In 2010 Merrilee Kick, now 53, was working as a high school teacher and studying for her MBA when she got the idea for BuzzBallz, single-serve cocktails that come in brightly colored spherical containers. After doggedly researching the industry but getting turned down by multiple lenders, she scraped together cash from a grandfather’s inheritance, took out a home equity loan and launched her company. She had to fight for distribution, but BuzzBallz, based in Carrollton, TX, now sells in 40 states and Bermuda and on Spirit Airlines, with orders pending in China, Thailand, Malaysia and Hong Kong. She employs 60 people and expects $20 million in revenue this year. In this interview, which has been edited and condensed, she talks about the challenge of being a woman in a male-dominated industry and why she doesn’t want to be called a feminist.
Susan Adams: Tell me about your background.
Merrilee Kick: I was a computer engineer and out of college, I worked at Ross Perot’s old company, Electronic Data Systems. I met my husband there. The year Mandela was elected in 1995, EDS bought three businesses in South Africa and we moved there. While my husband was working for EDS, I started a non-profit, Women in Film and Television. We raised $3 million to help women, especially women of color, to get them exposed to film and television. We taught them how to use cameras and teleprompters. Then my husband said, we’re going to move to Stockholm. During that time I made voice-overs, I started writing screenplays and I was editor of Screen Talk magazine, based in Denmark.
Adams: When did you move back to the States?
Kick: In 2003. I got a job as a news anchor at CBS radio in Dallas. I did that for seven years. Then a teaching job came up. Having two little kids it was really important for me to have the same hours as my children. I had been working myself to the bone. Plano West Senior High School, just down the street from me, hired me to teach entrepreneurship, sports and entertainment marketing. The school said, if you want, you can get a degree in administration and be a principal. I was like, I would hate to be a principal but I would love to get my MBA if you’re going to pay for it.
Adams: Where did you get the idea for BuzzBallz?
Kick: I was sitting by the pool grading papers. I had a crystal snowball from Sweden next to me. It looks like a big glass ball and in the top it has a hole for a votive candle. I thought it would be so cool to have a cocktail ball with a lid on it that would look stylish and pretty. It should have a strong drink inside that gives you a little bit of a buzz but doesn’t make you feel fat and bloated the way a beer would. I started researching how to make that and found it was something that hadn’t been done before. One day I was at Walmart and I was buying tennis balls and I thought the metal cap on the tennis ball container would work for me.
Adams: How did you figure out how to make your container?
Kick: First I had to research the liquor and tax laws. There are all sorts of rules about a single-size container. Then I hired a CAD designer to help me create a shape that would fit a metal lid. I called polymer experts at the University of North Texas. I called the Texas A&M department of food science to find out what kind of plastic I should get. I researched plastic bans and recycling. I had to check on mold and bacteria to make sure I didn’t kill anybody. Then I went online and found the Chinese marketplace, Alibaba, and learned that 95% of the world’s plastic is made in China. I found a Chinese plastic manufacturer who could take my CAD design and make my balls.
Adams: Did you travel to China to meet with the manufacturer?
Kick: No. It was all online. I’d get up in the morning and go to school. Then at 1 in the afternoon I would go to work in my warehouse.
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Adams: When did you get a warehouse?
Kick: I had to get a warehouse before I could get my permits from the government.
Adams: How did you figure out what sort of machinery to buy?
Kick: I just Googled “beverage manufacturers” in Dallas, Texas, and I started calling around. Nobody would talk to me. Finally a man named John Sheets at Bartush-Schnitzius Foods in Lewisville agreed to meet with me. He was an old man, a smoker, he’d been in the business for 60 years. His plant was meticulously clean. He showed me fillers and how you put your juice in a tank and there are these nipples that fill your container and then you go through a capper or a lidder. He said he’d never seen anything like my container. He said his buddy in Wisconsin who owns a beer filler line thought it could work for my application. He talked to him and the friend gave me a referral to a company that manufactured the filler for me.
Adams: How much money did you need to get the business off the ground?
Kick: More than I could get. I was trying to get $300,000. I applied for Small Business Administration loans and I went to every credit union in town. Nobody would give me any money because I was just a teacher. I was told, you’re a woman, this is a male-dominated industry, it’s very complicated and difficult and we don’t think you’re going to survive.
