Creating Growth and Finding New Ground in an Invisible IndustryCreating Growth and Finding New Ground in an Invisible Industry

Creating Growth and Finding New Ground in an Invisible Industry Transcript:

Announcer: You’re listening to The Kula Ring, a podcast made for manufacturing marketers. Here are Carman Pirie and Jeff White. 

Jeff White: Welcome to The Kula Ring, a podcast for manufacturing marketers brought to you by Kula Partners. My name is Jeff White and joining me today is Carman Pirie. Carman, how you doing, sir?

Carman Pirie: I’m doing well. Doing well. And you know, excited to be recording yet another episode of The Kula Ring with you, good sir.

Jeff White: Yeah. No, I think it should be good. It’s a Friday, going into a weekend. Ton of rain in the forecast, which doesn’t normally seem like a good thing, but we’ve been having crazy wildfires here in Nova Scotia, and we’re looking forward to a little bit of-

Carman Pirie: There you have it, ladies and gentlemen. You get your Canadian content included in the podcast here with a commentary on the weather, because nothing is more Canadian than talking about the weather. But let’s not talk about the weather. 

Jeff White: No. Talking to somebody on the other end of the continent, too. 

Carman Pirie: Yeah. Yeah. 

Jeff White: Great to bring people together in this way. 

Carman Pirie: We may be talking about the dynamics of marketing an invisible industry, but we did manage to find this person that could talk about it, so they’re not particularly invisible. 

Jeff White: This is true. So, joining us today is Lori Raymond, and Lori is the CEO of Tourmaline Enterprises. Welcome to The Kula Ring, Lori. 

Lori Raymond: Thank you so much. I feel circled around and included, for sure, and speaking of Canadian weather, I grew up in Washington state, and actually married a gentleman from Montreal, Quebec, that was living in Vancouver, B.C., and we always used to laugh about the weather report in Washington when it would say there’s a cold front coming in from the north. And you know, The Far Side was the big comic at the time, and we always had visions of great big fans at the border blowing that cold front down into Washington. So-

Carman Pirie: I will say there are a number of places in the U.S. that can get remarkably cold, but y’all have a pretty good way of blaming us for it. 

Lori Raymond: Exactly. It’s coming from the north. It’s a cold front moving in. So, enjoyed the intro very much. Thank you for that. 

Jeff White: Lori, tell us a bit about yourself and Tourmaline. 

Lori Raymond: Sure. Thank you for asking. So, gosh, I’ve been CEO of Tourmaline Enterprises since 2015. Inherited the company when my late husband passed away and had been working with him in the industry for about seven years, so I sort of had that pivotal moment of do I move forward or do I just kind of put this thing to bed, and I decided to move forward, and I love our industry, so that’s probably the first thing that drove me to saying I can do this is because we are an invisible industry and it always brings up conversation about, “Well, how did you get into this business? And why did you get into this business? And what do you do?” And all of that. So, I know you folks have seen this and your audience is only gonna hear it, but anytime there’s a food product, especially, that’s the best way to describe what we do, is we are encoding and marking of consumer product goods. 

So, any product that you bring into your home, let’s say it’s a gallon of milk. Dairy is always the easiest because it spoils so quickly, right? And there is always a date code on that dairy product and it’s an expiration date, and that expiration date got there somehow, but most people don’t usually care that it’s there until they go to drink that milk and it’s sour. And then all of a sudden they go, “Wait. What happened to the expiration date?” 

That’s what we do. We don’t do the actual printing, but we manufacture and distribute printers, inkjet printers specifically, the inks and supplies into the food packaging industry. So, food packaging, pharmaceutical, automotive, aerospace, anything that’s requiring a code, a manufacturer’s code, or a manufacturing date, or an expiration date. Lot code maybe, right? So, you want to make sure that you understand how to track and trace that product back to why that lot had a problem, or you want to recall that lot, that’s what those codes are for. So, we always say we’re in an invisible industry because people don’t really care how that code got there, and they usually don’t look at it until they need to know, right? 

Carman Pirie: It is interesting, though, because I think there are some people that are in invisible categories that would kind of add to that, where they would be like, “You know, the business doesn’t know that they need us. They didn’t even know that they have this problem, let alone that we exist to solve it.” But in this instance, there is a drive, obviously, for regulatory compliance. That is a must. So, they obviously must know they have a need for what you all do, but is it troubling getting beyond that in that they just see it as a commodity and let’s get it done and fill the regulatory need?

