[Podcast] 'Grow For Good™' S02 E6: People, Planet and Profit with Meliora's Kate Jakubas
On this episode of the Grow For Good podcast, Jed sits down with Meliora Cleaning Products' Founder and COO, Kate Jakubas.
If you have any questions or suggestions for future guests, send an email to email@example.com.
Read the episode transcript below.
Kate Jakubas [Snippet] : We could stay the size we are and everybody would be good, but that wasn't what the funding of our company was about. It was about making better product; it was about making a better industry.
Intro [Voiceover]: It's an age-old question. Can you do well by doing good? Welcome to the Grow For Good™ podcast, where we speak with leaders who strive to make a positive impact on the world. Here's the host of the Grow For Good™ podcast, Jed Morey.
Jed Morey [Intro]: See a problem. Fix the problem. This is the engineering ethos. To find practical solutions to everyday problems. That’s well and good, but then there are solutions to problems many of us still don’t know we have. When you’re bringing a product line to market, that’s a little trickier.
Kate Jakubas is an engineer at heart and by training. And she has the degrees to prove it. Armed with a bachelors in materials science engineering and a masters in environmental engineering and water management, Kate entered the workforce in areas that line up nicely with her education. But something nagged at her conscience at this point in her life, so she did what any good engineer would do. She learned yet another discipline and set about solving it.
The question that nagged at her was what exactly is in our cleaning products. As she progressed in her career, the question never left the back of her mind until she decided to pursue this with the rigor of an engineer and the spirit of an entrepreneur.
Born, raised and educated in Chicago there was never a question in her mind that her journey into the corporate world as a business owner would take place here as well. Kate founded Meliora - we’ll talk about the name, especially as you hear me butcher it in the introduction - as well as Kate’s path to starting, running and now growing a people friendly and planet friendly line of cleaning solutions.
We cover a lot of ground in this episode and I know you’ll find Kate both captivating and brilliant so I can’t wait for you to meet her.
JM: Hey, it's Jed from Morey Creative Studios, a Diamond HubSpot Partner Agency based in New York and the host of Grow For Good™. Check out our social justice podcast News Beat and our marketing podcast, Inbound & Down for more good stuff coming from our little shop. I am absolutely delighted to welcome our guest, Kate Jakubas, founder of Meliora, a people and planet friendly cleaning product company based in Chi-Town. Kate, welcome to Grow For Good™.
KJ: Hi, I'm so excited to be here!
JM: Thank you for making the time. We really appreciate it, especially in your busy production schedule and some really cool stuff that we're going to talk about.
JM: So, let's dig in. Before we get to your background personally—which I'm fascinated by and I have a few questions on—I want to talk about your company history a little bit. Can you just give us a broad overview and talk about Meliora and your product line?
KJ: Yeah. So, Meliora is a people and planet friendly cleaning product manufacturer. We were founded in 2013. The whole idea behind the company was to make cleaning products that were better, better for people, better for the planet, better for our wastewater systems—which is actually where the idea for the company got started. I was studying how we get rid of products and how the products and the chemicals that we intentionally add to things like the air and water and making sure that what's in our products that we use every day are safe for things like each other, other people, the fish and air—just thinking about how we use things and using them in a way that isn't going to be harmful.
And we've been growing. So we are, in some ways, we look like a normal consumer packaged goods, a CPG company. We make cleaning products pretty normal, but in other ways we're really super different and our name holds us to that. Meliora is a Latin word and it means better or better things. If you think of the English word ameliorate, it means to make something better, and that's kind of the touchstone of our company. What we're trying to do every day is offer better products, be a better company and improve from day to day and from year to year.
JM: Well, I’m mostly going to look up—how did I say it, Me-loria?
KJ: Yeah, that's very common, it’s Meliora.
JM: Yeah. I'm going to look them both up, just to see what everything means, but the more we keep saying and confirming how we say the company, the more it's going to stick in everybody's mind.
KJ: Great, Meliora!
JM: Meliora. I dig it, I get it, but I want to talk to about your background and education, because you have a slew of degrees in things that I really don't understand.
JM: So, can you tell us about your education journey and what prompted you along the way to come up with this idea?
KJ: Absolutely. I am not a natural entrepreneur, I'm an engineer nerd. I'm a science geek. I grew up with rock collections, I've always been interested in stuff and how things work and so, I went into engineering. That was really natural for me, I loved chemistry, I loved thinking about problems, how to fix things, using a roll of duct tape to make something work.
Material science engineering, specifically, is what I studied when I was in undergrad and material sciences is a little bit of a—not one of the more common engineering, it's kind of a cross between mechanical and chemical engineering if that means anything to you, but it's basically stuff.
So, what is special about stainless steel and what makes that different than plastics or ceramics? How do we design things that they don't break? How do we make something that could withstand reentry—so the space shuttle tiles are material science. How do we make wind turbine blades that are going to hold up to the high stresses and make green energy?
