Hint Founder Kara Goldin on Trying Times: “It Doesn’t Matter How Big You Get, You Need to Act Small”

Tuesday, April 21, 2020

By Kendall Fisher, executive producer

 


Kara Goldin founded Hint in 2005 and has since grown it into a multimillion-dollar company. Hint’s fruit-infused flavored water is a top choice for office refrigerators nationwide, and it’s stocked by most big retailers, along with Hint’s personal care items such as sunscreen. 

Her company’s retailers may be large-scale, but Goldin’s business approach is anything but. The founder and CEO has always believed in thinking big and acting small, visiting grocery stores herself to check on stock, fix displays and ask questions. Hint is using that strategy to respond to COVID-19, too.

As retailers’ shelves were stripped of paper goods, frozen foods and water, Goldin visited her local grocers to ensure that their stock of Hint products was being replenished in step with demand. She found out Hint’s products were taking a backseat to other “essential” goods on store shelves, so she took matters into her own hands. With the cooperation of her retailer customers, she not only restocked shelves herself, but she also reallocated field marketing employees to do the same nationwide, simultaneously saving their jobs and meeting her customers’ needs. 

Goldin also began reaching out to her retailer contacts to ease shipping and fulfillment delays, helping them place orders directly with Hint’s distribution centers. Those steps were crucial in strengthening Hint’s fledgling partnership with Costco. With full visibility into Hint’s supply chain, Costco added more Hint products to its shelves at outlets nationwide at a time when people needed them most.  

“The biggest lesson I’ve learned in all of this is it doesn’t matter how big you get,” Goldin says. “You need to act small.”

Watch our conversation with Hint’s Kara Goldin in the video above. 

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Here’s the full transcript of our conversation:

Kendall Fisher: Hi everyone. Today we have Kara Goldin on, she is the founder and CEO of Hint. Hi Kara, thanks for joining us today.

Kara Goldin: Hi. Thanks for having me.

Kendall Fisher: Hanging in there?

Kara Goldin: We're hanging in. Absolutely.

Kendall Fisher: Good. Good. Now I kind of just want to start off with, I'm sure much of our audience has heard of Hint most of them know what it is, but for those who don't, can you give us a brief breakdown, what is Hint?

Kara Goldin: Yeah, so I'm actually drinking a peach bottle right now and Kendall, if you were right here with me, I would offer you one as well. But we are an unsweetened flavored water company. So we started the company almost 15 years ago now on my own realization that I was drinking just a ton of diet soda and I wasn't as healthy as I wanted it to be. I sort of aspired to be a water drinker, but I never drank plain water because I thought it was so boring. So when I looked for a flavored water that didn't have sweeteners in it, and by sweeteners I mean not just sugar, but also the diet sweeteners that are in not only these flavored waters that are out there, but also, the vitamin waters and then the diet sodas.

And I was shocked that everything had some kind of diet sweetener in it. At that time it was NutraSweet and Splenda. Today it's Stevia. And so I just thought, I just want something with fruit and water. And so today we're the largest independent non-alcoholic beverage in the country that doesn't have a relationship with Coke, Pepsi, Dr Pepper or Nestle. We're nationwide in lots of places that many of you shop, including Target, Whole Foods, we're just now going into Costco nationwide as well. Yeah, so it's a pretty crazy time. And then in addition to that, and I'm sure we'll get into this, but about five years ago, my experience prior to this was actually not in the beverage industry and not in consumer products, but in technology and ecommerce and where I ran AOLs ecommerce initiative.

And so, about five years ago we started our own direct consumer business and we had had some small success on Amazon when they were first starting out their grocery business and then we just thought, well in addition to that there's going to be people that are really looking to just order direct from companies that want the selection of all 20 products and not just what an Amazon or a Target or somebody picks. So we started that and the last couple of weeks we've seen how that has just been incredibly awesome to be able to … so we're not reliant on somebody else's distribution centers to make sure that they're shipping our product out to them.

