Small Business Briefing

Battle of the summertime beverages heats up

The Globe and Mail

Margarita with lime (Comstock/Getty Images/Comstock Images)

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Plunging into a saturated industry can be difficult for any small operation. Add a few market-savvy players with deep pockets, and you've got a a really steep hill to climb.

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Take Big Easy Blends, for example, a small but growing operation in New Orleans, profiled here in Bloomberg Businessweek. Longing for a pre-mixed frozen beverage that stayed cold, it devised the Cordina - also known as the Mar-GO-rita, which it claims rivals the best frozen cocktails on Bourbon Street.

Launched in 2009, the company had the makings of a "fairy tale" small business success story. After a successful entry into the market, it generated $4.6-million in revenues in 2011, inked a deal with Walgreen for distribution and bumped its head count to 126 employees from 38.

Life was good, at least until a bigger player by the name of Anheuser-Busch came along. Recognizing the opportunity, the company released its Bud Light Lime-A-Rita in 2011 and the product, in the first full week of sales, hit No. 1 among premixed cocktails.

Can a small fish survive in a sea of spendthrift sharks? Yes. But it's more likely that if the company is performing really well, it  will eventually be sold to a larger company. Take Glaceau’s Vitaminwater which Coca-Cola bought in 2007, for example. Or Creemore Springs Brewery, which sold to Molson Coors in 2005.

And if they do happen to make it on their own, at the very least, they've got to have a gimmick. Even with a catchy hook - Jones Soda Co., for example, offers unusual or 'gourmet' flavours, unique and customizable labels as well as limited edition tastes while the former Jolt Cola used to offer twice the caffeine as soda giants - consumers are fickle and success is not guaranteed. The latter filed Chapter 11 bankruptcy in 2009 and rebranded as Jolt Energy.

Whether Cordina will face a similar fate is yet to be determined. For the time being, its product - frozen, in a pouch - is markedly different than what the bigger companies have on the shelves, but who knows how long that  will last.

I'm a business owner, not an entrepreneur

Utter the word 'entrepreneur' and images of high-powered, jet-setting business people like Richard Branson, Donald Trump and Oprah Winfrey may come to mind. But despite its currency and pop culture relevance, new research has found that small business do not like actually care for the term 'entrepreneurs.'

Out of 1,200  business owners and startups surveyed by Sage, just 4 per cent say they saw themselves as entrepreneurs. More than half - 53 per cent - said they preferred the term 'business owner,' with with 26 per cent describing themselves as being self-employed.

According to The Financial Times, Lee Perkins, managing director of the small business division at Sage, suggested the word 'entrepreneur' had “become sullied over the past few years, ” adding that “They equate the word to someone who has multiple ideas, rather than the traits of someone who might build and run a robust business."

Small business takes centre stage in U.S. election

As the U.S. presidential election draws nearer, small business owners - and the contentious issues that affect their operations - are being thrust into the spotlight.

The Washington Post reports that earlier this week, Mitt Romney, the Republican presidential candidate, made his pro-small business platform clear when he promised that if elected, he would not only lower taxes, block health care reform and eliminate cumbersome federal regulations, but he also vowed to remain "all ears" to the ever-changing needs of business owners and actively seek their advice.

Mr. Romney also took the time to point out the current administration's flawed 'anti-business, anti-investment and anti-job' policies, going so far as to say that "Obamacare has frightened more businesses from hiring people than any piece of legislation I can recall."

Barack Obama recently defended his own small-business agenda, urging the approval of the 10-per-cent income tax credit to companies that create jobs. He also criticized Mr. Romney's business background, arguing that he profited from the failures of other working Americans without hiring any workers.

As the U.S. economy continues to stumble and as November draws closer, solutions to address the most pressing challenges confronting small business owners - including access to capital, unruly red tape and sluggish hiring - will become all the more urgent and all the more important.

EVENTS AND KEY DATES

Global sales strategies for ambitious Canadian entrepreneurs

This workshop held on June 14 and 15 in Ottawa, led by Ken Morse, serial entrepreneur and founding managing director of the MIT Entrepreneurship Center, is tailored to the needs of innovative, ambitious Canadian companies and aims to teach core skills of entrepreneurship and global thinking to address skills exchange, mindset and significantly raise ambition within the business. Laura Barker Morse, human capital expert, teaches the part on recruiting, team building and compensation systems.

Innovator Idol

On June 13, the RIC Centre is hosting its fourth season of Innovator Idol. The competition is built  as a hybrid of American Idol and Dragons' Den,  where four companies are invited to present their company pitch to an investor panel for feedback. For more click here.

EDITOR'S PICKS FROM REPORT ON SMALL BUSINESS

Jumping on the accelerator bandwagon

As programs to nurture startups proliferate, questions are being raised about whether they can all be sustained, all offer real value, and long-term success.

FROM THE ROSB ARCHIVES

Ten tips for throwing a great client event

Planning to throw an event for your clients? Here are some do's and don'ts

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