Capital Kitchens founder Trish Wesevich joins Alison and Karin to discuss her experience navigating the world of food and beverage CPG, offers advice on whether to co-pack or go in-house, and shares her business philosophy.
Trish started as a food writer and personal chef, and forged her path into CPG by founding Capital Kitchens, an incubator for food and beverage startups. Through Capital Kitchens, Trish was able to work with many different people and companies in different aspects of food and beverage. Now she is a consultant with LaunchPoint Culinary Services, and she shares her expertise with us.
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[AUTOMATED TRANSCRIPT MAY BE SUBJECT TO MINOR TYPOGRAPHICAL ERRORS/VARIATIONS]
Alison Smith: (00:17)
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Karin Samelson: (00:45)
Welcome to the Umai Social Circle where we talk consumer goods tips to help business owners and marketers grow. We’re Karin and Alison, co-founders of Umai Marketing, and we’re being joined by Trish Wesevich, Food and Beverage Consultant and founder of Capital Kitchens and LaunchPoint Culinary Services. Thanks for joining us, Trish.
Trish Wesevich: (01:06)
Thank you for inviting me.
Karin Samelson: (01:10)
Absolutely. All right. Well, let’s jump into it. Can you tell us a little bit about how you got involved in CPG in the first place?
Trish Wesevich: (01:17)
Okay. Well, I started in Austin, really as a food writer, a long, long time ago, as a personal chef and as a caterer. And eventually, that led me to launching an incubator called Capital Kitchens, and it was for food and beverage startups. And it supported all aspects of the industry. I owned and operated that facility for eight years and sold it in 2019, still going strong and is an affordable and nurturing community of other food entrepreneurs and a great spot to launch a business from. During that time frame, I had the pleasure of working with all sorts of food businesses and beverage concepts from artisan food and beverage companies, private chefs, restaurateurs, corporations doing R&D and farmers markets brands and CPG startups. And so back then, we weren’t even using the word CPG really, I guess some industry experts who were from Austin were, but in general, not so much.
Trish Wesevich: (02:30)
So it just kind of happened organically when I had originally launched Capital Kitchens with a business partner, and we knew that there was a demand for commercial kitchen space in Austin. And we weren’t exactly sure who all would need it. And the first two clients we had basically were CPG brands, and so that’s kind of how it all started. And the first CPG brand that launched at Capital Kitchens is still going strong, and they have an almost national brand now, and it’s called Good Seed Burger. And I still think it’s the best burger on the market, vegan, plant-based burger on the market.
Karin Samelson: (03:16)
I got to try that.
Alison Smith: (03:18)
I’ve had it. It’s great. That’s wild that they were your first person.
Trish Wesevich: (03:25)
They had started in the back part of Daily Juice, which was a little juice shop in Hyde park. And I mean, this is a typical trajectory for these CPG startups back in the day and even still today. They started in that little space in the corner, and they had very limited ability to use the kitchen. And they used it off hours, and then they couldn’t really scale in there. And then when we opened Capital Kitchens, we had this big, huge facility. Well, it’s not that huge, but 3,600 square feet. But to them, it was huge and it allowed them to scale.
Alison Smith: (04:06)
Absolutely. So you were saying that when you started Capital Kitchens, you weren’t really sure if there was a big need for CPG brands or you thought more…who was going to be your Capital Kitchens members.
Trish Wesevich: (04:23)
We knew that there was a need for shared commercial kitchen space. I had just finished being a part of a startup to-go space, which doesn’t exist anymore. In fact, it’s probably about 10 years ahead of its time because, today, we all know to-go food is very popular and necessary. But back then no one had really quite adjusted to the concept yet. So I had just finished going through the process of helping to build out that space. So, when I realized that, I had been approached just really literally out of the blue by someone who said, “I want to open a shared kitchen.” And I knew what that meant. I knew there was one already in Austin, and I’m just so in love with food entrepreneurs. I was like, “Yeah, I want to be a part of that. Let’s do it.” And that’s all it took, just we agreed. And then we started pursuing. We were very naive about what we were getting into, but I would say that maybe that helps me actually be able to relate to some of the food brands who launch because they’re also usually very naive. And so I understand what that means.
Alison Smith: (05:44)
But it was so necessary. I mean, it was very much needed.