All of that is a part of material science and I was really fascinated by that, and so that's what I studied. After I graduated, I worked in research and development for a company that made sinks and faucets, and I'd always considered myself very environmentally focused, but when I was really digging into the details of, how do we make safe faucets? How do we make sure that the faucets we're using don't put lead into our drinking water? That becomes a technical question and so, in order to really understand that I went back to school for environmental engineering.
So, my master's is in environmental engineering, specifically how water and wastewater work, how do we control and modify the release of chemicals into the environment, so that's what I studied in school.
JM: So understanding a lot of this stuff, the environmental engineering side, I think I can sort of wrap my head around it a little bit more, but when I was watching some of your company videos, it also occurred to me that this really is a chemical engineering process. Did you study that or is it something that is intuitive to, I guess the broader set of degrees that you got, where you took a little bit of it, you understood the basics of it?
Because you've got tubs and you're mixing stuff and you've got surfactants and trying to separate oils and I'm watching you give the thing, it's so matter of fact, when you're giving the tour and I'm like, this actually looks hard.
KJ: Yeah. I guess material sciences is what I studied, but chemical engineering is related, but more of a hobby. So, I really dug into some of the details as we started the company and did a little bit more reading and did take a few classes in chemical and process engineering.
So, some of that kind of comes along for the ride as related to my engineering degree and specialty, and then some of it, we do want to make sure we bring in experts who are—our most recent hire in fact, at Meliora is a process engineer, so that's totally her deal, she understands, “How do we make a batch size? How do we process something to convert it from one chemical to another, in a way that's safe and effective and good for the environment?”
JM: I see. So, you're a Chicago native, right?
KJ: I am, I grew up in the suburbs.
JM: You did, okay. So, I've lost a couple of really close friends from New York to Chicago and they're just never coming back, they absolutely love it. So, I've always been a little upset with Chicago, but you seem to have embraced it all. So, you grew up there, you went to school there and then it's kind of like, hometown hero makes good, opens up manufacturing plant doing really good things for the world.
JM: Is Chicago a good place to birth something like this? What is the business and cultural environment around what you're doing?
KJ: Yeah, so you're right. I grew up outside of Chicago, studied here. I studied abroad in Wisconsin, I did an internship up there.
JM: Studied abroad? [Laughing]
KJ: [Laughing] Yeah, up north, with all the cheese. I married a Wisconsinite, so there's a little cross border love there, but yes, love Chicago. Some of the awesome things about building a business here, we are really central, so if you look at the industrial swath of the country, the Midwest is where a lot of great industry takes place. We're right in the middle of the country, so when we're making stuff, we think about our railroad. Chicago is the railroad capital of the US to this day; everything sort of connects through here. We have the best food, that's not super related, but it makes it nice to live here.
JM: I'm probably going to edit that out.
KJ: That's fine. [Laughing]
JM: Yeah, because you don't get to make that claim but continue. [Laughing]
KJ: All right, we can talk about pizza later. So, yeah, being here, kind of centrally located means we can have—there's a lot of local suppliers industrially speaking, but it also means if we need to reach a little further, we’re not on the West coast having to reach all the way to New Jersey for our distribution or vice versa. So, being centrally located solves a lot of, frankly speaking, logistical issues.
KJ: So that's nice, and then, we're the city of big shoulders, there's sort of an ethos of being hardworking, just getting the work done. If you've ever spent any time in a winter in Chicago, you know that it takes a lot of grit to get through it, sometimes literally, to dig a car out of your parking spot. So it's nice to be in a place where that is part of the culture.
There are definitely other companies that are being built here. We're actually located in a manufacturing incubator, so we're surrounded by about a hundred other companies that are doing in one way or another, some similar things that we're doing. So really trying to build something from the ground up and having something made here in the US and in Chicago.
JM: Yeah, in my reporting days, I did a story on the Chicago board of trade and I was there in the dead of winter, and I remember to this day, thinking to myself as I was walking down the street and the wind came up down the streets and it hit me and I wanted to just cry, I ducked into a building and I said, how do people—and I'm not from a warm weather spot, I'm from New York.
JM: And I said, oh, this is just another level, so kudos. If you can survive a winter there, I guess you can birth a business.
KJ: Right, yeah.
JM: It's amazing. So, one of the other curious, cool things that I picked up on in watching you give the tour—and the tour of your plant is available online, it's on YouTube and I think it's really cool and interesting to see, so I would encourage people to check that out. Essentially you maintain just in time inventory.
JM: But the way you explained it was something I hadn't heard before, because having small inventories, predicting demand, flexing production, makes a lot of sense to me, especially if you're trying to preserve cash instead of parking it in inventory. But you also explained it through the lens of physical plant management and environmental impact, in that you did not want to be managing a facility larger than it needed to be, to simply warehouse product. It seemed to me that you saw it through the lens of, “This isn't just a bad way to park my money, but it's also wasteful.” Was that a happy coincidence of just trying to build something out or was this deliberate?
