Cameron's Seafood: $175K Per Month Selling Maryland Crabs

The Story of Cameron's Seafood

Hello! Who are you and what are you working on?

My name is Cameron and I am the name and co-founder behind Cameron’s Seafood. We catch, cook, chill, pack, and ship Maryland Crabs and crab cakes to your doorstep (to all 50 states) on a date you choose. Our food is made daily and shipped fresh, not frozen in less than 24 hours.

We started home delivery in June, 2017. We are leveraging my family’s 33 year old Maryland seafood retail carry out business. We have 11 stores, 3 food trucks, wholesale division, crabers, and have quietly become the largest Maryland seafood company in the world doing over $20,000,000 per year with over 1,000,000 customers per year. But that’s my uncles company. I’m the second generation who is adding recommence and technology to an old school business that has a competitive advantage and high barriers to entry market.

Maryland Crabs from the Chesapeake Bay are the best tasting crabs in the world because the cold weather in the Chesapeake Bay makes the crabs hyperbate for months. During that time, their meat gains a layer of fat which gives them a sweet, buttery flavor no other blue crabs have! They are truly special and we own the largest Chesapeake Bay crabbing network in the world!

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A little more about us and what we do:

  • We offer the highest quality seafood with free shipping and low prices.

  • We maintain 5-star ratings and focus hard on customer service.

  • Our Flagship product: #1 Male Maryland Crabs (Large, heavy Maryland crabs)

  • We have 10 simplified seafood categories

  • Our customers are displaced Marylanders, gift givers, and Maryland Crab fans in the 35-90 year olds range that make over $50,000 per year.

  • Unless you live within an hour of the Chesapeake Bay it’s too inconvenient, heavy (bushel weighs 40 lbs), and stinky to find drive and sit in traffic.

  • Most competitors sell blue crabs not from the Chesapeake Bay at high prices.

  • Our average sale is $165.

  • In July, 2018 we made $200,000 and are on pace for $2,400,000 in really the first year.

  • I work 20 hours per week on the business because I am the President of Ideal Realty Group, a prominent Apartment brokerage in Maryland, DC and VA.

  • I love taking old businesses and adding technology to help them reach their potential. My cousin and I run the home delivery business and plan to hit $20,000,000 by year 3.

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

My father invested in the first retail seafood location in 1985 and my uncle ran it. My father and I built our Apartment Brokerage while my uncle and his son built what is now the largest retail Maryland crab company in the world.

My cousin, Pey, and I are second generation and we wanted to ship Maryland Crabs from the Chesapeake Bay to people who can’t get them real thing, nationwide.

One morning, a crab-lover from West Virginia rolled up to one of our family-owned food trucks in Hagerstown, MD, to buy a bushel of Maryland blue crabs. He told my cousin Pey, who was working on the food truck that day, that he was so sick of paying exorbitant prices for dodgy crabs in WV, and to him it was worth driving 6 hours, round trip, to come get the real Maryland crabs from us.

This is what got me excited because I had been asking Pey to invest in some food truck chains. He said that with my background I should be thinking of investing in national home delivery. I liked that home delivery was ubiquitous and we had a competitive advantage when it came to sourcing Maryland Crabs. I started looking at FedEx ground zones and realized I could get crabs shipped to their doors in 8 hours but it would cost more money.

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Instead of guessing, we started asking our customers and they loved the idea not just personally but to gift to their family and friends. Within weeks, we had launched a brand new website with an online store and started shipping our family’s products to blue-crab junkies and seafood-lovers across North America! We knew nothing about ecommerce so we had to learn everything on the fly.

I had started several companies in the past, but one one was profitable. However, they were invaluable because only when you fail can you learn. My other projects included:

  • 64-computer internet cafe while a Sophomore in college (I received 33 college credits!)

  • Change-elimination from cash transactions patent and software company

  • Large apartment brokerage in MD, DC, and VA

I funded this project with about $50,000. You don’t need venture capital to grow. It’s about being smart with marketing and partnering with companies or influencers who have existing customer bases to grow lean.

