This transcript was generated from the episode audio and may contain minor errors.
[Music]
Hey there, side hustlers. Welcome back. This is Chris Guillebeau, your host of Side Hustle School. You may have heard me say before that one of my first side hustles was importing coffee. That was a long time ago.
These days I just drink coffee. But today's story caught my attention when it came across my desk. It's about coffee pods. You know those machines where you can put a little pod in, you just press a button, then an espresso comes out. Long ago, when I was doing the coffee business, I don't think those even existed.
Or if they did, they weren't common. Today's story is about a guy in England who gets creative and finds a way to import coffee pods. Kind of like I did long ago, except I was actually importing the coffee, coffee pods are a lot smaller and easier to pack and ship. And this is a pretty big success. This guy actually starts the project with a partner, and within about six months, they're actually earning a full-time income from it.
I'll tell you all about how they got the idea and how it works right after this. [Music]
In 2015, Jack Bramhall was living in Greater Manchester, England, working in an office at a job he described as not worth talking about because it was boring. Like many of his colleagues, every day he'd visit the coffee machine, which at his office was an espresso machine, one of the kinds that required little pods to make coffee. He knew that his office manager sometimes had a hard time ordering the pods since the manufacturer required a very large minimum order to get wholesale pricing. In addition to that annoyance, Jack also wondered why you could only make coffee from the pods.
Why couldn't you make tea or hot chocolate or even something like a milkshake? Jack had always wanted to have a business. He left school at age 16 to work full-time and had tried several different ideas before, but none had taken off. Maybe this idea would stick. Working with his friend Mike, Jack set out to research if anyone else had cracked the caffeine-free pod market.
With a few Google searches, they learned that a company in Australia was making espresso-compatible pods in a variety of flavors and offering them for sale at a much lower price than the official ones. Jack requested samples, and when they arrived, they fit the machines perfectly, and they also tasted great. Next, they had to convince that Australian manufacturer that they were serious, but they did that by building a website in a weekend and agreeing to purchase a large amount of pods on Faith. And it worked. In the first month, they sold 1,000 pods at a price of around three pounds each, or about $5.
The next month, they sold nearly 1,500. They continued to grow month after month before finally stabilizing. It helped a lot that they had a great product at a low price. Though they would later pay for advertising, their first success came from just putting the word out on social media. They were able to attract individuals and other office managers who wanted to save money and try different flavors.
Remember, a lot of people own these machines, and Jack and Mike were the first people to import an alternative coffee pie that would fit them in the UK. And by the way, it's not illegal to do this, in case you're wondering. They just have to be careful to note that they're not affiliated with an espresso brand. And there's a prominent disclaimer on their website to make sure there's no confusion. One challenge was these pods came from Australia and they didn't arrive via overnight mail.
Since demand far exceeded their initial projection, they quickly went out of stock and had to reorder. Then it would take two weeks for their wholesale shipment to arrive. They'd have to unpack, repack in smaller mailings, and then send those mailings out to customers. This became a continual problem until they began to order in larger quantities and thus have more on hand. Exactly two years in MugPods, Jack's idea that stuck, is now generating multiple six figures in annual income and was recently featured as the business of the week by their local newspaper.
The partners have reinvested in the business to make sure it can continue to be successful, but Mike now works on it full-time. Jack focuses his time on creating more automation so they'll be able to grow further, but both founders still continue to pack pods every day. In addition to basic coffee pods, you can get hot chocolate mint, hot chocolate hazelnut, hot chocolate caramel, and the list goes on. Oh, and yes, there is a milkshake flavor. [Music]
Well, this is a classic example of following your curiosity, using the power of observation to ask, hey, I wonder why this doesn't exist?
Why do we have to meet this huge minimum order just to get lower pricing on the coffee pods? Surely there's an alternative. And also, why can't I get a milkshake out of my coffee machine? I mean, who hasn't said that before? Well, regardless of who said something about it before, this guy, Jack, actually did something about it.
You know, in some ways it's hard to imagine that something like this didn't exist two years ago in the UK, or maybe technically it existed somehow, but it was just inaccessible. It wasn't mainstream. People didn't know how to find it. I'm not quite sure. But either way, those pod machines are everywhere.
I see them whenever I check into a hotel. If you go in the shops, you can see them lining the shelves. Obviously people are buying them. They like the convenience of pressing a button and getting a decent coffee. I guess you could argue over whether it's really good or not, but that's a different conversation.
The point is this hustle is really working. I also think it's great that they are importing these pods, not going through what is undoubtedly a complicated process and an expensive process to learn how to make them themselves. When I first started reading the notes for this story, that's what I thought they were doing, making them themselves. But then I realized, oh, they're just reselling, which is in a lot of ways, so much easier. If you can find a market for something and there's a product that exists somewhere else, you can bring that product to market.
Well, I like that kind of business much more than setting up a factory or figuring out how to make these coffee pods in your kitchen. It's obviously working very well for them and they're continuing to invest in the business to protect it, which I think is also smart. It almost makes me want to go out and import coffee again, but not quite, because I love what I do and I love making this show for you. [Music]
I hope you enjoyed this story. As always, inspiration is good, but inspiration with action is so much better.
Today's show notes are at sidehustleschool.com/280. I'll be back with you tomorrow for the weekly recap. I'm Chris Guillebeau for Side Hustle School. [Music]
