I grew up farming. We raised vegetables, field crops and livestock. I started managing a seasonal roadside produce stand when I was 17 years old and did so for about 12 years. The produce stand was open from July through October and did about $500K in annual sales. This was a family business with my father and brothers. I left the business in 1995 because of differences in opinions and ideas within the family. Personal income was always tight and I was buried financially. There were simply to many partners and not enough net income in that business.
I went into financial planning and life insurance sales from there, at the age of 29. The business was slow building and when my father passed away in Sept. of 1997, I was in the middle of filing a bankruptcy from the accumulated debt while in the family business. I built an agency and recruited and trained other agents for the next several years. I met my current wife while working in the insurance agency. When 9-11-2001 happened business became more difficult and my heart was not quite in the insurance business anymore.
My wife Rebekah was a semester short of a culinary arts degree, grew up working in restaurants and bars and loved to cook before joining me in the insurance business mid-1999. Rebekah always wanted a restaurant and making money in the insurance business was getting tough. I knew of a bar about 3 miles from our house with a vacant kitchen. I struck up a deal with the bar manager and rented the kitchen for $300 per month. I wrote him a check on Monday and asked him to hold it until Friday. We opened the Kitchen June of 2002 for Rebekah's birthday. We purchased the needed groceries and supplies using credit cards and secured the location with the hot check and opened for business. (We did enough business that week to cover the $300 check by Friday)
We were making money with the restaurant in the bar, but not enough to cover the overhead and sustain our meager lifestyle. We found ourselves facing foreclosure on our home in mid-2003. I had to sell a water share and borrow some money from my cousin so we could keep the house and we knew we needed a better plan.
Rebekah always talked about how her stepmother raised 11 kids selling burritos on the street. We decided to give it a go. We had the food license and the kitchen in the bar. We started making burritos in the morning early and taking them to local businesses heated and wrapped in foil in Coleman insulated coolers. (The coolers keep things hot if you don't put ice in them lol) We were doing alright selling 50 or 60 burritos a day making some money and then one afternoon on the 2nd week of selling on the street an idea hit me. I was drinking a beer with the neighbor brainstorming and I said, "I wonder if we could sell 400 breakfast items in a morning?" We made a few calls and lined up some help. We agreed to meet at the kitchen in the bar 3:00 am and cook 400 breakfast burritos and sandwiches. We sold out by 11:00 am.
This was exciting for us. We knew if we could repeat this on a regular basis our money troubles would be over. Our help was temporary. We put ads in the paper and hired people to sell burritos on the street daily. We were selling 400 to 500 breakfast items Monday through Friday and a couple hundred on Saturday. This went on for several months and we were making enough money to survive and start getting ahead. (I was still running tractors on my cousin’s farm in the afternoon for some extra income.) $8 an hour.
This is when the bar where the kitchen was located started raising the rent. They went from $300 to $600 per month. When I paid the 600 for the 3rd month in a row, the owner said next month it will be a thousand. I said next month it will be vacant. You have my notice.
We scraped together the money we saved along with 10 grand that I borrowed from my cousin and we bought a nice sized food trailer. (Commercial kitchen) We set the kitchen up on our property, moved our health department license and never missed a day of selling. We were selling so much food we could not keep up.
This was mid 2004 and during this time period Rebekah and I had been eating burritos in convenience stores and grocery stores. The labels would say hot green chili burrito or spicy red chili burrito. We found this to be frustrating. We like spicy (chili pepper hot food). Although the labels claimed hot or spicy, the burritos were mostly bland. Furthermore, the labels would say things like bean and beef, but the meat was almost always vegetable textured beef protein. (Fake Meat) The tortillas used in these burritos were filled with preservatives and most of the burritos contained MSG. (flavor enhancer which does bad things to the human body)
This is when I realized there was a huge opportunity for a quality burrito made available in convenience stores and grocery stores.
Our health department license allows us to prepare food in our commercial kitchen and sell to the public. We were selling thousands of burritos per week and month to individual consumers. By this time, we had many customers ordering frozen burritos and tamales as part of their weekly grocery list. Our health department license does not allow us however, to sell to retail stores for resale.
By this time, we had been selling burritos and breakfast sandwiches on the street and job sites for a couple of years. This is when I realized it was to pretty much the same customers day in and day out. I said to Rebekah, "If we could get these burritos made in a USDA facility without compromising the quality, people would buy them on a regular basis. (Products containing meat and or cheese must be produced in a USDA approved and monitored facility.)
Rebekah found a company in our hometown of Pueblo using a trusty Google search and after several meetings and some hard core selling, I convinced them to make some burritos for Mauro's Kitchen. BY this time, it was early in 2005 and armed with samples we set out to develop a thriving wholesale business.
We quickly placed burritos in most of the mom and pop stores in town along with bars and independent grocery and convenience stores. This was good and it added some revenue to our business.
Our main target was a chain of stores owned by Kroger. (Loaf N Jug stores)
It only took 1 phone call to locate the category manager for food, and one call to her along with a trip to the corporate office (5 miles from our house) put samples in her hands. This lady (Her name was Dolly) was stepmother to a childhood friend and I figured we were good to go. Dolly said she loved our product and would get them in the stores in the next 30 days. This turned into 60 days and then 90 days and then Dolly was no longer with the company. Next, I called the Vice president of the company (Russ) I knew Russ for many years. We played a lot of basketball together in our teens and early 20's. Russ received samples the same day and said he loved the product. Said he would get them in the stores right away. Said to call Hamid, who was Dolly's replacement. Hamid never would return my calls. I called Russ a few more times but didn't get anywhere. Fed up and irritated I said I am not stressing trying to get in these stores anymore. We are making good money with our business the way it is, and I will just live with it.