We launched with a "minimum viable product" and listed to customers. This aloud us to pivot our business model, shipping model, pricing, offerings and such without investing too much money or wasting our team’s time.

Describe the process of designing, prototyping, and manufacturing the product.

We buy our product from our retail stores, who catch the crabs every morning. Mother nature creates our product in the Chesapeake Bay.

We were lucky to leverage upon an existing 33 year old family-owned seafood business. We have 16 crabbers and a fleet of third parties as the stores go through about 75,000 bushels of crabs per year, which is probably more than all of our combined Maryland competitors. We have access to over 100 SKUs from our store but we received valuable feedback from an indirect competitor to keep our site clean and non-confusing.

Manufacturing

You can’t manufacture crabs nor do they come in one size. These are living, breathing animals that will pinch hard! Buying seafood requires long-term relationships. Everyone wants to sell crabs around summer holidays (4th of July, Labor Day, Memorial Day, Father’s Day) when everyone else wants them.

But who does the crabber give them to? Us, because we give them work 365 days per year. This business cannot be entered in with tons of money. It has high barriers to entry that requires leverage to grow and I recognized this opportunity looking from the outside in. My family is so busy handling 1,000,000 customers every year and frankly they have money and got a little lazy.

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So what’s so special about Maryland Crabs?!

To survive winter, Chesapeake Bay crabs have to build up extra fat stores which gives them that sweet, buttery flavor you won’t find in other types of crabs or in blue crabs from other waters.

This is our competitive advantage - no one can harvest them to support national demand like Cameron’s Seafood can. I saw it as a "low hanging fruit" opportunity that I knew was 100% going to be successful. Crabs are sexy things to sell and we are the largest company that has access to the best tasting crabs in the world!

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Packaging / Gel Packs

Shipping heavy perishables is about the hardest and most expensive thing. You have to send heavy products in 1-2 days while keeping the temperature between 34-41 degrees during the summer when heat can breach 100 degrees.

We decided early on to ship fresh and have always handmade our food each morning. To ship fresh means using gel packs not dry ice. The first test shipments were to friends and family across the US. Our gel packs kept arriving melted so we kept adding gel packs (industry standard is ⅓ gel pack-to-product-ratio but we were using a 50% ratio and still having problems.

I called the gel pack manufacturer and screamed that their gel packs kept melting. They asked me how long I was freezing them for. I replied ‘In 48 hours they are rock hard’. He laughed at me and said ‘son, gel packs take 5 weeks to properly freeze’.

I remember my heart dropping in my chest. We didn’t have enough freezer space to chill gel packs for 5 weeks. I didn’t have the money to be in the cold storage business. I thought we were screwed. I started doing research. I knew we weren’t the first company to ship perishables. I contacted Blue Apron and Hello Fresh and within 24 hours I found out they buy pre-frozen gel packs - problem solved!

Some seafood like Alaskan King and Snow Crab arrive frozen so we use dry ice. We also add dry ice on some two-day transits and based on the shipping state’s temperature. (I’m looking at your Florida).

Boxes / Insulated Coolers

When Amazon ships me multiple products they shove them into the smallest possible spaces because "Fedex and UPS charge you the higher of the package weight or dimensional weight (DIM) of the box. Dim weight is calculated by LxWxH / 139."

After looking at our first 100 shipments I realized we were getting DIM weighted on 85% of packages meaning our boxes were too large. It took me 3 months to find the perfect supplier and figure out how to store them or pick them up within one hour. My family has a large house with 4-car garage. I’m the oldest of 6 kids and we have all moved out so the space was wide open.

I did try non-EPF (styrofoam) coolers that are more "green" but they were much more expensive and in startup mode you need to cut expenses. We sent test packages to FedEx who tested them for free and we deduced that EPF were most coolant efficient and cost effective. I figured since we weren’t doing weekly subscriptions it wouldn’t be a problem.