Trish Wesevich: (05:50)
Alison Smith: (05:51)
So that’s awesome. You had a great hunch, I guess. But tell us more about your consulting business. Who do you work with? What are the pain points and issues that you’re working with your brands on?
Trish Wesevich: (06:07)
So during the time that I got to work with such a myriad of food and beverage types of businesses, CPG and beyond, I learned a lot and we learned a lot together. So sometimes my value to someone wanting to enter the industry is that I’ve seen what works and what doesn’t work. I’ve seen what paths others have taken. I had at least 60 CPG brands that I worked with and one way or another at Capital Kitchens and probably a couple of hundred other concepts, as well as food trucks. We had a huge food truck business as well. So I’ve seen a little bit of everything. And then my background as a personal chef and caterer, I also was already what I call a product geek on my own. I spent every day at Central Market for 10 years, pretty much, and so I knew who all the distributors were, I knew who all the employees were. And so I just learned a lot about the industry, and all of that now kind of is what I utilize when I’m working with clients.
Alison Smith: (07:32)
When you say you spent 10 years at Central Market, do you mean as a consumer, you just would go every day?
Trish Wesevich: (07:39)
So I was a personal chef.
Alison Smith: (07:41)
Trish Wesevich: (07:42)
I would go every morning and shop for my clients, and then I’d go to their home and I would prepare food. And I was a caterer. So yeah, I learned a lot about the grocery industry.
Alison Smith: (07:56)
[inaudible 00:07:57] I would love to be in Central Market every day, that’s a dream.
Trish Wesevich: (08:01)
It was great. It was a dream really. Yeah.
Alison Smith: (08:05)
Karin Samelson: (08:06)
So you’ve worked with dozens and dozens and dozens of CPG brands, so you must know, what are some key things that you think set successful CPG brands apart from ones that just don’t grow as fast?
Trish Wesevich: (08:22)
Well, I think if they can set realistic expectations for themselves, that is key. Of course, commitment is key. You almost have to want to see your product on the shelf above and beyond everything else, but you have to be smart along the way and you have to be coachable. That’s also, I would say, very key. Most people don’t know what those expectations really are or even should be. But by going out and talking to others and then, like I said, being coachable and understanding, okay, this is how hard it really is going to be, I’m going to move forward. Those are the people that are truly committed.
Karin Samelson: (09:18)
Yeah. That is so in line with a lot of idea behind just like what makes a good client and what makes a bad client? I mean, no, no bad clients, right? But the good clients that we have worked with are just super open to testing, to learning, to trying new things. And I think that’s really important to be open-minded in this field because the moment you think you know everything, I think you kind of show that you don’t know a lot. So that’s a really, really good note. And we’ve talked before about the importance of connecting within the CPG community, so can you talk a little bit about that and what you would recommend, places that CPG folks can connect?
Trish Wesevich: (10:08)
Sure. So a lot of times people come to me and they want to launch a product and they have maybe come from a tech background and they’re thinking food beverage is easier. They’ve quickly learned that it is not or they’ve been maybe a stay-at-home parent or a school teacher even or have a full-time career on the side and don’t know anything about food and beverage. They don’t know that there is a very strong network CPG community here in Austin. And it makes sense because it’s like being a musician. Musicians like to congregate with each other and talk to each other and compare where they played or what songs they’re working on or music, and it’s the same with food and beverage. So that community definitely exists in Austin, and there’s so much to learn from what others have done.
Trish Wesevich: (11:12)
And I find that people in Austin who’ve been here a long time doing this are open, will sit down with you and tell you everything they know. And then the new people coming into town are learning very quickly that that’s how it is here, and they either adjust and become that way as well and become open, even if they came from a community that wasn’t that way that they’re not used to it. I’m seeing that they’re going, “Oh, this is a much better way to operate and function, like let’s be supportive to each other. And that community continues to grow. So there’s so many resources out there that are available, so that you don’t really have to reinvent the wheel necessarily, but it depends how much someone has available time so that they can go out and make those connections, right? So was your question like exactly where they can go?
Karin Samelson: (12:16)
I mean that’s super helpful. I think that that advice to reach out to experts, reach out to people that you really admire, reach out to people that have something to teach you, and you’d be surprised at how many of those people are going to be super generous with their time. Obviously, I don’t take advantage of it, but I think that’s something we have personally been really surprised about too. It’s just like a very open community, and I know that a lot of people aren’t from Austin, but even if you’re not, you can still reach out to us.
