The Startup CPG Podcast

Daria Jackson
I always tell our brands that I want to learn about your business before you learn about fruit guys. I want to understand what a successful partnership looks like for you, and that usually entails a lot of transparency. So I'm asking, what are your production cycles looking like? What forecasting can I provide you, what fun new flavors or seasonal items you may have, and really trying to get into the flow of let's have this be a conversation and let's work together and understand how we can both benefit and create a sustainable partnership. You know, a lot of the brands we work with are emerging.

00:51
Daniel Scharff
Welcome to the startup CPG podcast. We love having buyers on the podcast, people who can really help get your product in front of consumers. And today's guests do just that. Shipping to businesses, schools and homes nationwide. It's free fruit guys. They deliver farm fresh produce and single serving clean ingredient CPG snacks, working with mission driven companies that are sustainable for people and the planet. Today's episode features Daria Jackson, the snack category manager, and Eric Muller, who manages strategic growth and business development. We talk a lot about their company mission, the role of snacks in the workplace, what office purchasing managers and their employees are looking for, current snacking trends, and of course, how to make your brand a great candidate for a fruit guys box. You're gonna love this one. Here we go. All right, welcome, Daria and Eric.

01:43
Daniel Scharff
First of all, thank you so much for that amazing sample box that you guys sent of the fruit guys products. I felt like I was getting to act like an office or another business that you would send your products to, except instead of distributing them to all of my employees, I ate them all. So thank you for sending those. Those were delicious. There's a lot of fruit and a lot of delicious snacks, which that's kind of what I would want if I was lucky enough to have an office. Like, I would like healthy feeling snacks for people at the office that wouldn't feel like just a bunch of M&Ms. Or something, tempting them to eat things that they don't really want to be eating in the long run. They might regret it later. So I love having healthy snacks around.

02:20
Daniel Scharff
So could we just start with some intros? Eric, do you want to kick us off?

02:24
Erik Muller
Yeah. First, Daniel, thank you so much for having us and congrats on building a community of entrepreneurs. As we know, it's no easy task to build a CPG brand, especially based on all the different headwinds that these entrepreneurs face. And it's a herculean effort, I think, but what these folks are doing and your community is winning. And you know that you don't see that often. So as we know, you know, having done Fruit Guys now for going on 27 years, it takes a ton of grit and a ton of discipline to build a brand, which is hard. Yet it's probably the most rewarding thing that I've ever done in my life. So I want to start off by saying what you guys have done and the support network that you've built in to startup CPG is amazing. So awesome to see that.

03:09
Daniel Scharff
I really appreciate you saying that. And I also was reflecting this morning. I was walking my dog around the neighborhood here in the West Village and I was just walking, watching a couple people wearing suits going to their corporate jobs, which, like, hey, no disrespect if that's you, but I, I'm glad it's not me anymore. I'm like, I get to go back home, record this podcast and I'm going to be flying out and doing grocery run events with our community, helping these brands. I'm so lucky that I get to do this and it really is my pleasure and I really appreciate those kind words. Thank you.

03:36
Erik Muller
Awesome.

03:37
Daniel Scharff
Cool.

03:37
Erik Muller
So talking about Fruit Guys is like talking about my kids. I can go on forever and ever. But let me give you just a way of an introduction about Fruit Guys and who we are and what we stand for. So we're a mission driven company that we started back in 1998. Our premise is to deliver whole fresh fruit to offices along with healthy snacks. So you have to have a mission when you do a business. Otherwise you're just a commodity and it's a race to the bottom on price and you're not going to have enough margin to win. So our mission and our passion is to connect people, nourish communities and regenerate the planet. Unpack that a little bit what we mean by connecting people.

04:16
Erik Muller
Daniel, when you go to a party at somebody's house, more times than not we congregate in the kitchen, right? And it's all about food connecting us. It's one element that people come together around. We do the same thing in the office, in the schools that we service, right? We are bringing food to them as a way for them to engage and talk to another. It warms my heart when I'm kind of eavesdropping in one of our customers and you see, you know, somebody on the leadership team talking to maybe an administrative assistant and they're talking about a Blenheim Apricot, right? And they're experiencing this together. And just the joy that it brings these two folks and kind of bridging this gap that naturally happens. But all of a sudden, food is bringing us together. So that's what we mean by connecting people.

05:01
Daniel Scharff
I know what you're talking about because out of your sample box, me and both of my sisters bonded over the little lychees that were in and we're like, look, isn't this fun? And eating them together, cracking them. So that was super fun. And also, yeah, when. When we as an organization plan parties, we will put the food in strategic places to. Because we know people are going to congregate around that and we can move flows into different rooms and. Totally agree.

05:24
Erik Muller
Yeah, it's incredible. Seed. So nourishing communities. We hand select every piece of fruit and then obviously every CPG snack that we're putting into the boxes. And we slip a lot of product because our customers are paying a premium price. And if it has a branch mark or a blemish on it, we can't necessarily put it into the box. So we slip it. And we made the conscious decision back in 1998 that part of our ethos was to support those that were food insecure. So any of those slipped products, we go ahead and donate to the local food banks where we have one of our facilities. And we slip a lot. I think, you know, it's going on almost a million pieces, a million servings a year that we slip.

06:06
Erik Muller
And so there's a nonprofit here in the Bay Area where I am based, and I believe every single meal that they serve, breakfast, lunch and dinner, has a fruit guys piece of fruit on it, which is really rewarding for us to see. And so that comes under a program that we have called Good Works. We also work with our customers during the holidays if they would like to donate the box instead of receiving it in their office, where no one's going to be for the holiday season, they can go ahead and tell us which nonprofit they would like us to donate that box and we'll go ahead and donate it. So we're trying to nourish the communities where we do work as well.

