimum of regulation and labeling similar to caffeine, maybe alcohol, if that, but who's ever died from a cannabis overdose? Can you name two people? You know, anybody who thinks cannabis is a gateway drug to meth or coke, I don't know how you go from the psychoactive effects of, you know, smoking weed to, you know, being a meth head. It's like, One, they're completely different in terms of how they affect people, and there's different socionomic, you know, contexts to each as well. Similar to, you know, crack cocaine. I mean, we're talking about major, you know, issues with the drug trade and illegal, harmful substances, which should probably also be regulated or legalized. But I'm going to save that conversation for another day, because I'm just going to focus on cannabis as it's harmless, but it's used to keep black and brown people in jail. And we can't separate the two. We as an industry, anybody who is actively involved in cannabis on a for-profit basis, especially the investors with deep pockets, you must be involved in reparations and justice for the folks who've been the victims of the drug war all these years.
[00:37:27] Ray Latif: That's a tricky thing, though, just to be honest. I'm sure there's a lot of folks that say, OK, look, I want to make a buck in cannabis. I just don't want it to be a big political issue, even though it is.
[00:37:39] Errol Schweizer: Yeah. My answer to that is then you don't deserve to make a buck in cannabis. Where were you 20 years ago? Were you selling marijuana? Were you actually, you know, what we would call a drug dealer? Were you a drug pusher? You know, it's like you get the cops coming into the school with, you know, the, uh, whatever drug war propaganda that they used to foist upon us young kids. And, you know, everybody goes, you know, leave school and they're, they're, they're smoking a, you know, a spliff, a blunt, whatever, you know, they had a dime. And if you're going to come into it now, because it's safe, because you have the capital too. Where were you all these years? You most likely were using it, right? You were still benefiting from this, but because of probably your race and probably your social class, If you're especially wealthier, you most likely weren't going to get pulled over or stopped in the street, stopped and frisked in New York or in some other way criminalized for smoking or even low-level dealing. So you benefited from all these years, right? And now, especially if you want to benefit from it now, I kind of do take a hard line on this. You know, early in my youth, the statute of limitations have run out. I had some run-ins with the law. And what I noticed was nearly everyone else who had issues with the law were low-level drugs. I remember talking to somebody once in a courtroom. It's like, hey, what are you doing here? He's like, oh, you know, I was just smoking a blunt out on my stoop. And Popo came by and, you know, took me in. Here I am. And this is like the second or third time it had happened to him. And, you know, for a lot of those folks, it was like three strikes, you're out. You end up going away for a very long time. I have a hard time swallowing that. Pardon if I'm being rude.
[00:39:34] Ray Latif: No, not at all. And what you're talking about for some people would say is very controversial, for other people would say it's just the truth. He's just speaking the truth.
[00:39:43] Errol Schweizer: What's controversial is that there's still people in jail for smoking weed. That's insane. Think about in Texas, in Michigan and in these federal facilities or in states that haven't decriminalized it or started to purge people's records. It's crazy. There are people in jail for smoking weed, but there's billion dollar cannabis companies. What a crazy country. And, you know, I think it brings to a greater discussion of the folks who do work for companies or the companies themselves and how they support or rely on criminal justice reform and substantive racial justice issues. Because I'm going to take it to, for me, the logical extension of it in that the majority of wealth, the majority of business decisions are still made by white men in this country. And if we are really wanting to seek justice and create equity, we need to talk about governments in terms of who's making decisions, what institutional decision makers those look like, what the ownership structures are, who actually have a stake, in these companies and industries and can benefit from their long-term profitability, and then what folks are paid on the ground. Fight for $15, and this $15 minimum wage was started 10 years ago. Now that it's being adopted, we really should probably have a $20 minimum wage. The reason why I say that is if wages had kept up with productivity since 1975, the minimum wage would be $22.50. When you think about, and listen, I once, for a few years, I was making between $7 and $10 for most of my early 20s through about my late 20s, working food service and retail. I can't even explain to you how I survived. I worked two jobs at a time. It was insane. We never made ends meet. We were always in debt. I got lucky. I was smart. I