After our tests we decided on this:

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Some initial startup costs and tasks included:

  • Creating the website my wife designed (thanks Mimi)

  • Arranging shipping carriers

  • Buying and storing packaging materials like insulated coolers

  • Dry ice

  • Frozen gel packs

  • Labels

  • Bags

  • Product inserts.

My cousin Pey originally did all the fulfillment but we quickly grew and now have five full time employees. We already had the food licenses, state health inspection permits, and insurance from our retail stores. We don’t have food dead loss because the stores sell what we don’t.

Describe the process of launching the online store/business.

We had never created an e-commerce site. I had no ecommerce marketing experience and I only lurk on social media.

For our website platform we looked at Wix and Volusion but they weren’t robust. We started googling online fish companies and found one that looked clean. The footer had the name of the website developer. We contacted them and told them my wife is smart, young and willing to learn how to create a website. They consulted us in exchange for crabs. They advised us to use WooCommerce.

You don’t need to recreate the wheel. Find a direct or indirect competitor and learn from them. Order from them. Analyze their website and sign up for their newsletter and social media to see how they market. Immerse yourself in your market and copy what works while emphasizing your competitive advantages and customer service experience.

My wife is really the brains behind our website, emails, and customer service. Honestly, none of us would be here today without her. We joke that she is responsible for 90% of the success. She’s a perfectionist that genuinely cares. I could NEVER afford to hire someone like this. My guess is she has saved the company a solid $100,000 in the first 6 months.

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I started documenting our startup launch on reddit and received really good feedback about our pricing (as it pertained to shipping and a first-time-customer sampler).

Our competitors charge for shipping but I knew Amazon has trained all of us that Free Shipping is the standard. Psychologically, customers would rather you bake it into the price then charge them a fee. It’s hard to ship from Maryland to California and have a set of rules that applies to everyone without losing money on some orders.

Maybe one day we will get a fulfillment center in Kansas so we can hit every state with 2-day ground shipping. 48 hours is the maximum time you can push for fresh food shipping. We have toyed with flash freezing all items but we feel there is an appreciable loss to the taste and consistency of crabs.

FedEx/UPS

When you start you don’t have volume so it’s hard to negotiate from a position of strength. It’s hard to pin FedEx against UPS against each other because you are asking them to fight to win peanuts and if you can’t hit your minimums their introductory pricing will kill your margins. The answer is find an association that has volume and discounted shipping. We chose FedEx for these reasons:

  • Their association rates were cheaper than UPS

  • They cover more ground zip codes than UPS (from our east coast fulfillment center)

  • Their saturday ground network was vastly larger, and most of our customers wanted crabs on the weekends

Both companies try to get you to take insurance but don’t. You’ll never use it and when you do you will spend more money on coverage than recovering money. They also require a daunting amount of information that your carrier won’t supply. It’s an annoying money pit.

You should aim for <3% Fedex shipping issues and <1% internal fulfillment issues.

The Launch & Customer Retention

We launched on June 24th, 2017. Our first sale was five packs of our signature seasoning and you can’t imagine how excited we were to hear the phone ding!! After the launch we thought we could tap into our existing retail customer base.

The problem was that our store prices are so low (we operate on volume like Walmart) and customers didn’t want to pay for shipping and packaging. We did set up tablets to collect emails so they can gift their friends. I remember sitting there thinking we need to tap into people that moved from Maryland that cannot get the crabs and people that wanted the convenience of home delivery. Remember, unless you get Maryland Crabs from the Chesapeake Bay they will have no taste and will cost as much as the real deal.

The biggest challenges were and still are customer acquisition cost effectiveness and marketing. We asked our customers for feedback and analyzed all our orders. There were about 15% repeat orders, which we thought was low but a huge amount of customers were sending our Maryland Seafood as gifs for holidays, birthdays, and parties in addition to diner surprises.

Pay attention to what your customers are buying, saying, and why they are buying a certain product. Your customers will tell you their needs.

As a result, we added a hand-written gift messages and created a Gift Tab. We learned millenials were not our main customer but older people with large incomes. Our demographics are 60% females aged 35-90. I tried picturing my target customer and gave her the name "Sally". Where does Sally shop, what social network (if any) does she use? Where does she read? What TV and radio stations does she like?

