Lauren Rhoades started her fermented-foods business in Mississippi—of all places—because she was jealous of a friend’s social media feed. (She jokes that some key decisions in her life so far have been based on jealousy.)
In this case, the friend was in FoodCorps, and was posting “amazing photos” of the experience. Rhoades was working a less-than-thrilling communications and marketing job in Washington D.C., having moved there from her hometown of Denver.
So, in the spring of 2013, she applied to FoodCorps, and chose Mississippi for her posting because she’d heard it had the highest application acceptance rate. She’d never visited the state before she got the job. In the summer of 2013, she found herself moving to the Jackson area to teach elementary schoolers about eating and growing healthy food.
Rhoades had previously developed an interest in kombucha–a cultured tea that is a symbiotic colony of bacteria and yeast–after college, when she took a class and started making the drink at home.
“It’s a super-weird transformation that I found fascinating. It was fun to make something from start to finish at home,” she says, noting that her success led to an interest in other fermented foods, particularly sauerkraut. Her first batch, made with a friend, was “really horrible, too much salt, we had to throw it out,” she says now with a smile. But she kept experimenting with different kinds of cultures and flavors.
With fewer than six months left on her FoodCorps contract, Rhoades felt passionate about expanding her fermented-foods business, which was already “bursting at the seams” from her house. So, she began working part-time in a restaurant and subleasing kitchen space three days a week to make her products. She researched the FDA and permitting requirements, reached out to other fermented-foods companies to learn what she could and, through a long process, developed labels, bottling techniques and pulled together her corporate paperwork. “Sweet and Sauer LLC” was born in 2016.
Rhoades’ first retail outlet was Rainbow Co-op in Jackson; the natural-foods grocer was very supportive of local products, and helped coach her through getting a bar code and ingredients on her labels. Once her products were available in one store, getting into others was easier–she now makes the bulk of her revenue from wholesale, with her products in over a dozen retail locations in Jackson as well as some stores in Oxford, Miss., and New Orleans.
Rhoades also sells at local farmers markets; she’s a fixture at the Mississippi Farmers Market on Saturdays in downtown Jackson. She says wholesale is a best way to reach more consumers, especially in a place like Mississippi, where farmers markets are relatively few and far between. But, she notes, farmers markets are good for outreach.
Her number one advice after three years in business: “Calculate your margins.”
“Really look at your cost of goods sold and be very realistic about it. The tendency for an entrepreneur is to be an extremely optimistic person. You have to temper that with realism,” she said. “It’s helpful to work with someone who actually does crunch numbers and can help you look at that realistically. Factor in your time; the time it takes to make and deliver everything. When you’re starting, see how much of your costs you can eliminate up front.”
Rhoades says when she got started, she was chasing sales and underestimating what the product was worth–she was also worried that Mississippi wouldn’t pay higher prices for fermented-foods products like kombucha that require some education. She been able to overcome that education challenge by talking directly to customers at farmers markets, teaching classes that cover fermented-foods practices–and she notes that more people are hearing about the benefits of fermented foods.
“They’ve heard it from Dr. Oz,” she says, which helps with awareness.
Her current plan of action is to pare things down a bit and streamline the business. “It feels kind of messy to me and I want to be more organized,” she says. She’s planning to focus on kombucha production, looking into refillable bottles and other ways to use less glass bottling and labels. She’d like to cut costs and focus on making core products profitable.
“I’m passionate about Mississippi and the local market; I don’t want to grow just for the sake of growing and getting bigger. Growth doesn’t necessarily equal more profits–at least, in the short term,” she says.
Rhoades is encouraged to see other craft food startups in Mississippi and is enjoying being a part of a growing ecosystem.
“There are so many small food startups that are popping up and I think that’s really exciting; I’ve talked to a sourdough bread baker using spent beer grains. We have a lot of commonality in educating consumers,” she says, noting that she can also “geek out” with craft beer brewers over fermentation and working with microorganisms in crafting foods and drinks.
“Meeting people in Mississippi and Jackson doing food startups is really exciting,” she says. “You don’t feel like you’re totally alone.”