worked hard. I met the right people and I managed to move up. right place, right time. To know that they're 7 out of 10 of the lowest paying jobs in this country in the food sector, we have the most opportunity to change that. We have the most work to do in the food industry out of any industry that starts with the folks who are working in our companies, working in our industries, and not seeing wages and income as a cost center, as an expense. It needs to be seen as investing in our people. It needs to be seen as investing in our communities, investing in our future, because it's such a basic thing to be able to not only get by day to day and week to week, but to start accumulate wealth and assets so that you can actually have a better life than your parents, right? I mean, we used to call that the American dream at this point. Who talks about that seriously now? Not young people. Young people are angry. Young people are out in the streets because they see how much has been taken and how much continues to be taken. And so the heads of industry and the heads of companies and, you know, starting with friends and family, folks that I know in the food industry, I mean, these are, I think, major substantive issues that we need to really think about. And, you know, I'll say these aren't fringe. These aren't fringe, Ray. You go to Europe, in a country like Germany, Unions are not only popular, but accepted, and get seats on boards of directors in many countries in Western Europe. Union members have great benefits and retire early. The unions have an effect, a ripple effect on society, and not just unions, but the fact that People who work for companies ie workers they organize themselves to look out for their interests And look we who are in you know management positions do that all the time We're looking out for the best interests of the company who we represent There's no reason why we have to be scared of and feel that it's a threat if the folks who work for us do the same Because a lot of the time they're gonna be asking for stuff. They're gonna be telling us stuff that we don't see and or we don't experience day to day. And I think that's missing from the conversation, one of the reasons why things are just so damn backwards in this country right now with wealth and ownership. And you know, look, I could draw it back even further and say that the way things are in many sectors of the food industry is a direct, direct descendant of plantation slavery and the dispossession of Native Americans from their lands. The way we treat workers in the food industry is because the food industry was mostly black and brown during the New Deal, and those trades were excluded from many of the laws and regulations that protected workers during the New Deal that last to this day, that last to this day. And so for me, it's not just about protecting folks. It's also about giving them a skin in the game stake in the business. And I'm very supportive and enthusiastic about companies that have profit sharing, employee ownership, that give stock options to their employees. And I think the next other step is that companies should not interfere when their employees get together and need to organize for demands that may not be met. You look today at what's happened in the food industry post-COVID, I would say the most effective organization in the food industry for looking out for workers has been the UFCW. I've never had personal dealings with other than that they had unionized Fairway and MedMen. But when I look at the UFCW from a distance and the advocacy and the organizing they've done and just sending out the warnings to the industry of people are dying, they're sick, they're scared. It's amazing to me that more folks haven't listened. Some of the big retailers have partnered with UFCW, I think on hazard pay and PPE, but a lot haven't. A lot of the bigger ones, like let's call on Amazon here, have not really done a great job with how they've handled outbreaks and communication and treatment of the workers in their facilities. They've taken home quite a bit of profit because of that. but they've also made a lot of folks internally very unhappy and have now a terrible reputation because of that. And so I feel that the things that I'm talking about here may sound jarring, but they're not that radical. I think to me, they feel very common sense and they feel very much close to home and achievable because it's just about taking care of each other. It's just about making sure that the folks that we work with that work for us that work, you know, work with us are, able to live their best lives. And that's ultimately what I'm saying here.
[00:46:51] Ray Latif: It does sound like common sense, certainly to me, and I'm sure a lot of our listeners as well. And these topics are things that you discuss quite a bit in your podcast, The Checkout, which is, as we discussed prior to this call, quite an ambitious project. I think the interesting question here, though, is in a polarized society where it's really difficult to convince someone to think differently, Do you worry sometimes that you're talking inside of an echo chamber?