06:39
Daniel Scharff
That's very beautiful. I love to hear that. I know. It's really just such a shame that all of the slipped fruit often gets wasted.

06:45
Erik Muller
Yeah, totally. And we could monetize it, right? We could probably sell it to a juicer. We could sell it to a fruit leather company or something like that. But that's not really what our mission is. Right. And then lastly, regenerate the planet. So we have a bolt on nonprofit called the Community Fund. And I'm really proud of this work. We give micro grants to small family farms across the United States. It does not have to be part of our supply chain, but in order to do kind of sustainable farming practices. So for us that's around water conservation, cross pollination, healthy soils. So they apply for it. Amazing, amazing projects, amazing farms. And in 2024, the impact that we had, we. We were able to donate and fund 20 different farms across America in order to accomplish the work that we're trying to do.

07:30
Daniel Scharff
That's super impressive. Congrats to you guys. I had no idea what was laying beneath the surface of this business. That's really a beautiful thing.

07:36
Erik Muller
Talks about building brand equity, which to me is really a big differentiator. And it becomes kind of a moat with our. Some of our competition. And five years ago we decided to become a B corp. And so not that many people know what a benefits corporation is, but essentially any stakeholder in Fruit Guys had a sign off that the fiduciary responsibility of the business was actually to the communities where we do work. And the B corp mandate is to donate 20% of our net proceeds back into the communities. Like last year it was close to 34% that we actually donated. So again, it's a different philosophy of running a business. A year and a half ago we became women owned as well. So it's, you know, we've given ourselves a long Runway to do good in the world. Right.

08:15
Erik Muller
And I think a lot of people tend to overestimate short term achievements and they underestimate the long term capabilities that they can do. So 27 years privately funded business trying to do good in the world. And we're so excited to talk about the work where I think there is some correlation with the community that you're supporting and what Fruit Guys is doing as well.

08:36
Daniel Scharff
I think that's right now that everybody has heard that. One, we're all rooting for you because that's just such a great model. And two, now people are even more desperate to get to work with you. So let's talk business a little bit. Can you tell me what. How big is Fruit Guys? What's the scope of all the places that you deliver products to the businesses, the schools, the homes, all of that?

08:55
Erik Muller
Yeah, Fruit. Great question. So we operate 11 different facilities around the country. Part of that is because we want to be close to the farms that we work with. So we want to support local agriculture. For example, in Texas, the Go. Texan Produce movement is really robust. We want to support that. We want to bring product into our warehouses, repackage it into our brand, and then distribute it regionally to our corporate customers. We service about a half a million servings of a week to that environment. And then on the school side, most of our schools are in California. It's K through 8. It's through a USDA funder program called the Fresh Fruit and Vegetable Program. We service about 150,000 servings a week into that program as well.

09:36
Erik Muller
So when you combine it all, it's about 650,000 servings a week that we're able to distribute to folks around the country. Fruit Guys is small but mighty. We're 88 employees strong, kind of located in 15 different states. Our corporate headquarters is out in Northern California, so that's where I'm sitting today. And then we have these different warehouses around the country as well.

09:55
Daniel Scharff
All right, awesome. So, Daria, let's get you in the mix here. First of all, do you mind also introducing yourself, please? And what do you do at Fruit Guys?

10:04
Daria Jackson
No, not at all. So I am the snack category manager at Fruit Guys. I'm very hands off when it comes to produce and the be all know all when it comes to CPG and anything packaged in our snack boxes. I manage all of the procurement, the buying, making our boxes, the mixes, incoming shipments, outgoing product. That is all under me. And I typically kind of come in to connect people, connect our fruit customers with clean ingredient snacks. And so that way they have a very rounded diet or option to choose in the workplace. I've been with the Fruit Guys for going on almost five years now and just took over the buying 2022. So very much still on the ground running, trying to build up our customer base on the snack side.

11:02
Daria Jackson
But we've seen nothing but great response, not only from the types of snacks we produce, but who we're representing in our snack program. And I think that's something that is so rewarding in my position, is that I get to tell not only the nutritional value, but the stories and the communities that our vendors are supporting and allow our customers to really have a great array of brands and foundations, missions, sustainability efforts to support with their spend.

11:35
Daniel Scharff
All right, and we love CPG buyers here, so we are incredibly excited to have you. I expect you'll be getting a lot of LinkedIn ads right after this premieres. So I was looking on your website, you have some really cool articles on there, just talking about how people can use snacks in the Workplace, improve the employee experience, stuff like that. How do your customers actually use snacks? Use CPG snacks, use the fruit, how are they using it in their environments?

12:06
Daria Jackson
So typically fruit and snacks, they're both purchased as an employee perk. It's typically, you know, hire management is wanting to allow their employees to have something not only nourishing the fueling throughout the day. So we see this as a break room or pantry item that employees can come and grab. A lot of people call in, email in to stock their meetings and their conferences or even host a farmer's market in their office to help rally up engagement. We also see a lot of support around wellness funds and the healthcare industry utilizing our boxes since we're already doing the work to supply you with such well rounded, nourishing, clean products that it's a no brainer for them to source through us. And then we also see a lot in, you know, smaller kind of health and fitness industry.

12:59
Daria Jackson
We've got partnerships with studios throughout the country that buy them for their teams. Sometimes we'll end up in the front kind of desk area and overall kind of the buyer or customer profile has been very broad for us and people really tend to surprise us in the ways that they utilize both our fruit and snacks.

13:21
Daniel Scharff
All right. And some of the articles are really interesting like hey, there are tips for how you can use snacks. So if you're having a one hour meeting, for example, you could think about having just some simple waters placed here and maybe some fresh fruit. A three hour meeting, you might have a table outside the meeting that has these kind of snacks for energizing just really cool stuff that I'm sure really helps the office purchasing managers to think about what to stock and where to put it. I've been hearing a lot about how snacks play a role in also getting people back into the office. Still, you know, the COVID work from home lingers for a lot of people. A lot offices we see more and more trying to get people back into the office. What are your customers telling you?