Lori Raymond: Yeah, so that’s a really good question. Now it’s very scientific how factories are being built, as we know. It’s becoming more and more technical all the time about, from the beginning of the line through the end of the line, and how does that product get handled from beginning to end, right? So, now the more regulatory compliance comes out and food manufacturers, for example, we’ll use them because that’s one that everybody can understand so easily, is the more and more regulations come out, it’s partially driven by the consumer because the consumer wants to know, “Well, where did the original product come from? Where are the ingredients coming from?” 

Consumers are getting very educated now, mostly because of the internet, right? And so, now when they’re building out factories, they’re taking the consumer into consideration when they think about, “Okay, can we print directly on the product? Can we put something directly on the product so that if it…” Here’s an example. These are electrolyte tablets, right? And maybe someone would separate it from its container. The container would have the information on it but the product itself doesn’t. In some cases, you want the product… Let’s say it’s a medical device. You want the product to have that code on that in case it gets separated from its box, right? 

So, the engineers now look at what do we do with the product? Should we code on the product directly and then on its packaging? And then on the box that its packaging goes in, right? So, there’s primary, secondary, and what’s called tertiary packaging, and you’ve probably heard those terms before because you’ve been talking about marketing in manufacturing for years, right? So, the consumer doesn’t really realize that, but there’s a purpose why there’s a code on every part of the product. So, from beginning, the product itself, and then that primary packaging matters to… The primary packaging matters to the store or the retail outlet that is selling that product. They know that the code is there. And then when it gets to the warehouse, that code needs to be on that corrugated box that it’s all put in so that they can warehouse it properly without having to open up the box, right? 

Jeff White: So, is your business like a typical consumer or commercial printing business, as well, where the real product is in the refills and the cartridges and all of that, and not necessarily in the machines themselves? Or is it really the whole thing that matters? 

Lori Raymond: Yeah, so really good question, and we don’t do the printing. I don’t know if I said that. We do not do the printing. We only make the printers, bring in the finished goods, and sell the printers, and the inks, and supplies. So, yeah, we’re the razor and the razor blade, right? The money is ultimately in the razor blade or the inks for us because it’s an ongoing consumable. Now, the life of the printer itself can be anywhere from 6 to 10 years and sometimes beyond that before a factory will have to replace a printer if it’s maintained properly. 

Carman Pirie: And is it the nature that your consumables can operate across multiple printers or are they all proprietary? I.e., I’m wondering can you displace a competitor’s consumables without having to displace their equipment? 

Lori Raymond: Sure. Really good question. So, what is a great selling point for us is that our business model is we sell our product through distributors. So, those distributors sell multiple pieces of packaging equipment, and they sell into the factories. So, our mission is to get them to understand that if they sell that printer, they will get the revenue from that ongoing ink supply, right? And how do we do that is our product is actually coded with a direct code into the printer itself and it has that distributor’s proprietary code in it. Then the ink cartridge has a sim chip, very similar to the sim chip in your credit card with all your info, right? And that sim chip has beyond just that distributor’s code. It also has the coding of that ink type. What are the firing parameters? How does it need to be handled? All that information is coded into that chip so when that end user then puts that cartridge of ink into the printer, the two marry and they get a nice, clean print and that’s what they want. They want to know that, right? 

We get phone calls frequently from end user customers all over the globe saying, “Hey, I’m looking for this ink,” and our first question is always, “Where did you buy your printer from?” And we can tell very easily if they’re just looking for a cheaper price or if they really forgot who they bought it from, because then we have to ask them what’s the serial number of your printer, and if they purchased it from us we can tell them, “Oh, you bought that from XYZ company in Nova Scotia and you need to call them. They have a supply of ink for you.” 

And so, our distributors love that because it takes out that stealing other people’s customers, if you will. 

Carman Pirie: Yeah. There’s not a lot of chance of conflict in that instance. 

Lori Raymond: There’s not a lot of chance of conflict and there’s not a lot of cannibalizing in an area. Because everybody has a different customer base so it is pretty rare when we will have a distributor run into another distributor’s customer that they’re both in the same facility, and when they do it’s whoever went in first is who gets the business, you know? Kind of how it goes. 

Carman Pirie: How often do you as a company connect to those end user businesses versus just the distributors? I appreciate that you don’t sell to those businesses, and you rely on the distribution channel for that, but I’m curious about your informing your gut instincts about what customers really want, et cetera, and ensuring that the voice of the customer is coming through in what you do. 