[00:47:23] Errol Schweizer: Yeah, of course. But I mean, I keep in touch and I talk to folks that at least I can align with on a few things. And I actually come at it from a community organizing point of view. I actually was a community organizer in the Bronx. And you just start with what people are looking for. You just start with where folks are at. And, you know, if you just want to march into the street, armed to the teeth, and think you're going to make any progress, you know, other than saying that, hey, I'm defending myself, then yeah, there's going to be a confrontation. I'm not interested in confrontation about this. I'm interested in putting the spotlight and amplifying the voice of the folks who are doing this work. I'm doing these interviews with you guys because I love you guys. I love BevNET. I'm a member of Project Nosh. I've been reading you guys since it started, but I'm not the spotlight. For me, the focus of the show, the interviews, the other content that we're going to develop will be these leaders and activists and researchers and retail and CPG professionals. I've got a whole bunch of CEOs that I'm lining up to because it's not polarized here. Folks are doing good work. They get the spotlight. Let's hear what they're doing. Let's hear what they're saying. Let's create more of that dialogue. And I'm specifically gearing this to the food industry or folks who are interested in actually how food is made and distributed. That's the other funny thing, because I read a ton of food journalism and food blogs, and there's some good stuff out there. I want to give a shout out to Ag Insider by Firm, which is amazing research, investigative reporting. The Counter is really good. But a lot of it outside of those is academic or is too focused on just farms and farming and organic farming or regenerative farming or conventional farming. And you know what? Most of the money, most of the activity happens once stuff leaves the farm. I'm personally, for all these years, been involved in food service, retail, processing, manufacturing, some distribution. Yeah, I've worked on a farm. I garden a little, but for me, 95% of the energy is not on the farm. It's demand side. podcast is very much about amplifying and elevating what I consider to be exciting, new, interesting, diverse voices in the food system. Honestly, I hope it makes some folks uncomfortable. I hope folks are willing to be challenged. and give it a chance and listen to it. Not all the interviews for me are like me putting out my specific ideas. It's about giving these folks the platform and using whatever credibility and connections I have so they can do that, but also the fact that it's fun. I've been involved in on and off in media for many years, and this is my first dabbling in what I call new media, internet podcasting type stuff. The guy I'm working with, Evan Driscoll, not only is he a long-time farmer, farm worker, farm manager, small-scale local venture investor, activist, he actually used to do a podcast for National Young Farmers Coalition. He's actually a real podcaster and he's the producer. I'm just the mouthpiece. It's been fun and I expect a lot of the stuff to make folks uncomfortable. I'm probably going to keep doing it whether or not people listen because I'm just having fun with it. Since I'm not traveling two weeks of the month like I had been, I have a little time in the afternoons, usually between my last phone call and when I have to make dinner for everybody. If things change, then we'll adjust and we'll make changes to it. I hope folks give it a chance otherwise.
[00:51:16] Ray Latif: Well, one thing we learned is that you probably have to schedule when your laundry is being done.
[00:51:23] Errol Schweizer: My wife is a midwife. She's been a professional midwife for about 15 years. She's done about 600, 700 births. Wow. And she's an essential worker. So for COVID, you know, she has to mask up, full PPE to see clients. It's very stressful, but it's, you know, for her, it's labor love. And, um, We're able to have her see clients, you know, outside her house just so it's safer for everybody. And therefore, you know, she has to use the laundry. So she was washing something and I had to text her, I'm sorry, honey, I had to turn off the laundry. I'm on an interview.
[00:52:00] Ray Latif: I'm just ribbing you, Errol. It's an amazing thing she's doing, and I can't imagine what it's like right now for someone in her position, but just kudos to her and you for just continuing to do what's necessary.
[00:52:15] Errol Schweizer: Yeah, we're doing what feels right. We're doing it from our hearts, even though it drives us crazy. Both of us, both our careers, so yeah.
[00:52:26] Ray Latif: Well, I'm sure one of the other things that drives you crazy is, you know, how passionate you are about, you know, everything that we've been talking about and, you know, exposure and education is so important, but once it gets past exposure and education, you're expecting results. You're expecting action and results. So, you know, in your opinion, and based on your experience, what are some of the most effective ways to generate that action after exposure and after education?