14:01
Daria Jackson
Well, I think overall employers are starting to understand, just as consumers at home and individuals, how much nutrition impacts their overall productivity and enjoyment throughout the day. And so now more than ever they're understanding that these products can help us maintain our employees energy and provide them with something that is tastes great, is satisfying, keeps them well fueled and excited about what they're doing day to day in the office. And then we also have a lot of stories of people saying actually I love that chip that you put in the box. And I grabbed a couple bags and took it home because I just wanted all of it.

14:40
Daria Jackson
And since employees are kind of listening to what their body wants, and their then employers are also kind of gauging the room and reading what is moving as fast, I think we're going to see this trend continue.

14:57
Daniel Scharff
So when you work with, let's say, a new customer or one of your existing ones to expand the assortment, what are they looking for exactly? Do they mostly just ask you for recommendations or are they coming with specific needs that they're asking for based on who their employees are or things that they've specifically asked them for?

15:16
Daria Jackson
So in our assortment, we coined the term of being experts of all the categories that we encompass. We include bars, we include crunchy items, protein, sweets. And so they're really coming to us to take away the stress of having to figure out what's out there, what can I provide for my employees that's going to cater to everyone in the office? Our mixes always have an array of products, depending on what your kind of dietary restrictions or preferences may be. So we strive to build a mix to where everyone can come and find something that they enjoy and then feel good about eating at the end of the day.

15:55
Daniel Scharff
And do you have guidelines on what you want to include just from a, let's say, taste and indulgence versus health kind of standpoint? Because, I mean, in the, at least in the box that I got, like, there was nothing in there that I would say is kind of crappy food that I would. Unfortunately, I do have crappy food. Taste like I love, just sugar, salt, like anything really snacky, I'm gonna go for. But you were helping me make good decisions with the products that were in there. So do you have kind of a standard that you strive for?

16:25
Daria Jackson
Yeah. I'm so happy to hear that. And you're not alone. We all have those moments where we just want something a little maybe too overindulgent. I think the kind of baseline level we're really looking for snacks that are clean, ingredient based. We want to understand everything that's on the label. And so that typically comes to play with items that are minimally processed, you know, maybe have minimal preservatives and really are things that people can potentially also find in their at home pantry and make themselves. And I think kind of building that framework, you know, we're not going to hit the nail on the head every single time, but that gives us a great baseline to then run off from and strive when we're looking for new items. And new products to put in our mixes.

17:10
Daniel Scharff
All right, so Eric, let's tap you back in here. I wanted to ask. So you are the fruit guys, but obviously you have a lot of these snacks also. Can you tell me about that evolution and how much of your business is on cpg, let's say, versus fruit or how much of the consumption that happens in the office?

17:28
Erik Muller
Yeah, so it's the fastest growing category for fruit guys is on the snack CPG side, which is really interesting. We got into it by accident. So we got into it, I think it was in 2013, 14, and there was a very large high tech company in Silicon Valley and it was fascinating. Daniel, you would love this. The administrator, some of the desks from the administrators had this like what I called like a goldfish bowl, you know, like one of those rounded bowls and inside this round of bowl were like all these little chocolates, right? Like almost like what you get at Halloween, like all these like little single serve bite sized candy things. And the leadership team finally threw up their arms and they said enough of this, like we gotta get healthy. Because I.

18:12
Erik Muller
They actually saw a performance decline and they came to us little fruit guys and they said, hey, can you help us replace these not good for you little tiny candy bars with something else healthy? And we said, man, that's interesting. It's an interesting problem to try to go solve. Let's see if we can do it. And so went over to somebody over in Watsonville on the coast that was packaging nuts and dried fruit and we quickly came up with like six really cool skews that were mostly dried fruit and nuts. So like cranberries and raisins and almonds and there were some trail mixes and at the time we even did this little banana chips, which maybe arguably isn't the best for you, but they sure tasted really good. And we branded them really cool in this little fruit guys 1 ounce packages.

18:58
Erik Muller
And the customer loved it like instantaneously. They got rid of all these little goldfish bowl things of the candy. They replaced the pantry with the CPG fruit guys brand. And we ran with that for like three years. And then the same customer said like, hey, this has been awesome, but it's gotten a little stagnant. Like, like, you know, can we get something crunchy and can we get something salty and can we get something with more protein? And that then actually allowed us to think differently. Said, hey, we can't innovate this ourselves. We're going to have to go out and reach out to other brands. And think about how we can support them and what our criteria is to bring that in house and then go ahead and supply our customers with that. So it kind of fell into our lap out of necessity.

19:42
Erik Muller
But we're really good problem solvers. And quite honestly, based on the customer feedback, they're the ones that kind of drove this for us. And I think they continue to drive it for us. We're constantly asking them like, hey, what's moving? What could we be doing better? How do we merchandise this? Merchandising is a big topic right now in terms of people buy with their eyes, like, how do you display it to let them know that this is available to them? And then putting it into the pantry, into the break rooms.

20:08
Daniel Scharff
I got it. So you're following the patterns here and what people are asking for. I can envision that goldfish bowl and I would be reaching into it and pulling out probably Mr. Goodbar, the crackle that's in there.

20:19
Erik Muller
Exactly.

20:20
Daniel Scharff
Hershey.

20:21
Erik Muller
Oh, that's exactly right.

20:22
Daria Jackson
Yeah.

20:22
Erik Muller
It was so funny.