KJ: It's a little of both. I have a lot of what's called quality background and lean manufacturing—is one of the terms we use for this umbrella of things, like just in time, things like a lot of these systems used in manufacturing, although it's also used in a lot of other industries like healthcare now. So lean manufacturing tools are traditionally thought of as a great way to reduce costs and improve your bottom line, but what I think a lot of people don't always realize right away is that lean can also be green, they're basically the same thing.
When we remove waste from a system, we're making it more profitable, but we’re definitely also making it greener, literally reducing waste. If we think about the current movement of zero waste lifestyle, low waste products, it's built in there. Reducing the waste is going to make improvements and that's one of the best ways, that it's a win-win from a company perspective and a consumer perspective, because waste by definition is something that nobody wants, it doesn't need to be there.
So, if we can work and find ways to reduce it, not only can we improve our business's profit profile and offer better products, but we know that that's what people are looking for as well, so that overlap between lean and green has always been part of our company and having the technical skill set where, you know I was taught lean manufacturing from that profit perspective, from the bottom line perspective, but it doesn't matter why you learn it, we apply it and make it a more sustainable company.
KJ: So, having that skillset there has been really great for us.
JM: Right. But, you know, reading up on you, I had the same kind of feeling that I got when we talked to the founder of Bombas socks, because they had such a simple premise in that for every pair sold, a pair would be donated to homeless shelters. They didn't just say, well, it's a one-off, they actually designed new socks for the shelters based upon the needs of the people that were there and they made sure that they designed, in their minds, what was going to be the very best sock and it seemed like such a simple thing, but it was so deliberate and actionable.
So, I want to talk to you about the product itself because it's a great idea, it's good and certainly low impact on the environment is what we need and it helps people, but the product has to work. So, can you just brag a little bit about your product line and tell us why? And also, maybe explain, I guess how we would have gotten caught up in this cycle of believing that chemical smell almost, and the need for chemicals is the only way to get a deep clean? So maybe just talk about the product, but also the psychology behind how we got to the place that we did.
KJ: Oh, wow, it's just a small question there! So fundamentally, it doesn't matter how green your product is if it doesn't work. If something shows up at your house and it says it's a stain remover and you use it on a stain and the stain is still there, you've just wasted that entire product, so all of the energy that's in it, all of the cost, it's literally all waste, so nothing that you do matters if the product doesn't work.
So that's always been one of our central tenants of how we do product development, it has to work, it has to be good for people, it has to be good for the planet. If it doesn't work, not only are all of those resources wasted, but we lose the trust of the people that have trusted their paychecks and their laundry to us. So, making something that works is really important, and in fact, that's why you still won't see an automatic dish detergent on our website. We know, we know that's what you want, it's our number one request, we haven't given up, but we're not going to launch something until we're sure that it will actually work for people, so it's definitely something that is always top of mind.
Something like cleaning products, and I think it's great that you mentioned socks because, we talk all the time, we're like, yeah, this is a pretty unsexy product, just like socks, they’re really, in some ways that's pretty basic, but if we really dig into the details, we can make these things great and a lot of the times it's by embracing the unsexiness. Let's dig into the details, let's take a few weeks to reevaluate the exact packaging we use. Can we move from a dual material package to a single material package just to make it that much easier to recycle? So those are some of the projects that we work on, the things that get us excited. Maybe not everyone thinks it's exciting, but those are the things we really embraced, to keep pushing our product line forward, making it easier to use, making it easier to recycle.
And there are so many reasons I think that we are used to, kind of the 1950s style advertising hype about cleaning and being sold on what things should smell like and what they should look like and how they should be packaged. And ultimately, I think a lot of that just drives towards where was the profit in the industry? And there's such a trend towards looking at ingredients that do clean just as well, but were much more profitable and could be manufactured at a bigger scale and could be sold in a different way, and really again, if you think to the Mad Men era of advertising, how is that all packaged and how do we get used to what was being sold to us? That's where I think a lot of our current expectations—that are kind of starting to age out now—that's where our expectations of what clean smells like and looks like come from, but I think a lot of people are realizing that some simpler ingredients get the job done really well.
And it's always a fun feedback loop to hear people that are pleasantly surprised that our products work, we have this sort of this dismissive interpretation and this impression that, “Oh, it's green, so it must not work.” And like any product, some of them are better than others, but when we hear people say like, “Oh my gosh, I used your cleaner and it worked.” I'm like, “Thanks, we knew that, but I'm glad you're on board.” We did design a product that would work, but yeah, that pleasant surprise is a fun reaction that we get from customers.
JM: I’m curious, living in the time of COVID-19, if you got deeper, different questions that you hadn't before, about the efficacy of the products, in terms of people just being absolutely obsessive about, “No, you don't understand, this needs to remove everything. I am completely paranoid, so my green is going to go out the window.” Did those types of conversations come up with your customers?