We learned that Facebook worked the best. Instagram was OK and eventually that generation will be our target demographic, but, who knows how long Instagram will be around... No one cares for seafood on Twitter. Today, we are focusing on YouTube. Crabs are a sexy seafood and people love seeing them and feeling like they are part of your inner workings so we will give them that.

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

Honestly, the Blue Apron and Hello Freshs’ of the world have taught people it’s ok to receive fresh food delivered to your doorstep so that has been HUGE.

During our first 3 months all we heard were crickets. Customer’s weren’t finding us online. Our site was not SEO optimized and we didn’t know how to handle PPC ads. We weren’t prepared with a marketing plan and that was a mistake. I waited too long to hire a marketing specialist and it’s my biggest regret.

Initial PR

I started calling all the large newspapers pitching their food critics, their startup business writers and even pitched the angle of immigrant-run companies. My first hit was with the New York Times. "I googled “New York Times Food" and learned Florence Fabricant was their critic. I then googled “Florence Fabricant email” and asked her to sample our food.”

I read she is a stern critic so we were worried but to our surprise she loved the food and when the article came out we did close to $40,000 in sales in three days and could barely handle the volume. That was an intense week but made it happen. We did the same with The Washington Post , Forbes, Bethesda Magazine and Baltimore Business Journal. This has been our best marketing to date but it can only go so far.

Here is the EXACT EMAIL I used to contact the food critic at the New York Times

Subject: A story of two cousins who founded Cameron’s Seafood, Maryland largest Maryland Blue Crab and Crab Cake provider now ships nationwide

Hi Florence,

I own Cameron's Seafood Market, the largest seller of Maryland Blue Crabs and Crab Cakes since 1985. We just started shipping nationwide and I need some help spreading the word. Here is a PR link for some reference: http://www.prnewswire.com/news-releases/camerons-seafood-now-shipping-nationwide-300481057.html

My thought is to have you do a piece on our food. I can ship you some samples. Let me know if interested!

It worked and it generated more money, at full margins, than anything else we have done to date.

To contact the press, I recommend targeting macro press (i.e. USA Today). To locate the right contact google your indirect competitors or other vertical companies (i.e. Hello Fresh) to see who wrote their articles. Google the writer’s contact information and send an email introducing your company. Offer them samples. Know who you are contacting. If they are in foodies discuss your food. If the New York Times didn’t respond to my email I would have contacted their small business contacts and pitched a "startup food delivery business" story with a focus on the the business model and business plan. If one door shuts just open another until you have results. I used Google Docs to list all my contacts and I keep notes and monitor when I last followed up.

Google / Facebook / Bing

These still give us about half of all our traffic. We worked with a specialist to get our ads performing at 400% ROI and maintain that level. However, since our profit margins are low it’s hard to justify a growth strategy using PPC so we cut it from 20% to 10% of our gross revenue.

SEO

We hired a third-party company to handle our SEO. Our organic traffic is about 30% and that number is growing. But you know, SEO is key to lowering your customer acquisition cost. Blue apron is at $250 while we are at $45.

Email Marketing

This provides a very strong ROI. About 6 months into the business we revamped our entire site to focus on two actions: collect emails and purchase seafood. We have seen a 400% growth in emails in just 90 days. We are currently at 22,000 emails. Email is 7% of our traffic. I spoke to an indirect competitor who convinced me to focus on marketing. During that call I realized we had missed a huge opportunity with our 1,000,000 annual customers. We weren’t collecting emails and they were already customers. Think about how many out-of-state family they have that could be receiving crabs as gifts. I bought Kindle Fires (they are $50 so even if employees or customs stewal them it’s no big deal) and installed them at all 14 POS. When you provide your email you get a few dollars off that day’s retail meal. It was an immediate success! Online, I made sure each page had one or more places to collect emails.