20:24
Daniel Scharff
And then. But then, like, I don't know, it never tastes as good as it looks also. So I would much rather dig into one of these beautiful oranges that you guys have. So. Okay, but actually talking more about trends, what are you seeing now than people ask for? Because you have the fruit assortment, you have the snack assortment. But we're seeing some major shifts right now in consumer trends. Things like protein and impacts of GLP1. What are people asking for now in your assortment?

20:51
Daria Jackson
Yeah, we hit the nail on the head with protein. That is the number one ask that we have in our assortment, always. How can we get more protein? Can you include more? Another huge trend that I've seen not only in trade shows, but with our customers are water enhancement. Just beverage in general. I mean, for us, we categorize water enhancement as an electrolyte powder, something that you can add quick and easy. Very, very ingredient focused as well.

21:18
Daria Jackson
I know that is broad, but when people are starting to flip over packages and actually email us and ask us about ingredients more so than ever, and trying to understand, you know, what are these alternative sweeteners in our products and what resources do you have to guide our employees on how they can make good decisions and eating and find these items or find similar items on the shelf when they go home that also align with what you're providing for us and the knowledge or that you're also supporting.

21:54
Daniel Scharff
That's pretty interesting to hear. I would love to know what they think about all of the different sweeteners. Which ones they're okay with, which ones they aren't. It really is evolving very fast right now. And then also just kind of back to that note, having spent time with some of these office purchasing managers, I know they're also really interested in sustainability these days. There are some offices that are trying to go single serve plastic free. You know, when you're talking about the enhancers, that's, you know, one thing I was thinking about. Are you seeing a lot of requests from them around sustainability?

22:23
Daria Jackson
Yes. Yeah, actually, I mean, it's kind of interesting being in the position that we are seeing as we do specialize on this single serve which typically is surrounded around single use plastic. You know, we strive as a company, not only in our own sustainability efforts, but just as people who care about the planet, to then talk to our brands or prospective vendors and understand what they're using in their packaging or efforts in a way which our customers can then recycle their packaging properly depending on where they're located. Because every kind of, you know, metropolitan area has a different recycling program. And so we do get these occasional requests for people who are looking to transition over to potentially gravity feeders or something that's more, you know, the scoop and items like that.

23:14
Daria Jackson
But you know, I don't think that people are completely opposed to having our traditional and single serving single use plastic items. They're just being a little bit more cognizant about what is my responsibility at the end of the day as a consumer to then recycle these products.

23:31
Daniel Scharff
That makes a lot of sense. Just made me remember I was at the LinkedIn office once and it was the only time I ever saw an employee take a can out of the fridge, drink it, and then actually cut the plastic sleeve off using scissors and put that plastic sleeve into the recycling separately with the can. I was like, whoa, this is amazing. I don't know if they had some kind of employee education around that, but early stage brands, now a lot of them can use digital printing, but before when it wasn't really an option, pretty much everybody was going on sleeves in their early stages and probably not thinking a lot about the recyclability of it. So I think there is some pretty interesting opportunity.

24:08
Daniel Scharff
I love that you guys are being so thoughtful about it and digging in with the suppliers about the sustainability of their packaging and then trying to figure out how to translate that to talk to the offices about it. So by the way, in your portfolio, what are the top selling items? If it's an office of one and it's me. I'm probably, I don't know, maybe I'm hitting some of the protein bars and the snack, like the chips and stuff the most. But what's kind of like 1, 2, 3 for you guys?

24:31
Daria Jackson
I would say number one, kind of the number one request that we see is protein. Like I said. Second is crunchy, whether that's a chip, a cracker, a trail mix type. And then number three is we're never going to get away from sweets. Everyone wants a sweet treat. And I get a lot of requests, not only from customers to include more sweet items in their boxes. That's probably just behind protein, the number one request I get for customers to buy a full case of product.

25:01
Daniel Scharff
It is hard to get away from sweets. And in a second I want to know both of you what your snacking habits are during the day. But for me I made a really good change I think this year where last year I was in the habit of having coffee with cream and sugar or like a lot of sweetener in it. And I got addicted to that. I would have two a day. And then in the new year that was the big change I made was I went black coffee. Whether I make it at home, I got a nice coffee maker, I make it home or I go out and I'll get an iced coffee. It's black but the sweetness still creeps back in. I've noticed myself now. I'll go to Starbucks and get that iced coffee.

25:34
Daniel Scharff
I'm like, well I should have a cake pop, but I won't eat all of it. You know, just wanting something sweet. Maybe you have a nap, it helps you wake up, I don't know. So I'm not perfect. I want sweet stuff sometimes. So how about.

25:46
Erik Muller
I do think you're teasing out something though Daniel, which is kind of this emerging trend as food, as medicine. And for me this is very personal. As a two time cancer survivor, this is part of a catalyst of fruit guys for me, like how do you bring something healthy into the workplace? And, and I'm seeing this grow exponentially and I think the number is that the growth would be a 40 billion dollar category by 2034, right? So like there's more and more emergence about people talking with insurance companies, for example, like hey, how do we keep our population healthy? Right? And so there's a lot of information right now about mushrooms for example. And dairy has done an amazing job of outsourcing some mushroom jerkies out there. They're fantastic. And quite honestly like as good as like the Meat product kind of stuff.

26:27
Erik Muller
And it's savory and it's delicious and the texture is right and they've really nailed it. Reduction of inflammation is another big category. So, you know, that's like the turmerics and the gingers and things like this. And I think people are becoming more and more conscious about, like, how do I use food as this preventative thing that keeps me healthy and helps my not only longevity, but even like the health version of longevity. And I think we're starting to see more and more inquiries around this as well. Like, you know, how do you bring this in that still tastes good, that still even coincides with like lean muscle mass and things like this as a way to keep people motivated?

27:03
Daniel Scharff
That's beautiful. And congratulations on being a two time cancer survivor. That's fantastic. So. Oh, and Eric, so what do you snack on? You. I kind of get the impression you're both pretty healthy. People make good choices, probably better than me. But you're in this snack game, so I'm sure you've got a couple things that you like to smack on. Eric.