Lori Raymond: Sure. That’s a great question. And I will tell you we do sell to end users, but there’s a caveat to that. We only sell to end users in our geographical area that our corporate office is in because when we started with this industry we had to get an install base going so then we could go to distributors and we could say, “We’ve proven this product line works and now we’d like to…” So, where our distributors are that we are not, every lead that comes in we will pass over to the distributor, right? But on the end user side in our geographical area, that keeps us in touch with who that consumer is. It keeps us in touch with what the needs are. We understand packaging more as a result because we are not just supplying to a supplier. 

We also go in and we understand that the production line engineer, or operator, or the maintenance operator has concerns, and what are those concerns? The biggest concern is downtime. So, when a printer goes down, everything stops because the production line has to stop, right? And so, we always say that we do not want to be the reason why a production line goes down. We never want to hear a customer say, “Well, it was our printer.” So, it’s very important to us that we stay up with what’s important to that factory worker, you know? 

Carman Pirie: Yeah. Now, I appreciate this might not be a strategy that’s open to everybody, but it is an interesting thought experiment, I think, for people to imagine this notion of maintaining a kind of a geographically contained direct sales channel as a way of better informing your understanding of the customer and… That’s really a unique perspective that you get. I don’t think I’ve encountered that terribly often. 

Jeff White: I don’t think so, either. 

Lori Raymond: No. It does help us because when we… So, then when we go out with our channel salespeople and work with a distributor directly and their salespeople, we understand what they run up against. We absolutely understand what the objections are. We absolutely understand when they’re wanting to make equipment changes why they’re wanting to make equipment changes. What’s important to them? It’s usually cost per print on the ink. That’s a big thing. That’s math and we can help them do the math, and our printers will actually calculate it as soon as you put that ink cartridge in. 

Obviously, it’s a computer board. It’s gonna tell you anything you want to know, right? And so, based on the size of print that you want, let’s say it’s a… You’re in meters, so let’s say it’s 2 millimeters in height, right? And it’s 6 millimeters long. You put in the parameters and that cartridge of ink, that controller on the printer is going to tell you exactly how many prints you’re going to get out of that cartridge based on that message. 

Jeff White: I love how detailed you need to be about something that’s allegedly invisible. 

Lori Raymond: Isn’t it crazy? Yeah. 

Jeff White:  A very complex process that fits into an even bigger, more complex process, and I think you’ve chosen to solve some of the marketing and sales challenges in a really unique way. You know, this idea of having this test direct market and all that that you can learn from, and the way that you’re working through distributors. But even earlier in our conversation you talked about the end-end consumer, who’s looking at a jug of spoiled milk is a consideration and something that you’re thinking about. So, how are you approaching kind of marketing to each of those different tiers? You know, how are you approaching marketing to the distributors that retail your product and also thinking about the needs of a production manager who doesn’t want their line to go down because of his coding printer?

Lori Raymond: Yeah. Really good questions, guys. So, I think that coming from… You know, our years of experience, and also dealing with end users, and being consumers ourselves, right? Every one of us is a consumer, so when we talk about marketing, we look at it from the standpoint of what helps the consumer understand this B2B business that we’re in? So, we’re on social media, right? Even though we’re B2B, it’s all B2P, right? Business to people. Which I think comes back to The Kula Ring, right? We’re all passing it on, right? 

And I think that when we look at who’s our target market, our target market and our customer persona in marketing speak is definitely that production manager. Because he’s gonna go to his distributor that he works with and he’s gonna ultimately say, “Hey, I saw this printer, and could that be something that is gonna solve the problem on my production line and get more product out faster if I solve this problem?” And so, we target our marketing for anybody to understand. My marketing team just did a great piece that went out on LinkedIn and all over social media, and it was really taking something as simple as the 1950s coffee percolator and explaining how the ink droplets come out of the cartridge of ink and the technology behind thermal inkjet. 

So, it was a great piece of marketing, but I’m thinking, “Okay, so even a consumer will look at that and they’ll go huh, I never really understood that but now I understand that because now I understand how the coffee percolator works.” 

Carman Pirie: I wonder, is there an opportunity ever to… You know, I’m thinking of that example particularly in pharmaceuticals, where you could imagine that disconnection from the package and the interest in having the compliance code extend to the actual product itself, and along that. Have you ever encountered a situation where either your understanding as a consumer or your understanding of consumers led you to think of a way to introduce basically more product safety into this where it didn’t exist before? I.e., we started printing on this for the first time and it’s made that entire category safer as a result? 

