Matt Melville, founder of seasoning firm Rum & Que, talks starting his food venture on Facebook, travelling overseas to barbecue competitions and how the firm is managing inflation.
What does your business do?
Rum & Que specialises in barbecue rubs, seasonings and sauces sold in 500 stockists across New Zealand and Australia. The business launched in February 2018.
What was the motivation for starting it?
We started Rum & Que as a fundraising - we had some products and weren't selling them, then back in 2017 we got invited to the Jack Daniels barbecue competition in Tennessee in the United States. To raise some funds we started selling our rubs - we only had four rubs then, selling them on Facebook and we got some money together and went over there and competed. When we came back, it wasn't until 2018 that we actually got our products into shops properly. We had people requesting where could they buy them so we got our gear together and got them stocked in shops.
How was the business funded and how much did you invest to start Rum & Que?
As we were working at the time when the business started we funded it gradually ourselves as the business grew. Any money earned went back in to help with growth. In our second year we borrowed $10,000 off a friend to help with updating the packaging. This made a huge difference to our shelf appeal and distribution.
How big is the team?
It is still just me and my wife Tracey. We had staff, they left recently, so we changed our model and now get another company to pack our product into our pouches and our shakers. We used to do that all in-house but now we just outsource it.
Where do you see the business in three to five years' time?
We want to bring on more products, distribution is pretty good at the moment so hopefully we can continue growing the way we have been and continue to expand the range. Inspiration pops up from time to time so it is hard to say how many more products we plan to launch. We currently have 12 on the market, with another two on the way, and if we average it out we are probably releasing four products a year. In four or five years' time, we may have another 16 to 25 products.
We're happy with our operating model at the moment, our speciality is in flavours rather than process so I would like to have new product and be a brand that is known to be premium - not too expensive but certainly not very cheap.
How did Rum & Que navigate disruption from Covid-19 over the past two years?
We grew quite a bit during lockdown. Because our business is based around the recreational side of life, during lockdown a lot of barbecuing happened. We found that although our bread and butcher, which is our butchers and barbecue stores closed, we found distribution through the supermarket chains, which enabled big growth for us. I'm not sure where we are headed at the moment so that remains to be seen. We are considered a luxury so we could be going the other way shortly.
How are you managing inflation and rising costs?
Things are certainly going up around us. So far we have maintained our prices and steered away from any price increases, so margins are being eroded. Being a food business, inflation and rising costs makes it much harder to do business. Labour rates are going up as well, which is another reason why we weren't too upset about losing our staff because it is one of the hardest parts of the business to manage.
Outsourcing lowers our risk as well; any packaging problems, for example, are someone else's problem and not so much ours. We are certainly feeling the squeeze as we're starting to see increased products coming to us.
How are you finding your first foray into the world of business ownership?
You certainly don't work usual hours - definitely longer hours, often we are still tapping away at 8 or 9 o'clock at night. The business has definitely done better than what we initially hoped for.
What advice do you give to others thinking about starting their own business?
Go for it - but find a genuine gap in the market for your product or service to bring to market. Owning and running your own business gives you freedom and allows for flexibility, but be prepared to work hard.