KJ: They did come up, so one of the most frequent questions that we got in March, April of 2020, was, is this a disinfectant? So those are really interesting opportunities for us. I think the impression of disinfecting is that it's a one and done, that you can just spray something and it magically does all the work for you, and what we learned and what we had to talk about is that disinfection is one step and it is applicable in some environments, particularly hospital environments, particularly if you've got an active infection in the household, but it always is coupled with the cleaning steps.
So, there's this idea that oh, I just need a disinfectant. No, cleaning is actually a very effective way to remove germs and literally to clean the surface. So anytime you see, even a chemical disinfectant—and a whole other topic would be, what chemical disinfectants are the safest kind? I would actually reference a wonderful resource called Women's Voices for the Earth, they have a lot of really great resources. they're a non-profit and they talk all the time about what are the safer disinfectants, how can we avoid some of the chemicals that, yes do disinfect, but also have some harms that come along with them, how can we choose the safest ones?
Going back to the questions we got. Yes, the questions were surrounding like, “Is this a disinfectant? Is this not? What is cleaning? How do we distinguish cleaning and disinfection?” And the truth is that you always need to clean, so using soap and water to clean, if you remember all the hand-washing that we all got into, about a year ago, just washing your hands is effective at removing germs.
So, soap and water cleaning is one of the best things you can possibly do, even in an environment like this one. Cleaning is the first step to using any type of disinfectant, especially a chemical disinfectant that you might or might not decide to use, so we definitely did a lot of talking with our customers about, no matter, whether or not you decide to add an additional disinfectant, you've got to clean the surfaces, you can't just spray a disinfectant on a pile of dirt in your kitchen and hope that it's going to work. It won't work.
JM: So, let's talk about the why. As you position this, and it's true that this is a human and environmental imperative, but let's start with the human side. Can you, maybe crush our souls a little bit and reveal the worst type of products that people commonly have in their homes without mentioning obviously product names, but just the type of ingredients and why it is such a human imperative, the common killers that are around us that we don't even realize?
KJ: Yeah, I’d say laundry softener is probably one of the things that people are used to using, I too used to walk past a window and smell that laundry softener smell and find comfort in it, but those smells, very literally, chemically speaking are volatile organic chemicals, VOCs. In a product like a laundry softener, whether it's a dryer sheet or the liquid softener that you'd use in your laundry, that smell that we're so used to, that synthetic fragrance smell can contain thousands of undisclosed ingredients. So not only are we using this chemical that lingers, that goes volatilely into the air, we don't even know and we are not afforded the opportunity as consumers to know what's in the products that we're using in our homes.
To me, that's just unconscionable, I can't imagine telling someone, buy this product, put it on your kid's clothes, put it in the laundry machine where you wash your dog's bedding and by the way, I'm not going to tell you what’s in it, whether or not it's something you're literally allergic to, whether you're trying to avoid animal ingredients for some reason, the ability to know what something is that you use, the ability to avoid something if it has an environmental or human health impact that that you're trying to avoid, that's just the fundamental thing I think everyone should be afforded. So, laundry softener is one of the worst offenders in terms of having hidden ingredients that not only can be really dangerous and have health effects that you wouldn't want, including endocrine disruption, carcinogens, but you just literally wouldn't be able to tell if they were in there.
JM: Do you have a solution for that in your product line or do you recommend not using a softener at all?
KJ: We actually recommend skipping it, there are a couple of really great ways to keep your laundry soft without using a softener. If you want to use a rinse, we love vinegar, just plain white vinegar as a rinse, the scent will not remain in the clothes. You're not going to smell like a salad dressing afterwards, but vinegar works really great at softening clothes. Also, there's a couple of plain old mechanical tricks to avoid static and crunchiness. So, if you separate materials by type, like I always wash my athletic gear separate from a towel, so if you've got really dissimilar fabrics, for example, especially when they go in the dryer, that's actually what creates the static. So, there's other ways to avoid static other than dumping chemicals as a coating onto your clothes in order to reduce it. So, yeah, cottons are one load, athletic gear and synthetics are a different load and that's one way to work around it as well.
JM: I wish I had your brain. Your background, your education, like you see everything, well, that's what makes static, I've never been like, “What makes static?” That's incredible. Okay, yeah. So, let's talk about the environmentalist impact then. As I mentioned, we're in New York and I live on Long Island, which sits atop a sole source aquifer, so there's actually been a lot of education in our community about what we put on our lawns in particular, because there's nowhere else for it to go. What we put in our drains—and not every community that we have is hooked up to wastewater treatment plants. Some are, some are not, but can you explain to us then what happens when we dispose of toxic chemicals and household cleaning products?