Adams: Did you try to raise family money?
Kick: My husband said, I will not support this. Don’t use any of our 401(k) or our savings. I took $27,000 from an inheritance from my grandfather that I’d stashed away. I took out a home-equity line of credit for $69,000, which was my deposit on my house. A bank said if I put that amount of money down, it would give me $178,000. That’s how I got enough money to buy the equipment and get my first forklift and afford one employee. I didn’t pay myself for two years.
Adams: Why didn’t your husband want to help you?
Kick: He’s a CFO and I was 48 years old and he was terrified that I’d lose every penny. He changed his direct deposit to go from our checking account to a private bank.
Adams: Did that create tension in your marriage?
Kick: We already had tension in our marriage. It was a bad situation. But he loves it now. He has a new golf membership and a house in Montana. I’m sure if the tides had gone the opposite way, we’d be divorced by now.
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Adams: What kind of market research did you do?
Kick: I did the research as part of my MBA. I went to liquor stores, I went to bars. One of the things I learned that I didn’t like was that everything had to be bought in four packs or six packs. I wanted to make my product available by the ball that you could buy for $2.99.
Adams: How did you come up with the price?
Kick: I figured out how much it would cost to make each item, where I would display it, what kind of insurance I would need, my cost of goods. I asked my distributor what kind of margins he would expect. If it was$2.99 on the shelf, I’d have to sell it for $1.30 to the distributor.
Adams: How did you decide what kind of cocktails to sell?
Kick: I wanted to start with ones that I thought were popular, common cocktails like cosmopolitan, screwdriver, margarita, piña colada, strawberry daiquiri. We gave them fanciful names like Tequila Rita is our margarita. The Cosmopolitan is Cran Blaster. We have Lotta Colada. Then as time progressed we got a little more sophisticated and used cream-based products that were shelf safe. We made a blueberry yogurt type of drink, called Blueberry Blitz.
Adams: How did you get your product into stores?
Kick: I went store to store. I’d hit 20 different stores in a day and talk to store managers and show them a prototype. I also sent a letter to 17,000 convenience stores, with pictures of BuzzBallz. All of a sudden sales started taking off. After a year of getting my product into stores, my sales manager said, I’ll give you a referral to any of our other states. I had to find the names of the managers who were at his level and make a presentation and fly up to meet them. I sold into Arkansas, Missouri and then in Kansas. After I got into those states I had to quit being a teacher.
Adams: How did you do in your first year?
Kick: We lost $100,000. Then the next year we made a $100,000 profit. Then the following year we doubled in size and we were at $2 million in revenue. It just kept doubling.
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Adams: Are you profitable now?
Kick: Oh yeah. We were after year one.
Adams: Do you still manufacture your containers in China?
Kick: After two or three years I had custom machinery made in China and brought it back to the states. The Chinese manufacturer was jacking up my prices and holding me hostage. He was also taking too long. When he’d go on Chinese holidays, he’d cut me off. An outsourcer makes the containers for me but I own my own machinery and he custom-makes it for me. I save half of what I was paying for the containers.
Adams: Why has your revenue dropped to $20 million from $23 million in 2014?
Kick: Walmart, one of our biggest customers, reorganized its displays. It used to sell our product in a bin at the side of an aisle but it started a clean floor initiative and got rid of the bins. We have to sell on a rack and that cut our sales by about $5 million. We’ve bounded back a little by selling in more states. We just met with Walmart a couple of weeks ago and they’re looking to help us.
Adams: One of your products is called Choc Tease. Don’t you worry that women might find that offensive?
Kick: My dad named that drink for me. I thought it was freakin’ hilarious. We market to millennials. We don’t want to be taken too seriously.
Adams: As an entrepreneur who built a successful company despite being turned down for loans because you’re a woman, do you consider yourself a feminist?
Kick: I wouldn’t label myself as a feminist because I love guys. I promote women because they have special skills that men don’t. The heads of most of my departments are women. It’s because they’re good at multi-tasking and they’re versatile and detail-oriented. I will use my network and help other women.
Adams: How big do you think the business can be?
Kick: Honestly I think we’re just scratching the surface right now. I think we’re just 20% tapped in the US. Internationally I think the world’s our oyster