How An Entrepreneur From Ohio Launched His Own Applesauce Company

Ethan Holmes

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Published: January 12th, 2019

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Ethan Holmes

Founder, Holmes Mouthwatering

$40K

revenue/mo

Founders

Employees

Holmes Mouthwatering

holmesmouthwatering.com

from Cleveland, Ohio, USA

started January 2015

$40,000

revenue/mo

Founders

Employees

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Reallionaire: Nine Steps to Becoming Rich from the Inside... Farrah Gray

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

My name is Ethan Holmes. I’m from Shaker Heights, Ohio and I am the 25-year-old founder and CEO of Holmes Mouthwatering Applesauce.

Holmes is an all natural applesauce product I created at the age of 15 and have since grown to hundreds of grocery stores throughout the Midwest.

how-an-entrepreneur-from-ohio-launched-his-own-applesauce-company

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

I’ve always had a love and interest in entrepreneurship and starting my own business. From the age of 11, my early developments were starting a seasonal lemonade stand and landscaping business around my neighborhood.

On my 15th birthday, I was given a book by my godmother entitled Reallionaire that told the story of Farrah Gray, a 14-year-old African American boy who made a million dollars from creating and selling his own product.

When I read the book, it motivated me to create and develop my own food product, with a goal of selling it on grocery store shelves...I just had to figure out where to start.

So I did research via Google on the healthy food market and after a few weeks, decided on applesauce: A product loved by many around the world, but typically always made the same...I wanted to innovate the product completely and do something different.

Next, I turned to my grandfather for guidance on how to make applesauce from scratch. After a few days in my mom’s kitchen, I had learned the process of peeling, coring, cutting apples, boiling the fruit and blending it to the right consistency. But the recipe was still incomplete. It lacked the sweetness and wholesome taste that I wanted to achieve, without a syrupy, artificial aftertaste.

I would then spend the next year on and off in my mom’s kitchen, trying new ingredients and formulas to make the perfect applesauce recipe.

After a year, I eventually came up with the following: Golden delicious apples, pears, and apple cider. 3 simple all-natural ingredients that make up our product to this day.

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

My process of manufacturing my first food product was a challenge due to the fact I knew very little about cooking food. I had to experiment with various fruits and measurements. I would record the recipe on my refrigerator and critique it as I went along.

Describe the process of launching the business.

I launched Holmes Mouthwatering Applesauce with a mix of everything: business competitions (grant funding), micro loan funding (debt financing), IndieGoGo crowdfunding, and our first equity investment deal in 2015.

I started my business using a lean model of renting space and equipment as needed in a shared kitchen located in Downtown Cleveland. I was an undergraduate studying business at Hiram College at this time and would only make a small amount of inventory a month for events and ecommerce.

I built credit relationships with suppliers and took advantage of being a young entrepreneur to gain exposure of my products. Thus helping me gain the next big opportunity, my first supermarket chain Heinen’s in 2015 (23 locations).

Once I began to gain revenue and consistent production, I switched to a contract manufacturer that would make and package my products using my recipe. It saved me time and money, but I lacked control in the process and quality.

After successfully raising $130K in investment funds last year, we purchased equipment and began leasing our own shared facility to create and produce our products in 2018.

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

What has worked best for me to attract and retain customers is being public and promoting my journey and story as an entrepreneur in America.

Social media

Since the beginning of starting Holmes Mouthwatering Applesauce, I have utilized social media, specifically Facebook as a way to make others invested into my story and success.

For example: If I made a new sale, I would post a photo of me shaking hands with the purchaser and tell a story of how it took me months to acquire. This would motivate people and allow them to see the behind the scenes of a running a business.

Press

I also took advantage of press opportunities in Northeast Ohio by pitching my story to journalist and news networks. Just from cold calling and emailing my story, I have been able to get featured in the following: Black Enterprise, Now This News, Plain Dealer, FOX 8, and more.

Speaking

Lastly, I believe it is important to publicly tell your story as much as you can and give back to the community in the process.

Since the start, I have done over 100 presentations at schools, universities, summer camps and even a military base in January of this year. Most of the presentations were unpaid. But they have allowed me to create new customers, gain exposure and larger opportunities.

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

I am currently producing Holmes Mouthwatering Applesauce in a shared 10,000 sq foot kitchen and warehouse facility in Bedford, Ohio. I have a staff of 3 production workers that handle all of the prep, cooking, and packaging of our products. We currently produce up to 4,000 units a month, 500 gallons of applesauce.

We have built relationships with local growers and source all of our inventory from Ohio orchards and packaging suppliers.

Our applesauce is available in 200 store locations throughout the Midwest: Whole Foods, Heinen’s, Kroger, Marc’s, Dave’s Market, Earth Fare, Target, and more. We sell direct to some stores, but most of our business is selling to distributors and acquiring new warehouses to carry our products for their customers.

The future for Holmes Made Foods, LLC and Holmes Mouthwatering Applesauce is more store locations, regions, and creating healthy but yet delicious products.

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

One thing that I have learned since starting a business is the importance of knowing how to deal with people and problem-solving.

There are many times you’ll have to defuse situations or deal with different personalities. How you react and move forward from those situations defines your outcome.

What platform/tools do you use for your business?

My favorite tools to utilize for my business are the following: Gmail, Apple Notes, Mobile Banking, Google Spreadsheets, and pretty much anything Apple and Google.

I love having all of my documents and files synced on all devices and accessible in the cloud.

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

Research what you want to create or do, outline what it will take to start or get to the next level, and make it your mission to get through the list.

Once you’ve done that. Create more lists, and repeat. Remaining passionate, persistent, and patient is key.

Are you looking to hire for certain positions right now?

I am always looking to work with hard working, passionate people that can help grow my company. Contact us for any interest in employment or contracting opportunities: [email protected]