Trish Wesevich: (12:49)
Exactly, exactly. And I have a client right now I’ve been working with, and she’s been self-producing her product for a while now, and that’s getting harder, and she’s growing very rapidly and realizes, okay, I need, I need production options. And so the first thing we did was call someone who makes the same product in another state, not the same product, but a similar. I guess you would normally think that’s a competitor, right? But they really aren’t going to be competing very much. We contacted them, and now they’re going to be co-packing their products. So they were super supportive, and then they were like, “Well, we could do this for you and we can tell you how to do that.” So you just never know. You have to be willing to really go out and start asking questions, and if people close the door, fine. Don’t let it discourage you, that someone else will open the door.
Alison Smith: (13:40)
I really love that and I love that about the community aspect. Everyone is so helpful. CPG can be very confusing. It’s like, where do I start? There’s not this clear roadmap. There’s so many different channels you can go into, you don’t have to go into. It’s confusing. So wanted to ask you, what are the manufacturing options that these food and bevs brands have? Is it straight-to- commercial kitchen or are there other options? Can you tell us about that?
Trish Wesevich: (14:20)
Well, before the shared kitchens, there were as many as there are now and there are more coming online, which we’ll talk about, it was really these brands. And I mean, I’m thinking legacy brands in Austin. People have been here 20, 25 years with a product at Whole Foods or Central Market. They literally would go and knock on the door of maybe a bakery or a commercial space that was dedicated to one company or a restaurant, and they would just ask, do you have any space for rent? And so many brands launched that way. It’s incredible. I actually kind of have an idea one day, I would like to bring those legacy brands together with the new people on the block, just to kind of compare stories and see how things have changed so much. So there are still brands that have launched in the corners, like Good Seed Burger did in the back of Daily Juice. There are still some of those.
Trish Wesevich: (15:28)
And finding those can be kind of a gem because then you end up, if the space is big enough and you can scale to a certain point in there, the rent can be pretty reasonable and you have your own space with only maybe a couple of other businesses in there. If you don’t have that opportunity, if you don’t find that kind of space, then going into a shared kitchen is ideal because it’s not such a big commitment. You can rent by the hour or most of the kitchens have minimums. You can get started and you can go a long way or you can even live there and make your product. Well, the idea would be you start in a shared space or sharing or in the corner of another kitchen and then you grow to the point where you either need a co-packer or you need your own facility.
Trish Wesevich: (16:33)
And so back in the day, everyone would always say, well, you just go to a co-packer. But nowadays, a lot of food companies, even those who are with co-packers, are kind of bringing it more in-house again and realizing, no I’m going to do my own production. There’s pros and cons to both. It was so hard to find available space five years ago, six years ago. Really, really hard. It’s still really hard, but now that the industry has boomed and Austin has become really a Mecca, there’s more opportunities. There are plenty of spaces. It’s almost even better to just choose a space that is close to where you live, that’s more practical. And it takes time to find the right space, and a lot of people don’t always take all the time that is really needed to find the right space for them, but it’s important.
Alison Smith: (17:44)
Yeah, I’ve noticed driving home. There’s two new kitchens right next to me that just popped up out of nowhere. So that’s great that they’re solving that issue. But can you tell us more about the pros and cons about co-packing versus using a commercial kitchen or a shared kitchen?
Trish Wesevich: (18:09)
So when you’re in a shared kitchen or using your own facility, you’re doing all the labor, a large part of your week is spent in production. And so people often have other full-time jobs. And then at night, they’re in the kitchen, and they’re producing product. And after a while, that can get pretty hard to maintain. And going to a co-packer is hard to find, it’s a long process. It’s usually about a year. It could be longer to find the right co-packer, and you’re not going to find someone to make small batches for you. So you have to be pretty far along in your business to engage a co-packer.
Trish Wesevich: (19:02)
There are exceptions, and that’s the thing. That’s why there’s no rule book or guidebook for launching a food business. There are exceptions to everything. There’s so many variables. There isn’t just one path. But here in Austin, we don’t really have any small batch co-packers. So you pretty much have to be pretty far long to approach a co-packer. Having your own facility, taking your production in-house means you’re responsible for a lot; you’re responsible for the lease, you’re responsible for the electricity and the maintenance, and all of those expenses add up very quickly. And then you have the labor, you have to create a team and you have employees. And so that’s a big business to manage all of a sudden. So those are the challenges.
