NFIB

Sweet Growth Plan
04/ 15/ 2002

by Lisa Waddle

A seller of chocolate-covered strawberries is leading the way in the next stage of e-commerce: online franchises.

Shari's Berries, which for 11 years has sold decadent chocolate treats from four California stores, sees the Web as a way to supplement, not replace, retail sales at its four stores. That's why its growth strategy couples online franchising with additional bricks-and-mortar retail outlets.

Since launching http://www.berries.com in December 1998, Shari's e-commerce sales have surpassed the combined sales of its four stores in Sacramento, Citrus Heights and Studio City, Calif. "I think clicks-and-mortars will be more successful than pure retailers and pure e-tailers," says Christopher Ewing, president of the 60-employee Shari's.

After overcoming the challenge of shipping fresh strawberries anywhere in the country (it took a specially designed, refrigerated box) Shari's has realized its goal of taking a brand well established on the West Coast nationwide.

The company hopes to continue that expansion through online franchising, which is a way to continue offering top customer service, without having to hire more employees. How it works: Shari's builds a Web site for a franchisee, who markets and runs the site. For instance, a franchisee in Los Angeles runs http://www.laberries.com, which drives customers to Shari's main Web site.

"It's another marketing arm, because they can drive traffic to their own Web site, they run the site, answering customer questions," Ewing explained.

Shari's still makes and ships all the orders placed through the franchise, but the franchisee can develop a personal relationship with customers.

It's a concept that works for Shari's, because "our company expands best through people seeing and tasting our product," Ewing says. Its chocolate covered strawberries are mini works of art, covered with almonds or drizzled with white chocolate. Prices range from $44.95 for a gift-boxed dozen to $64.95 for a dozen arranged on stems like a bouquet or roses.

The emphasis on Web sales growth is coupled by Shari's push to expand its retail presence. But as an alternative to opening more stores, the company is pursuing retail affiliate programs, where Shari's puts a small kiosk in stores with complementary businesses, such as florists or gift shops. This cuts down on the costs of opening freestanding retail stores, and continues to put Shari's product in front of customers.

"We've found that if you can see and taste our product, you'll buy more," Ewing says. "That makes our customer acquisition costs extremely low."

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This article originally appeared in the January/February 2001 issue of MyBusiness Magazine, NFIB's member magazine.

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