VitaZest-Vitamin & Fruit Enriched Water

LONG ISLAND WEEKLY DESK
L.I.@WORK; Carving Out a Spot In Crowded Markets

By STEWART AIN (NYT) 1386 words
Published: June 12, 2005

LONG ISLAND can be a place where the Davids of business load their slingshots and dream of toppling Goliath -- or, at least, dream of finding a comfortable spot outside his shadow.

VitaZest is one example. So are CardBrowser and Chester Mountain.

VitaZest is trying to carve out a niche in the beverage business, an industry dominated by giant multinationals. It calls its product ''vitamin and fruit enriched water,'' and it's meant to compete with Gatorade Propel from PepsiCo and, most directly, with Glaceau Vitamin Water, made by Energy Brands, the leader in the ''enhanced water'' category. What distinguishes VitaZest, according to Zev Alcalay, the director of operations, is that it is free of sugar, carbohydrates, calories and stimulants.

Sitting in his Lake Success office, Mr. Alcalay, 33, pointed to a chart his company made that listed the ingredients of VitaZest and those of its principal competitors: Glaceau, Propel and Fruit20, from the VeryFine division of Kraft Foods. Glaceau and Gatorade contain carbohydrates and sugar; Fruit20 and VitaZest don't. On the other hand, Fruit20 does not feature added vitamins, but VitaZest does.

Mr. Alcalay said some of his competitors' products also contain caffeine and another stimulant, taurine, but his does not.

''The perception of consumers is that they are buying water with vitamins and that it would be healthy,'' he said of his competitors' products. ''So we created a vitamin water that is enriched with vitamins A, C, D, E and five B vitamins and calcium. We flavor it with natural fruit flavors, so there are no artificial colors or preservatives.''

The VitaZest company is part of Triple A Products of Boca Raton, Fla., a company owned by Mr. Alcalay's family. The drink, which is made by subcontractors, took two years to develop and went into production last December. Mr. Alcalay said he planned to have four subcontractors around the country making the drink by the end of the year, including one in Buffalo and another in Los Angeles.

Still, it is one thing to develop a product and quite another to get shelf space for it in stores. To break into the market, the company looked for an industry veteran to serve as its national sales manager. Mr. Alcalay hired Scott Abramson, 52, who said he had been in beverage sales for 15 years.

So far, VitaZest is sold in more than 3,000 stores in the New York metropolitan area, and Mr. Abramson said he was working to increase distribution elsewhere. One important target has been Florida, on the supposition that snowbirds and vacationers who sample VitaZest there will ask for it in their local stores when they return home.

''I want to be able to go to distributors with a stack of e-mails showing that consumers want it in their area,'' Mr. Abramson said.

''We have to be a name brand, and within three years someone is going to come to us and say, 'We love your product, and we want to buy you,''' he said, quickly adding that there are no plans to sell the company.

Like VitaZest, another small company with big ambitions is CardBrowser. The company, which operates out of an eight-room house along the water in Northport, collects the business cards of sales representatives working in certain fields and then sells the contact information in a database to other businesses. The founder and president, Steven C. Morgan, said the collection of cards already numbers more than 70,000.

''Hoover's and Info USA are multi-hundred-million-dollar companies that sell contact information and sales leads, and we have been successful in competing against them and doing it unconventionally,'' Mr. Morgan said.

Mr. Morgan concentrates on sales representatives in technology industries like computers, software, telecommunications and networking. His 45 independent contractors around the world -- mostly people who work in technology industries themselves -- are paid to collect cards for him, mostly by attending trade shows.

It's easy to get salespeople's cards in that environment, he said. ''If you try to walk past a booth, they will stick their foot out and force their card on you,'' he said. A large show may have 2,000 vendors and exhibitors. Mr. Morgan dates the cards and enters the data into computer file, which he then sends to a company in the Philippines whose employees verify all the information. CardBrowser's customers view the verified database, including images of the cards themselves, over the Internet.

In 2002, when the company started selling access to the database, its contractors attended 80 trade shows; this year the figure will be in the high 200's. ''As we sign more and more customers, we learn of more and more shows,'' Mr. Morgan said. ''and our database gets bigger and bigger.''

He said that CardBrowser's 500 customers, including I.B.M., Apple Computer and Oracle, pay fees of $2,500 to $10,000 a year, depending on how they use the database.

''I.B.M. uses it as a recruiting tool for sales and marketing people,'' Mr. Morgan said. ''If you owned a software company and were spending money for an exhibit at a California trade show, you are going to pick your top sales and marketing people to represent you. Even when it's a local show, you want to put your best foot forward in exhibiting your product.''

