Black and Fagan's Cider Company

This small cider company in Michigan had a brief life and then closed - not because there was anything wrong with its cider, but simply due to the other pressures which so frequently beset 'startup' food and beverage businesses.

Brian Black wrote an interesting and thoughtful valediction about this on the Cider Digest, and he's given me permission to reproduce it here.......

(Note added by Andrew in October 2002....sorry, but I don't know where Brian Black currently is.  The e-mail address he gave here doesn't work any more. If you're looking for a copy of his business plan, I can't help you.  I never met Brian in person - we just corresponded frequently by e-mail at the time he was developing his business.  But after that, I have no further information.........)

Subject: the end
From: "Brian Black" <>
Date: Mon, 6 Nov 2000 23:08:00 -0500

Black & Fagan Cider Co has closed, but only for personal reasons. I
wanted to write to the Digest and explain our history, encourage others
to make cider commercially, and offer all kinds of help and advice
(free!) to anyone who is interested.

By way of background, Goldfinch Cider was sold in green bottled crown
capped six-packs and kegs throughout West Michigan. I (Brian Black) was
the operations/marketing/money guy and Dan Fagan (my lifelong friend and
cousin) was the cidermaker. We have made cider together since we were
illegal to do so. We're both 40. I was "between" corporate marketing
jobs in 1997, so we decided to try this. It worked. He kept lawyering,
and I ended up with my other dream job (historic building restoration -
that paid money) after we started B&F.  We both continued our "day jobs"
throughout B&F's life.

We grew the business to the point of needing major investment (only
$150,000, to break even in year three) through our own meager cash
investments (no more than $10,000 each over three years) and discovered
that it is physically impossible to each operate a business full-time
(we're self-employed in our day jobs), operate a hobby business, raise
investment capital, homeschool 6 kids (each), have a life, and remain
married. Can't be done folks. So we finally cried "uncle". It was easy
in a way because we both love our profit-producing jobs. So that's why
we quit. We would sell the whole thing if we had the time. Looking back
after only two months, I don't know how we did it.

So how was it? Great. We made the best all-fresh "draft" cider in North
American, as far as we can tell (no offense, but you have to believe in
what you do). We had a very loyal local following, and a huge amount of
fun. The best part is selling it. Giving a customer a glass of YOUR
CIDER and watching the response is wonderful. "Hey, this is really good.
This doesn't taste like (insert national brand name here). This tastes
like apples, or champagne or something. What is it called? Can I have
another taste?" Now THAT is fun!

What would we do differently? Knew you'd ask. I'll enumerate.
1. Forget "draft cider" as a 6-pack market. We only chose to enter the
market this way because I thought that people would find cider more
"approachable" in this package. Partly true. AFTER we introduced
Goldfinch, the draft cider thing boomed, and we found ourselves lumped
in with some real swill (Hardcore, Cider Jack, Hornsby's, Woodchuck,
etc.) in a market we, well, detested ("Hardcore"?! Give me a break. Grow
up.) We wanted to sell to adults (as in "adult beverage"), and kept
sliding into the post-pubescence "market segment" (see #2 below). My
fault. We should have packaged Goldfinch in 750 ml bottles with crown
caps. This would have put us in a wine market, where we are personally
comfortable, and where cider as a product belongs. We still would have
offered it in kegs, and this would have added a unique aspect to the
"wine" side of things. And Goldfinch was always better from a keg. Cider
in small bottles in not very good for it. Also, we spent well over half
of our time running a bottling business, not a cidery. They are two
overlapping businesses, believe me. Counterpressure bottle filling in
scale is very complicated, technical, difficult and time consuming. But
I'm not bitter. We had fun. Then there's sterile filtering of cider, the
Final Frontier. Forget it. Don't do it. Can't be done. We know; we have
the bills and the spills to prove it.

2. Don't use a distributor, if you can avoid it. I hope they don't read
this, cause I know they have "connections", but as a group, they should
be avoided. Sell it yourself, deliver it yourself, if your State allows
it. Ours did. We just got tired of hauling full kegs around (they're
very heavy) late at night and on weekends, when we were least welcomed
by our customers. Beer distributors just don't get it, which is what we
went with cuz of the kegs. They see everything as a "segment" which is
their job I suppose. During our last month of operation this adult
beverage was introduced called Mike's Hard Lemonade, made from hard
lemons I guess. This is the strong drink of the drinkable yogurt and
instant latte crowd as far as I can tell. Anyway, this citric swill was
rammed into the market with the usual marketing drivel, and it took off
on the usual "ramp". As I was making a delivery to our local distributor
late one evening, the Sales VP crossed by path and said "Boy that Mike's
is selling like mad. Your market segment is really hot!" My market
segment. Really hot. Uh-huh. And I wondered why we had problems. So
these guys don't get it. We should have at least used a wine
distributor, but that goes back to #1 above.

Now that I think about it, those are the only two! Not bad, really. We
made some dumb "tactical" level mistakes, but these are the two biggies.
But they wouldn't have killed us.

I REALLY want other people to do this. Dan and I will do anything we can
to help. I developed a really nice business plan and investors
prospectus (am I humble or what) that I would be happy to share with
anyone. We know a whole bunch about this now and I want it to keep going
because people need to drink good cider. We walked away owing very
little money, and owning very little equipment (FOR SALE:  labeler, Z&N
oxygen tester).

The cider market is waiting to be developed by a True Believer with
money. We had no trouble finding investors; we had four $20,000
commitments after six contacts: but it took six months to make six
contacts! Cider is different enough that it is attractive to investors
if presented well. If you make good cider (which I assume you do),
people want to become part of it somehow.

If you live in a cider state with even the usual varieties (you can make
great cider with them if you know how to blend), there are plenty of
people around to create a market. You only need to be regional to make a
living at this.

The offer stands. Write back.

One more thing. Andrew Lea made this entire thing possible - I mean it.
Dan and I mostly "figured things out" as we went, but we could not have
figured out all of what he already knew, and so eagerly shared with us.
Here's to a Great Man! May we meet soon and drink!

Brian Black
Retired General Manager
Black & Fagan Cider Co.
Grand Rapids, Michigan

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