Kendall Fisher: Yeah, and you hit the nail on the head. We are definitely going to dive into that and I guess this is a great place to start. I wanted to know how has the current climate that we're in right now, how has it impacted Hint's business? What has been the biggest change or hit if there has been a hit? Can you kind of walk us through some of that?

Kara Goldin: Yeah, I mean, I would say that the biggest thing, look, it shocked everybody, right? What has happened in the last few weeks. I mean it's been nutty, but I think the first thing that I noticed when I was going into some of our retailers, I've always, even as the founder and as the CEO, I've gone into retail stores to make sure, even though we have a sales team whose role is actually to do that, but what I started realizing when this was really hitting, I guess about three weeks ago in my area where I live in the Bay Area, I started to see a lot of out of stocks and people were starting to really stock up on essentials not just the toilet paper and the soaps, but also water. And our product is considered water and it's not just to stores, but also to consumers who like me, want to drink more water.

And so I started seeing a tremendous amount of out of stocks. And so I started questioning like, why is our product out of stock, for example at Target or some of these other places or low in stock, not necessarily totally out of stock. And I would personally go in the back room of some of these stores to just see if it was sitting in the back room because frankly that's a whole other piece of this that if you don't have your own sales team or merchandising team to kind of pull the stuff out of the back room, especially when these stores and retailers get busy, then your stuff does not get out of the back room. So I'm typically going in the back room and even as a CEO pulling cases out and going and putting them on the shelf and making sure that they're out there just to help our sales team out.

But this was happening again and again and again. And when I went back to our sales team and I said, "Hey, I think there's really a problem that's going on in the system." And I know that some of these retailers are telling us whether it was Whole Foods or Target or some of the local stores here in the Bay area that they have auto replenishment and that everything's tied. I said, "Something is not working because it's not getting out there fast enough." And so our teams went in to those stores and then went back to our buyers from some of these major retailers and they said, "Hey we're seeing these out-of-stocks and I know we're on auto replenishment that's supposed to actually come from the register in order to restock, but it's just not working."

 
 
 
 
 
 
     
 
 
 
 
 
 
 
 
 
 
 
 
 
 

A post shared by hint (@hint) on

Hint founder Kara Goldin has worked hard to ensure her products are in stock and on display at grocers.

And so some of the retailers said, "No, it is working," and others who were really smart were saying, "Hey, we're missing sales on our end by not actually putting this stuff back on the shelf." So they started to look at the supply chain to figure out like what exactly is going on here. And a few of them owned the fact that it's just not getting ordered fast enough and something definitely is wrong, but we don't have time to figure it out right now. So we said, "Well, if you guys just want to order direct from us and then we're happy to do that even as an interim step until the supply, the distributors that we're using or you're using to get our product can get it in stock."

And so I would say that the thing that I learned in that process was if you are a supplier and you see a problem, go back and have a solution, right? … say to them like, "We're happy to get a truck and actually get it to you guys." And a lot of those buyers were saying, "Okay, we definitely get you guys through a couple of different distributors, but for some reason they're just really backed up and your stuff is not coming on the truck with them." Because again, there's only so much stuff that they can fit on a truck. And so even though we were and still are considered essential which again is the soaps and the toilet papers and all the rest of it, they were doing their own priority and not necessarily getting our stuff on there.

So we said, "Okay fine, we'll just figure out a way in our own supply chain to get the truck." And again, having our own distribution center for our ecommerce business, we were able to really act quickly and try and see what we could do and really give us all for that. So when I look back on the last few weeks and now I'm in shelter in place, but I try and help my sales team by going to one store a day and really trying to understand, have we fixed the problem? And one day I'll go to Molly Stones, which is a local market in the Bay Area and then I'll go to Whole Foods and then I'll go to Target and I'll go to Walmart and what I've seen is that the smaller scrappy companies like us that are able to actually do what we're doing and really monitor it even to some extent manually are the ones that are winning.