KJ: Absolutely, so I think you're right, it's unusual and I'm a little jealous that you're in an area where everybody, or many people are more aware what an aquifer is, how the waterway works, where chemicals go. In Chicago, the metropolitan water reclamation district, our wastewater system, they do some outreach as well, but I wish we all did more because I think so many people just really don't think about what happens, where does your water come from?
In Chicago we collect it from Lake Michigan, it gets processed and then, where does the wastewater go? So, if I flush something down the toilet, if I do laundry in my house, that water gets processed and then after it's processed, it gets released into the river and it ends up in St. Louis, so here in Chicago, what I decide to use in my laundry could affect the people of St. Louis. And isn't it maybe reasonable to expect that I can make some decisions, not just about myself, but about my neighbors down on the other side of where this water is going?
Some of our wastewater systems, they’re legacy systems, they're decades and decades old, they work great for things like taking out bio-matter and turning it into compost and digesting the natural things in there, they're not great at a lot of things like pharmaceuticals. So, our wastewater systems are just not designed to handle certain chemicals. Unfortunately, there's not necessarily even a standard way that that wastewater systems work, so it could even depend on where you live, as to what sort of processing does take place, but fundamentally, if what you're putting down the drain is not compatible, and it's not taken out by the wastewater system that stays in the water.
That could be, some kind of pharmaceutical, that could be a component of the fragrance of your laundry detergent, that could be any number of different things. So, being careful thinking about where does this go? Is somebody going to take this out? It doesn't just disappear, just because we send it down the drain.
JM: Amazing. So, we're going to take a quick break to talk about our agency a little bit. And on the other side, we're going to talk more to Kate about the business of her business and her B Corp journey. So, we'll be right back.
Break [Voiceover]: Is your company looking to scale? Morey Creative Studios is a Diamond HubSpot Partner Agency that helps organizations leverage HubSpot's platform to achieve sustainable and predictable growth, from video production and inbound content marketing to sales and customer retention strategies. Morey Creative Studios provides comprehensive digital solutions for your company, so you can Grow For Good™. Visit moreycreative.com to learn more.
JM: Okay, welcome back. We're talking to Kate about the business of her business and talking a little bit about the B Corp journey, and we'll probably jump off on some other tangents as well. But Kate, one of the things we were talking about at the break is, in this B Corp structure and in the mission-oriented type of business, there is a mantra of no mission without margin. So, we do have to protect the core tenants of our businesses to make sure that there's profit, because that's how we grow and that's how we stay in business.
So, a quick question before we get into supply chain and the B Corp process and things like that. In terms how you go to market and how you position your products, where do you fall along the cost spectrum? In the consumer's mind, are you an expensive choice, are you the low-cost provider, where do you fall?
KJ: In truth, we're in the middle. We would like to refer to ourselves as a medium shelf wine, where we're right there, we're not coming out of the box but we're also, you don't have to ask anybody to unlock a case to get Meliora products. I think there is a little bit of a misconception, that because we're so sustainable, we must be more expensive and again, I think that for the most part, it's wrong and we do have to combat that a little bit. But just to give a couple of examples, our laundry powder, it's the same cost per load as Tide, Tide by the way is not the low cost provider, so it kind of gives you an idea again, we're kind of a middle shelf there.
If we think about our all-purpose cleaner, which comes in a glass bottle and tablet forms, and we sell the tablets as refills, that's actually lower cost per bottle. The cost per bottle is extremely low, it's actually about the same cost per bottle as a conventional cleaner you could buy somewhere like Walmart, so having truly green, really sustainable product with wonderfully transparent and safe ingredients and comparing that to something that you might get in a mass market, big box store with some assaulting smell and some questionable ingredients, that to us is a really great benefit that we provide that we really do have a low cost option for cleaning. So, yeah, again, we try and hit middle of the road, we don't think that it should cost more to clean well, it's not only rich people that have skin sensitivities, that have allergens and that care about the environment, so we want to make sure that that's accessible.
JM: You know, it's interesting about the impression that organic or sustainable carries a heavier cost to it. I feel as though that was at some point true, simply because the pioneers in the field had not yet forged the supply chain relationships to make this possible, and that so many of those early adopters, the ones that really pushed the boundaries and forced the whole supply chain from raw material sourcing all the way through to packaging, forcing people to visit this and bring the costs down over time. Whereas now, if you're going to come into a market, you all did the hard work and the heavy lifting to normalize those manufacturing processes. Do you think that's a kind of a fair statement to make? That if you're going to start today, these things exist, so you kind of have the imperative to do it the right way?
KJ: Absolutely. Yeah. I think if you think about early adopters in green cleaning products and people that bought green products before they were really available, they're almost investors in a way, they're paying more money for something that was harder to make at the time and I think you're doubly right as well, if you're making products now, it is so much easier to launch a green product. There are so many more sustainable packaging options, it's so much more common to do that, you're hardly going against the grain anymore.