[00:52:53] Errol Schweizer: Yeah, I mean, frankly, that wave of activism, that really intense activity in June and July generated probably the most comprehensive set of criminal justice reforms in this country in modern history, and probably was among the most widely attended set of protests and events, and they're still going on. I mean, they haven't stopped. In Austin here, we had some pretty gnarly police brutality at some of the events, and the community really came together. I testified at City Hall via Zoom a couple times, and I think they got over 100,000 comments here in Austin. and have started the process of figuring out how to rebudget for public safety and not be just dependent on policing. Police are trained to do a certain thing. So not only do we need to probably rethink how we train police, and we need to even think about how much we really need police, when 1% of all 911 calls in Austin are violent crime, 99% are not. You know, looking at re-targeting those budgets to homelessness, there's a ton of homelessness in Austin. It's terrible for all those folks who don't have a place to go at night or are living under highways. You know, in terms of drug treatment, community development, what they call here in Austin RISE funds, which are direct payments to individuals. If you want to impact food access, the best thing to do is give people money so they can buy food, right? There's other things we can do, because in Austin and other cities, the police budget is like 40% of the annual budget for the whole city. And so for me, as a business leader, I still come at it like, all right, if this is a business, what's your ROI on all that investment? In Austin, you have among the highest per capita police killings in all of Texas per population. Is that really what we're about? How are we training these folks? We're giving them all this surplus military equipment and training them to essentially be a domestic paramilitary organization. Is really that the best use of public funds? Does that make everybody feel safer? For me, I'm looking at it in an organizational manner and thinking about, well, what kind of city do we really want? What kind of country do we really want for our kids, for our families, and then mostly for the folks who've been closest to the pain? I couldn't even imagine what the mother of Breonna Taylor must feel like today after knowing that a sheetrock wall got more justice than her daughter did in that courtroom. So I think in terms of where I'm taking this with The Checkout, you know, my intention here is to create more dialogue, to, you know, put out good examples of what folks are doing, you know, and we'll see, we'll take it from there. It's media. So it's different than purchasing and purchasing, you know, I was responsible for a PNL and, you know, managing inventories and, you know, creating products, you know, as a board member, I have to do share responsibilities and governance responsibilities and work closely on mentoring and training and, you know, developing leadership in these companies. And as a podcaster, it's about creating content and information and hopefully some inspiration. For me, knowing where those ripples may go, the fact that it's out there on the internet, yeah, I'm sure not everybody's going to like it. That's fine. It's a free country. But for those folks who are looking for that type of info or inspiration or wanting to be challenged, Also, from the particular perspective that it's coming from, that, hey, this is from the inside of the food industry. I'm somebody, I'm an operator, merchant, board of director member. I'm not coming at this from either an academic perspective. I'm not coming at this from just a pure journalistic perspective. This is an inside look at the food industry from the food industry with the intent of making things better and of improving the livelihoods of workers in the supply chain, of elevating the voices of these folks who are doing good work, and also highlighting the successes of some of the food industry executives who've done really amazing things too, some of whom are my friends and close colleagues. I think we've released five episodes so far. We've recorded probably another 10, and I think I've got about 25 scheduled with wide variety of content from, like I said, some really cool CEOs to labor organizers and labor studies professors. because we don't talk about work and labor in the food industry much, except as an expense once again, which to me I think is a mistake. We're talking to researchers and academics. We're spending a whole bunch of time on cooperatives and alternate finance and employee ownership. For me, that's very important and I think is a huge, huge need in this country for folks to have skin in the game. When companies say, oh, you have ownership over your job, no, no, no. You just have a job and you're accountable. Ownership is if you actually own a piece of the enterprise.
[00:58:01] Ray Latif: Good point, for sure.
[00:58:02] Errol Schweizer: Big difference, big difference. That's what we need to be moving towards. And then, you know, I'm also a bibliophile. I am a huge nerd, Ray. I mean, my Twitter handle is actually Grocery Nerd because I am a grocery nerd too. I love going into stores and critiquing what they're doing and looking at merchandising and marketing and products. But I'm also a literal nerd. I read a lot in my spare time. I've got a pile of books at my desk. And one of the things that we're doing on the show is always coming up with book lists. We always ask the guests to come prepared with a few recommendations. We're going to link the bookshop so people want to buy them right off the site too. We've got some fun stuff on there already. And what's really funny, Ray, is a lot of our guests are Star Wars fans, so we're accumulating this set of Star Wars books on our book list as well. I'm a science fiction nerd. Star Wars has not been my favorite, but I obviously give it a lot of credit for popularizing sci-fi. Anyway, so yeah, we're looking forward to it, having fun with it, and we'll see where it goes.