And I see so many companies I mean especially in the Bay Area, I even look at some of the coffee companies, coffee bean companies that I see, I mean they're losing shelf space because they're not keeping up with the supply and I've even gone back to a few of those companies that I know and I've said, "Hey, I was in this local store and I saw that you're out of stock." And they're like, "Oh, we're supposed to be on auto replenishment." And I'm like, I know I'm with you. It's not happening. I'm sure this is going to be the conversation when everything calms down a bit. These big retailers or smallish retailers are going to say like what happened here? …sales along the way.

And ultimately the ones, I'll just say one more thing, ultimately the customer if they really want our product, then they can go to our website @drinkhint.com or Amazon. But even Amazon, I mean we're selling a ton on Amazon right now and they've been doing a great job of being in stock but even Amazon, if they're, for example, prioritizing toilet paper over our water, I mean that's not going to help us, right? It's not necessarily going to help the customer either. So we always say to people like, "Look, we love Target, we love Amazon, we love all of these companies, but if it's just not working, then just go direct to us, at drinkhint.com and we'll ship it out today."

Kendall Fisher: Yeah. And that was going to be my next question is first of all, so you've seen, I'm assuming, you've seen a massive uptake in ecommerce since all of this began?

Kara Goldin: Massive uptake in the ecommerce but also in the stores just because we are going in and saying like, "Hey, we're here to help." Again, we don't have the massive distributor or the salesforce that like a Coca Cola or Pepsi has, but we're going in and we're in touch with these people and even if it's by email or whatever, just to make sure that the stock levels we're looking very closely at it. And I think you just can't... this is a lesson that we've been talking about forever, which is you just can't rely on the store systems to just solve your problem for you. And at the end of the day, the retailers are just trying to keep their business going. They're not going to keep your business going, right? And so if you're a company our size or a company smaller and you don't have people that are going in to these companies or these stores and actually seeing what I'm seeing, you're going to lose your space on the shelf.

It's like they're out of stock and not just talking about beverages, like I said, coffee and paper goods as well as bars. I mean there's just people are going in and they are, right or wrong, they're hoarding things when they're going in. And I think that unfortunately I think what's going to happen when all of this thing settle is for you as a smallish brand to go and get your space back in these retailers will be really, really complicated. And then online as well, if you're a company that you just decided to close the door and not actually deliver on time and continue to do what you're doing, I think you're given a little bit of a leeway with the customer by a few days, but you can't be like, "Hey, we're gone now. Six weeks from now we'll be back and we'll start shipping." So I think that that's the big lesson I've learned.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

A post shared by hint (@hint) on

 Goldin's quest to get Hint water on more store shelves is "manual" at times, but it pays off.

Kendall Fisher: Yeah. Where does visibility come into play as you're reacting to this changing market and the changing customer habits and the partners, retail partners that you're working with? I mean, how were you able to get the visibility you need to see, okay, Whole Foods in this city is low on stock, let's make sure we're getting there, let's make sure we have product on the shelf at this store in this other city, what role does visibility play into all of it?

Kara Goldin: Well, I think depending on how big of a brand you are with these stores, you get access to some sort of stock information. I mean, we have national deals. We didn't, when we were a $10 million brand, we weren't getting that. Once you're a few hundred million, then they start to say, "Okay fine, we'll give you guys some access so you can see it." But frankly if you're a small brand, I think it's just getting in there and seeing for yourself and obviously getting in there as fast as you can. I don't think for example, that... I think the world has changed in terms of sampling teams. I mean we have an entire group that is focused on sampling for a product and we quickly shut that down three weeks ago because not only for the safety of our employees, but also we just thought who's going to be walking into a store and wanting to sample food or drinks, I mean I see that now.