Lori Raymond: Well, I like to think that I brought some awareness personally to… I think I may have shared this with you when we originally spoke on whether or not it was a fit for me to be on your show. So, several years ago when my late husband was alive and was battling cancer, we started dosing him with cannabis because he had not gotten to the point in treatment where he was having any treatment. He was diagnosed and unfortunately passed away in a three-month period, so at that time the legal cannabis industry had just taken hold in California, and I called my youngest daughter and said, “You need to get your dad a medical card. We need to start treating him.” 

And I was absolutely shocked at how little information was on the product. Absolutely very little information. It was like, “Okay, it’s this much THC,” or, “It’s this much CBD.” But other than that, there was really no information on it. We started experimenting here after he had passed away with everything from the barrel of a vape cartridge to the little pots that… I forget what it’s called. Shatter or something. It’s the resin. The resin of the cannabis. 

Jeff White: The concentrate. Yeah. 

Lori Raymond: Yeah. The concentrate, right? And so, we started testing 2D barcodes on these things that would not only tell you the THC and the CBD content but would also tell you all the way back to the farm where it came from, and customer loyalty, so you could engage the customer at a dispensary level by having that 2D barcode and they could become a member of that dispensary or whatever. So, we were very instrumental in starting back in 2016 here in California and really opened up a lot of eyes in the cannabis industry, so that’s the best example I could give you of how we kind of took it upon ourselves and said, “I think there’s something more here.” And the industry just doesn’t know what they don’t know, and you know they don’t know. 

Carman Pirie: Yeah. Exactly right. 

Lori Raymond: So, it becomes our responsibility to help them know it and then I personally got involved with the California Cannabis Industry Association and went to a lot of various board meetings and those sort of things just to get awareness out there of what’s possible so that the consumer does have the information. 

Carman Pirie: I think it’s a fascinating space that’s I think evolving more rapidly than people think about this notion of farm to fork and being able to trace our entire food supply in that way. That obviously extends to product like to your point, cannabis and others. I mean, it’s really interesting to think about the role that inkjet printing technology is playing in that as a guy who used to run a print shop and just didn’t really think about it. 

Lori Raymond: Right? And so, there is a new regulation that’s changing in the food industry and that by 2016, I believe it’s January of 2016, every food product is going to be required to have a 2D barcode on it. Now, there’s several types of technology that prints these codes. We have thermal inkjet. There’s also a product technology called continuous inkjet. Continuous inkjet has been used in food and beverage for decades and decades and was probably one of the first types of technology to print codes, so that is typically used in super high speed production. Think Coca-Cola, right? And we’re actually doing some testing right now with a company, the largest food packager in Mexico right now, on their bean can line. 

And they’re printing 650 cans per minute. 

Carman Pirie: Wow. 

Lori Raymond: So, that’s super-fast speed, right? And usually, you would need to have a continuous inkjet technology printer running at that kind of line speed. The quality of the print for something that isn’t running at that type of speed is not near as crisp and clear as thermal inkjet, so there is a purpose for both, right? Now, continuous inkjet cannot print 2D barcodes, so now that this regulation is coming out and all food packagers are gonna need to put a 2D barcode, we have the answer. We have the solution. Because thermal inkjet can print 2D barcodes because you need those crisp lines to be able to capture that 2D barcode and get the information out of it. 

So, we are testing on that line, and so far the testing is going really well, and I’ll keep you guys posted if they end up purchasing printers from us. They have 80 production lines currently and they have opportunity in all 80 lines for multiple places on those lines to be utilizing the technology. 

Carman Pirie: Well, my goodness, it’s a very important problem to solve in that instance. Otherwise, you need to be sure that you can meet your regulatory compliance of that 2D barcode, but you don’t want to be slowing down the production line to do it. 

Lori Raymond: Can you imagine? 

Carman Pirie: A huge cost to doing that, so yeah. 

Lori Raymond: Yeah. Again, that’s that big mission of ours is not being the reason that that line goes down. 

Carman Pirie: Yeah. Exactly right. 

Lori Raymond: You know, because it’s interesting. Our operations manager used to be operations manager for Nestle water bottling and he said when that line goes down because of your printer, it’s not just the printing that stops. It stops all the way back to the filling line where they’re filling the water bottles because they can’t fill them if you can’t get them down the line for that package to be printed. So, it stops in several places, so it’s not just from the printing line. And so, yeah, we don’t want to be that reason. 