[00:59:08] Ray Latif: I gotta ask, is Carla Vernone a Star Wars nerd?
[00:59:11] Errol Schweizer: Carla was not. Carla had really cool sort of classical literature tastes. She, I believe, mentioned a C.S. Lewis book, which I've never read, and then really intense, she mentioned Elie Wiesel, who was a Holocaust survivor. As you know, Ray, my My grandmother was a Holocaust survivor, Auschwitz survivor. So like Holocaust studies, Holocaust studies literature for me is like deeply personal. And the fact that I connected with Carla on that too, it was just a nice surprise from the podcast as Elie Wiesel was a very important to me when I was younger as had Simon Wiesenthal and a lot of other folks from that, that era who survived. But yeah,
[00:59:50] Ray Latif: That was a fantastic interview you recorded with Karla. Just remarkable human being and a remarkable leader.
[00:59:57] Errol Schweizer: Karla is fantastic. Oh my God, she's brilliant. Like she is amazing.
[01:00:03] Ray Latif: I mean, I would encourage our listeners to absolutely listen to that episode. Listen to all your episodes, but that one in particular was really special. You know, you have such an influential voice in our industry and you will have even more influence as a result of your podcast. That being said, I always think about When I'm talking to people or trying to convince them about my point of view, the first place I start is with my family, my family members. Um, you know, I have a daughter, so I hope to be, hopefully she'll, she'll be influenced by my, you know, set of values as she gets older. I wonder, you know, how do you think about talking to your family or influencing them when they might have a different point of view?
[01:00:46] Errol Schweizer: Yeah, I think we're, we're kind of lucky. We raise the kids in a way of sort of leading by example. We were never dogmatic with them, never pushed our beliefs at them. My daughter is actually 18 now. My son is 14. They're their own people. They share a lot of our perspectives on things. In fact, I think my daughter is probably a lot more radical than I am. She's able to be. She's in college. she's very angry with the world and what she sees in the injustice. Thankfully, she has some privilege and some resources where she can go to school and spend some of her spare time working on topics or subjects that are important to her such as criminal justice or fighting sexual predators and making sure that the campus is a safe and welcoming place even via Zoom. Then likewise, my son, he's very different personality than my daughter, kind of happy-go-lucky, an amazing athlete. But also, once again, I didn't shove it down his throat. I took him to some canvassing events for some local political candidates, and he was a natural canvasser. He's really extroverted, he loves talking to people, and he wants to do good things in the world too. Once again, I feel really, really humbled and lucky to have two kids who give a shit, who are into some of the same stuff we are. They're figuring out their own way as well. It's hard for them. You have kids. This whole pandemic is really, really hard for kids to be cut off from a lot of what you had considered normal, having to adjust your behaviors and your habits. Thankfully, we may be, quote, stuck at home, but we have a home. It's unlike my ancestors who came on a rickety boat fleeing the Holocaust with children in tow with no money, just the clothes on their back to be settled by a refugee organization. We're doing okay, Ray. We can get through this. Not only can we get through it, but I think it's very intentional for me and I think it is for the kids too, but to use this time and this energy to keep improving, repairing, the world. And for me, as somebody, I'm not religious, but I was raised Jewish, something that we call tikkun olam, which is repairing the world, repairing the breach, that you're doing what you can to take care of each other and try to fix things, make them better. So thankfully, the family here is aligned on that. I'm very lucky and I'm very grateful about that.
[01:03:27] Ray Latif: Well, we're really lucky that you are doing everything you can to repair the world, to make things better. Errol, this has been an honor speaking with you on Taste Radio. Likewise, likewise. Thank you so much for taking the time to be with me today. I hope you didn't get into too much trouble with your wife.
