Yeah, selling food on Amazon takes a lot of work. Yeah, there are fees involved and algorithms to figure out and rule changes to stay on top of. And yeah, there are always pesky copycats trying to steal your business. Any other complaints? Probably. When it comes to the e-commerce behemoth, small businesses have all kinds of beefs.
While some of these complaints may be justified, here’s the thing: Amazon isn’t going away. In fact, the COVID-19 crisis has catapulted its grocery business to new heights. Today, a huge slice of the U.S. population buys food on Amazon, and most won’t stop shopping there once the pandemic ends. They can find almost any product they want (including your competitors’), discover new foods to try (including your competitors’) and have their entire order (including your competitors’ products) delivered to their doorstep—all from their computer or smartphone. That’s a pretty sweet proposition to walk away from!
So, what does this mean for most emerging food brands? Time to suck it up, stop resenting Amazon and do the work necessary to excel on the platform.
Take it from Michael Zhang, founder and CEO of Fenrici Brands, who joined Tera on latest Edible-Alpha® podcast: “When you have an attitude of no complaining, just do what needs to be done, Amazon has amazing potential. You need to say ‘hey, I’m going to go all in. No matter what the challenges or barriers are, I’m going to face them and stick with it.’”
Michael did exactly this, allowing him to grow his lifestyle company from zero to $4 million in sales in three short years—all on Amazon. Now he’s coaching other small brands, including food producers, on approaching Amazon with the right attitude and strategy to succeed. Tera can attest from her conversations with several small food companies: Michael’s method works. Tune into the podcast to get the full scoop.
But aside from “the how,” let’s keep talking about why emerging food companies should invest in an Amazon strategy, as some are likely still skeptical. The truth is, because this is where America shops and where the competition does business, many small brands can no longer afford to overlook Amazon. There are just too many eyeballs and potential sales sitting there to not try to capture.
There is also just too much excellent, strategy-informing, FREE data available from Amazon for food entrepreneurs to not take advantage of. Wouldn’t you love to know where your best customers live, what times of day the shop, which keywords they use to find your brand and what else they buy? Wouldn’t you love to use that data to direct your marketing, promotions and even new product development?
Again, there is no denying that selling on Amazon has its hurdles and headaches—but it can have a ton of benefits too. And given grocery e-commerce’s astronomical rise over the past year, few food entrepreneurs can afford to ignore the giant.
Amazon is super intimidating for many food entrepreneurs, but Fenrici Brands founder and CEO Michael Zhang believes it’s well worth navigating. After growing his brand to $4 million in sales since 2018—100% on Amazon—he now shares his expertise with other small businesses. In this podcast, Michael breaks down how the platform works for vendors, what mindset entrepreneurs need, how to leverage Amazon data and sellers’ tools, and so much more!
Listen to the Latest Episode
And now, our roundup of the best food and beverage finance news, events and resources from around the web…
Business Model Insights
- Startups seize fast-growing upcycling trend to drive sales, make social impact (FoodNavigator-USA)
Foods and beverages made from upcycled ingredients are gaining traction with sustainability-minded consumers, creating a $46 billion market opportunity that emerging brands are pouncing on. - Why diversity in hiring matters (New Hope Network)
- What ‘going’ to Sundance taught me about brand storytelling (New Hope Network)
Raising Capital
- Despite growing interest in soil health & carbon farming, climate tech needs more investment: report (AgFunder News)
New Transformative Investment in Climate-Smart Agriculture report analyzes the current state of soil health tech adoption and pinpoints new sources of capital to improve on-farm adoption. - 4 Ways to Generate Investor Interest, Even When Funds Are Scarce (Entrepreneur)
- Mondelez launches program for early-stage snack brands (Food Dive)
CPG/National Brands
- CPG brands need to front the costs to overhaul the food system, but consumers will pay in long term (FoodNavigator-USA)
The agriculture supply chain is long overdue for an overhaul, but the question of who should foot the bill is impeding meaningful progress. It may be time for CPG to step up. - Why do Coca-Cola, Frito-Lay, and Mars get the best real estate in grocery stores? Because they pay for it (The Counter)
- Innovation and sustainability: Conventional food companies’ 2021 plans (New Hope Network)
Market Trends
- Frozen foods heat up as pandemic drives sales growth (Food Dive)
New report dubs frozen foods a “pandemic powerhouse” that raked in in 2020, as 30% of shoppers increased their freezer capacity. Today, 57% say they purchase more frozen foods than pre-pandemic. - Pandemic brings great changes in daily life but small shifts in consumer values (New Hope Network)
- Satisfaction nosedives for online grocery services in January even as sales surge (Grocery Dive)
Farming and AgTech
- Yard Stick provides measurement technology to combat climate change (TechCrunch)
“To turn agricultural land into a thriving carbon sink, farmers need to be able to manage it by shifting to regenerative agriculture practices … But you can’t manage something until you can measure it.” - A Different Kind of Land Management: Let the Cows Stomp (The New York Times)
- USDA Forecasts Dip in Net Farmer Income in 2021 (Modern Farmer)
Deals/M&A
- CPG giants reshape portfolios with significant divestitures, limited acquisitions (FoodNavigator-USA)
Widespread SKU rationalization in early 2020 prompted many CPGs to reevaluate their portfolios long-term, sparking the current reshuffling of brands and potentially altering acquisition propositions. - Kalera acquires Vindara, the ‘missing link’ to vertical farming operations (FoodNavigator-USA)
- Vegenaise brand acquired by $40 billion food giant, Danone (VegNews)
Virtual Events
- Seafood Expo North America Reconnect: 3/14–3/18
- FFI MVP Series: Sources & Uses of Capital Finance Planning Workshop: 3/18
- American Bakers Association 2021 Virtual Convention: 3/22
- Global Food Safety Initiative Conference: 3/23–3/25
- Findaway Adventures–Netrush Liftoff Pitch Slam: 3/24
- American Food Sure Virtual Summit: 3/29–3/30
- FFI Scenario Planning: 4/6–4/8
- Plant-Based Foods Value Chain Americas 2021: 4/13 –4/14
- FFI MVP Series: Food Safety & GFSI Planning Workshop: 4/15
- Raising Equity: 4/20–4/22 (NEW DATES)
- Food Safety Summit: 5/11–5/13
- Natural Products Expo West Virtual Week: 5/24–5/27