We had a pop-up on that offered $10 off but it only had a 1.67% conversion rate so we switched to a wheel game, which allows you to enter an email to win 5%, 10%, $20, and a bushel of crabs. This literally has 10x our signups to 10.67%! If you look at our site www.cameron's seafood.com you will notice we have four places that try to collect your email. We even have the home message that states "ENTER YOUR INFO TO SEE IF WE SERVE YOUR AREA."

We love using Gleam.io giveaways with influencers and indirect competitors to grow our emails. I know the above recommendations work but this is too clever. To win our prizes you have to enter your email. To get more chances to win you have to take actions like visiting a page or inviting friends (who enter their email) to join. Last week we had a campaign generate 1,600 emails in one day! You have to state in your rules that all entrants agree to let you email them.

Influencers

They provide access to existing niche customer bases. We find them on Instagram and Youtube. We provide them free food, give them $20 per sale, and sponsor giveaways to their audiences.

You want to target macro-influencers in your field not just famous people with huge followers that will result in low conversion rates. 5% conversions are possible if you do it right. For example, a Keto diet macro influencer with 250,000 followers will have a dramatically higher conversion rate for us vs. a rapper with 5,000,000 followers.

Partnerships

Your product may compliment another. For example, Old Bay Seasoning compliments Maryland Crabs so it’s natural that we try to arrange a partnership to tap into each other's’ customers.

We don’t sell on Amazon or wholesale to big box retailers yet but are exploring that possibility. Honestly, we aren’t set up for the demand they would create so we need to expand.

This winter, we plan to expand our fulfillment center. Amazon is a great idea even if they take 15% because that’s a marketing expense. You should have 15% to 20% set aside for a marketing budget in a startup.

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

Sice I run an apartment brokerage "I spend my nights and weekends working on the business growth and my goal is to create of system for each of our daily tasks so simple a monkey could do them. If you have the funds then hire and delegate all the menial tasks you can so you can focus on top-line growth. If you don’t have the money then work your butt off.

I spend my nights and weekends working on the business growth and my goal is to create of system for each of our daily tasks so simple a monkey could do them.

We hit profitability a few days ago and are super excited!

Quick Facts:

  • Gross Margins: 15% to 35% on $165 average orders

  • Cost of goods: 47%, which seems high but we sell premium-grade seafood. What would you rather sell 1) hot dogs at 80% gross margin for $1.50 profit per or, 2) On crab order at 20% margin at $40 profit?

  • Customer acquisition costs: $45

  • Ad costs: 20% of revenue. We will dial it back to 15% once we hit a critical mass of customers.

  • Repeat Orders: 17%

  • Monthly traffic: 85,000 hits a month. We took over www.cameronsseafood.com after it was 10-years old. IT had about 25,000 hits per month already.

  • Avg time on page: 66 seconds

  • Conversion rate: 1.1%

  • Email subscribers: 21,000

  • Social media engagement: 9,100 Facebook and 10,600 on Instagram

Distribution

Our fulfillment center is literally inside our retail HQ in Rockville, Maryland. We arrive at 5am to hand-make the crabcakes and crab soups from that mornings crab catch. We steam and chill the crabs, which can take 3-6 hours to properly cool and reduce internal moisture. 100% of our sales are from www.cameronsseafood.com.

Since we have 30 foot ceilings and about 1,000 SF we have room to expand by building an upper level. It sucks carrying boxes and food upstairs for the packaging but we have to get them done every day before FedEx arrives with their truck. Because we let customers choose their delivery date we always know the minimum orders we have to prepare for tomorrow and ground packages must be dropped off by 6pm or the package is won’t arrive on the proper date. It gets hectic with 3pm order cut-off times.

New Fulfillment Center

We plan to build a new fulfillment center in a warehouse a few miles away. We will finally have multiple loading docks and everything one one floor...no more stairs! I looked into outsourcing the food prep but our business is particularly labor intensive and requires specific training. For example, we have to catch the crabs from the Chesapeake Bay and drive them to our stores early. 15% die during. Then we sort/grade by size and gender. Third-parties want to automate everything and aren’t set up for our niche.

