Joe's Gourmet Fish Fry
Joe's Gourmet Fish Fry is a company from Atlanta, GA, that creates a southern-style pre-packaged seafood breading mix. The entrepreneurs are a husband and wife team who formerly had six restaurants in New Orleans that were all wiped out by Hurricane Katrina.
Following the storm, the entrepreneurs were able to save two deep fryers and traveled with them to festivals and set up on street corners for fifteen years, providing fried foods. These foods caught people's attention enough that some asked if they could buy the unfried foods so they could make them later at home, which led to the idea of starting Joe's Gourmet Fish Fry.
In the demonstration, it was shown how the breading mix can be used with more than just seafood, offering samples of fried shrimp, zucchini, scallops, and carrots to show how the flavor works with each.
A single bag of the fish fry product retails for between $2.99 and $4.25 though it was stated that it sells for $5 per bag "direct to consumer". A bag costs $1.22 to produce and sells to retailers at a wholesale price between $2.25 and $2.75.
The entrepreneurs state that the fish fry product is sold in 52 Kroger and 142 Publix supermarkets. Additionally, the fish fry has been available in 315 Walmart stores for the past seven weeks. They claim to be in 800 retail locations overall.
Joe's Gourmet Fish Fry projects to gross $270,000 in the current year and projects $450,000 in the next. Total gross sales over the lifetime of the product are $409,000.
To start the business, the entrepreneurs raised $50,000 from the family, primarily Joe's father who owns 85% of the total business.
This deal aired on Episode 9.16.
Making A Deal
Daymond bit on the deal and offered the requested $200,000 for 25% of the business rather than just the 15% of equity originally pitched. This represents a hefty $400,000 bite off the original $1,000,000 value or 40%.
Because 15% of equity was originally offered and Daymond took 25%, it can be presumed that the entrepreneur's father allowed his ownership to be diluted so that the entrepreneurs were not left with no ownership stake.
- This is an interesting distinction to make, the price difference between those who, presumably, order online versus those who purchase the product in a retail location. While companies often sell through their website at the same price as retail to both not undercut retail sales and to maximize the margins not lost to wholesale, actually charging more is unusual and seems to penalize those who seek out the product directly. It would be interesting to find out whether this was misspoken or whether this is actually the case.