The Right Relationships Can Make All The Difference

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The Silk Road Spice Merchant, Calgary

Joint ventures are common practice in the oil and gas sector, and they’re often measured in the billions of dollars. But for small businesses like Calgary’s Silk Road Spice Merchant, the most important partnerships can be much more modest. When it was looking to expand into a different market, it identified Edmonton as the most obvious and logical choice. The owners were far less certain about how to actually go about doing it, though. “We always had plans to expand in some way, but we didn’t know how that would look,” says co-owner Kelci Hind. “We talked about franchising or creating a chain but we weren’t really sure.”

That’s where Evoolution, a new concept on Edmonton’s popular 104 Street promenade, came in. The store wanted to stock Silk Road’s products, and while it could only pay wholesale – and so might potentially cannibalize some of Silk Road’s existing sales in Edmonton, which came at a higher margin – Hind thought the risk was worth it. She recognized the benefits of being able to test her products in the Edmonton market without any additional investment. “We thought, ‘If we don’t sell at all, then maybe we’ll have an idea that Edmonton isn’t the place for us. And if we do, and if people are saying they want more, it’s a low-risk way to find out,’ ” she says.

“Our business has grown totally organically, and I think it’s from word of mouth and being involved in the different communities.”

Well, they sold. “It’s been a great relationship,” Hind says. “Their store is doing really well, and I think they’re opening another new location with two more on the way in Edmonton, and they want to have our spices in all of them.” It wasn’t the first time that Silk Road had been approached by someone wanting to sell its products, mind you. Indeed, Hind says that they were getting approached “once a week” by potential partners, but turned them down because they didn’t want to dilute their concept or cede control of its execution. So why did they choose a company that was brand new, never mind one that was also doing something – selling premium flavoured olive oils and vinegars in bulk – that hadn’t been done before in Alberta? “One, they’re in Edmonton, so they’re close. Two, one of the owners lives in Calgary and commutes back and forth, so actually getting the product up there was easier. And we just loved their business and the way they approached it – it totally reminded us of us.”

Hind and her business partner, Colin Leach, had paired with a like-minded entrepreneur before. In the very early days of the business, they met Aviv Fried, the proprietor of Sidewalk Citizen bakery, who had just quit school to start his own business – in fact, he was still hand-delivering the loaves of bread he baked personally by bicycle. They did a co-promotion where people could either buy a loaf of his bread for $6 or pay $10 and get a jar of spices along with it. “I think we sold, like, 50 of these little packages – but we were so excited about it,” Hind says. “You sell for a little bit less, but it feels so grassroots and good and that’s how we met a lot of other people in the community. Now, a lot of us are doing a lot better, but those relationships are still there.”

Hind says that those relationships, and the sense of community they create, are one of the keys to Silk Road’s ability to get its name out there and attract new business. “It’s so important. We did a group ad for Inglewood in City Palate and we’ve done some Google AdWords, but that’s it. Otherwise, our business has grown totally organically, and I think it’s from things like that – it’s from word of mouth and being involved in different communities. There’s our neighbourhood community in Inglewood, there’s the food community and then there’s the small business community. We made a point of making relationships with all of those people. That’s how you grow, and that’s how you learn about other things.”

Parting Advice

Sometimes, the best partnerships are the ones a business doesn’t make. That’s particularly true for small businesses, which can be tempted in the early days to trade control for cash. The Silk Road was approached by a lawyer representing a company that made its money by buying stakes in food businesses and then handling their operational minutiae in exchange for a cut of the profits. The owners were tempted by the offer, too, but ultimately declined –
and they’re happy they did. “If we’d done something like that, especially that early, it would have changed everything,” Hind says. “There’s always a price for that.”

Alberta averaged 38,000 housing starts this year, up 8.2% from the previous year

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