Earning

Small business owner: Making this change 'honestly saved us' after 'cash flow just sort of froze'

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Dan Honig helps demonstrate how to break down a carcass.
Courtesy Dan Honig

Before the coronavirus outbreak, Dan Honig's business, the Happy Valley Meat Company, sold meat from small Pennsylvania farms to Michelin-star restaurants in New York City. But after many restaurants were forced to close in March, "overnight, all of our cash flow just sort of froze," he says. 

Honig seized the opportunity. Having long considered opening up a small online shop to sell meat directly to consumers, he realized this could be his chance. Now, the company sells various cuts of meat on its website and ships across the nation, from 1 pound of ground beef for $6.50 to 10 pounds of meat for $70.

This turns out to be a good time to sell beef online. Many major grocers have had to limit purchases of meat, so smaller grocers and meat wholesalers have been able to step in to fill the void. Honig's products regularly sell out.

"The pivot to direct-to-consumer has honestly saved us," he says. So far, the company has not had to lay anyone off.

The situation has called for sacrifices and changes, though. Here's how Honig is making ends meet as he self-isolates and tries to grow his business in new ways.

The earning strategy: Forgoing salary to give his company 'the longest runway'

Happy Valley Meat has five full-time employees and three part-time workers. The company pivoted using Shopify, an e-commerce platform that enables businesses to sell their products online within days after restaurants were shut down.

The company's team has had to adapt to the new business model by taking on new roles. "I've taken my sales team and since they're not talking to restaurants anymore," says Honig, "they've become customer service reps and so are helping people learn how to cook."

The company is filling between 40 and 80 orders per day to be shipped anywhere from New York to California. It's also looking to expand its capacity for sales by working with a warehouse in the Amish community in Pennsylvania.

Honig typically pulls a salary of up to $4,000 per month from the business. He's elected not to take a salary at the moment, however. Since the future of dining out remains unclear, he prefers to give his business "the longest [financial] runway that I can to make sure that I don't have to lay people off."

Dan Honig.
Courtesy Dan Honig

The spending strategy: Just the essentials

Honig's monthly living expenses are typically in the $3,000 to $4,000 range, including $2,000 on rent for his Brooklyn apartment. Since the pandemic hit, he has been quarantining in his childhood home in New Jersey with his parents, brother, and sister-in-law.

Though he's not living at home, he is still paying rent; he uses money from his savings, and he says he has enough to continue for a "couple months."

He's also continuing to pay minimal monthly gas and electric fees, $40, and a monthly internet fee, $50.

The savings strategy: Going out to eat 'stopped pretty quickly'

Honig has been able to cut out the $100 per week he used to spend on groceries, as his parents have been covering that expense. He's also been able to cut the fluctuating cost of regularly dining out.

"I like going out to eat a lot," he says. "That's one of the main things that I spend on. That stopped pretty quickly."

Another business advantage: Having an abundance of his own inventory. "I'm lucky enough to have a pretty big freezer worth of meat," he says. "So I've just been cooking a lot more than I normally do."

Egg Hill Farm, which is a source for Happy Valley Meat Company.
Courtesy Dan Honig

The silver lining: Chefs will 'cook' your food and 'talk about it'

Another positive outcome of these challenging circumstances: Honig's found that big names in his industry, like chef Trevor Kunk of The Little Beet and Union Square Hospitality Group, have been open to collaborating and mentioning the Happy Valley Meat Company on social media. 

"A lot of influencers who we're able to talk to are a lot more helpful," he says, "whereas previously we would've had to spend more to engage with them."

Chefs who are usually busy in their kitchens or running their own businesses, he says, "are now like, 'Yeah, send us some meat. We'll cook it and we'll talk about it.'"

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