Obviously, you still have to figure out how to make the overall business model work, but there are options, you don't need to reinvent the wheel, there's some stuff that's obviously harder to get a supply chain for than other things, and we do still have a trade-off to be honest, if we package everything in plastic bottles, it would definitely be cheaper than we have with our packaging, but that isn't a trade-off that we've decided to make, and we know our customers appreciate it. But that being said, it's definitely less expensive now than it was even for us, seven years ago when we got started.
JM: So, let's talk about your B Corp journey, because our company has started, we're on our journey and we're trying to get it done this year. It's one of these things though, where we've spoken to a number of B Corps not only on this show, but just in other conversations and we realized that the journey is just as fun as getting the certification.
JM: Pushing yourself to actually do these things and do them the right way, document the processes, but you're in your, I think you're in your third year and you're rocking a 106—which for people that haven't been part of the process or don't know anything about B Corp certification, that's a great score because you're in manufacturing and distribution. These things are hard to do, you've got to work at this in order to qualify for these measures. Can you tell us, first of all, why you went down that road and some of the challenges that you faced along the way to certification?
KJ: Yeah, B Corp certification is something that we always knew we wanted to do as a company, before the company was founded, we knew that was our goal. It took a few years after we got started to get the track record and then start going through the assessment and start compiling all that documentation, but to us, the reason we went for the certification is we really wanted an outside firm to confirm what we thought we were doing and what we wanted to do. So, the accountability is really what that certification gets us.
You can talk all day about the things you want to do as a company, how sustainable you are, how sustainable you want to be, but unless you've got some way to tell whether you're on the right track, you're running a huge risk of what we call greenwashing, which is when, maybe you do things wrong all year and then you write a small check at the end, and then talk about the check you wrote to some environmental non-profit, or some such.
So, rather than just talking up what we do, we actually look holistically at all of our practices from who owns the company, how we're governed, how we pay our workers, what products we developed. So really kind of having a framework that tells us, look at your supplier relationships, how do you evaluate, and select product? How do you do this, how do you do that? Having that framework there really make sure that when we say, “Hey, we are more sustainable, we are a company that is better for people and better for planet,” we're backed up, we feel confident in saying that and we can point to quantitative measures—you mentioned 106—like literally points on a scale that show this is how we're doing all those things we say we're doing.
JM: Do you think it's been a differentiator in going to market? Do you think the consumers care one way or the other?
KJ: I think there's certainly some consumer recognition and it really feels great when you see someone pick up your product and they see the little B with a circle around it and they say, “Hey, you're a B Corp, that's awesome!” And we've certainly talked to people that have found us purely because they said, “You know, I'm trying to spend more dollars with B Corps and we know you're one of them, and then that's how we found you,” but it's not always consumer recognition.
A lot of the benefit that we get is internally again, knowing that we do the right thing and whether or not someone that picks up our product on the shelf, whether or not they know what that stamp means, I think that they do know that Meliora represents what they're trying to support as a consumer, and one of the best pieces of feedback we get is like, “Wow, I've been looking for this, you guys are really legit. There are a bunch of companies that say they're green, but then I found out they used this ingredient or there were a bunch of accompanies that say their green, but you look at their packaging and it's all plastic, you guys are really doing it.”
So, however you phrase that, we're really doing it, that legitimacy, that's what B Corp means to us and that's what we want to do as a company that really comes together in that way.
JM: Meliora as a manufacturing company, as I said, has more factors that it has to check the boxes for. We're a service organization, essentially and most of our team right now is distributed, they're remote, so there's a lot of the B Corp certification measures that don't really apply to us and so we have to look at different things. But as a manufacturing company, it's not just you, it’s everything from sourcing through to packaging.
So, can you tell us a little bit about sourcing some of the raw materials that you have? I know that there was, I think I saw somewhere that you even get sunflower oil from Wisconsin or something like that—which now I get the Wisconsin connection, it seems a little insider to me, but we'll let that pass—but can you talk about sourcing raw materials and some of those aspects of the supply chain that you have to pay attention to that others might not be thinking about?
KJ: Right. Absolutely and this is one of the areas where there really is strong overlap between improving the business, like looking at the bottom line and improving the environmental and people profiles. So we talk about a triple bottom line, it's people, planet and profit, and this is one area where they are really tied together. So if we think about our suppliers and our supplier selection process, one of the things that we do that we get points for, for B Corp, that's part of our process is. we have a supplier selection and a supplier evaluation process, so we go through and we look at who owns this company? What kind of products do they offer? Are they certified B Corp as well? Are they maybe a veteran owned business, are they minority owned in some way? Are they local? Do they have any practices of concern?
So literally we Google them with the name lawsuit and see if there's anything that comes up. Do they maybe have some issues that we want to avoid and are they someone that belongs on our suppliers list quite frankly? So, doing this evaluation gives us a good idea of the environmental and social impact of our supply chain, but if we think about the profit as well, this is also just a good idea to do to your suppliers.
