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Business Ideas – Business Lessons from Jenny Craig (food & service entrepreneur) by Evan Carmichael
Today we’re going to look at how a gym manager mortgaged her house to start a business because she saw a need, moved to Australia, and later sold her business for $600 million. This is the story of Jenny Craig and the top three lessons you can learn from her success.
Action Item #1: Promote, Promote, Promote!
Building a better mousetrap is not enough anymore to get a company off the ground. You need to aggressively promote your business to make sure your customers know that you exist. From advertising and public relations to search engine optimization and social media marketing, you have many opportunities to spread the word about your company and you should never take your foot off the gas!
In the company’s early years, Craig made sure that exactly ten percent of sales was directed back into commercial advertising each and every year. Individual franchises were also expected to spend ten percent of sales, or at least $1,000 a week, on local advertising for their own centres.
They used traditional advertising on television programs, leveraged celebrity endorsements, and created direct mail campaigns. But they also tried many offbeat approaches. As one example, Sid got the company a lot of publicity during one televised international cricket match, where cameras picked up on a sign in the crowd directed at the captain of the English team that read: “See Jenny Craig. Quick.”
Action Item #2: Offer Products and Services
I believe the best way to build a business is to start a service – it’s low cost and gets you close to your customers. Your chances of survival are much higher and you learn what future services and products your clients need. Once you’ve established a base of customers and know exactly what’s missing in the marketplace, you can create your products. You’ve got cashflow from your service business to keep the company running and you’ve got a loyal group of clients who are ready to buy!
Jenny Craig had the same philosophy. Her business started with Jenny Craig centres where they would help clients establish a workout program, offer nutritional guidance, and also give motivational services. Her business grew every year as she added more centres and people to her team. It was a very successful service based business.
Jenny Craig’s big break came when she started offering prepared food products as a part of her offering. She brought on board a highly qualified staff of dieticians, psychologists, and physicians to help her create a menu that was healthy and nutritional. In doing so, Jenny’s Cuisine became a central component to her program. All of her clients were required to purchase these portion and calorie controlled foods, which included over sixty different breakfast, lunch, dinner, dessert and snack options. Jenny’s Cuisine proved so popular that the company’s gross revenues from food sales increased to 91 percent by 1993.
Action Item #3: Never Give Up!
Just like I discussed in my last post, it’s important as an entrepreneur to never give up on your idea. Every business owner will face a moment of crisis which forces you to think whether it’s all worth it – the long hours, the mounting debt, the personal sacrifices. These moments will help define you as an entrepreneur. It’s the founders who stare those moments square in the face and keep on building who go on to be the ultra-successful entrepreneurs.
From losing weight, to starting her own business, to not being able to run her business in America, Craig has proven that with perseverance anything is possible. When the Craigs first sold their chain of Body Contour gyms, they did so in agreement to a non-compete clause. They were not allowed to set up shop again anywhere in the U.S. for two years.
And so, refusing to wait two years before they made their next move, the couple went on a search for their next destination. Where could they begin their new line of fitness centres? What country was similar to the U.S. in terms of diet and fitness levels but presented no language barrier? The Craigs decided on Australia. Their friends thought they were “nuts” but the couple never gave up and turned their new business into a company that sold for $600 million.
John Mackey on Whole Foods, Conscious Capitalism, and Life Beyond the Profit Motive
“I think the critics of capitalism have got it in this very small box – that it’s all about money,” explains John Mackey, co-founder and co-CEO of Whole Foods. “And yet, I haven’t found it be that way. I’ve known hundreds of entrepreneurs and with very few exceptions most of them did not start their businesses primarily to make money.”
In “Conscious Capitalism: Liberating the Heroic Spirit of Business,” Mackey and his co-author, Raj Sisodia, make a case that businesses are at their best when reaching for a higher purpose that ranges far beyond any simplistic notions of the profit motive or self-interest.
Reason’s Nick Gillespie sat down with Mackey to discuss his new book, the success of Whole Foods, the growing burden of government on day-to-day life, and how the Austin-based entrepreneur came to appreciate what he calls “the heroic spirit of business.”
