Brutus Beverages Inc. is one of the five semi-finalists in The Globe and Mail's Small Business Challenge Contest. (Check out the other four here and vote for your favourite.) The 2016 contest drew more than 3,400 entries, and a panel of judges selected the semi-finalists. The winner of the $100,000 business grant – and a suite of secondary prizes – will be announced in September.
Zack Silverman and Aaron Harowitz know cocktails. The childhood chums, who grew up in Richmond, B.C., worked as servers and bartenders throughout high school and university.
So when they decided to partner and start a business, it made sense to develop a much-needed enhancement to a highly popular, made-in-Canada cocktail: the Caesar.
"I have served and consumed many, many Caesars in my years working in restaurants and bars," says Mr. Silverman, a University of British Columbia business and law school graduate who worked for six years as a lawyer in New York. "We realized that everybody was using the same mix, a product made in the U.S. filled with ingredients we wouldn't normally consume in food, such as MSG, artificial colour and artificial flavour."
Mr. Silverman and Mr. Harowitz used all-natural ingredients that include vine-ripened tomatoes, grated horseradish, Worcestershire and hot sauces, and clam juice – the real stuff, not the broth made from dried clams, says Mr. Silverman.
In 2013, the two launched their company, Vancouver-based Brutus Beverages Inc., and its star product, Walter Craft Caesar Mix, named after the Caesar's inventor, Walter Chell. Another childhood friend, Joshua Linde, came on board as the company's first employee and soon became a partner and co-owner. Brutus Beverages now has five full-time employees and about a dozen part-timers.
"Today, we're in over 1,000 retail locations and restaurants throughout the country, including all Oliver & Bonacini restaurants," Mr. Silverman says.
Available in classic and mild spice, Walter sells for about $8 per 946-millilitre bottle at independent grocers such as Whole Foods, McEwan, Pusateri's, Urban Fare and Sunterra. Brutus Beverages has started to go after national supermarket chains, and the brand launched recently in Sobeys stores in Ontario.
The problem is that most national retailers charge vendors a one-time listing or slotting fee for a spot on their shelves. Mr. Silverman says it will cost him and his partners more than $100,000 in listing fees to get into all the retailers they're targeting this year.
"We're now in a position where these retailers are talking to us, but as a small company we face challenges around the capital needed to pay those listing fees," he says.
"As sales continue to grow quickly, we are in the process of talking to investors about raising additional funds, not just to cover listing fees but also to provide us with working capital. An interesting challenge that many small companies face is your inventory is increasing a lot and you have to finance your receivables."
Brutus Beverages sold about 120,000 bottles in its first year of business and 200,000 last year. Mr. Silverman says the company is on track to double sales this year if it succeeds in listing with more big retailers.
"We're obviously going to need more than the $100,000 prize money," he says. "But if we were to win, it would help a lot."