Table of Contents
- Introduction
- The Strategic Acquisition
- Diving into Norsland Lefse
- Technological Enhancements
- Facing the Challenges Head-On
- Future Plans and Strategies
- Conclusion
- FAQ
Introduction
Imagine leading a thriving ecommerce development firm and then deciding to acquire a specialty food manufacturer. It sounds like an unusual business maneuver, right? This is precisely what Lori McDonald, founder, and CEO of Brilliance Business Solutions, did in February 2024. She acquired Norsland Lefse, a unique direct-to-consumer food producer. Understanding the rationale behind such a move, and the subsequent learning experiences, sheds light on the intricate relationship between diverse business domains and the holistic growth of a company.
In this detailed blog post, we'll delve into the reasons behind Lori's acquisition of Norsland Lefse, the operational complexities she encountered, and her comprehensive learning journey. By the end of this article, you'll gain valuable insights into how diversification can enhance business strategy and why understanding customer perspectives is crucial in today's competitive market.
The Strategic Acquisition
Expanding Horizons: Bridging Two Worlds
Lori McDonald’s acquisition of Norsland Lefse is more than a diversification move; it’s a strategic step to bridge her primary expertise in ecommerce with the intricate world of food manufacturing. With Brilliance Business Solutions specializing in web development for manufacturers and distributors, Lori saw an opportunity to deepen her understanding of her clients' operational challenges by acquiring a small, manageable company like Norsland Lefse.
By stepping into her client's shoes, she aimed to gain firsthand insight into their daily struggles and operations. This empathy-driven approach is rare but incredibly valuable. It’s an innovative way to align one’s business solutions more closely with client needs, thus fostering stronger, more effective partnerships.
Financial Diversification: A Smart Business Move
From a financial perspective, acquiring Norsland Lefse allowed Brilliance Business Solutions to diversify its revenue streams. This move provides a safety net, ensuring that the company's income isn't solely reliant on one sector. The stable income generated from Norsland Lefse complements Brilliance's project-based revenue, offering a balanced financial portfolio.
Insight into Consumer Behavior and Expectations
Moreover, turning towards a niche market like Norwegian flatbread and Scandinavian specialty foods opens doors to understanding consumer behavior on a micro-level. The insights gained from direct-to-consumer sales, primarily through platforms like Amazon, help in sharpening strategies for Brilliance’s other clients. It’s a symbiotic enhancement where lessons from one domain enrich the other.
Diving into Norsland Lefse
The Heritage and Legacy of Norsland Lefse
Norsland Lefse, with a rich 40-year history, specializes in producing Lefse, a traditional Norwegian flatbread, and Uffda! Chips, a crisp fried byproduct of Lefse. With a modest team of around 20 mostly part-time employees, Norsland leverages its deep-rooted heritage and niche market appeal. Generating over $1 million in annual revenue and offering around 270 different SKUs, the company’s primary sales channel is Amazon, accompanied by their own ecommerce website, NorslandLefse.com.
Operational Complexities: A Learning Curve
Shipping perishable goods like Lefse is no trivial task. Maintaining freshness and quality requires efficient logistics and meticulous attention to detail. Lori's team uses FedEx 2Day with ice packs to ensure the products arrive in optimal condition. This experience emphasizes the importance of fast and efficient shipping in the food industry, a valuable lesson for any ecommerce professional.
The operational side revealed another layer of complexity. From inventory management to dealing with equipment breakdowns and fluctuating supplier prices, Lori’s hands-on experience with Norsland Lefse provided a crash course in the myriad of challenges faced by small manufacturers.
Technological Enhancements
Migrating to BigCommerce
One of Lori’s initial steps was migrating Norsland Lefse’s ecommerce site from Wix to BigCommerce, a move that was remarkably completed within three months. This shift not only added new capabilities but also made the site more mobile-friendly, enhancing user experience. This migration, handled efficiently by the Brilliance team, showcases the integral role of robust ecommerce platforms in supporting business growth.
Inventory and Order Management
Norsland Lefse's technology stack currently includes XPS Ship, which integrates with Amazon to streamline shipping logistics. However, there is significant room for more technological integration and automation. Lori's experience highlights the gap between having sophisticated ecommerce platforms and the hands-on realities of managing a smaller manufacturing firm.
Facing the Challenges Head-On
Profitability and Margin Management
A striking revelation for Lori was the delicate balance of profitability, especially on platforms like Amazon. Some products were being sold at a loss, underscoring how easy it is for sellers to miscalculate margins. This insight is invaluable for Brilliance’s clients who may deal with hundreds or thousands of SKUs, each potentially having its own profitability challenges.
Direct Sales and Margin Optimization
A critical goal from the beginning was to boost sales directly through NorslandLefse.com due to the better margins compared to Amazon sales. However, translating this goal into reality proved challenging, offering Lori a profound appreciation for the daily operational tasks and strategic intricacies faced by ecommerce merchants.
Future Plans and Strategies
Focused Product Line
Moving forward, Lori plans to concentrate on Norsland Lefse’s core products: Lefse and Uffda! Chips. The strategy is to emphasize quality and marketing these key items effectively rather than expanding the product line unnecessarily. This approach aligns with the philosophy that sometimes, less is more.
Subscription Models and Digital Marketing
Exploring subscription models to provide year-round delivery of Lefse is on the agenda. Additionally, partnering with Ox Optimal, a digital marketing firm, to enhance email marketing and manage Facebook and Google Ads shows a commitment to leveraging digital strategies for growth. Here, Brilliance’s technical prowess is complemented by Ox Optimal’s marketing expertise, presenting a comprehensive growth plan.
Conclusion
Lori McDonald’s acquisition of Norsland Lefse exemplifies an innovative approach to business growth and diversification. By integrating a specialty food manufacturer into her portfolio, she enriches her understanding of her clients' needs and operational realities. This journey of hands-on learning and strategic decision-making showcases the symbiotic relationship between ecommerce development and direct-to-consumer retailing.
By focusing on core products, optimizing margins, and leveraging advanced ecommerce platforms and digital marketing strategies, Lori has laid out a path that promises both learning and growth. Her experience serves as a lesson for other business leaders on the value of empathy, diversification, and technological integration in crafting resilient and comprehensive business strategies.
FAQ
Why did Lori McDonald acquire Norsland Lefse?
Lori acquired Norsland Lefse to diversify her revenue streams and gain a deeper understanding of her clients' operational challenges, thereby enhancing empathy and alignment with Brilliance Business Solutions' customer base.
What are the primary products of Norsland Lefse?
Norsland Lefse specializes in two main products: Lefse, a traditional Norwegian flatbread, and Uffda! Chips, a crisp fried byproduct of Lefse.
How does Norsland Lefse handle shipping?
Norsland Lefse ships its perishable products primarily through FedEx 2Day, using ice packs to ensure freshness upon delivery.
What technological changes did Lori implement at Norsland Lefse?
Lori migrated Norsland Lefse’s ecommerce site from Wix to BigCommerce and integrated XPS Ship for better shipping logistics.
What challenges has Lori identified in managing Norsland Lefse?
Lori identified challenges in profitability management on platforms like Amazon, the complexity of inventory and order management, and the operational realities of running a small manufacturing firm.