Karin Samelson: (20:01)
Yeah. And so a lot of people that are going to be listening aren’t to that co-packer stage, so when does a brand know when they are ready for that next step? Are there minimums that they should be thinking, like I should be selling at least blank to get to that co-packer step?
Trish Wesevich: (20:26)
It really, really varies. So I have a client now who is launching, like she’s not out on the shelves yet, but she’s starting with a co-packer. And so the minimums are somewhat small, and we’re having to kind of invent the process for her product, but it’s expensive for that co-packer to make each one, so the price is already pretty high. Could she make it for less money? Probably in a shared base, yes. So there isn’t like one number. There’s not like 10 or 20,000 units. It’s not really standardized. That’s typical. You kind of have to weigh all your options. I mean, if you’re someone who really doesn’t have time or does not see yourself doing production, then you’re not even going to consider that in the beginning, you’re going to launch a product, finding a co-packer right from the start.
Karin Samelson: (21:37)
So what do you think the food industry can improve upon to make manufacturing easier for small and extra small brands?
Trish Wesevich: (21:47)
So co-manufacturers and distributors, which are going to be usually a part of your business at some point as you scale, but they’re elusive. They’re hard to find. So I guess there are many food manufacturers who want to be elusive. They’re not looking to add new products necessarily. And then there are others, they’re constantly manufacturing. They don’t have marketing people. They don’t have someone who could answer the phone and answer questions. There’s a company in Round Rock who manufactures ingredients that a lot of food businesses utilize. And I had a conversation with them recently, they get maybe 60 inquiries a week. And so, they can’t even handle that kind of volume. So, what can food manufacturers do? I don’t really know if there’s a solution. If there’s a solution, I don’t know what it is.
Karin Samelson: (23:08)
Have better marketing and have more employees to be able to handle all of that, yeah.
Trish Wesevich: (23:15)
Yeah. Ideally, that’d be great, but they’re already usually challenged with their own labor challenges. The key employees are on the floor doing the manufacturing, right? So it’s why they are elusive, it’s because it’s just not a piece. The customer service piece is not, I guess, that valuable to them because the demand is there. I mean, I guess, if everyone really started bringing their production in-house and the co-packers started losing business, then maybe that would turn around.
Alison Smith: (24:01)
Gosh. I mean, this whole, the manufacturing piece is something that a lot of people struggle with, at least the conversations we have, and it’s wild. But we’ve hit that on the head a lot. So I’m curious, what are some of the other challenges that the brands you consult with, are dealing with, and if you have any solutions, by all means.
Trish Wesevich: (24:32)
Some of them are really not prepared financially for the amount of capital it really takes to grow and to maintain. So that’s a challenge, especially right now when ingredient prices are higher than ever and packaging is hard to find. So hopefully, we’ll get past this pandemic, supply chain shortage and challenges. And then we’ll be back to normal, which is still challenging. But everything is in flux right now, so it’s really even hard for me to advise my clients who are launching products and just jars are not only hard to find, but really expensive. And it doesn’t really always make sense to launch this time. But someone who wants to launch a product is going to launch their product. They’re pretty committed to that concept. And then the other piece is everyone wants to use sustainable packaging. But again, that’s pretty hard to find and it’s pretty hard to find affordable packaging. But it’s really what we have to do it all together. We all have to do it together. The entrepreneurs are the ones who can go out, some of them and really dig around until they find the right solution.
Alison Smith: (26:16)
I mean, the supply chain issues that we’re having, I can’t imagine being in logistics for that right now. What do you foresee happening? Do you think it’s going to get better? Do you think there’s going to be new innovation because of it?
Trish Wesevich: (26:34)
I think there’s new innovation now, absolutely. I try to stay as engaged as I am available to on several LinkedIn groups who are discussing intently and discussing packaging solutions. So there are people out there really trying to solve that and connect dots for everybody else. And that’s just one example. There are people you can find, like that goes back to that networking, being really savvy and realizing that there are communities you can tap into, and really should be tapping into, to bounce ideas off of and find solutions for that are on LinkedIn, Facebook groups, et cetera. But I don’t have the solutions for all of this.