I saw it yesterday and I thought the fact that that's even allowed, I mean, first of all, it's pretty hard to have somebody six feet away when you're taking a sample from somebody, there's like a connection. Maybe they won't touch, but it's definitely greater probably than six feet. But it's also not really showing as a brand that you're taking care of your customer or taking care of your customer and taking care of your employees… a lot of people on our teams and they're all over the country we're really tasked with, okay, you need to go into a couple of stores a day, you need to instead of doing sampling and marketing, we're going to have you more on the merchandising side ...

Kendall Fisher: Right, check on stock, yeah.

Kara Goldin: So that you can actually be doing this stuff manually. And then also, I mean, we've also pivoted those people towards figuring out in their community where first responder donations might be really helpful as well. So I mean, that's not from a sales perspective necessarily, but it's really we want to be known as a company obviously that is helping. We've helped a lot of people enjoy water and throughout many, many things, including the fires in Northern California and the flooding in Houston and New Orleans, et cetera, we've been there with truckloads and truckloads of water. We're also watching that very carefully and trying to figure out if there's in our communities where we can be helpful as well. But I think that's really the key thing that I've seen and as I've always said to my friends who are entrepreneurs and starting companies, it doesn't matter how big you get, I think that you still have to act small and you still have to really understand not only the actual brand, but also the supply chain and try and really understand what all the employees do too and try and figure out, okay, we've got people that are interfacing with public.

I mean, we figured this out three weeks ago before anyone was even doing this. We were like, boom close the offices, get these people working and obviously, I mean, we had a handful of people who were living with people that potentially they were compromised in some way, whether they were living with an older person or somebody who had previously been sick and so we really we're careful about that. There was only a handful of people that really had to sort of opt out from working because of those issues. But the rest of the people were like, okay, we're in. And what they've all told us is just by showing up and and sort of helping in these communities and they're careful obviously they have their hand sanitizer, they're typically changing their hours, which is a whole other piece too that I think is interesting that I wouldn't have noticed, but some of these people they're starting their day at 4:00 in the morning versus 8:00 in the morning because they'd rather go into a store when there's nobody in there.

And so they're going in or late at night, I mean right when they're closing at 9:00 at night, they're like, "Hey, do you mind if I come in and actually check the stock and do the …?" And so a lot of these retailers nationwide have said, "Sure, go ahead. We just love the fact that you're even coming in and you're checking on stuff."

Kendall Fisher: Yeah. And helping. So I have two big questions, kind of the first being, so you talk about, it doesn't matter how big you get, you need to act small and you need to really understand your supply chain. What about yours? Was any part of your supply chain affected by this? Did you have to shift anything in order to make sure that you're meeting the demand from e-commerce and from retailers? You said some of these retailers were going direct to you so that you can distribute it yourself, anything that slowed you down?

Kara Goldin: Well look, most offices are closed. So our food service business, which goes into offices, which is a significant part of our business we knew three weeks ago that that was going to be slowing. We didn't know for how long so a lot of the supply that we sort of had allocated to that, we knew that we were going to be able to push that over into not only the e-commerce but also the growth that we would have with going into these retailers. And then we also had new retailers coming to us, not only expanding the amount of product in some of our retailers, like Target for example, but also as I mentioned, we're going to be going into Whole Foods nationwide, sorry, not Whole Foods, Costco, nationwide and so Costco reached out to us and the fact that we do everything in the US was definitely huge, right?

Again, it's like who would've ... I mean, it was sort of a personal belief of ours just from a sustainability standpoint that I just thought like we want to get our product, all components of our product done as close to our distribution points as possible. That's always been part of our ethos of our brand. And so a lot of retailers are seeing too that if you've got components of your product or your actual product is coming from Asia or Europe, then you just don't know what's going to happen once they're out of stock here in the US. I mean, I'm pretty sure there's containers sitting at ports, right? Holding onto some of those things and not that there's anything wrong with them, but they're just not really clear whether or not they are allowed release them yet in some cases.