On a pheasant hunting trip to Kansas in November of 2005, we stayed in a motel where each room was equipped with a microwave oven. There were about a dozen guys spread out over 6 rooms and the first morning before daylight I brought everyone a breakfast burrito. I had no ulterior motive. Just feeding my hunting buddies.
When we stopped for lunch, one of the guys approached me. He is a lifetime friend and hunting partner, my principal in high school and at the time just ending a period in office as one of the Pueblo County Commissioners. He said "Teddy, the burrito you gave me for breakfast is one of the best I have ever had. Why aren't they available in the Loaf N Jug?" This was quite the compliment. Pueblo Colorado is famous for our Pueblo Chili Peppers and this is definitely a burrito and chili eating town. I answered John with what I wrote above dealing with Dolly, Russ and Hamid. John said interesting and we went on hunting.
A couple weeks after the hunting trip, Rebekah and I were set up in front of the Ark Thrift Store with our coolers full of burritos and an Ice cooler full of cold drinks selling to foot traffic on a Saturday morning. We used to set up there every week. We had many customers who would pull up buy burritos and drive off. About mid-day my cell phone rang and it was John from the hunting trip.
John said "Take down this number. Art is the president of Loaf N Jug this is his cell number. I spoke with him about your burritos. Art said he was looking for a good quality line of burritos to sell in the stores."
I called Art Monday morning and he said to call Hamid. Hamid returned my call within 15 minutes and we did a sample cutting a few days later. We were test marketing by the following week and Hamid put me through the paces and raked me over the coals.
We had to supply a commercial food warmer and a bus cart for each store along with signage and decals on the food warmers. The test marketing in the 1st couple stores was slow selling only a few burritos per day in each store. On the 3rd day, I told my nephew Chris who was helping me at that time, "Let's display these burritos like we used to display produce in the roadside stand." Instead of a nice level tray with 5 or 6 burritos, we heated up 30 burritos and piled them on the display. We went to the 2nd store and did the same. By the time we made it back to the 1st store a couple hours later, there were only a few burritos left in the tray. We restocked and went back to the 2nd store finding the tray almost empty there as well. We started a spread sheet and showed Hamid and Art that based on our testing and the total amount of stores owned by the company, we could potentially sell 1 million burritos per year. We sold over 100 burritos per day in several of the busy stores during this test marketing period.
We maxed out our credit cards purchasing every food warmer that looked decent on eBay and became distributors for the bus cart company to bring costs down. (made some extra money selling bus carts on eBay) By the summer of 2006 we were in around 30 stores located in Pueblo, Colorado Springs and several small towns within a 50-mile radius. We had to deliver the burritos to each store on a weekly basis. Between buying equipment and delivery expenses we were not in the profit zone at this point.
In the fall of 2006, when our delivery driver was caught shop lifting a Red Bull from one of the stores, Hamid said he was going to have the distribution company for Loaf N Jug (Core-Mark) start purchasing the burritos from us and taking care of the distribution. Hamid said for me to start expanding into more stores.
We had purchased a cargo trailer which we insulated for delivering burritos. Now that Core-Mark was delivering, I used the trailer to make road trips and set up more stores. Every time we accumulated 10 or 15 warmers, I would call a group of stores from the list and proceed to set them up. We ended up setting up every store in Colorado, Wyoming, Nebraska and South Dakota. By mid-2007 we were in about 100 stores. We were starting to notice a profit as well.
Hamid called me late in 2007 and said the warmers on the bus carts did not look very good. Asked what we could do about it. I suggested a banner with our logo and promo text to go around the bus carts like a skirt. I had a sample made and he liked it. Hamid instructed me to put one on every bus cart in every store. Costing $100 each, this was a $10,000 set back and it took about 10 days on the road to get the banner placement job done.
Sixty days after making the trip with the skirting for the bus carts Hamid called and said I have good news and bad news. He said we purchased our own warmers. We need you to pick up all your warmers. He said that the warmers he purchased were all decked out and they did not need the skirting either. He said he would like to keep the bus carts however so they could haul the trays of burritos from their convection ovens to their food warmers. He said to pick up the skirting as well. Hamid said the good news is we are rolling you out to all 280 stores. I made another 10-day trip picking up warmers and skirting. I had to buy a shed so I could store the warmers.
The burritos were rolled out to all of the Loaf N Jug stores. We have been their #1 hot and ready deluxe food item for almost 14 years. We have sold over 13,000,000 burritos at the time of this writing 3-14-2020. There is a $21,000.00 order scheduled for delivery to McLane Western in Longmont on Wednesday 3-28-2020. This volume is way down due to changes in the warmer program and not utilizing the large display of the same item sales tactic.
I understand that we were in all Loaf N Jug stores as well as some of the Kwik Shops and Kroger convenience stores. I do not have access to every location because the distributors (was Core-Mark, Now McLane CO) do not share that info with us. I have heard we are also in Montana, Missouri, Washington, Kansas, North Dakota and a few other states. We currently ship to McLane Western in Longmont Colorado. We used to ship to McLane Ozark. They distribute from those locations.