27:21
Erik Muller
So dairy does such a good job. Yesterday I was in the office and we get a box delivered here every Monday and there was like three new really cool brands. There was this one brand that she brought in that had green banana flour and it was like this little tiny cinnamon chip thing. And I think it's good for like your gut. Like just the digestive system of it. And she can tell us the brand name of it, but like, I think I had two packages of those, right? And it was just, it was so delicious. It was, it was so yummy and like satisfying and everything else. Like, I'm constantly looking for what she's bringing in. That's kind of, that piques my interest. And I am an ingredient reader, so, like, I'm looking at the ingredients to understand, like, what's in it.

28:00
Erik Muller
And some of the wacky stuff that she's found is like, it's phenomenal.

28:04
Daniel Scharff
We'll be right back. Are you gonna crush it on Amazon this year? It's such an important channel, but it's so hard to do alone. And most agencies are a total ripoff. We can't afford $5,000 a month and a commission on our sales. They just don't get it. That's why I love our partners at Daybreak. They are full service, meaning they do the creative work, the listings, the logistics, and of course, all the ads, all with the most reasonable retainer out there. I Work with them. Personally, I'm so grateful we have such a good partner to recommend out to you. Our community, they do evaluate your product first to see if it might be a fit. So if you want them to have a look, email them startup cpg@daybreak agency and they'll do a free audit for you. Good luck, everyone.

28:46
Daniel Scharff
All right, Daria, how about you? What are your snacks, your go tos?

28:50
Daria Jackson
I love anything crunchy. Chips are my guilty pleasure. Pretzels, a some type of Chex Mix type product. And then I have a major sweet tooth and I typically try, since I'm. I'm sampling products all the time, I typically try and save my sweet tooth for something a little homemade. So that way I can keep that a little bit more well rounded. But if there's a interesting chip on the shelf, I'm the first to try it and I've got to take it home. Even if I'm the only one eating it, I will finish the whole bag.

29:22
Daniel Scharff
I know how that goes. And I also, I just really appreciate having a lot of fruit around. I try to keep as much fruit in my house as possible just because for me, I feel like that's a healthier choice a lot of the time than the other stuff I'm gonna eat if I don't have a lot of fruit. So there is a balance there. But I really love having some beautiful blackberries and blueberries and raspberries and strawberries around to get me through the day on a healthy note.

29:47
Erik Muller
You're a berry guy. You like berries.

29:49
Daniel Scharff
I like berries. I like peaches, but I don't know what. I just feel like I never get the right ones when I order them because I don't go into the grocery store. Honestly, despite being very heavy cpg. Mainly what I do is order so that I can spend my time at home here making this podcast instead of in line at the store. But yes, I do like a good assortment. But I really did love those lychees that you guys sent. I thought that was super cool. So, Daria, how much do you feel like as a buyer, your personal preferences for those items influences the assortment versus just strict database consumer decisions? Like how much are you following your intuition or really just trying to focus on what your. What the data is telling you, what consumers are telling you?

30:31
Daria Jackson
I feel like I try to strive a good balance of the mix because, yes, I want to understand what consumers are eating throughout the country. I mean, since we have such a wide array of employees and businesses that we work with, we've got eaters on every coast up and down the US I have to rely on some of that data. But I kind of go back into what are the key tenants of fruit guys and who do we strive to support to also guide a lot of my buying so I can have two amazing jerky products.

31:14
Daria Jackson
And I always tell our vendors it's never a hard no, but sometimes I need to listen to maybe what the brand story is, what are their initiatives, what are the communities that our vendors are hopefully also supporting to then support who is purchasing from us, our customers, and really help them understand that, you know, you can have an array of products and you can always strive to allow whatever you want in your pantry. But we're going to show you this product this quarter and then next product we're going to kind of come in with another item, whether it's in the same category or a different product type. And so I think that balance, it is very hard to strive.

31:58
Daria Jackson
I maybe don't always get it right and sometimes I'm a little late to trends because I'm so focused on who are we supporting and how are our customers also going to rally behind this brand that I introduced them to. I also love, I'm fully remote, but I love coming up to the corporate office. And we actually did this after Expo west where I brought my back to samples. We had two tables full of products, I had a couple of brands send in additional samples and I get the team's opinion on it. And that is so valuable to me because it goes beyond just kind of my palette preferences. And I can understand what are people kind of getting from this tasting note or how would they enjoy or consume this product?

32:42
Daria Jackson
Is it something that they can have a quick grab or is it something that a bar they may come back to later on throughout the day because they can't finish it in all in one sitting.

32:50
Daniel Scharff
That is awesome. Invite me next time for the snack party. I'm there. I'm available for that.

32:55
Daria Jackson
I'd love to have you.

32:57
Daniel Scharff
And you know, it's such a cool thing for brands to be able to work with you guys because that office distribution is incredible. 1 Because employees typically are not paying for the product, right? And so it's almost like you're getting free sampling programs where, I mean like paid to do sampling because the businesses are buying the product from you, but you're getting just high velocity because probably a lot of us have worked in those offices where snacks are available and you're probably just, you don't have a huge selection you're not in a grocery store with 100,000 SKUs, you've got eight, 10 options. And so they're going to get very familiar with your brand and then they'll see it in the store like oh yeah, that's what I like at work. And just a often also it's just a really desirable demographic.

33:41
Daniel Scharff
Well, you know, well educated, maybe higher income if they're professionals in the workplace, you know, with families. I mean just people that brands would love to get their product in front of. So speaking of that assortment, how does it work for you guys? Do you have one broad assortment, a certain number of products that are stocked in every one of those 11 facilities and then customers can just choose a selection from it or you have standard packages, is it seasonal? You switch things up?