In Lindenhurst, another small company, Chester Mountain, is making headway selling a product that is anything but unique or high-tech: it delivers bottled spring water for water coolers.

The competition is formidable: Poland Spring, Deer Park and Culligan, among other brands. Daryl Y. Holzman, Chester Mountain's vice president for sales, pointed out that Deer Park and Poland Spring are both owned by Nestlé, one of the world's largest food companies. ''It spends millions in advertising,'' he said.

Mr. Holzman, whose brother Ross founded Chester Mountain in 1998, said Nestlé's size and financial muscle did not deter them because the New York metropolitan area is heavily populated and bottled water sales are booming, creating opportunities for companies of all sizes.

Chester Mountain's sales have been growing by about 20 percent a year, Mr. Holzman said. A business that started with a single delivery truck now has seven, serving 3,000 customers on Long Island and in New York City and Westchester. About half are private homeowners, and half are offices.

''We have 12 employees and expect the number to double by next year,'' Mr. Holzman said. ''And we plan to increase the number of trucks to 9 or 10.''

In March, with the help of a 10-year tax abatement arranged by the Babylon Industrial Development Agency, Chester Mountain moved out of rented offices in Farmingdale and into its own building in Lindenhurst. Chester Mountain's water comes from springs in Chester, Mass., and it's then trucked to Lindenhurst. An production line capable of filling 1,200 five-gallon bottles an hour is scheduled to open in September, Mr. Holzman said.

Making the product stand out in the marketplace is not easy. Mr. Holzman acknowledged that most people cannot distinguish one brand of spring water from another. So Chester Mountain emphasizes service, he said, as well as its position as the ''only company on Long Island that owns its own springs and bottles its own water down here.''

''A lot of companies will bottle their water somewhere else,'' he said, ''and our water does not supply other companies. We like to have total control.''

To increase sales, Chester Mountain gives existing customers a $50 credit for referring a new customer. It also offers coolers in various colors and gives customers the option of a more manageable three-gallon bottle, useful for people who have trouble lifting the standard five-gallon bottles.

''There is no minimum usage required, and we have no contracts,'' Mr. Holzman said. ''We also sell or rent coolers, and for those who rent it, we clean and sanitize it yearly.''

Photos: VitaZest of Lake Success is taking on Gatorade Propel and Glaceau Vitamin Water in the ''enhanced water'' category. Zev Alcalay is VitaZest's director of operations. (Photographs by Vic DeLucia for The New York Times)





