The Daily Grind

Entrepreneur,  Feb, 2000  by Michelle Prather

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Today, Victorian House is reinvigorating the shelves of more than 800 retailers in California and Western Nevada. "It's like Sesame Street--one of these things does not belong," jokes Greg Jr. about the product's place among Starbucks' whole-bean coffees and other traditional instant coffee products.

Long gone are the days when so-called experts tried to persuade the inexperienced family business proprietors they'd never be able to sell anyone on the product. Early on, a marketing expert even went so far as to proclaim Ryan Coffee's chances of raising money (which it did via private-placement financing in the spring of 1998) as being slim to none. "I was so depressed as I drove back to the office," recalls Greg Jr. of his meeting with the marketing expert. "But I knew deep in my heart this was a great product and a great idea."

STAND AND DELIVER

Despite being the little guy, Ryan Coffee has managed to emerge unscathed from a challenging industry initiation: Overly competitive representatives, stunned by Victorian House's prime, eye-level shelf space, have attempted everything from moving the company's product into a store's backroom to stealing shelf space. The family employed a food broker who accomplished nothing, and handsomely paid a marketing whiz who failed to land a big account in over 10 months. "We now have a rule that no one is allowed to sell our product without us sitting at the table," says Greg Jr. "We're nervous of anyone who talks a great game--especially when we know we can get it done [ourselves]."

And by working in unison, they have. Thanks to Heather's previously untapped marketing genius and her dedicated demo appearances from 1990 to 1996, Victorian House is fast on its way to becoming a household name.

On occasion, the brand's growing popularity caught the Ryans off guard--like when the Marina Safeway (the grocery chain's flagship store in San Francisco) account led to a Northern California systemwide account in 1994. Heather says it was Ryan Coffee's defining moment. Greg Jr. remembers the stress. "After leaving the meeting where they told us they wanted to [take the product systemwide] in one to two months, Heather and I looked at each other, walked out and were like, 'Oh my God, we can't make that much.'"

They worked around the clock--even slept in their makeshift plant. Then Heather would get up at 4:30 a.m., jump in her Jeep Cherokee, and join the ranks of the huge Budweiser and Coke trucks distributing to their routes. Financial matters weren't any easier. Sales were good, but payments never came soon enough, making it nearly impossible to pay the bills. Says Greg Jr., "We came very close to running out of cash."

But the Ryan Coffee Co. motto is "Yes, we can." Ten years after starting, they're sporting 16 employees and projected sales of $3.4 million this year. A larger conglomerate may acquire and market the heck out of Victorian House someday. But a new facet of the business comprising 30 percent of the company's total revenue--using the concentrate as an ingredient in other foods (Dreyers uses it in its Dreameries Cup O' Joe flavor)--would keep the Ryan Coffee name alive. In all cases, the key to future success is flexibility--a small-business specialty.