34:07
Daria Jackson
Yeah. So out of those 11 facilities we actually utilize three to pack our fruit and our snack boxes just to help us reach that national grass. Also snacks are shelf stable so we don't have to pull on farmers as much in a small radius. And so we tend to have anywhere from, I think at one point the largest amount of SKUs I had was 115 items to then mix and match in our snack boxes. So we're constantly bringing in new products so that we can develop a curated mix that rotates weekly to really avoid any potential eater fatigue and then to also share with our customers new and innovative products. We always want to keep our books open.

35:00
Daria Jackson
I'm always looking for new vendors so that way each mix when I go in I can say okay, you've got a new bar and a new cookie and maybe some fun new veggie item in your mix. And our customers are kind of getting this broad view of so many different brands that may be not in their local markets or may just be emerging in that region. Then they can go support them at a pop up or a grocery run or anywhere that they could find them online as well.

35:37
Daniel Scharff
All right, and I have to ask, as a beverage guy, do you do beverages? If not, what are your customers typically doing to get beverages?

35:44
Daria Jackson
We do not do beverages just yet. I mean that's kind of something that we're looking at this year. Actually we're in the middle of understanding what are some of the items that we can shift in our boxes. Depending on the size, space is really valuable in those. And so water enhancement, any type of kind of powdered item that we can include and your standard kind of glass of water is really what we're starting to jump Into I think that'll be more of a 2026 project. And also understanding what our customers want and surveying them to see what beverages that they are gravitating towards in the office beyond maybe a coffee and tea, which is standard in most offices.

36:28
Daniel Scharff
I gotcha. And so actually important point there for people. So it sounds like you guys mainly are shipping in a box all of these offerings to consumers, the fruit. Also all of the packaged products, which there are other companies that may do local delivery and come in and actually like stock the shelves for you, but you are a. You're going to ship the box to them. What kind of customers typically prefer that approach?

36:50
Daria Jackson
We have customers anywhere from legal, tech, healthcare, Eric, and any more come to mind to you.

36:59
Erik Muller
Warehousing financial services is a really big one. I mean, traditionally, I would say it's kind of the white collar industries, right, that have the discretionary cash to give this kind of benefit to their employees. However, coming out of the pandemic, we had to refocus a little bit on customers that were actually in offices. And so we focus more on manufacturing. And so manufacturing is really fascinating for us, right, because fruit is a hydrating component. And if you're in a hot warehouse to eat a crunchy apple with a high water content is actually really nourishing for them. So I think those are probably our five or six top industries that we're focused on.

37:37
Daniel Scharff
I was asking also like, compared to. Because there are options where you could hire a company that actually comes into your office and like stocks the pantry for you with the products and puts the beverages in the cooler. I imagine Fruit Guys is probably a more cost effective option for a lot of. Because I've seen the bills for some of that stuff. I can get it very expensive.

37:55
Erik Muller
And sometimes we work with those companies, right? So especially on the fruit side where they're like, hey, we don't want touch fruit. It's really complicated. Bananas is the number one issue, by the way. Like, it's the number one office fruit and it's the most complicated to get, right? And so they're like, hey, we just want to outsource that to the experts. And so they'll call us and say like, hey, can you handle that for us? And then I would also say like an office that maybe has 200 or fewer employees, maybe they don't have those services, but they're looking for a vendor that does fruit and snacks. And so they'll call Fruit Guys as a way to kind of consolidate that Buying, purchase and bring it into them.

38:30
Erik Muller
The other part that I find really interesting, and this was a great quote from an office in Chicago I visited a couple weeks ago. They said, hey Eric, we need to make the office environment more inviting than the home. And so we need to entice these employees to make the office a better place for people to get work done than what they're going to find in their home. And they said, we want to make it that they're going to have experiences in the office that they're not going to be able to get at their home residence. And I said, well, let's talk about that, let's unpack that. Like, what does that look like for you?

39:01
Erik Muller
And they said, we want to have really unique things that people are not going to be able to have in their home office that we can only have here as a way to kind of draw them in. And then we elaborated on it and we said, well, you know, there's this thing called like an affinity calendar. And so it's Pride month, right. The month of June. And like what if we supported Pride as EPG Brands and brought that in? Or if it's Women's History Month, you know, we found brands that supported that or Black History Month and have been found Bipoc CPG brands as well for that. So that all of a sudden has this level of engagement that you're not going to find in the home office, but you're only finding the corporate office if the company's willing to support that.

39:39
Erik Muller
And I think that level of engagement is pretty exciting for employees when they can come in and they can experience this with their colleagues and share in something like minded and perhaps even learn something as well.

39:50
Daniel Scharff
All right, okay. So Daria, are there any snacks out there you're looking to add to the set but you haven't found yet any white space, any super cool protein products you just haven't figured out how to find yet what's out there that if people have, they should reach out to you?

40:05
Daria Jackson
Yeah, I think one item that I've started to hear a little bit and the network on the protein side, more fish alternatives for those who may not eat red meat or maybe pescatarian diet. I've, I've connected with a few brands and I'm just trying to understand our customer kind of engagement with that type of protein beyond on the fish, more pescatarian side. Any type of protein in general is always welcomed in our books. We're always looking to build up that category. I also am Very interested in what I like to call sweet to kind of break the mold, I guess outside of the traditional kind of candy bar or cookie or fruit snack ray of items. Veggie is a very hard category for us to capture.

40:54
Daria Jackson
You know, items like freeze dried edamame olives, some kind of like brined veggie seaweed, those tend to be a little bit more polarizing snacks depending on the eater. So I'm always looking for innovative veggie items. You know, maybe it's a crisp that's loaded with a lot of nutritions. Those are all on my radar. And then going back to just, you know, how our customers are utilizing our products. As Eric mentioned, representation and kind of mission driven brands are always vendors who we strive to connect with. And I'm always looking for those that are being change makers in the market and maybe serving underrepresented populations, maybe they come from an underrepresented group of people. And we want to help amplify their products and share their mission, share their efforts. Our customers want to know where their spend are going, who they're supporting.

