Natural sodas set for expansion

regulatory requirements and researching and experimenting with recipes. “If the first 10 people hadn’t liked it, we probably wouldn’t be here.”

It took off. In addition to his own brand of all-natural sodas, Cox also produces custom-branded sodas for other organizations. In 2014, he began making other traditional flavours, such as cola and ginger ale, and taking flavour requests. “People would come in and ask, ‘Do you make an elderflower?’ and I’d say, ‘Yes.’ Then Millie would develop the recipe and make it happen.” Jason Cox and Millie Holmgren pitch The People’s Crafthouse soda on Dragons’ Den. for help to automate some of our processes to meet demand, not realizing due diligence would take months.” more than the investment, we were hoping for an experienced partner,” said Cox. That partner is Manjit Minhas, who asked for a 35 per cent equity stake. The terms of the deal have changed but both parties appear eager to close.

Post-filming, Cox sold his wine-and-beer shop to focus on craft soda. He used funds from the sale to build a new, larger facility in Penticton. He also partnered with a restaurant to share the space and drive foot traffic.

The vision for the next one to three years is to expand sales beyond B.C. Cox wants to continue to focus on food services, wineries and distilleries and, he hopes, with Minhas’s help, to move into grocery stores. He’s also interested, as per Minhas’s suggestion, in creating a hard soda. “A big part of what drives craft sodas is the growing cocktail culture,” said Cox.

“People buy these quality craft spirits and don’t want to kill them with high fructose-based sodas. They want complementary flavours. It makes sense to do a premixed product.”

If the deal closes, Minhas says her focus will be on expansion, both in offerings and retail locations, across Canada first, then the U.S. “It’s a great-tasting product, and the resurgence of craft cocktails is a plus. Hard soda is a massive trend across North America. We have proprietary technology to make malt hard sodas to enhance the product. Craft sodas are not as popular in Canada as in the U.S.; we are hoping the hard-soda trend will parlay into the craft-soda space.” She also hopes to help them reduce costs and get distribution with Sysco, which also carries Minhas sodas. “There is a big market for them as long as they can keep up, keep the product stable and raise awareness.”

Brad Cherniak, partner at Toronto-based business advisory firm Sapient Capital Partners, likes the low-sugar, all-natural aspect but says they will be going up against giants such as Coke and Pepsi, which have been acquiring craft brands and will get preference for shelf space. As well, “I’m puzzled by his choice of branding. The Marxist-Leninist symbolism may be problematic in the U.S. If I were advising him, I’d say you are still early enough to change the brand significantly.”