The pandemic has upended companies. Take Liber & Co., for instance. The Austin, Texas-based producer of cocktail syrups bought principally to bars and eating places. Then Covid hit.
“The pandemic initially decimated our income,” stated co-founder Chris Harrison. “Within the third week of March 2020, 70% of our enterprise was wholesale to bars and eating places.”
Harrison didn’t panic. Whereas his wholesale income evaporated, direct-to-consumer gross sales tremendously expanded. 2021 was the corporate’s finest 12 months, and 2022 has began robust. DTC income is now bigger than wholesale.
He and I just lately mentioned Liber & Co., together with the pandemic-induced pivot, growth plans, and extra. Our total audio dialog is embedded beneath. The transcript is edited for size and readability.
Eric Bandholz: Inform us about your organization.
Chris Harrison: I co-founded Liber & Co. in 2012 with my buddies Adam and Robert, who’re twins. We had been in our early 20s on the time. We went to highschool collectively after which to the College of Texas right here in Austin. Our curiosity was making good alcoholic drinks. We noticed a distinct segment for cocktail syrups. It was a sluggish begin and bootstrapped — no marketing strategy and no enterprise capital — though a household pal invested for a little bit of fairness.
We gained momentum, accrued information, constructed provider relationships, and bought the precise gear. We ultimately manufactured the syrups ourselves. We promote to bars and eating places and direct to shoppers.
The pandemic initially decimated our income. Within the third week of March 2020, 70% of our enterprise was wholesale to bars and eating places.
However we rebounded. 2021 was our greatest 12 months, with 80% year-over-year progress. 2022’s been robust, too. This week we secured a lease in Georgetown, simply north of Austin. We want extra manufacturing area. We will’t launch new merchandise as we don’t have obtainable pallet positions. We’re going from 7,000 sq. toes to 21,000. It’s an enormous chew. We signed a seven-year lease.
Bandholz: Did you take into account shutting down the enterprise when Covid hit?
Harrison: No. It was a intestine test for positive. Our bar and restaurant enterprise stopped, however our on-line gross sales by way of Amazon and our Shopify retailer elevated by 300%. Gross sales to liquor shops had been secure. We ended 2020 with extra income than in 2019.
Our direct-to-consumer channel is now bigger than wholesale.
Bandholz: How do I make an Outdated Long-established?
Harrison: It’s a easy drink, simply two substances: whiskey and our Outdated Long-established Cocktail Syrup, which is enriched with gum arabic, fragrant bitters, and a little bit orange peel. It’s the non-alcoholic model of an Outdated Long-established. Simply add 1 / 4 ounce of the syrup with a shot of booze. Then stir over ice, and also you’re good to go. It’s all-natural with actual citrus and sugar and appears much like maple syrup. You can also make 36 Outdated Fashioneds with one bottle.
Bandholz: Have you ever thought-about personal labeling?
Harrison: No. The margin on personal labeling is low. Plus we don’t have the capability. Essentially the most worthwhile facet of our firm is the model. The merchandise are nice, however anyone might reverse engineer what’s occurring right here. It’s not difficult. Sourcing, substances, high quality management — it’s a meals merchandise.
We’ve huge plans to maneuver past non-alcoholic syrups and do some booze stuff. Promoting booze triggers a slew of rules, however the margins are nice.
Bandholz: You’ve had a robust 2022 to date. What’s driving that progress?
Harrison: It’s primarily direct-to-consumer gross sales by way of our Shopify website and Amazon. We generate about 40% extra income on Amazon, though the per-order quantity is low, barely over one bottle on common.
Amazon is sweet for us as a result of we tightly management who will get our merchandise — no third-party resellers. Our contracts for all distributors forestall reselling on Amazon, though we’ve had points with that. Typically, nonetheless, we’re the one vendor of our merchandise on that market.
Plus, Amazon drives clients to our Shopify website as a result of our bottles say, “You need cocktail recipes? We’ve 600 on our web site. Go there.”
However most of our Shopify-store clients hear about us word-of-mouth. We pulled our Fb adverts after the iOS replace final 12 months. We do some Amazon promoting.
We’ve retained influencers on Instagram who promote and tag us. We’re huge on Cocktail Reddit and Tiki Reddit. Bars and eating places that purchase our merchandise additionally drive consciousness. Folks go to Saltgrass Steak Home, for instance, and order a pineapple margarita. Then they ask, “What is that this?” The bartender provides them our recipe, which has our identify and model.
We use Grapevine, the post-purchase questionnaire, for suggestions. It’s mainly, “The place did you hear about us?” Many individuals will say a bar, a pal, or on Amazon. It’s vital to understand how individuals come to our model.
Our advertising and marketing lead, Alex, and our advertising and marketing assistant, Cristina, are cocktail novices. They’re pushing TikTok. Cristina seems in our movies — 15, 20 seconds. She’s nice. I nonetheless like longer movies, nonetheless, for YouTube. It’s onerous to overview a bunch of bourbons in a brief clip.
Bandholz: Speak in regards to the Instagram influencers.
Harrison: We’ve had good luck with that program. The influencers typically love our merchandise and don’t ask for cash, simply samples.
We’ve just lately began experimenting on YouTube with cocktail influencers doing opinions. These are normally former bartenders who’re taking their information into their dwelling studio.
An instance is Anders Erickson out of Chicago. He does high quality productions and is aware of his stuff. We partnered with him, and it’s been an awesome match. We prolonged an affiliate low cost to him. He provides the hyperlink beneath his YouTube video that sends individuals to our web site, which we observe.
Up to now it’s been nothing however upside for us. It’s not like a 10-times return on advert spend, but it surely’s positively value it. And since it’s YouTube, it’s evergreen. We’ll get visitors from these hyperlinks 5, 10 years from now.
Bandholz: The place can individuals discover you?