Karin Samelson: (27:33)
We’d be really, really successful women if we had the solution to this problem.
Trish Wesevich: (27:41)
Karin Samelson: (27:42)
Not that we aren’t successful women, let’s be real.
Trish Wesevich: (27:44)
Karin Samelson: (27:45)
So you talked a little bit about how you spent really 10 years, every single day, going to a place like Central Market. And we get on the grocery lost in, not lost on. We’ll go to the grocery store, and that’s one of our favorite past times to just go and look at all of the products and see what innovation there is, what new products there are. And it’s all really, really exciting and fluffy and beautiful. Then we go to their social pages, we go to their websites, and it looks insane, but we know that on the back end, nothing’s perfect. There’s a lot of comparison and shiny object syndrome that happens. But on the back end behind the scenes, are you seeing some issues pass that glamor of being on shelves and having this amazing brand?
Trish Wesevich: (28:38)
You mean challenges or positive pieces that-
Karin Samelson: (28:41)
Challenges. I would say challenges. Yeah, because there’s a lot of positives that are really apparent. But what do you think are some struggles the founders have behind the scenes?
Trish Wesevich: (28:53)
Okay. First of all, just the grittiness of having a food company and being in the kitchen is hard work, and you’re physically tired. And so I remember seeing brands in my kitchen who maybe even had been in the SKU accelerator program or other programs, opportunities that they had been offered and they would spend their days in those programs and then come into the kitchen and just be so exhausted mentally, but then they have to start the physical part of it. So that’s one piece of it.
Trish Wesevich: (29:38)
When you have a product and you have to get the product to the store after you’ve spent all those hours in the kitchen making the product, then you have to get in your car and drive it to the retailer. And sometimes usually retailers, if you’re self-distributing, need you to come in the back door. And the times that you can do that is from 5:00 AM to 8:00 AM before the customers are really… So again, that’s not really a lot of fun. Just the stresses of getting a purchase order and being able to fulfill that purchase order and then having to wait to be paid for that purchase order and all the delays and that games that can be involved in that are really, really stressful.
Trish Wesevich: (30:20)
Sometimes it’s just the simple thing, like just knowing that you have just created a product and you spent all this time getting to that point, and then you know which retailer is right for your product. You’ve already figured that out, but you can’t get them to return a call, answer an email. You can’t get it in the door. But there’s a lot of “no”s. It used to be a little easier to approach a retailer, certain retailers than it is now. And then on the other side, there’s a lot more local grocery stores now than we ever had before. So that’s always evolving, and you can go outside of Austin and find more retailers to carry your product. But again, you have to make the product, put it in your car and drive it there or hire someone to do that for you. It just can be exhausting.
Alison Smith: (31:21)
Yeah. So do you see a lot of burnout with the brands that you work with?
Trish Wesevich: (31:26)
Alison Smith: (31:27)
Yeah. I mean, I can imagine. And I mean, what’s your piece of advice when they just can’t do it anymore?
Trish Wesevich: (31:36)
Hindsight’s 2020. I definitely recommend to brands that before they even launch to sort of have in their mind that concept of having an exit strategy, because, I mean, do you see yourself doing this for five or 10 years? I mean, let’s say you haven’t progressed out of doing your own production. That’s what you’re doing, and you’re physically so tired, but what are your options? If you want to change careers, do you just shut the business and walk away, which I’ve seen happen. Can I sell my company? Yes. But realizing that also takes a while. Sometimes people hit the wall before, and then they’re impatient. Like no, I want to just call someone and offer. They want to buy my business, I’m sure. It’s like, no, that’s going to take you at least another year to potentially find someone who may be interested in purchasing your business.
Trish Wesevich: (32:42)
And then there’s going to be a negotiating process, and that’s going to be very stressful too. Or finding someone on your team already, I see this happen who is really engaged. And then they’re interested in actually taking over the company. That can happen as well. And if you nurture your relationships with some of your own key employees, then that’s also a possibility, but it is something that a founder should think of when they’re launching, like, okay, how am I going to get out of this? Because sometimes getting out of a business you started, I’ve done it before, it was really hard.
Alison Smith: (33:25)
Are most of the brands that you work with, is their endgame selling? Is that generally people’s goals?
