The Walmart Business Advance Podcast: Luke Schneider, Fire Department Coffee

[00:00:02] Luke Schneider We're growing the company, and it was growing profitably. But we were still new. I didn't understand financials. I didn't have a business background. I knew we were heading in the right direction. And I knew that the business was doing the right things, but I didn't know what that meant from a financial perspective of what a PNL was or a balance sheet. 

[00:00:25] Ashley Hubka That's Luke Schneider, founder and CEO of Fire Dept. Coffee. In 2016, Luke turned a lifelong love of firefighting and a desire to find the perfect coffee blend into a business that combined both passions. With a lot of hard work and determination, Luke has since grown Fire Dept. Coffee from a side hustle to selling coffee to Walmart customers across the country. 

[00:00:51] Ashley Hubka I'm Ashley Hubka, senior vice president and general manager of Walmart Business, and welcome to the Walmart Business Advance, a series dedicated to highlighting the small and medium-sized organizations that are Walmart Business customers and suppliers. You'll hear stories of how they've grown their organizations and what they've learned along the way. At Walmart Business, we are dedicated to helping organizations save time, money, and hassle so they can operate and grow. Whether that's helping them purchase the items they need to operate or serving as a platform for businesses like Fire Dept. Coffee To sell their products to our B2B customers. 

[00:01:33] Luke Schneider I got into business kind of by accident. I was very passionate about the craft of coffee. When I met my wife, she was a barista. I was a firefighter, and I'd go see her at the cafe. Was taking some college classes, and so I would go in there and work on my homework and talk to her about coffee and then we would go to different cafes and taste different coffees. And so I started learning more about that and fell in love with the craft. Learning about the different varietals of coffee, the different growing regions, the different processes, the different roasting profiles. When we got married, we had an idea of why don't we start roasting coffee and then we can sell it at farmers markets. We had some savings and we thought, we can make some extra money and do something that we love doing. I wanted to do a coffee that spoke to being a firefighter. So I did a fire department blend. And so we started doing these tasting events. And out of all the coffees we did, everybody wanted the fire department blend. And then it kind of grew and evolved into realizing there was a big need for firefighters. So our mission became to give back to support sick and injured firefighters. Starting the business from scratch was a learning process. We started with a five kilo roaster in a 800 square foot strip mall. First thing we ran out of was space, and so we started getting creative with how we were constantly rearranging the space and stacking boxes, and kind of became like a maze in this 800 square foot strip mall. And we had this little production line where we were roasting, bagging, and then putting it into orders and then packing orders, and then the USPS was coming and they were bringing their small trucks, and they were starting to get frustrated because, like, we were filling up their, their car. So we then started having to drop it off and that wasn't super efficient. Growing the company, and it was growing profitably, but we were still new. I didn't understand financials. I didn't have a business background. I knew we were heading in the right direction, and I knew that the business was doing the right things, but I didn't know what that meant from a financial perspective of what a PNL was or a balance sheet. So somebody showing me that. And how to look at it has been a huge blessing for me. And I would say, like, one of the big things, that I learned was that I was not going to be able to do a lot of things myself. And I had a vision, and I saw a clear path to get to where we wanted to go and to grow the business, but I needed help to get it there. 

[00:04:26] Ashley Hubka Understanding the value of help, Luke reached out to a local development corporation and other business leaders in the community, who helped him with both capital and mentorship, to scale his business to the next level. Soon, they increased roasting capacity, set up a fulfillment and customer service team, and established an in-house marketing team. Currently, the business has close to 50 full time employees, a testament to the work Luke and his wife have put into Fire Dept. Coffee. That growth also prepared Luke to bring his coffee to Walmart stores across the country. After seeing a social media post about Walmart's Annual Open Call event, he knew he'd found his opportunity to make his case. Walmart's Annual Open Call, which celebrated its 10th anniversary last year, is at the heart of our commitment to U.S. manufacturing. Every year, we invite selected entrepreneurs to pitch their products to our Walmart and Sam's Club's merchants. Those selected get a golden ticket and the opportunity to sell their merchandise in stores and clubs across the nation. In 2023, over 700 businesses from all 50 states gathered in Bentonville, Arkansas, to pitch more than 1000 shelf ready American made, grown or assembled products. 

[00:05:45] Luke Schneider I heard about Walmart Open Call through a LinkedIn post. For us, walmart was our number one goal to get into, and so I saw that post about an open call in the Chicago area for businesses to come present their business to potentially get an invite for open call. So I commented on that. Mark Espinoza responded, and I asked him if we could come out and bring our fire truck because we have a fire truck that we serve coffee out of in a time of disaster, a lot of times there's power outages and we're able to get people a hot cup of coffee and show our support for that community that that needs to support at the time. So we have this truck, and I asked him if we can bring it down, and he made space for us to come down there. We brought the truck and we were serving coffee, and I got to talk to Mark. I got to tell him about our story, our mission, our capabilities, our distribution. He even walked through the store with me. I showed him where we wanted to be on the shelf. I told him who our main competition was, why we were different, and what were the differentiators between our brand and our products. And he spent like an hour with me or more, and I was just super blown away that this senior person in Walmart spent so much time with me to to hear our story and learn about Fire Dept. Coffee. And then we ended up getting an invite to pitch an open call. We were as nervous as all can be, and we knew that this was a pivotal point in our business to where this could be a massive opportunity for us. We told them about our story, our mission, our capabilities, what products we saw in the set, how we were going to promote it through our social media network. And towards the end of the presentation, they looked at each other and they they were like we were thinking maybe a few hundred stores, but after this, this is at least 2000. And they both agreed that this was a national rollout. We ended up getting the golden ticket, which was just it was an emotional moment because we knew what that meant for our business and the impact that was going to have. 

