The pandemic led to a 70 percent drop in sales for both artisan cheeses makers and sellers. They had to react - but how? On the one hand, you need to preserve your financial and personal resources to survive. To help, I organized some group conversations online, using Google Meet. One group for producers and one for store owners.

So, how do you change the way you do business overnight in the most efficient way possible and in the midst of chaos? Not all the ideas are easy, profitable or simple to achieve. Worse, what if you choose the wrong idea? I started each group by asking two questions. “What were they doing to manage the chaos,” and “of all the ideas they have tried, which ones worked?”

To manage you have to predict, yet, prediction goes out the window when things are chaotic. Business changed in a heartbeat. Not knowing can lead to costly mistakes and those can kill a business.

Luckily, there is a way to move forward through the fog of chaos that is the rule of the day. Like with a start-up, by trial and error. The faster they could generate, confirm their ideas by testing, the less damage the ones that won’t work could do.

Chaos in Pandemic Times
A total of 25 people participated in the discussions. The understanding was that they would share all ideas that worked.

The goal was to survive. To survive, they had to become more agile.
They had to: validate ideas fast! (test small); hurry the implementation of those that passed the test; drop an idea fast if it didn’t; and give priority to the things that generate healthy cash flow and are less work intensive.

For the stores, the 15 ideas that proved to make a big difference were, in no particular order:
1) Rank your inventory by amount of risk. Focus on selling the most perishables first.

2) WhatsApp Business: Up to 90 percent of sales were coming from WhatsApp, as the stores had to close their doors to the public.

3) Sales by Instagram: Featuring that they were making deliveries.

4) Using the Catalog Feature of WhatsApp Business. The work of communicating with each client at each request is a lot of work. The catalog takes some pressure off. Also, send a notification to your list of customers one to two times a week.

5) Simplify. This idea alone saved one of the participant’s business, and helped many of the others survive. To learn a new way to do business overnight is a lot to ask. Add to that, putting themselves, their families and everyone who worked for them at risk.

The trick is to focus on the things that generate the most dollars profit with the least effort. The aim in this situation is not so much to make a profit but to survive. You need enough cash flow to pay the monthly expenses. Now is the time to survive, not preserve margin.
Reduce the variety of items. Direct sales to only three things, for instance. Group cheese categories and sell without specifying the brand. (This is used by one participant by creating a monthly cheese club. Clients pay monthly. She delivers a selection of cheeses twice a week.)

Offer only one or two kits a day. Cuts confusion and overwork. Many of them were facing a completely new way of doing business: online and with delivery. Simplifying increased sales, and satisfaction. (In a couple of cases, sales improved and workload diminished when offering only one kit per day. One kit, but with a simple variation, like with wine or without.

6) Sales of Complementary Items. Try to include items that complement each other, e.g. breads, butter, honey, cheese and jam

7) Kits. Types of tested kits that worked were: party kits; breakfast kits; and one shopkeeper was successful with ingredient kits with cheese for cooking. Kits for pairing cheese did not do so well.

8) Baskets. Like kits but bigger. Worked best when they offered only a few types a day using a WhatsApp catalog or Google Forms.

9) Managing their Deliveries. Delivered by the owners, their employees or by choosing a service (under contract). Not by using the online delivery apps, as the quality of delivery suffered.

10) A Subscription Club (Mentioned before). Delivery of “kits”, two per week. Monthly payment. Use cheeses of your choice, especially those in danger.

11) Negotiate postponement of payroll

12) One store owner got a bank loan to pay one month of bills, to get a head start. Only if the conditions are in your favor (low interest, or deferred payment)

13) Buy Less, More Often (the one thing everyone did that paid off for all who tried it.) Allows you to better manage cash flow. Since the aim of the moment is to generate cash to stay alive more than maximize profit, it is a wise thing to do, even if the cost per item may be more.

14) One person made a drive through, and it worked very well.

15) Reach out and work in partnership with producers. Help them cut excess stock. Generate rapid sales and cash using aggressive promotion.

The surprising things that everyone thought would work, but didn’t:
• Reducing hours, wages and sending people on vacation. In fact, business came back to a level where they needed to call some employees back in only a couple of weeks. Online sales happened. When you think about it, people still have to eat. They need to know how to find you. In the end, it was an emotional effort that contributed less than other measures taken.
• Investment in websites did not pay off. WhatsApp and Instagram contribute more sales, for less investment. They have little to no lag time until ready for use. The cost of setting up an online store and “Shopping Cart” on their website was shocking. WhatsApp catalog was free, fast, and easy to complete.

Things That Worked for Cheese Makers
Sales Policy: Direct sales to the final consumer: to take the place of fairs, trade shows and gastronomic events. Dilemma: direct sales may harm the stores you normally sell to. Citing this, some producers held out against selling direct. After a few weeks, sales through normal channels began to return.

New Ways to Promote: new descriptions; professional photos; new pairings; listing culinary uses; seeking contact with online food “influencers”; add channels for delivery and communication; and find more personal and direct ways to communicate. Interact with consumers using Facebook, WhatsApp Business and Instagram.

Renegotiate with banks and suppliers; reduce, renegotiate deadlines, or eliminate payments Watch your receivables. Professionalize your process of managing late payers.

Logistics: Achieve scale through cooperation. (A working group has been set up to explore how to create a new logistics system for artisanal cheeses.)

Manage Resources: Decrease or cut activities, manpower, and processes; dry the cows only at the end of lactation, so as not to damage production in the future; sell the less productive cows to reduce feed costs; fill the silo to prepare for drought; reduce wages and hourly load of employees (producers found it was essential); switch to a daily milking instead of two per day; set quantity of cheeses and selling price to generate cash flow to pay monthly bills.

SIMPLIFY: Stop multi-tasking, (the enemy of productivity - DS); and reduce task steps, or heavy processes, which provide weak results.
Cut products if they don’t help you reach your current goal: to survive.

Diversify: Take advantage of your farm to produce other goods. Besides dairy products, examples are fruit jams, or other foods. One famous producer uses the whey from its cheese manufacturing to feed boar to sell as meat. Country chickens. Vegetables.

Strengthen collaboration between the various links of the chain. Strengthen partnerships up and down the supply chain. Collaboration is the best solution to solve problems in the current situation. Cheese maker associations can contribute a lot to that.

Need to better understand pricing

Development of simple tools to better understand and manage costs.
What are you doing? Can any of these proven ideas help? Send us your comments! DS

Dan Strongin is a former president of the American Cheese Society, chef and business coach for small to medium value added businesses. Dan can be reached via email at dan@danstrongin.com

The views expressed above do not necessarily reflect those of Cheese Reporter.

Dan Strongin

Dan Strongin is a former president of the American Cheese Society, chef and business coach for small to medium value added businesses, and the owner of the sites learn.managenaturally.com, and the Facebook group Enjoy Cheese. His online course: “Cheese: How to Buy, Store, Taste, Pair, Talk About and Serve”, is available at enjoycheese.net. Dan can be reached via email at dan@danstrongin.com.

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