*In the News…* LONG ISLAND WEEKLY DESK L.I.@WORK; Carving Out a Spot In Crowded Markets By STEWART AIN (NYT) 1386 words Published: June 12, 2005 LONG ISLAND can be a place where the Davids of business load their slingshots and dream of toppling Goliath -- or, at least, dream of finding a comfortable spot outside his shadow. VitaZest is one example. So are CardBrowser and Chester Mountain. VitaZest is trying to carve out a niche in the beverage business, an industry dominated by giant multinationals. It calls its product ''vitamin and fruit enriched water,'' and it's meant to compete with Gatorade Propel from PepsiCo and, most directly, with Glaceau Vitamin Water, made by Energy Brands, the leader in the ''enhanced water'' category. What distinguishes VitaZest, according to Zev Alcalay, the director of operations, is that it is free of sugar, carbohydrates, calories and stimulants. Sitting in his Lake Success office, Mr. Alcalay, 33, pointed to a chart his company made that listed the ingredients of VitaZest and those of its principal competitors: Glaceau, Propel and Fruit20, from the VeryFine division of Kraft Foods. Glaceau and Gatorade contain carbohydrates and sugar; Fruit20 and VitaZest don't. On the other hand, Fruit20 does not feature added vitamins, but VitaZest does. Mr. Alcalay said some of his competitors' products also contain caffeine and another stimulant, taurine, but his does not. ''The perception of consumers is that they are buying water with vitamins and that it would be healthy,'' he said of his competitors' products. ''So we created a vitamin water that is enriched with vitamins A, C, D, E and five B vitamins and calcium. We flavor it with natural fruit flavors, so there are no artificial colors or preservatives.'' The VitaZest company is part of Triple A Products of Boca Raton, Fla., a company owned by Mr. Alcalay's family. The drink, which is made by subcontractors, took two years to develop and went into production last December. Mr. Alcalay said he planned to have four subcontractors around the country making the drink by the end of the year, including one in Buffalo and another in Los Angeles. Still, it is one thing to develop a product and quite another to get shelf space for it in stores. To break into the market, the company looked for an industry veteran to serve as its national sales manager. Mr. Alcalay hired Scott Abramson, 52, who said he had been in beverage sales for 15 years. So far, VitaZest is sold in more than 3,000 stores in the New York metropolitan area, and Mr. Abramson said he was working to increase distribution elsewhere. One important target has been Florida, on the supposition that snowbirds and vacationers who sample VitaZest there will ask for it in their local stores when they return home. ''I want to be able to go to distributors with a stack of e-mails showing that consumers want it in their area,'' Mr. Abramson said. ''We have to be a name brand, and within three years someone is going to come to us and say, 'We love your product, and we want to buy you,''' he said, quickly adding that there are no plans to sell the company. Like VitaZest, another small company with big ambitions is CardBrowser. The company, which operates out of an eight-room house along the water in Northport, collects the business cards of sales representatives working in certain fields and then sells the contact information in a database to other businesses. The founder and president, Steven C. Morgan, said the collection of cards already numbers more than 70,000. ''Hoover's and Info USA are multi-hundred-million-dollar companies that sell contact information and sales leads, and we have been successful in competing against them and doing it unconventionally,'' Mr. Morgan said. Mr. Morgan concentrates on sales representatives in technology industries like computers, software, telecommunications and networking. His 45 independent contractors around the world -- mostly people who work in technology industries themselves -- are paid to collect cards for him, mostly by attending trade shows. It's easy to get salespeople's cards in that environment, he said. ''If you try to walk past a booth, they will stick their foot out and force their card on you,'' he said. A large show may have 2,000 vendors and exhibitors. Mr. Morgan dates the cards and enters the data into computer file, which he then sends to a company in the Philippines whose employees verify all the information. CardBrowser's customers view the verified database, including images of the cards themselves, over the Internet. In 2002, when the company started selling access to the database, its contractors attended 80 trade shows; this year the figure will be in the high 200's. ''As we sign more and more customers, we learn of more and more shows,'' Mr. Morgan said. ''and our database gets bigger and bigger.'' He said that CardBrowser's 500 customers, including I.B.M., Apple Computer and Oracle, pay fees of $2,500 to $10,000 a year, depending on how they use the database. ''I.B.M. uses it as a recruiting tool for sales and marketing people,'' Mr. Morgan said. ''If you owned a software company and were spending money for an exhibit at a California trade show, you are going to pick your top sales and marketing people to represent you. Even when it's a local show, you want to put your best foot forward in exhibiting your product.'' In Lindenhurst, another small company, Chester Mountain, is making headway selling a product that is anything but unique or high-tech: it delivers bottled spring water for water coolers. The competition is formidable: Poland Spring, Deer Park and Culligan, among other brands. Daryl Y. Holzman, Chester Mountain's vice president for sales, pointed out that Deer Park and Poland Spring are both owned by Nestlé, one of the world's largest food companies. ''It spends millions in advertising,'' he said. Mr. Holzman, whose brother Ross founded Chester Mountain in 1998, said Nestlé's size and financial muscle did not deter them because the New York metropolitan area is heavily populated and bottled water sales are booming, creating opportunities for companies of all sizes. Chester Mountain's sales have been growing by about 20 percent a year, Mr. Holzman said. A business that started with a single delivery truck now has seven, serving 3,000 customers on Long Island and in New York City and Westchester. About half are private homeowners, and half are offices. ''We have 12 employees and expect the number to double by next year,'' Mr. Holzman said. ''And we plan to increase the number of trucks to 9 or 10.'' In March, with the help of a 10-year tax abatement arranged by the Babylon Industrial Development Agency, Chester Mountain moved out of rented offices in Farmingdale and into its own building in Lindenhurst. Chester Mountain's water comes from springs in Chester, Mass., and it's then trucked to Lindenhurst. An production line capable of filling 1,200 five-gallon bottles an hour is scheduled to open in September, Mr. Holzman said. Making the product stand out in the marketplace is not easy. Mr. Holzman acknowledged that most people cannot distinguish one brand of spring water from another. So Chester Mountain emphasizes service, he said, as well as its position as the ''only company on Long Island that owns its own springs and bottles its own water down here.'' ''A lot of companies will bottle their water somewhere else,'' he said, ''and our water does not supply other companies. We like to have total control.'' To increase sales, Chester Mountain gives existing customers a $50 credit for referring a new customer. It also offers coolers in various colors and gives customers the option of a more manageable three-gallon bottle, useful for people who have trouble lifting the standard five-gallon bottles. ''There is no minimum usage required, and we have no contracts,'' Mr. Holzman said. ''We also sell or rent coolers, and for those who rent it, we clean and sanitize it yearly.'' Photos: VitaZest of Lake Success is taking on Gatorade Propel and Glaceau Vitamin Water in the ''enhanced water'' category. Zev Alcalay is VitaZest's director of operations. (Photographs by Vic DeLucia for The New York Times)