Hacking the supply chain: Pete Russell
Pete Russell is a local food advocate, social entrepreneur and founder of Ooooby. After seeing first hand the destructive nature of globalized food and the accelerating demand for local alternatives during his time at a multi-million dollar food business, Pete became committed to working in the local food space. Driven by a passion for developing smart systems for food sales and logistics, Out of our own backyards (Ooooby) is the result of his work — a local food operation delivering to hundreds of Auckland doorsteps each week.
Chairman & CEO of Illy Coffee, Andrea Illy, on sustainability and business strategy
It’s twice the price of store brand coffee, but aficionados happily pay it. What makes a niche brand of coffee so sustainable? INSEAD Knowledge meets CEO of illycaffè, Andrea Illy, to find out more about this business model with a difference.
Walkability: Alicia Barber
As the cities we live in grow and change, some of their central areas can become less appealing, and less walkable. By setting a few key priorities for these areas, each one of us can help to reclaim these spaces as functional and attractive parts of our communities.
Rose George: Let’s talk crap. Seriously.
It’s 2013, yet 2.5 billion people in the world have no access to a basic sanitary toilet. And when there’s no loo, where do you poo? In the street, probably near your water and food sources — causing untold death and disease from contamination. Get ready for a blunt, funny, powerful talk from journalist Rose George about a once-unmentionable problem.
Rose George “talks shit” to raise awareness about the lack of basic sanitation worldwide.
WHY YOU SHOULD LISTEN TO HER?
Rose George thinks, researches, writes and talks about sanitation. Diarrhea is a weapon of mass destruction, says the UK-based journalist and author, and a lack of access to toilets is at the root of our biggest public health crisis. In 2012, two out of five of the world’s population had nowhere sanitary to go.
The key to turning around this problem is to “stop putting the toilet behind a locked door,” says George. Let’s drop the pretense of “water-related diseases” and call out the cause of myriad afflictions around the world — “poop-related diseases” that are preventable with a basic toilet. Once we do, we can start using human waste for good.
George explores the problem in her book The Big Necessity: The Unmentionable World of Human Waste and Why It Matters and in a fabulous special issue of Colors magazine called “Shit: A Survival Guide.”
“‘The Big Necessity’ [takes] a subject that seems fixed and familiar and taboo and makes us understand it is … dazzlingly intriguing.” Johann Hari, Slate, 10/20/08
Good Foods Taste Great: David McInerney
Join FreshDirect’s co-founder David McInerney, as he champions changing the way people eat as a featured speaker at the 2013 TEDx Manhattan conference. McInerney travels the world meeting with hundreds of farmers, fisherman, and ranchers to source the healthiest, freshest, highest quality foods in existence for FreshDirect’s customers. During his travels, McInerney has become keenly aware that there is a fundamental flaw in our food system, which forces our farmers to grow food for transport rather than taste. What’s more, today fresh foods don’t taste like they should; people aren’t eating them, and processed foods are winning–and its crippling our country’s health. During TEDx Manhattan, McInerney calls on the retailer and the consumer to help change our broken food cycle and join in his taste crusade, to allow farmers to grow good foods that taste great, helping to change the way people eat, and change the world.
David McInerney has been on a “tastes-great” crusade for the past twenty years. A former French-trained chef, he is a co-founder of FreshDirect.com, the leading online grocer in the U.S.
In strategically setting the direction for food at FreshDirect, David helps educate and provide higher quality fresh food to millions in New York and Philadelphia. Every year, he spends the majority of his time visiting and building relationships with local and global farmers, ranchers, and fishermen, giving him a rare view across the entire sustainable food spectrum. David started his food career while studying and working in Burgundy under renowned chef Bernard Loiseau at his Michelin 3-Star restaurant La Cote d’Or and later under legendary New York Chef David Bouley.
He is a sought after speaker and food educator. He has dedicated his life to changing the way consumers eat, and how the industry sources fresh, healthy, sustainable foods.