The Only Way I'd Sell in Grocery Stores Again

Ten years ago, I quit my job as a corporate lawyer in London, sold everything I owned, and moved to a country I'd never even lived in to open an ice cream store. Big Love started as one small shop in Santa Monica, selling pints over the counter.

A few years in, those pints started showing up in conversations I never expected - Erewhon wanted them on shelves. Then Whole Foods. Then Gelson's. For a small food business, that's supposed to be the dream.

I walked away from grocery stores once already. Erewhon. Whole Foods. Gelson's. All gone.

Most founders think landing a deal like that is the finish line. I can tell you - it's just the beginning.

So would I ever do it again?

The answer is yes. But only if a few conditions existed. Most founders never even ask themselves the first one. Let me walk you through them.

Condition One: Build the Model, Don't Retrofit It

We run an ice cream store here - a retail store, and we sell pints. The pints did really well. The natural next thought was: maybe we should get these into grocery stores. People kept asking for it.

Here's the problem. Our business model for selling pints at retail is completely different from the business model involved in selling pints at a grocery store. Pricing is different. Scaling is different. Marketing is different. Volume is different. The economics change entirely. We were trying to stuff a square shape into a round hole, and it just didn't work.

Let me give you an example. In our store, we sell pints for $16.95. We can do that because we're selling directly to the consumer - we keep all the revenue minus our cost. Super simple model.

Grocery is nothing like that. Go into any grocery store, look in the freezer aisle, check the pricing. There aren't many ice creams sitting at $16.95. If you want to be competitive in that market, you need to be around $6–7 for a premium pint - think Ben & Jerry's, Häagen-Dazs. Some brands are selling for $4.95, even less on offer. That's the mass market.

Can what you're doing in your retail store actually fit into that economic model? For us, it couldn't. Our ingredients were too premium. We'd have had to change the whole recipe and compromise on it - which is exactly why so many mass-market ice creams lean on water and dairy fillers instead of real ingredients. It's cheaper, and it bulks the product out.

So you have to ask yourself honestly: can my current pricing, my current ingredients, and what I currently do actually scale down to that grocery price point? Because that's what the market wants, and that's what grocery buyers want. I know, because they told me directly.

But even if you solve that economics problem - and plenty of companies do - you're still not out of the woods.

Condition Two: Do You Have the Capital to Survive the Middle?

Grocery is a completely different game, and you have to think hard about your capital structure before you go in.

First: you're not getting paid quickly. Terms with some of these big retailers can run 12, sometimes 18 months before you see real revenue. You have to make the product, deliver it, and then wait - sometimes close to two years - while the bills don't stop.

On top of that, there's marketing. When we spoke with Whole Foods, one of the things they pushed hardest on was marketing spend. Gelson's said the same thing. How much are you, as a brand, willing to put in to make sure customers even know you exist on their shelves? Grocery stores aren't going to do that work for you - they want you to pay for the awareness. Tastings, samplings, gondola displays, promotions. And here's the part that surprises most people: those markdowns you see in stores - "on sale for $4.95, usually $6" - that's not the grocery store eating the cost. That's the supplier. That's you.

None of this means grocery is a bad market. You win by volume - sell across the country and you're moving thousands, sometimes millions of units. But you're making cents on each one, and you need the capital behind you to survive the gap between "we're on the shelf" and "we're actually making money." That gap is exactly why so many small brands go under in grocery. Not because the product failed. Because they ran out of capital before the volume caught up.

Even if you get the capital right, and you're genuinely well-funded - there's still one more thing to think about.

Condition Three: Are You in the Right Category?

Some grocery categories are just inherently simpler than others, and it comes down to one thing: what you have to do to keep the product intact between you and the customer.

For ice cream, that's frozen storage. It's a massive complication. If I were selling chips or cookies - anything dry and shelf-stable - I could box it and ship it straight to a store or a distributor with zero extra handling. No melting, no cold chain, no food-safety window to hit.

Frozen changes everything. You make the product, keep it frozen, arrange frozen delivery to a distributor. The distributor charges you for shelf space - typically around 40% - and they have their own frozen storage costs on top. Then it needs frozen transport again to actually reach the store. Every one of those steps adds cost before the product even reaches the freezer case, on top of needing your pricing to already be right from Condition One.

Compare that to a bag of chips. Bag it, box it, ship it by UPS or FedEx, no temperature requirements at any point. Distributors love it because it's simple for them too.

Frozen is the hardest category to work in. Chilled is easier. Dry goods are the easiest by far - and if I ever built something for grocery again, that's exactly where I'd start. Something I could box and ship without ever thinking about temperature.

The Real Reason It Didn't Work

Looking back at the last time we sold into grocery stores, I think we failed for one simple reason: I was trying to force my retail store's business model onto grocery's retail model. It didn't work. That's on me. That's the real lesson.

It wasn't the buyers. It wasn't the retailers. It was me.

That's just part of being in business - you test things, you find out if they work, and the important part is not continuing something that isn't making you money in the long run. Once I actually understood that, everything changed.

Looking back, grocery stores weren't the problem. My business model was.

If you're thinking about launching your own grocery range, and you want the full story of why we stopped selling pints into grocery stores in the first place, that's a separate video - I'll link it below.

- Big Love, Michael

About Me

I'm Michael Philippou, co-founder of Big Love, a plant-based ice cream business in Santa Monica that I've been running with my wife Victoria for over ten years. Before ice cream, I was a lawyer. I write about the real, unpolished lessons of running a small business — no gurus, no hype, just what's actually worked and what hasn't. You can find more of these stories on my YouTube channel, Real Business Real Lessons.