How I Started A $100K/Month Food For Auto-Immune Sufferers Business

Stacey Schlaman

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Published: February 25th, 2020

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Stacey Schlaman

Founder, Liberated Specialty Foods

$100K

revenue/mo

Founders

Employees

Liberated Special...

x.com/Liberated_Foods

from Alabama, USA

started April 2015

$100,000

revenue/mo

Founders

Employees

Discover what tools recommends to grow your business!

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Quickbooks

Discover what books Stacey recommends to grow your business!

📗

Breaking the Vicious Cycle: Intestinal Health Through Diet Elaine Gottschall

Gut and Psychology Syndrome: Natural Treatment for Autism... Natasha Campbell-McBride

Want more updates on Liberated Specialty Foods? Check out these stories:

Note: This business is no longer running. It was started in 2015 and ended in 2023. Reason for closure: Shut down.

Hello! Who are you and what business did you start?🔗

I’m Stacey, founder and President of Liberated Specialty Foods, based in the quiet town of Madison, Alabama. We run a food manufacturing business making a full line of baked food (made mainly from nut flours) like almond flour pizza crust, cashew bread, and coconut flour donuts, along with additive-free sauces like ketchup and pizza sauce; with the specific mission to help those suffering from autoimmune diseases like Crohn’s and Colitis, that ALSO fill the niche of Keto, Paleo, Atkins, and other trending diets.

We sell online and to retailers. We went from about 100 retailers with our products in 2016 to over 1,000 today, including major chains from Whole Foods and Sprouts to Wal-Mart -- and we hope to keep adding more!

how-i-started-a-100k-month-food-for-auto-immune-sufferers-business

What's your backstory and how did you come up with the idea?🔗

I was working as a fitness instructor at the time and was already very aware of and “into” the paleo and keto diets for physical fitness. I had a background of working at a bakery in my younger years, and as a distribution manager for one of the largest retailers in the USA after college so had a little experience there also.

Find a mission that you really care about, something where the mission can push you through the hard times because there will be many.

Our daughter was diagnosed with a host of autoimmune diseases at a very young age including Epilepsy, Hashimoto’s, Celiac, Psoriasis, and a bunch more. Doctors had prescribed a number of very heavy pharmaceuticals (including shots) to treat these that would need to be taken the rest of her life. Worried about the side effects, I found nutritional options to treat which were supported by several respected doctors. The results were astounding, but forced me into the position of hand-making much of her food, from ketchup to crackers to cupcakes. It was a full-time job, especially for someone who had little food-manufacturing experience outside the home.

I started Liberated to help others that were in the same position as me. It’s impossible to spend 50 hours a week in the kitchen and maintain a family and a full-time job. So we hope we can help out with that!

Take us through the process of designing, prototyping, and manufacturing your first product.🔗

The difficulty in the food business is that costs are high, margins are low, so a cheap product is the name of the game. And our food has been scientifically altered to work with manufacturing equipment and to cheapen the product. Liberated food cannot contain any additives -- no starches, no flow agents, no anti-caking powders, so initially it was all handmade.

We’ve found some methods to utilize some more industrial type equipment in the bakery, but especially when we started it was a group of mothers with mixing bowls and ovens.

Our first products were cheddar crackers, cupcakes, and pizza crusts--kids favorites! We also had a couple of staple items, like cashew, coconut, and almond bread.

Describe the process of launching the business.🔗

I didn’t know what to expect when we launched. We started as a retail location, with a sit-down cafe and sold mostly online. We worked with our local Whole Foods to go through quite a complex process of implementing the required steps of moving from inspections from the local county health department to a myriad of outside food safety audits, product recall databases, FDA labeling requirements, and certifications--like Gluten Free and Kosher!

Once our first Whole Foods took us, the entire region began buying. So from our little country road cafe, overnight we were selling from Mobile, Alabama to Raleigh, NC. THEN we needed to figure out both how to produce more food--faster, how to store it, and how to distribute it!

Since launch, what has worked to attract and retain customers?🔗

This was not something we were good at initially. We do utilize most of the social media venues and newsletters. But, advertising isn’t in our budget. We made a couple stabs at paid advertising and they were failures. So we have relied on word-of-mouth and PR opportunities. Our story is real. We are who we say we are--a group of women making food out of our own little place in a little town.

We started working with a Whole Foods representative about making suitable products for their stores. We were quickly accepted by our local store--then all 40 stores in the Southern Region. We grew from there.

We had the TODAY show fly-in and did a full segment on our business, which we loved of course!

Have thick skin. Life isn’t fair. Not everyone likes your products. Some people are mean. Learn not to take every criticism personally.

We found most other brands were utilizing huge manufacturers to co-pack their food, creating a backstory to make them sound authentic, and spending all their time selling. And we watched many “clean” brands devolve into food-science experiments in the process.

In reality--this is probably the better method, but our niche wouldn’t allow it. Our customers and their needs are too important.

How are you doing today and what does the future look like?🔗

We had to expand fast to meet demand and probably took on a little too much. We had to build warehouses, enter into distribution agreements all over the country, manage retailer promotions and expectations.

Entering into the big retailers is expensive--they expect lots of deals and many require ‘slotting fees’. Distributors are very aggressive and base their fee not on what is delivered, but on the purchase price. So the same distributor, on the same truck, delivering to the same store charges us $2.50 to deliver our higher-priced box of pizza crusts, where a cheap competitor could be charged $0.20. It’s a broken model and a lot of it has come from consolidation with huge companies buying up their competition.

Amazon has been hard for us, as others can buy our products directly from the distributors and then put on Amazon to compete against us. When they sell expired products, or non-refrigerated products, or broken products, the customers come back to us, not the seller, for refunds. Others know how to manipulate the system, and again, we don’t. It’s driven a slough of bad reviews on a couple of our products and has us considering pulling out of the platform altogether.

We are not yet profitable and we probably tried to grow too fast for our learning curve. It’s made funding the business a challenge, but we have a great path forward as we finally have the scale and experience to be efficient in the manufacturing process. Our growth curve is still straight up--but we need capital to maintain the growth.

We would love suggestions here from the readers!

Through starting the business, have you learned anything particularly helpful or advantageous?🔗

We have learned a lot! Find a financially connected partner right out of the gate. They can help you set benchmarks and access capital when you need it. They also won’t let you do anything too expensive or costly!

Find a mission that you really care about -- something where the mission can push you through the hard times because there will be many.

Have thick skin. Life isn’t fair. Not everyone likes your products. Some people are mean. Learn not to take every criticism personally. (I’m still learning this by the way!)

What platform/tools do you use for your business?🔗

Our online store is with Shopify. We worked with some smaller less expensive ones in the past and there were problems as we grew.

Quickbooks are great for accounting and payroll.

EDI is required for large retailers like Wal-Mart. This allows purchase orders, invoices, shipping documents to transfer directly from your system into theirs.

We’ve sort of hatcheted together a bunch of independent systems and made them work together. Quickbooks, EDI, Shipping-Easy (shipping and inventory management), Shopify. We built our own product recall database using basic database software out there.

Facebook and Instagram have been a great way to get feedback from our customers.

What have been the most influential books, podcasts, or other resources?🔗

For me, Breaking the Vicious Cycle by Elaine Gottschall, and Gut and Psychology Syndrome by Natasha McBride, MD. They taught me how to prepare the food that the community needs.