[01:03:43] Errol Schweizer: So far, so good, Ray. I'll check in.
[01:03:46] Ray Latif: Please let her know that I am very appreciative, as are our listeners.
[01:03:50] Errol Schweizer: Awesome, Ray. Well, this is wonderful. I love the work you guys do, and thank you so much for having me on. Thank you again.
[01:03:56] SPEAKER_??: Peace.
[01:03:59] Ray Latif: That brings us to the end of episode 228. Thank you so much for listening, and thanks to our guest Errol Schweizer. As always, for questions, comments, ideas for future podcasts, please send us an email to ask at Taste Radio. On behalf of the entire Taste Radio team, thank you for listening, and we'll talk to you next time.
[01:04:27] Good Catch: Hello, I am Melissa Traverse here for the Taste Radio podcast, talking about some of the biggest tension points that CPG brands and founders face when they're scaling a brand, and those are financial accounting and inventory management. I am joined by Matt Lynn, inventory accounting guru from Belay Solutions, and he is going to shed some light on all of this that is going to help everybody out quite a bit. Matt, thank you so much for joining us today.
[01:04:57] Fairway Market: Thank you for having us, Melissa. It's great to be out here at Expo West and it's great to sit down and be able to chat this because it's kind of a passion project of ours, working mainly with CPG brands and hoping to help them scale.
[01:05:09] Good Catch: It's been such a pleasure chatting with you and the team and learning all about what you do over there at Belay Solutions. Can you tell us a little bit about yourself and what your role is and the kinds of solutions that Belay gives to CPG brands and founders?
[01:05:25] Fairway Market: Yeah, absolutely. My role with Belay, I'm actually our inventory accounting manager. I run our inventory department. So we work with CPG brands, taking them from spreadsheets, putting them on inventory management systems, and really helping connect their tech stack between their sales, online marketplaces to that inventory management system, even down to their financial systems like QuickBooks. Belay overall is kind of an outsourced accounting firm. And with that, we're helping teams. We have different levels with bookkeeping, controller level work, even high level into CFO type items. So we really help those brands in any way that they need financially. And then I just have a subset of a department where we're really just laser focused on inventory.
[01:06:07] Good Catch: It's certainly a complex topic and there are plenty of places to go wrong. Let's start by going right and start super simple. Can you tell us what some of the biggest red flags are that would help a founder understand or, you know, the person running a brand understand that it really is time to get some help with some of these areas?
[01:06:28] Fairway Market: WKYT. they have a lot of transactions that don't get coded or they just put them into placeholders to just get rid of it so it's not an eyesore. They'll notice they have revenue but no cash or they notice that they have a good amount of cash but their blind spot is really seeing the vendor invoices that are sitting there just needing to be paid and so they just lack that clarity that's going to really be around the corner.
[01:07:05] Good Catch: You know, you were talking about one of the red flags that comes up that I think makes so much sense. When somebody asks you what your numbers are and you can't come up with the right number, that's a big problem because that's something that you really should be able to share with decision makers who you're ideally looking to do business with. What should you be able to call up at a moment's notice?
[01:07:30] Fairway Market: really at any time, you should be able to know an accurate margin. It's amazing how many founders we end up talking to that they can tell you their revenue numbers, they can tell you their selling price, and then the minute you start talking about cost or their cost of goods sold, they just get a deer in headlights look. So really it's very hard to tell, am I even making money? or if you don't know your entire landed cost. Maybe you know what the freight cost is, the duties separately, but you're not really getting that as part of your unit cost. So it's really hard to tell. Am I even making money or am I losing money from the very beginning?
[01:08:03] Good Catch: And do you recommend that founders are able to call up a margin by channel?
[01:08:07] Fairway Market: Absolutely. And depending on the number of products and channels, you kind of want to know what are your best sellers, which ones are making the most and which ones maybe you're not making as much. But especially if you're branching out and you're doing D to C with B to B, absolutely want to know that.
