When San Francisco-based Happy Moose Juice discovered in late August that its cold storage partner was shutting down in the first half of 2023, the company’s leadership team saw an opportunity emerge.
By February, Happy Moose’s leadership had finalized the acquisition of that business, Growers’ Refrigeration, in full, a deal that both solved its own refrigerated storage issues and potentially those of many cold-chain CPG brands in the region, where capacity has historically been hard to find.
Describing the situation as “right place at the right time,” Happy Moose co-founder and CEO Ryan Armistead now finds himself balancing his juice company with new responsibilities and revenue streams as head of his new venture, renamed Growers’ Cold Storage.
“The opportunity was attractive enough that we did not have to go far for the capital. We didn’t even have to go to our investors. We went to our family members,” Armistead told BevNET last week. “We’re operating it now and just kind of doing our best to carry on the legacy that they’d established.”
Launched in 1929, Growers’ Refrigeration had been owned and operated by the Baumsteiger family for three generations. Armistead and the new leadership is hoping to build upon that foundation, taking over at the beginning of April and working closely with the former owners to ensure a smooth transition. All of the former Growers’ staff have been retained and the 30,000 sq. ft. warehouse located near the produce terminal on the east side of the city has continued to operate uninterrupted.
Operating Growers’ in addition to Happy Moose will be a challenge but brings additional value to the juice brand at a critical point in its growth. The company is currently raising a $750,000 seed funding round, and the acquisition allows it to improve profit margins by cutting out storage costs while creating opportunities to expand its network of potential business partners.
“We see anyone and everyone that comes into this facility and that’s going to give us access to distributor relationships, supplier relationships,” Armistead said. “We’re going to have complete insight into everyone that everyone works with over here.”
Launched in 2013, Happy Moose Juice sources and copacks fruit and produce directly from family farms throughout California, Hawaii, Mexico and Peru. The brand currently offers 10 varieties of cold-pressed juice blends in 12 ounce bottles and five flavors of 2 ounce wellness shots.
High property values means cold storage is not as readily available in expensive metro areas like San Francisco, Armistead pointed out. Growers’ will seek to address that issue by focusing on partnerships with small CPG businesses, startups, restaurants and seafood providers to help ease the high costs of working with refrigerated storage companies outside of the city.
United Cold Storage, San Francisco’s other refrigerated facility, primarily works with larger brands, Armistead said, creating an opportunity for Growers’ to be a customizable service provider for small food and beverage brands similar to Happy Moose.
The new venture will eventually include building out third-party logistics and other value-added services to help startups navigate the often complicated process of getting a product from ideation to store shelf.
As a founder himself, Armistead said he brings a different perspective to what services CPG founders need to be successful.
“It gives us a real clear pulse on what’s going on in the marketplace, where services can be improved, where they need to be adapted to meet the needs of new age businesses,” he said. “That’s where I think we can bring empathy: from [us] being in the space, knowing the headaches and the issues and challenges that founders have faced. We’re not just hearing this from people, we’re feeling it ourselves.”
The current economic climate has dried up a lot of available capital, Armistead added, and providing a suite of services may help smaller brands get their product from manufacturing facility to shelf without “blowing up their margin structure.”
“A brand can spend all their time on their product and their co-manufacturer, but if they don’t have a really complete plan to get the product to shelf, they’re going to end up spending an arm and a leg on the last mile fulfillment,” he added.