[00:08:11] Ashley Hubka At the 2023 Open Call event, Fire Dept. Coffee was one of more than 130 deals Walmart made with suppliers to sell their products on Walmart and Sam's Club shelves, or online at Walmart.com. This is where Luke landed the opportunity to work with Tommy Reed, Walmart's merchandise director, for the coffee category, to bring fire department coffee to Walmart customers in more than 2000 stores across the country. 

[00:08:41] Tommy Reed I've heard some stats that coffee there's 3200 brands in the U.S.. I don't know how true that number is because some of these local roasters, that number could be higher or lower, but I don't have space to carry 3200 brands on a shelf. But how do I carry the ones that make the most sense for the customers. For coffee, you know, the average footage is 40 to 44ft. We have stores that are a lot more. We have stores that are a lot less. And so how I manage the space in the store is crucial. I always love it when the suppliers had the ability to at least get into our stores and look at the category prior, and have an understanding of kind of what we have on shelf and what they have similar to what we currently have or something totally unique that we don't have. I'm trying to understand from the supplier what is it that that they have that's different, that our customer wants out there. And it could be a quality piece. It could be a it could be a flavor. It could be a packaging that that's interesting. It could be the just a brand that is huge in, you know, Southern California and we don't carry it. When you look at Fire Dept. Coffee, what they brought to us is great quality coffee. It starts to quality, right? Because if the quality is not there, the customer will buy it once and they won't buy it again. The other thing that the Fire Dept. did is they had a passion to helping the fire department, whether it's with medical bills or assistance or anything, is there. Walmart is big about how we give back to communities and they're doing the same thing. So when we can be be a part of that by selling their product and then that that will allow them to give some of that proceeds back to the Fire Dept. That's a that's a great thing. So that was a lot of conversations early on. What do you have? What would make the most sense? How do we get it in front of your current customers then to how do is work as you bring it into Walmart? 

[00:10:33] Luke Schneider Tommy was willing to meet with us on multiple occasions, even prior to the launch, laid out for us what to expect, the store count that we were going to be in, the timing of it. The communication was very good, which I think is key for any relationships, especially a business relationship. So we weren't surprised by any of it or anything that was coming. And so we were able to ramp up our inventory, our production, and make sure that we were going to be able to fulfill everything on time. So that was that was really awesome, because that isn't that isn't like across the board from my experience. It's something that was very unique with Walmart, just how well the communication has been. And it really is evident that Walmart wants to see businesses succeed. And if you have the capabilities and are transparent about your capabilities, they'll be transparent with you. Not everybody gets a golden ticket, but they'll at least walk away with learnings or what they can do differently or have learned something from that experience. And that in itself is an opportunity. 

[00:11:55] Ashley Hubka Tommy views his role as going beyond supporting those suppliers who earn a spot on one of our shelves. For him, it's about how he can help the supplier community more broadly, wherever they are on their business journey. 

[00:12:09] Tommy Reed With suppliers, we really aren't ready for Walmart size, then what advice can I give them that allows them potentially to get ready? That will make their business not only better? Maybe even with us, but just overall. I think it's the responsibility of a Walmart merchant to get the best advice that they can to help that supplier along. Hopefully it affects the Walmart customer, but if it doesn't, then then maybe it's a good thing for for them because we truly want suppliers to win. 

[00:12:37] Ashley Hubka Growing a business is a lot of work. However, you don't have to do it alone. After all, asking for help is how Fire Dept. Coffee got to where they are and how they are looking to the future. 

[00:12:50] Luke Schneider The rollout happened. Walmart ended up picking picking up seven SKUs rolled out into around 2300 stores, and now we're being expanded to around 3000 stores. So now it's really high level planning, execution, getting into the data and focusing on growing our business with Walmart. It's been a huge opportunity for us, and Walmart has been a great partner. 

[00:13:23] Ashley Hubka And finally, when it comes to advice for other business owners, Luke has this to say. 

[00:13:29] Luke Schneider If I was to leave any advice or encouragement, it would be just keep going. There's going to be hills and valleys, but you'll never see what's on the other side of that hill if you don't keep climbing. And during that time when you're having challenges and problems, don't be afraid to ask for help. Talk to people around you. I believe, as in the military and in the fire service, you're only as good as your team. And having a strong team is essential to mission success. So just continue to focus and build that community around you that is going to support you. 

[00:14:15] Ashley Hubka You've been listening to the Walmart Business Advance, a series dedicated to highlighting our great business customers and suppliers, what they've been through, and sharing insights to help you reach the next level. If you'd like to learn more about being a Walmart Business customer, please visit business.walmart.com. Likewise, if you enjoyed this episode, please follow, rate and recommend the show to a friend or fellow business owner.