And so I think that was a huge component for us. So when these retailers were calling and saying, "Hey we've got this huge opportunity for you, we know that you've been doing a little bit regionally, but we really want to turn this on nationally. Do you have everything that you guys do here in the US?" I mean, it definitely was a question that we were like, yes. And they were like, okay, let's move forward with this. So I think … not that you can plan for that, I mean, I don't know that I would tell every... I mean, again, it's sort of my personal belief that again, and I think about this all the time, we're only in the US right now, but if we were to go into Asia, I would want to do the same over there.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

A post shared by hint (@hint) on

 While focused on matters at hand, Goldin still takes time to imagine what taking Hint overseas might look like.

I would want to do everything that we do in Asia, right? Rather than shipping water overseas or shipping bottles overseas and shipping food overseas. I would much rather just do everything wherever we're distributing. So that has been a huge component as well. But yeah, I mean, I think that the key thing was that we were able to really look at our distribution from we have the food service, we have the retailers, and then we have the ecommerce side of this business and again, just sort of looking at, okay, we don't have a crystal ball, but what's going to happen? We know that it's going to slow, we didn't know how long it was going to slow for food service and we didn't know how long or ultimately if it was going to be a longer term thing.

But clearly the fact that we were even saying to a lot of these offices like, "Look, we sort of heard that they're going to start to shut, some people are going to start to shut down businesses. Are you sure that you're going to stock up as much as you're stocking up?" And so, I mean, what was interesting, we were actually ahead of many of these offices that were stocking … product. But again, our product has a shelf life of over a year so it wasn't... even if they did stock up, it wasn't like, oh the product that you're going to put in, it's going to go bad. But still from a cost standpoint, we were also educating and really trying to be helpful in that respect.

Kendall Fisher: Yeah, and that brings me to that second big question that I wanted to ask and you kind of touched on this. In terms of when things started kind of closing and how you reacted immediately on the cashflow management side of things, your first of actions obviously you said you shut down the offices right away, you thought of food services and where do you use that inventory elsewhere. Any other big things that you did on the cost management side that you'd provide us advice or just … that was unique or interesting. And with that, have you had to do anything on the workforce side to cut costs?

Kara Goldin: So we have a significant portion of our employees that are remote because our biggest chunk of our employee base is our salespeople that are going into stores and actually stocking shelves and throughout the US and so those people were already kind of working from home. They didn't have an office to go to, but our supply chain group, which is actually split between our small office in New York and our larger main office that you've been to in San Francisco we immediately said in closing this down, I mean, "Are you guys going to need anything at home in order to do this?" And I mean everybody has a laptop, everybody was pretty self-sufficient in that respect.

Our customer service team as well. I mean we have a customer service center that's actually remote in Texas, but we also have a few people that are working out of our San Francisco office. But again, they were able to work at home. I mean I don't think that anyone... I would say that the team that was probably the most effected and we quickly reallocated them to do something else was the sampling and the field marketing team. So I think it was just thinking about what else can they be doing? And we have somebody who also manages our college campus programs too and so we reallocated her, she's really managing the college teams and of course the college teams, they don't work for us, they're kind of interns, but the college campuses all shut down.

So there were a few of these campus reps that were going back to where they lived and we said, "Hey, we've got merchandising opportunities and would you be interested in taking some of those and you're going to get paid for doing this back in your community." And so a few people said, "Yeah, I'd love to do that. I'm going to be working or going to school remotely and so I would love to be able to do that." And then figuring out also on just other roles that they could ultimately do in the company. But there was, I don't know, there was probably, I'd say there were probably 25 people in the company, we didn't lay anybody off, we don't have plans for laying anybody off.

