MEXICAN ENCHILADA SAUCE - PART I

Product Concept

Pedro's Mexican enchilada sauce contained tomato salsa, a dry seasoning mix and water. When prepared on site in their restaurants, the ingredients were combined and then cooked to create the sauce. Milano's challenge was to maintain the same appearance, flavor and texture, but to package it as a RTU product in a pouch that could simply be heated, cut open and used. Under the terms of their informal understanding with Pedro, Milano would manufacture and pouch-package the product. In the restaurants, the pouch would be heated in a hot water "liquid toaster". Pedro had liquid toasters in all their restaurants, and wanted to use them with this new product. The pouch containing the sauce would clip on and be pushed into a bath of heated water. When it popped back up, the product was warm and ready to serve. A simple, labor saving, fool proof approach.

Milano believed that this was a large volume niche market opportunity if they could meet Pedro's product specifications and make it "vendor-friendly" (i.e. low cost, ease of preparation, safe handling by employees). Steve's philosophy was that if "you run the same product everyday all year long, you don't have to have a sales force out there to sell it, you don't have to pay a brokerage firm to broker it, and shipping or billing instructions are not needed. The more you run a product, the more efficient you become, the more ingredients you buy, the cheaper the price becomes. So you get really, really, really focused and it's a money machine and everyone gets used to making it. "

After the product was developed, Milano had the possibility of becoming the sole supplier of pouch technology for Mexican-style enchilada sauce for Pedro. Milano would control the technology and product "know how". What a business opportunity!!

Don consulted with his management team and concluded that this was just too good an opportunity to pass up. They could hardly wait to get started on developing the product and process.