[01:08:24] Good Catch: Gotcha. You mentioned that when things feel really chaotic, that's probably a red flag. I would say that it probably almost always feels chaotic if you're running a CVG brand. And I know this may be hard to quantify, but is there a revenue number? Is there a number of doors number that would help a brand understand whether or not it makes sense to bring on a partner like Belait? Understanding that so many brands are bootstrapped or they might be tight for cash. What is that friction point?
[01:08:54] Fairway Market: a little bit different for everybody depending on where you're at in your process and sometimes just your level of understanding of financial aspects. You know, when you're first starting and you're really cash conscious and don't want to spend that much money, you may keep it on yourself. But as you're growing, as you're getting to those six-figure revenue numbers, and especially as you're approaching seven, you want to make sure you've got good financials. Because as you scale to that point, most likely you're going to be looking to raise capital. And investors, the first thing they're going to look at is your books. And are they clean? And do they show a clear picture of your business?
[01:09:27] Good Catch: You know, another area that folks might look to to organize some of the chaos are their systems. So many folks stick with Excel spreadsheets for a good amount of time. How do you know that you need to outsource some of your accounting to an organization like Belay Solutions versus maybe signing on to a Synth7 or NetSuite or something like that?
[01:09:50] Fairway Market: Well, that's actually something we really help with. When it comes to that cost question, that's something that trips people up. And sometimes if you just have a turnkey business, you buy and sell a finished good, you can maintain with spreadsheets. And we've had clients with million dollar revenue that can do that. But we see so many brands nowadays are using contract manufacturers. and they're just sourcing certain parts of their product. So when you start talking costs, they have no idea exactly what their unit cost is. So that's where we come in and we kind of understand, we'll speak with the customers and the clients and get their needs. And then if we think they're ready for a system, then we'll help put them on that system so they can get some of that clarity. And it's not something we force on anybody. There are plenty of times where founders come to us and we'll tell them bluntly, you're not ready for it right now, but we'll let you know when we think you are.
[01:10:36] Good Catch: This sounds like excellent advice. What should a founder or somebody running a brand look for in an outsourced accounting partner? Are there certain checklist items that they should make sure that their partner be able to execute or be able to help them understand?
[01:10:53] Fairway Market: Absolutely. I think one of the keys, there's, there's a lot of outsourced accounting firms out there. Some focus on service-based SaaS companies, but if you're a CPG founder, you really want to make sure that your accounting firm has CPG experience. I would ask them, you know, what kind of brands have they worked with? And even Beyond Meat industry specific, because there's so many subsets of CPG. And that's something that I think is great about what we do with Belay is that we kind of run the gamut. It's kind of like the insurance commercial. We know a thing or two because we've seen a thing or two across a broad spectrum.
[01:11:22] Good Catch: Probably getting references is always helpful, right? Absolutely. All right, so this all sounds great. I think we have a really good understanding of would it make sense to hire an outsourced partner? You know, what some of the things you should be looking for are. What does offloading this kind of work mean for the brand? What can this do for lightening the load of a founder or lightening the load of a brand operator? Like, how does that help them in their everyday business?
[01:11:52] Fairway Market: It just tries to really help quiet the chaos. So what we're looking to do is just take some of the weight off that founder's shoulder. Let them focus on building the brand, building the business, getting that exposure. If you don't have sales, you really don't have anything. So we want them to be able to focus on that while we take care of your back-end office work. And we can just present that to you on a monthly basis. You can help make decisions. You can take that to investors. And really, you can just focus on growing your business.
[01:12:17] Good Catch: I feel like I felt founders and the folks who are running brands collectively sigh a breath of relief just hearing that. How can people learn more about Belay Solutions?
[01:12:28] Fairway Market: So people can text TASTE to 55123 for their free inventory guide to get started.
[01:12:34] Good Catch: Matt Lynn, Inventory Accounting Guru at Belay Solutions. Thank you so much for joining me here at Expo West. It's been such a pleasure to chat with you and learn about what you all do over there to help founders and brands with their financial accounting and inventory management. For everybody else out there, thank you for listening to the Taste Radio podcast. I am Melissa Traverse and we'll see you next time.