Carman Pirie: Lori, maybe changing gears a little bit just as we round the corner to end the show here. 

Lori Raymond: A little engineering term. 

Carman Pirie: We don’t have occasion very often, I must admit on this show, to interview women CEOs. I don’t think that that happens very often, if at all. We’ve had a number of incredibly articulate and smart female guests, but I don’t know about CEOs. So, I just wonder if you might reflect on that experience that you really kind of I think were thrown in a bit unexpectedly, obviously. 

Lori Raymond: Yeah. 

Carman Pirie: And being a woman CEO in what may be an otherwise fairly male dominated space, I’d be curious to hear about it. 

Lori Raymond: It kind of is. That’s the history of my life, though, Carman, I have to tell you. I seem to always find myself in those industries. So, you know, I was in the industry for seven years before Jerry passed away, and for me I’ve always been very entrepreneurial and I’ve always been in management of some kind, so I said, “You know, let me take a look at this company and either I can pull it forward or I can put it to bed.” 

And I knew that then my option was I would probably become a barista and go make coffee all day, right? So, I said, “You know, we have a few employees here,” and I felt like I owed it to the employees to really make sure that I kept that vision alive, and I am more of a visionary than not, so my goal was to take my late husband’s concepts to fruition and then grow beyond that, and I think we’ve done that. We’ve grown about 350% in both revenue and employees since that time. And you know, it is a challenge, but I always like being part of that group of very few women in our industry that gather, and the guys are kind of, “Does she get it, or does she not get it?” 

I learned early on, I was division manager of a chemical manufacturing company, and I learned early on that when you are talking about chemicals, and you’re talking about ink for example, the men in our industry at first will question why you’re there, but secondarily they lean in to find out. Do you understand what you’re talking about? So, I think that women who are not afraid to embrace something as simple as a packaging line… I mean, can certainly go into a factory and talk to the men and say, “You know, let me help solve this problem. Let’s just angle the print head this way. We’re gonna get a cleaner print out of it and you won’t get a break in the line.” 

They lean in and they start to listen and there’s a level of respect that is shown. And I have always found it really challenging, and I like being in a position where I can offer opportunities to other women, and to men, and to a really diverse group. I mean, I have a great diverse group of people. I say pretty soon I’m gonna have to get a passport to come into my office. And I like having a company where we get to offer opportunities to everybody, like our marketing coordinator, for example, used to be our shipper. And we were only maybe five people at the time, and he’d worked for us for about a year and a half, and he was a great shipper, by the way. He did a great job. He’s very detail oriented. 

If you look at my marketing, you’ll know it was him. He’s very detail oriented and he’s got a great eye, and he came to me one day and he said, “You know, Lori, I really like working here, and I love working for you, but I never really wanted to be a shipper. I took the job because my brother taught me how to do it so I would always be able to get a job. But I really want to be in marketing.” And I was like, “Well, oh. That’s interesting. Well, we outsource our marketing, and we don’t really… We’re not big enough to have a marketing department but let’s see how we can figure this out.” 

And it took us about a year to put a pathway forward for him to be able to duplicate himself and bring a shipper in that he could train to do as good a job or better than he was doing while he learned how to create his dream job of being in marketing. And he’s been in marketing for us now for a year and he’s hitting all his KPIs and doing a great job. And everybody comments on, “Wow, your marketing is just… You’re crushing it. You guys are doing a great job.” 

And so, I started a short little video that I do once a week called Tips From The Trenches for business owners, so it’s an offshoot from the printing and the ink cartridges, but it’s really how do you step forward when life sort of slaps you in the face and you need to pivot? As a business owner, how do you rise above those things? And what are the day-to-day things in the trenches that business owners face and how do you overcome them? Or what’s important to business owners? So, if you get a chance, you’ll see it on my LinkedIn, or you’ll see it on Instagram. Tips From the Trenches. And we try to keep it light, but we try to give some really good nuggets of gold out there for other business owners. 

Carman Pirie: That’s fantastic. I encourage listeners to look that up and check it out. I know I will. 

Jeff White: Yeah. We’ll link it up in the transcript, as well. 

Carman Pirie: Fantastic. Well, Lori, it’s been lovely to have you on the show. Thank you for all that you brought to it. It’s been lovely to have this conversation. 

Lori Raymond: It’s been really fun, and I can’t thank you enough because marketing in manufacturing is really unique. I love your podcast. I think it makes sense. 

Jeff White: Thanks very much. Great to have you on. 

Carman Pirie: Take care. 

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