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"Tiered pricing and strategic partnerships are my secret weapons in business." Meet Carolyn Phillips

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Carolyn Phillips was always passionate about food and entrepreneurship. Yet, she wasn’t quite sure how to combine her two passions until her husband asked why she had two freezer chests full of homemade frozen pops in their dining room. 

 

We caught up with Carolyn to ask about the journey to becoming a small business owner, the big lessons she's learned about pricing and the exact moment when she realized she had to start thinking like a CEO.

 

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Name: Carolyn Phillips

 

Business: Alchemy Pops

 

Started: March 2015

 

What inspired you to start Alchemy Pops?

 

My undergrad major was in Entrepreneurial Management and I focused on the sustainability of food systems in graduate school. I always intended to start a business, but I weaved my way into creating Alchemy Pops completely sideways.

 

Originally, I threw a party at my house and combined ingredients from the farmers' market with my liquor cabinet to make a bunch of boozy popsicles. They were a big hit! 

 

After that, I started experimenting with different flavors. I loved going to the farmers' market to buy small batches of fun ingredients, like local melons, then mixing them with herbs from my garden. I soon had two freezer chests full of pops in our dining room. My husband was like, “What are you doing?!” 

 

That’s when I realized I would start a frozen pops business that sold handmade produce from farm-fresh ingredients.

 

When did you know your business was going to work?

 

There is a nationwide jewelry retail chain called Kendra Scott. I’ve always been impressed by Kendra because she started her Texas-based business with only $500. I called my local Kendra Scott store and pitched a collaboration event to coincide with its quarterly collection launch. I called it "pop and sparkle." The staff thought it was a great idea! 

 

They then asked if I would cater at the opening of another store, with Kendra actually there. When I met her, she said her favorite flavor was grapefruit rosemary and that she couldn’t wait for my pops to be sold in Austin so she could buy them.

 

I was super starstruck. Hearing encouragement from another woman entrepreneur who also started from scratch made me realize I could definitely do it. 

 

After that, I never looked back. I focused on when I could quit my job and buy equipment, then set milestones that would carry my business forward.

 

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What has been the biggest surprise so far after starting your own business?

 

Making the transition from being an employee in her 20s to becoming a CEO took a lot for me. I had to grow into the fact that I was a small business owner, despite being a confident and competent person. 

 

I had to think, "Yes I can hire people, yes I can make a difference for farmers and provide products that people love." I had to get comfortable with being uncomfortable. I also realized that some things I’d have to learn by doing, and I couldn't rely simply on reading and research.

 

How do you price your products?

 

I offer tiered pricing or packages that meet different comfort levels. This is a volume business, so economies of scale certainly play into it. 

 

I price individual, direct sales on par with the competition so that I’m not particularly overpriced. Prices per pop vary depending on how much it costs me to vend at a festival or event. We have a minimum order number and people can come by our kitchen and fill their cooler. If they order 100 pops or more, they can also pay to have a cart set up with a server.

 

I offer a lot of packages that all come with specializations or add-ons. The price for these is based on value to the customer and not simply the costs to me, which was a lesson learned. For instance, we can stamp a wedding date or a couple’s last name onto the popsicle sticks. This type of pricing generates value for the customer and a great margin for me. We also offer corporate packages and client gifts.

 

There are some variable costs, like the price of milk. Different products have different prices depending on the amount of labor required. For a cold brew coffee pop I’m just pouring liquid, versus a strawberry pop that requires strawberry hulling. Seasons also play a role because ingredients that are more abundant cost less. I’m working on offering more products that aren’t seasonal to even out the sales cycle and help with cash flow.

 

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What is your most effective means of getting new customers?

 

Building strategic partnerships and networking helps me meet more of my target market and vice versa, which is money in the bank. I’m almost guaranteed a bunch of big orders. The Kendra Scott story is a great example because I pitched a collaborative event and they accepted it.

 

I also teamed up with a mobile donut business. Donuts are more of a morning thing, so I offer a coffee pop to complement them. Cross promotion and linking to other industries is so powerful and it's a great way to help each other’s businesses. I’m also not afraid to pitch to people, because speaking to even just one person can change the course of your company.

 

Social media is also great because people eat with their eyes. Instagram has been our best platform so far. It’s somewhat like offering a sample when people see my ice pops online, but getting to people in person is always most effective. 

 

Unless we’re doing a specific campaign or launching a new marketing strategy, I don’t typically buy ads. We’re developing a social media strategy now, but it isn’t how I’m mainly attracting new customers.

 

If you could go back in time, what’s the one thing you would do differently when starting your business?

 

I would’ve invested in capacity and bought equipment as soon as possible. I waited a whole sales season to buy new machinery, which has made the biggest impact on my company’s growth. Losing those sales cost me more than the equipment.

 

What would you like to learn today from a community of other small business owners and self-employed professionals?

 

I want to learn more about ways in which I can make sure I remain happy with owning my own business. When I talk to fellow entrepreneurs, some don’t feel content with their business because it’s a struggle. 

 

I'd like to know if there's some type of practice, technique or habit others have cultivated to make sure they are satisfied when following their passion.

 

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Share your story with Carolyn below!


How do *you* find happiness in running your business day after day? What keeps you motived and inspired to keep moving forward?

 

Share your tips and ideas with all of us below! :-)

1 Comment
Highlighted
Level 5

"Tiered pricing and strategic partnerships are my secret weapons in business." Meet Carolyn Phillips

I was really struck by Carolyn's dilemma (and hesitation) about investing in equipment which, in the long run, helped her reach a new level of success. It can be hard to make a financial commitment without a guaranteed return on investment. Carolyn's experience is a good reminder that sometimes you just have to take a deep breath, accept the risk and spend the money on what you believe in. 

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