Trish Wesevich: (33:35)
So many people now are on the… they have this idea that I’m going to launch this brand that no one ever thought of before, and then some big food company’s going to acquire it and I’m going to get rich. Just isn’t the way it works.
Alison Smith: (33:51)
I wonder what the percentage of that is, I would love to know.
Trish Wesevich: (33:55)
I don’t know what the percentage is, but it isn’t very much. Although, it’s perfectly fine to admire and learn from those who have had that experience. And as we all know in Austin, that has happened multiple times, and it is inspiring, for sure, and there’s a lot to learn from those people. But it is not norm. So often, founders launch alone and then finding a consultant to help them is helpful. Finding people, other like-minded businesses to collaborate with is helpful. But it is also helpful to start with a business partner. And then again that can be challenging because maybe they haven’t found the right business partner in the beginning. And then after a while, if they realize that that isn’t going to work out, then it’s hard to separate from that business partner.
Alison Smith: (34:55)
Yeah. I mean, running a CPG brand isn’t exactly a lifestyle business, unless you’re able to hand it off and have someone else run it because you got to grind in this industry. So I was just curious what the goal was for most of your brands.
Trish Wesevich: (35:17)
I would say I think people have more short-term goals than they have long-term goals. Maybe that’s just our human nature, right?
Alison Smith: (35:28)
Yeah. And it’s a beautiful industry. I mean, you get to make food and beverages for people to enjoy. So yeah, I mean that in itself is wonderful.
Trish Wesevich: (35:43)
Yes, it is. It is. And it’s very rewarding. And there’s value in…you learn so much. I would say at Capital Kitchens, I would look around and I’d see everybody really working hard and I’d say everyone’s kind of pretending to be running a food company, but really what everyone really is doing underneath is they’re becoming better humans because they’re learning to work with each other and to collaborate and to be considerate. And they’re learning about business, and they’re learning about sales and they’re learning about food safety. And there’s so much to gain really. And whether their food business is successful in the end, I mean, of course, we want that to happen, but if it doesn’t, then there was definitely value in the experience.
Karin Samelson: (36:26)
Yeah, absolutely. And we obviously want to encourage anybody who has the dream to build something that they’re passionate about to do it, to try because you have one life to live. And if this is something that you want to be passionate about, do your best. And like we said, you got to grind. But as long as you know that and you don’t expect it to be like an easy ride, especially these people that are coming from different industries and coming into CPG and have no experience and have no idea how robust it actually is, I think they should go for it. But I really love that. So we were talking about a little bit of the negatives of like if you do decide to bail, but what they can gain personally and what they can learn about themselves is super powerful. So thanks for reminding us.
Trish Wesevich: (37:35)
Karin Samelson: (37:37)
Awesome. Well, Trish, it was such a joy to get to talk to you. We really enjoyed learning more about how you got started and what you’re seeing in the industry now, but would you like to leave the audience with a link or call to action or a final statement?
Trish Wesevich: (37:52)
Sure. So I do consulting, and I’m kind of the person that will kind of hold your hand along the way and kind of be the business partner that you don’t have to break up with eventually. I’ll just help you, take as many steps, thoughtful steps forward as possible. So my company’s called LaunchPoint Culinary Services. My website is launchpointculinary.com. I put some resources up there. I have a blog I’ve just kind of started to get more serious about, and I’ll start putting more practical resources up there. And I run a little Instagram product review page. That’s kind of more for fun called CPG Find. And you can see me around town at various networking CPG events and accelerators and incubators. So I kind of make the scene, make the rounds. And I love to chat with people about their concept. And so I’m pretty much just an email, phone call away.
Alison Smith: (39:08)
Awesome. Thank you so much, Trish. And we’ll be sure and link all of those in the show notes as well. So you can contact Trish, and you all can talk food and bev.
Trish Wesevich: (39:19)
Well, thank you guys so much for reaching out and interviewing me today.
Alison Smith: (39:22)
Alison Smith: (39:25)
Umai Social Circle is a CPG agency-driven podcast based out of Austin, Texas. We’re excited to share more behind-the-scenes insights, chats with industry leaders and whatever else we learn along the way. Follow us on Instagram @umaimarketing or check out our website, umaimarketing.com. Catch you back here soon.
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