I think everybody really saw that it's kind of all hands on deck and we're going to get through this and we're going to work with you on this, but we didn't see it as something that we had to say, "Okay, we better start cutting things." And again, I think the key thing that we did there was really taking a look at what is going on out there and what problem can we be solving for these retailers? And just being proactive too. I mean, even with our Amazon business, I mean Amazon is pretty on it, on … inventory levels, et cetera, but I think even calling Amazon and saying, "Hey, just a reminder, we're water and we're considered essential so don't hold our product and put somebody else's shipments in front of us because we are 100% considered water as compared to a sort of soda." So that's how they were looking at shipments that if you're shipping water then that would go out before some of these other products. And so just reminding them and again, being smart about your business, but sort of thinking about what are the issues that they're worried about or that they might have confusion over and just sort of preempt those problems more than anything.

Kendall Fisher: Yeah, definitely. Are you guys seeing any interruption on the shipping side? I know like you said with Amazon, they're obviously prioritizing certain things over others, but both from a direct side and Amazon side, are you able to continue shipping as normal, no disruptions there?

Kara Goldin: No disruptions, it's been great and so we have... but again, we're looking at the logs closer and I think that's the key thing. And we've also had a lot of other companies that we've had some trucking companies for example, that we had never worked with before who had reached out to us and we've been trying to help some of those companies because many of those companies were dealing with apparel and things that maybe we're going to stores like Saks Fifth Avenue or Macy's or whatever, and now they have no shipments. And so they've reached out to us and we've been trying to help them figure out, and we've done it in more than a few cases whether it's with us or also getting the word out to our network to say, "Hey, there's these people, they have trucks that can actually take things to people and can you use them?"

And then people are like, "Yeah, okay, connect me." So, I mean, again, we're just trying not only to sort of focus on our own business, but I think in times when, we're in right now and just stressful times, I mean, whatever you can do to sort of be helpful … I think I'm a huge believer that it ultimately will pay back.

Kendall Fisher: I love that. I love that. Now I know we're running a little late, so I just have to round out with one question. Is there a change that you've made or some of the other stuff you've done that you will think about carrying forward after all of this is over?

Kara Goldin: I think the key thing is I still love the idea of seeing people and hugging people and high fiving people and I think that that will never go away. But I think actually making sure that people have the tools to be able to do their business no matter where they are is so critically important. And not that this is a sales pitch for NetSuite, but I always talk about how NetSuite has really allowed us to do that as well. And be able to just sign in and sort of know what's going on from an inventory perspective and that just allows us to just be better at our business. And so I think that, again, when things calm down for people or if you feel like you're in sort of a forced low right now, maybe now's the time to figure out what are those problems that I'm seeing that I wish my business had that maybe I didn't know that they had a few weeks ago and use this time to sort of solve those issues?

Is it looking into setting up an online business or online capability? Is it upping my supply chain visibility? Whatever that is because this will pass and I'm sure it will, but I think everybody with every sort of challenging time, I believe that we can all look at how can we just be better, right? … I mean, that's life, right? And so I think that that's the key thing that everybody should really take a look at if you're missing out on sales, get into those stores and really understand what is actually happening versus relying on a spreadsheet. Sometimes you have to manually check things still and make sure that they're happening. And then also just sort of looking at if you were to take employees and reallocate them to do other things in your company, I mean do you really need to lay them off?

I think that that's another piece and if you're listening to this too, if you're one of those employees that is just sitting there worried, oh gosh, they're going to cut my job, is there something that you see in the company that is something that you can be helpful doing? Then tell people, right? And tell people like, "Hey, I don't know if you knew this about me, but I have this experience doing this. I really want to help. How can I do that?" And I think that that's critical to any leader right now.

Kendall Fisher: Yeah. Wow. That's seriously such good advice. I so appreciate you taking the time to hop on with us during an incredibly busy time for you and a challenging time for everyone. So I appreciate it, Kara, and we look forward to talking to you as we will certainly do in the future and just stay safe and stay healthy.

Kara Goldin: Thank you. You too. Good to see you.

Kendall Fisher: You too.

 

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