41:50
Daria Jackson
And as long as I'm doing my job, and I think I am, we're able to provide them that guarantee that your products and your dollars are coming from a diverse wide range of purveyors.

42:04
Daniel Scharff
I love it. Okay, great. Just more on the actual size and packaging and cost especially what kind of stuff are you open to? What kind of guidance are you giving brands? Like yeah, it'd be great if it was smaller, like you know, within single serving. Like I don't necessarily want full size, half size, snack size. What do you look for and what are the price points that you're open to?

42:26
Daria Jackson
Yeah, so size ranges anywhere from about a half ounce to maybe 2 ounce. When the conversations that I have with our vendors that we typically centered around, you know, how the product was, will fit in our boxes and that then guides me into how many units of your product I can include every single time I make a mix each week. So a crunchy item, a bag that has a little bit more air and more volume in there is a little bit harder for me to include large quantities each week. But I haven't run into very many issues there. So anything on the single serve that kind of smaller half Hour that to 2 ounces, great. And then costs. Our customers really drive the like purchase price that we're looking for.

43:14
Daria Jackson
They're looking to spend on average about a dollar to A$50 per unit on their products. And so as long as we can stay under the, under that range that is typically golden for us, but kind of unlike essentially like DCs or groceries. Since we built this curated mix, I can bring in a higher price point item and offset it with something that's a little bit more cost effective. That's the game that I love to play every single week of. You know, I've got this wonderful oatmeal that I want to include in the box and that's a little bit higher price point, but I've got a bar that I can offset that with and allow our customers to have something that may be a little bit higher price range, but it's is just as good as anything else in the box.

44:00
Daria Jackson
And so that's the work that I strive to always bring to the table every single week and guarantee. Our vendor said, like, I'm on your side. I want to figure out how many units I can put in our boxes each week. And I will strive to, you know, make sure that we have as many units as possible in every single mix that we produce.

44:20
Daniel Scharff
So the box that I got, I had there was one box of fruit and then a separate box that had the snacks in it. And it's not like there was a bunch of padding in there or anything. So it seems like, I mean, you gu pros, you obviously have been doing this for a long time. You know how to ship stuff so that it's not breaking and getting spills inside the packaging. So I imagine you are pretty interested in the shippability of those smaller items. Not going to include stuff that might leak or get damaged if a box gets shaken around a little bit. So what is it like for a brand to actually work with you then? Let's say that oatmeal brand gets in, gets to work with you.

44:52
Daniel Scharff
Is there anything that they can do to try to be successful other than having a great product and packaging and working with you on the logistics and everything?

45:00
Daria Jackson
Yeah. I always tell our brands that I want to learn about your business before you learn about fruit. Guys, I want to understand what a successful partnership looks like for you. And that usually entails a lot of transparency. So I'm asking, what are your production cycles looking like? What forecasting can I provide you, what fun new flavors or seasonal items you may have? And really trying to get into the flow of let's have this be a conversation and let's work together and understand how we can both benefit and create a sustainable partnership. You know, a lot of the brands we work with are emerging. And so without that forecasting, without that kind of hands on, you know, check in almost every other week connection, sometimes we can run them into a bad spot with our demand.

45:51
Daria Jackson
And I want to make sure that I'm being respectful of your goals as a business and where you want to see your product and the type of eaters you're hoping to reach. And so just having that transaction, transparency and checking in constantly is what I love to hear from our vendors. I want to be your biggest cheerleader. I want to support you. I want you to succeed and get into every single market that's out there. So just keeping me informed and coming up with creative, kind of, maybe flexible or adaptive ways to get the best product out there is really what we strive to attain with every single relationship we have.

46:31
Daniel Scharff
Okay, that's amazing. And just in terms of the logistics, how do you guys typically pick up from people? Do they ship direct to you? Are there any other people in the middle?

46:40
Daria Jackson
We do both. All of our ordering is direct. It is preferred just so that way we can have those relationships and really work on understanding, you know, how do we make this partnership as beneficial as possible to all sides. And I have vendors who offer both direct and fob pricing. And it really just depends on the timing, the season, when we need product, or when they're running a production as to which we decide. And I think that flexibility is such an amazing piece in our model, unlike maybe a traditional brochure or DC is that, you know, if I place a PO and you don't have a flavor that's on that pod, I don't mind adapting. I'll kind of switch what we've got. I don't have to hit a certain SKU or product type every single order.

47:30
Daria Jackson
I just want to make sure that we're providing our customers with amazing products from amazing brands. And that kind of adaptability, I think, sets us a little bit different. Little sets us apart from the others out there and really allows our vendors to kind of understand that we're on their side 24 7. There's nothing I want more than for you to succeed, and I'm happy to support that in any way or shape or form.

47:57
Daniel Scharff
All right, that's amazing. And maybe in the early days, working with an emerging brand, you might be doing orders of, what, a couple pallets to get started or what's the typical order size as you're starting to work with them?

48:09
Daria Jackson
Yeah, it depends on the product type. Larger volumes, like crunchy. It's definitely a couple of pallets But I going back to this kind of, you know, ongoing conversation and dialogue between brands, it's really understanding what is most profitable for you. So if our minimum order quantity has to be a pallet, well that's great. I've got three facilities and I can cross dock my items if I can't hit that minimum pallet in every single facility. So I'm going to do the work to make sure that we're taking care of you because you are what is, you're who's supporting our business, you're who's keeping our customers happy beyond, you know, our inner workings of delivery. And so however best I can support that goal or cog that we both want to hit, I'm going to make it happen.