What risks do our suppliers have? If we're getting—we did an evaluation, we use a lot of coconut oil. Coconut oil is not grown in the US like our wonderful sunflower oil that’s pressed in Pulaski, Wisconsin, Century Sun, great supplier. So, our coconut oil comes from a couple of different places around the world and so in the course of doing our supplier evaluations, it was okay, these are coconut oils grown in the Philippines. Well, that raises a couple of other questions, can we check to see if this is fair trade? Are we confident in the supply chain? But also guess what, when you read on the news that there was an earthquake in the Philippines, that means something a little different to you as a business owner. Of course, you're concerned, but you're keeping an eye on the news and it actually reduces our risk because we know if there's some interruption to the supply chain, we can react to that faster, we don't have to wonder is this going to affect us?
We know that there's some supply chain effect, so it gives us better knowledge of how our supply chain works, because we're looking at all of these elements to the products that we buy and how our supply chain works, and just understanding that better is simply better for business, even if we didn't care about the environment, which of course we do.
JM: I think you're coming up on your recertification, if I'm not mistaken, right?
KJ: We actually just finished it. We signed it.
JM: You did?
KJ: So big sigh of relief there, very exciting, always feels good to go through a recertification
JM: So, in addition to your B Corp journey, you've partnered with 1% for the Planet and Women's Voices for the Earth, where you actually commit 2% of your annual revenues to environmental and charitable non-profits. That's revenue, not profit, right?
KJ: Top line, exactly yeah. That's revenue percentage.
JM: Okay, that's something that—I don't think we've spoken to anybody, that's part of initiatives like that, where they give off the top line, because to me that's next level, when you're willing to commit, forget about profits, because you can, as we know, you can make your profits kind of where you need them to be.
JM: Revenue. There is no hiding from that.
KJ: Yeah, you can't hide the revenue.
KJ: If there's a dollar coming in, we are giving 2 cents to a non-profit.
JM: That is a very big deal. I’m sure the business owners that are listening are doing the math in their heads and saying, wait, wow, that could be significant. So, what was the calculus behind that?
KJ: So, Patagonia, a very famous B Corp, the founder of Patagonia, Yvon Chouinard, who is also the founder of 1% for the Planet. So, I spoke about wanting to be a B Corp, right from the beginning, it was actually the same with 1% for the Planet, I saw what had been done and with the founding of 1% and the idea behind it was really was that, let’s look at the top line.
Again, you can mess with your profits through any number of methods, but if you think about it, the idea was as a tax really, is how Yvonne explained it, it was a tax on doing business. If we're open as a business, we want to acknowledge that we're really given a license to operate by society, we want to acknowledge that no matter how hard we try, we do have an environmental impact and so this is a way to acknowledge the bigger that we are, we want to make sure we build in an acknowledgement and some give back to this planet that sustains us and so, that's where our commitment comes from, is making sure that no matter how big we get that we can take some of that give back along with us and the bigger we are, the more impact we can have with our give back.
JM: What’s the difference between Women's Voices and a 1% for the Planet?
KJ: So, 1% is a commitment to donate 1% or more, in our case two, to an environmental non-profit, and 1% has a list of registered non-profits. There are slews of them working on a number of different environmental issues, so 1% is basically the commitment to do that and we do make some donations to 1% itself as an organization, but the commitment itself means that we can donate to a lot of different organizations and Women's Voices is basically our primary partner, they were our first organization that we donated to. I think the first year we were in business, I think I wrote them a $300 check, and I promised them that it would get bigger and luckily it has. So, they're our primary beneficiary.
JM: I see.
KJ: I think I have a meeting with them in a few weeks to look at our plan for this year, to continue making sure that we're supporting them.
JM: Okay. So, you said something really important before, coming out of that philosophy that Patagonia has laid out, and it's almost like they laid out a gauntlet for all of us.
JM: Just the way that they behave and they operate, always forging to do better, but with the recognition that just existing means we have an impact. So, what are the things that you have yet to accomplish that you have on your roadmap, where you’re like, “I don't know the answer to this yet, but I'm committed.” What keeps you up at night thinking about, “I’m going to get there?”
KJ: A lot of it is product related, so as we grow, we have more options, you kind of mentioned if there's only a few people working on a sustainable supply chain, it's really difficult to do, even within a company that's very much true. So, if you're a teeny tiny product company, you're essentially limited to what's coming off the shelf, you're getting sizes of things like packaging, the ingredients that are available to you are here's what it is, buy it or don't.
So, as we get bigger, we can get much, much more leverage and ability to say back to a supplier, “Hey listen, this is what we want and if you don't already make it, well maybe you'll make it for us.” So, having the ability to really have more influence over what gets made is a big focus for us right now, so we're working on streamlining our packaging to go to single material and looking at some of the, I'll call them compromises.
