Marcus Lemonis is a fan of Brooklyn Biltong, a snack that founder Ben van den Heever describes as the South African "child" of beef jerky and prosciutto. "It's surprisingly good!" Lemonis says when he tries it, and keeps a package for himself.
Still, Lemonis is concerned about van den Heever's business plan. Brooklyn Biltong, which did roughly $50,000 in 2014 revenue, only distributes online today. Van den Heever had to withdraw it from the shelves of five local New York City stores in November 2014. "The profit margins weren't working," van den Heever admits, and explains that a South African co-packer was manufacturing the product for him.
Van den Heever appears as the featured entrepreneur in the most recent episode of "Ask Marcus Lemonis," a weekly Inc.com video series in which business owners have the opportunity to ask Lemonis one question about a pressing business challenge. Brooklyn Biltong's biggest problem: How to profitably produce more biltong.
Rather than abandon a co-packer model right away, though, Lemonis encourages van den Heever to keep working with one long enough to prove American consumers want to buy a lot of the Brooklyn Biltong product. Since van den Heever and his co-founder wife, Em van den Heever, know little about manufacturing, it would be too costly and time-consuming to start to produce the biltong themselves, before proving market interest in it.
"If the crazy Americans like me don't accept the product, what's your risk? Not much," Lemonis explains.
Expensive though co-packers may initially seem, partnering with one for at least a year can give you time to further incubate your business, and confirm what resonates with consumers.
For more on this South African beef jerky brand--and how you can test out your business model--watch the episode above.