48:59
Daria Jackson
And it's just honestly it's like an ebb and flow relationship of you know, at some points you may have a price change that you need to enact and I'm more than happy to discuss that with you. So that way we're both profitable, we're both walking away happy and we're both being uplifting support in each other's businesses.

49:19
Daniel Scharff
It's amazing. Yes. Again you will have a lot of LinkedIn outreach after this because sounds really fantastic to work with the fruit guys. Is there anything that's a non negotiable like hey, if you don't have this certification or if you have this kind of ingredient, we just cannot look at your product unfortunately. Anything out there that's kind of a non starter?

49:38
Daria Jackson
Yeah, I mean we're constantly looking at ingredients. That is kind of a key tenet of how we designed our SNAP program. So we do have a ongoing list that we're reviewing, maybe we're adding, subtracting to and before I go down the rabbit hole of price negotiations and really second, third, fourth meeting with a brand potentially that's something that comes up in our first meetings. And I would just say if anyone, you know, curious about what ingredients or you may be food safety stance we have on certifications, feel free to reach out because we developed our business around supporting the underdogs. We want to be as flexible and adaptable as possible. So even if you are still producing in a shared commercial kitchen, that's not a non negotiable for us.

50:34
Daria Jackson
Us we want to understand, you know, how do we get you out of that commercial kitchen and into your own space or into command that you love working with and then, you know, grow your business. And so those conversations, I welcome all of them and we're an open book. We want you to succeed. So share our requirements or we'll share, you know, our flexibility that we can have in some of those requirements to ensure that we can have your products in our meeting mixes.

51:02
Daniel Scharff
All right, so just as we wrap up here, speaking of them reaching out, how should brands actually apply or get in touch with the fruit guys?

51:11
Daria Jackson
I love direct email. That is the best way to contact me. You can also go to our website and just email our kind of catchall info. Fruitguys.com Quick call LinkedIn, Instagram. We connect with our vendors on all platforms and everything gets funneled to me.

51:30
Daniel Scharff
Perfect. Do you want to give out your email so people have it?

51:33
Daria Jackson
Yeah, yeah. This is my first name. Daria D A r I a dot Jackson j a c k s o n@fruitguys.com.

51:44
Daniel Scharff
All right, clear your inbox out. You're about to get a lot of inbound. Okay. And then just to wrap up again. So yeah. Eric and Daria, where can brands also just try to bump into you in person? What's your trade show circuit or what events are you out there at throughout the year?

52:02
Daria Jackson
Well, recently the grocery runs have been amazing. I have a couple that I'm looking to add to my calendar. I mean, the one that we had just down the street from our facility in South San Francisco was amazing. I've had three brands that I'm in the middle of onboarding actually from that show.

52:19
Daniel Scharff
Yes. That's so good.

52:21
Daria Jackson
Those are wonderful. Expo west is one that we go to every single year. Fancy foods we're starting to attend. And then Eric, I mean, on the kind of fruit. And we've connected with a lot of CPG brands actually in some of the circuits that you guys have visited as well.

52:36
Erik Muller
Yeah, there's a really big one, Daniel, called NAMA at the National Automatic Merchandising Association. It just happened in Las Vegas a couple weeks ago. So that's a really good one as well. We typically have a big booth there and we're displaying not only the fruit, but also all the snacks and talking to different partners there.

52:52
Daniel Scharff
That is awesome. And I really appreciate you guys coming to the grocery run events. That's a huge initiative for us. We are doing, I think, 18 grocery run events this year, which is us, me going around the country doing events in local markets so that brands can meet the most relevant retailers there. And that's so beautiful that you managed to pick up three brands for your box from the grocery event. That's what we're all about. We love it. Thank you. And so maybe, Eric, I'll just give you the last word here. Is there anything that we didn't talk about today that you wish everybody would know about the Fruit Guys, Obviously you have been at this a long time and it is just a big part of who you are, how you're out there in the world. Any last word for us here?

53:32
Erik Muller
You know, we love telling stories, right? I think our society is built on folklore. And so we want to be storytellers to our consumers, our eaters, the employees that we service. So the more the TPG brand has a story for us to tell, we do a great job disseminating that kind of content to those eaters. And I think it's just. It's another form of engagement, right? People want to know the why. I gave you the why of fruit guys in the mission. I think we want to hear the why and the mission and the vision that the CPG brands have so we can take that story and give it to our eaters, our customers as well. Because I think that creates a stickiness, right?

54:08
Erik Muller
All of a sudden people are like, man, these guys are bringing us this amazing product and has this amazing story. Let's do more together. And I think that's what we're all about in terms of this collaboration that we're looking to form.

54:20
Daniel Scharff
That's amazing. All right, perfect words to end on. So I just want to say thank you again to both of you and to everybody for listening in on this one. And definitely, look, connect with the Fruit Guys team at a future grocery run or one of the national trade shows where we like to help all of you get meetings with them and do all the fun stuff at all of our parties. So thank you again, Eric, Daria, for joining me here today. Really appreciate the time.

54:46
Erik Muller
I appreciate it too. Daniel, thanks so much.

54:47
Daria Jackson
Thank you so much.

54:52
Daniel Scharff
All right, everybody, thank you so much for listening to our podcast. If you loved it, I would so appreciate it if you could leave us a review. You could do it right now. If you're an Apple podcast, you can scroll to the bottom of our Startup CPG podcast page and click on write a review. Leave your company name in there. I will try to read it out. If you're in Spotify, you can click on about and then the star rating icon. If you are a service provider that would like to appear on the Startup CPG podcast, you can email us at partnershipsartupcp. Lastly, if you found yourself grooving along to the music, it is my band you can visit our website and listen to more. It is super fantastics.com thank you everybody. See you next time.