We knew we didn't want plastic packaging, so we decided to go with a combination of cardboard and metal and now that we know it's better, how can we actually improve that? What is the actual impact of our packaging? Can we make that even better? I think last year we had trouble finding a scoop for our laundry powder that wasn't made of plastic, we finally found a metal scoop. So, continuing—these seem like small things, but when you multiply them by thousands and thousands of products, we are having an impact and we're continuing to do that and so, by making those product improvements, as we get bigger, the impact itself changes as well.
JM: So, let's talk about size and scale before we start wrapping this up a little bit. First of all, I'm always curious about the entrepreneur's journey, because as you said, “I’m not an entrepreneur,” but here, you've built a company, it is substantial now, you're beginning to get some scale. But I was struck by, I don't know if it was in a release or one of the videos, you have an area where there's a sign up that says, “quiet we're sciencing,” or something to that degree, where science happens and people are allowed to just go in and free wheel and figure stuff out, and the time and the space to be creative in that discipline is really obviously important in the R&D and product development, but I know that you were one of the key “sciencers” in the beginning. Do you allow yourself the time to do that still?
KJ: I do, I was actually in the lab yesterday. Unfortunately I can't tell you what I was working on, but hopefully it'll be something, it would be great if it's something that ended up as a product in the future, but even if not, I think you're right, it's a little bit of room to play because even if what I worked on yesterday, it doesn't become a product, the ability to play with processes, to play with ingredients, to kind of think, “What if we made something that worked like this,” helps us in our other products as well, whether it becomes a process that improves how quickly we make other products.
We love benchmarking, I'll be honest, we go to breweries— not right now, we'll go back to brewery someday—I love a brewery tour because you're literally watching someone and we're like, “Hey, look how they move that liquid, I wonder what kind of pump that is.”
JM: That’s interesting.
KJ: “Hey, look at how they make that batch.” We get inspiration from so many places and watching how other people make things. We steal ideas like that all the time and we try and kind of mismatch different products. Hey, that ingredient looks cool, I wonder what that would behave like if you put it in soap, is something that we think about all the time.
JM: So, let's finish up on scale because this is usually, we get such a different range of answers on this, which I love. And I'll give you one example, when we spoke to the founder of Grain surfboards in Maine, we talked to him about scale and said, “Well, how big can this get? How big do you want it to be?” And he was almost puzzled by the question, he was like, “What do you mean big?” And he didn't want to sell more boards, but his mission was to be as impact free as possible. His journey was, oh, I'm good with the number of boards, we all make a little bit of money, enough to get by and we all make a living here, thank goodness and we love seeing each other every day. But we have a problem because we have this one piece of our process and we don't know how to recycle it, so that's what we're busy figuring out.
Whereas we've got some other folks that we've spoken to that rely on scale that say, no, no, we have to change our industry and the only way that true change is going to come is if we are the tip of the spear for taking it over.
Where do you land on that spectrum? And be honest with me about this, do you have these entrepreneur visions and dreams now, do you want to run a multi-multimillion dollar company with supply chain all over the world where you have literally changed the conversation, or do you want to be just the best company disrupting a part that you're curious about?
KJ: You know, we're in such an interesting place here at Meliora, because we very recently kind of tipped over from that “Gosh, wouldn't it be great if this was going to work” and we could make a good living doing it and everyone was good, and we've done that, for the past couple of years. We've been in that place where we could stay the size we are and everybody would be good, but that wasn't what the founding of our company was about. It was about making better product, it was about making a better industry, and in the same way that Patagonia puts down the gauntlet and says, “We’re over here, we told you where our product was sold. You thought you couldn't do that? We just did it.” Just seeing other companies do that, the cleaning products industry needs that, and that’s why we were founded almost eight years ago, and we're not done doing that yet.
So, it's great to be in a stable place as a company, it's great to know that all of your employees are getting taken care of and everybody's got a safe and stable work environment, but we’re coming for you P&G. We've got sites set and we want everybody that wants safe products with great packaging and that works well to be able to get it, and we need to get bigger in order to have that work. And we would love it if more cleaning product companies came after us, we love a good competition, we get inspired when we see these other brands come out and we can kind of scope them out and see what they're doing, we would love to have that happen, we want everybody to be able to get better product.
JM: So, how can people find you? How can they get in touch with you? If they have a question for you, how can they contact you directly?
KJ: Yeah, so our website is meliorameansbetter.com. So, a little throwback reminder to that definition, so yeah, the website, meliorameansbetter.com and you can shop right there and get products shipped to your door. We are in about 200 brick and mortar stores scattered throughout the US, a lot of those are green focused and resale stores also, so definitely check out your local bulk refill store, and we may already be there, there's info forms on our website if you want to get in touch and we'd love to love to talk to you!
JM: I loved every second of this conversation. I can't thank you enough for agreeing to come on the show and for telling us about the company and I join you enthusiastically in your desire, come on P&G we’re coming for you. I love it. I love it. Thank you for your time today.
KJ: Yeah, thanks so much!
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