A local sauce slinger said business hasn’t been too hot.
Merfs Condiments, which said its hot sauce could once be found in 700 restaurants and another 400 stores, will close early next year.
“The product is in high demand, but I can’t make any money,” said Kelly Schexnaildre, owner of Merfs, which is named after her dog Murphy. The business will officially close its doors when it runs out of inventory, which she expects to happen by the end of January.
“We got absolutely destroyed by Covid,” she said. “If the pandemic never happened, I’d still have my business.”
Merfs, which she founded in 2014, has lost 80 percent of its revenue and seen costs triple since the pandemic, said Schexnaildre, 37.
“All my customers are broke and I’m broke and all our costs have tripled,” she said. “Losing revenue would’ve been one thing, but cost tripling was the nail in the coffin.”
The vast majority of Merfs’ pre-pandemic customers were restaurants, which accounted for around 80 percent of its sales, she said. The rest were wholesale to grocery chains such as King Soopers, who she signed a deal with in 2018, and gift shops. The company’s flavors include jalapeno and lime, apricot and habanero plus strawberry and jalapeno.
But once the pandemic caused Colorado eateries to shut down in 2020, restaurant wholesale dropped to one-third of the business’ revenue, she said. To make up for the loss, Schexnaildre beefed up her e-commerce and retail and grocery streams, with each accounting for one-third of Merfs’ sales as well.
“I was a restaurant supply company,” she said. “That’s why we went outta business.”
She said the impending Trump presidency is also a factor in closing.
“If we really are gonna get 25 percent tariffs with the incoming administration, that’s gonna bankrupt companies that’re using glass,” she said, noting that all of her sauces live in glass containers. She also mentioned chile peppers, which she sources south of the border, as another potential costly commodity.
The Louisiana native started Merfs in January 2014 to create a craft hot sauce alternative to staples such as Sriracha and Tabasco. She spent the first several years working out of a commissary kitchen largely making all the product herself and was profitable by year three, she said.
Soon after, she signed with distributors Shamrock Foods and, eventually, Cisco. The height of the business, when Merfs was in the aforementioned 700 restaurants and hundreds of stores, was right before the pandemic.
In February 2020, traditionally one of Merfs’ slower months, Schexnaildre said her revenue tripled from February 2019. She expected 2020 to be “lit.”
“I set out to be the hot sauce company in Colorado,” she said. “It’s painful after 11 years of being the hot sauce boss.”
Schexnaildre is launching another business, The Juicy Lemon, to give other entrepreneurs a road map to launching consumer packaged goods. She will connect them with industry figures she met through Merfs, and she will also offer individual coaching to young owners.
It will go live Jan 1.
“It didn’t work out for me, but it doesn’t mean that it can’t work out for someone else,” she said.
