Life tastes a little sweeter for James Harris, president and cofounder of Ensemble Beverage Co., L.L.C., producer of Heritage Southern lemonades, teas, and juices. Together with his business partners, Nathaniel Shaw and Robert Smith, Harris exemplifies the company’s slogan, “Good Folks Turning Lemons into Lemonade.”
Ensemble’s line of “country juices” originally started out as a class project for Harris, who was attending graduate school at Auburn University in Alabama. Shortly after being laid-off as an account executive for Coca-Cola, Harris and his two fraternity brothers, Shaw and Smith, came together to further develop the idea.
Despite a solid business plan, banks and the Small Business Administration denied the company funding due to insufficient credit. The trio relied upon themselves for startup cash and accumulated $80,000 by way of credit cards, 401(k), and personal savings. Smith, 38, was a state coordinator for former Alabama governor Don Sigelman prior to becoming vice president of Ensemble. “We raised an additional $60,000 from private investors and received an $18,000 signature loan from the bank,” says Smith. These funds went to purchase raw materials, glass bottles, bottle tops, label and product design, and equipment.
The business partners agree that dealing with the two largest monopolies in the soft-drink industry — Coke and Pepsi — is their biggest challenge. Forty-two year old Shaw, a former pharmaceutical representative at Takeda Pharmaceutical, says it was extremely difficult for them to tap into markets already under contract with the mega-giants. Smith adds, “Even when faced with adversity, we didn’t fail because we still learned something from the experience.”
Harris, 37, notes that, “It is illegal for large companies to prohibit smaller companies from doing business. Although companies have diversity programs, many fail to exercise them.” When contacting venues, the fraternity brothers emphasized the importance of diversity and their products’ superior quality. This approach won accounts for Ensemble at the Montgomery Ballpark Stadium, Alabama State University, and Tuskegee University.
Unlike its competitors, the Montgomery, Alabama-based company specializes in an assortment of southern-style flavors such as julep tea swirl, watermelon, blackberry, peach, and lemonade. The drinks, sold in 16-ounce bottles for .99 cents to $1.59, can be found in over 715 delicatessens, schools, and grocery stores including Calhoun Foods, Albertson’s, Wawa, Cub Foods, and Kroger throughout the South.
Established in 2001, the company has six full-time employees and works with a host of subcontractors. In its first year of operation, the company reached $65,000 in revenues. Three years later, revenues for 2004 hit $265,000. Ensemble has contracts in its pipeline that will put its drinks in an additional 900 stores and boost revenues to a projected $1.6 million for 2005.
The turning point for the business came when a local co-packer for Tropicana offered to bottle its beverages. The co-packer was able to produce six months of supplies for the firm in one day, compare to a mere 100 cases that the trio produced per night. Up until that point, the business owners made and bottled their drinks after hours at a friend’s restaurant. Efficiency in production has enabled