We are noticing local Marylanders buy online as opposed to driving to our 14 locations which make us think hot-food home delivery within a 60 mile radius has merit. We are monitoring retpeat orders to see if the customers demand a subscription model. We aren’t doing wholesale at the moment but we have meetings set up with Costco for our crab cakes.

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

A couple things have really stuck with me:

Focus on customer service.

If you focus on the customer and customer service you will have viral growth. You want long-term customer relationships with a focus on 5-star service so they tell their friends. Word-of-mouth is the best type of marketing.

No matter what our SEO or marketing says the bottom line is Amazon has taught people to read reviews. We have the only cash refund or reship policy in our industry. We really care! Call us and we would help you order a pizza.

No matter what our SEO or marketing says the bottom line is Amazon has taught people to read reviews

Simple, focused web site design.

A focused message and easy customer experience is key. Don’t try to do too much at once. Don’t confuse customers. If you have a lot of products organize them well.

Get creative with your marketing

Try contacting influencers to grow your email base because emails can be your highest marketing ROI. Give them free products and have them blog or youtube about them. Offer giveaways to their audiences. Give them money for sales they generate and try to get 12-month commitments.

Your website should have an SEO focus because that’s how people search for new products. Third-party reviews are your marketing proof so make sure to respond to all reviews and work on 5-star ratings.

What platform/tools do you use for your business?

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

I’m a big Kindle reader and Audible guy (my car is a library on wheels). Favorite books:

  1. Delivering Happiness: A Path to Profits, Passion, and Purpose

  2. Sam Walton: Made in America

  3. The Everything Store: Jeff Bezos and the age of Amazon

Advice for other entrepreneurs who want to get started or are just starting out?

Beginning a new business can be scary but just start small but work on it obsessively. Immerse yourself in your chosen field - try to know more than your competitors and focus on getting a minimum viable product out the door as fast and inexpensive as possible to get customer feedback. Then pivot and repeat. If your startup takes more than 3 years to be profitable consider it a hobby and move on.

If your startup takes more than 3 years to be profitable consider it a hobby and move on.

Do everything yourself at first and put in 90 hour work weeks. Once you set up the basics work on creating systems for each facet of your business - fulfillment, sales, marketing, automation, even accounting. Everything.

Create the ability for growth on day 1. Create a well oiled machine that makes you money while you sleep. Can you build a business without fundraising? If so, what is your customer acquisition plan? Are there competing examples of success stories that you can follow so you don’t have to recreate the wheel?

Most successful companies spend hundreds of thousands of dollars on a customer acquisition strategy including how they market. You can stalk them and follow their footsteps for free because success is copyable and your startup likely isn’t taking us to Mars. You don’t have to have the best product or service but you have to be better prepared than your competitors.

Find your indirect and direct competitor and order from all of them. Reverse engineer what they do but do it better, cheaper and with better customer service. Find their pitfalls and don’t repeat their mistakes. For example, I contacted Hello Fresh and visited their headquarters. I ordered their food. I learned how they ship. What gel packs they use. What box manufacturer they use. How they market and this information was free and really fun to learn. They raised money to grow so I challenged myself to do it without public funding and it’s working.

I think too many entrepreneurs delay their product and website release because they think people will steal their idea but in reality nobody has the time nor do they care about your idea.

Keep reading! Most people stop reading after college but does learning magically end then? NO! Look at wealthy people they all read. If you hate reading get audible or watch youtube videos.

Are you looking to hire for certain positions right now?

We are hiring!

  • Influencer marketer to help grow our emails

  • Marketing specialist to create partnerships with complementary businesses with an established customer base (ie.e Old Bay Seasoning)

  • Blog and recipe writers

These are paid positions but they can also be unpaid interns. All the above are full-time, paid positions with tons of room for growth but we also are hiring unpaid interns. You can do this job with an internet connection, a phone, and passion. We don’t care where you live as long as you are a good communicator.

Where can we go to learn more?

Want to start your own business?

Hey! 👋I'm Pat Walls, the founder of Starter Story.

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