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Retail Intel
Retail Intel
Ep 47: Swig
Join our host Brian Sheehan as he chats with Nicole Tanner, the visionary Founder of Swig, home of the Dirty Soda. Discover how Swig is bubbling up across the country. Don't miss out on this engaging conversation filled with entrepreneurial wisdom and innovative ideas.
Welcome to Retail Intel, the podcast where we dive deep into the dynamic world of commercial real estate. I'm your host, Brian Sheehan, and I'm thrilled to be your guide on this journey through the bustling streets of retail, the aisles of shopping centers and the world of commercial property investment. With me today is Nicole Tanner, founder of Swig. If you're not familiar with Swig, it is a drive-through soda fountain chain that was founded in 2010 in this home of dirty soda. Swig has reimagined the soda fountain for the modern age and is expanding rapidly across the country. I'm excited to learn more, Nicole, welcome.
Nicole Tanner:Thank you so much, Brian, for having me. It's a privilege to be on your show.
Brian Sheehan:Before we get started, can we talk about your background, what you were doing prior to founding SWIG?
Nicole Tanner:Yeah, I'm a mom of five beautiful children and now five grandbabies, grandchildren. But back in the day before I started Swig, I had my associate's degree in really secretarial and I had just a good basic job with that and got married and started having babies and worked up until my second baby and then stayed home with my kids and I would go to Sonic all the time for my drink fix, which was a Diet Coke with lime. I loved the pebble ice, I loved the foam cup and even their straw was a little bit bigger than other locations. So you could get a really good swig if you will through it. But a lot of times in my experience, whether at Sonic or other, like a gas station, that was my other option. Or, yeah, I guess you could go to McDonald's they have a good beverage as well soda but it was getting all my kids unbuckled out of the car walking into a gas station, which is dangerous with littles because they're going to grab all the treats they can. So it was like I think there's a better way to be getting my drink fixed, and oftentimes at Sonic. And listen, I love Sonic, but I just saw that there were some, some things missing and that was like that customer interaction of like I see you as a person. I'm grateful that you're choosing to come here on a regular basis, like knowing my name, knowing my drink, like I know that I craved to be treated like that and I think everybody kind of wants that to be made to feel known, and I just felt like that was missing in my experience there and other places. And sometimes the wait was long, like they're cooking and prepping food and so I just was coming for my diet Coke fix, but oftentimes I'd be waiting, you know, like 10, 15 minutes for just my drink. I'm like I'm a busy mom, like I gotta get going, I've got kids to pick up from school and whatever soccer practice, and so there was just kind of that need of like I think there's a better way to provide people like me their drink fix, and I knew that there had to be other people like me that wanted it. I sat outside of a gas station and watched how many people walked out with just fountain drinks and it was astounding in like a couple hours time. So I'm like, okay, there's the need If they could stay in their car and just get that beverage and get it fast and get it with a smile and hey, I see you, I know you even better.
Nicole Tanner:So we take your order person to person, like Chick-fil-A. Like we don't take it on a squawk box ever. It is out in front with an iPad, person to person. And we do that very intentionally so that we can see people where they are at in life. Like you're going through a hard time, we always ask how your day's going. We call them by name if we know them and a lot of our regulars we do know their name, we know their drink and I really feel like competitors out there are going to do exactly what we do. But for us, we are more than that drink. Actually, we are about being the best part of people's day, even with just a drink, but it's because of how they feel when they come through that drive-through line. So that's how it started.
Brian Sheehan:I just thought I would appreciate something like that and, yeah, just started down that path it's incredible there's so many lessons in there for today's restaurant multi-unit operators and just something as simple as trying to remember customer's name and using it and having that in-person interaction.
Nicole Tanner:Yeah.
Brian Sheehan:And that was a real driving force for you behind the creation of this incredible brand.
Nicole Tanner:Yeah, absolutely, that was a big part of it. Those three things so make customers feel known like amazing customer service, a fast line and a superior product. Those three things are what have built us. So anything that we bring on the menu or any place that we go, we just make sure that we bring those three core values with us.
Brian Sheehan:You had this experience and something was gnawing at you, I guess. Right, Talk about how you decided to then take the leap to start Swig.
Nicole Tanner:Yeah. So I found an old building right by used to be Dixie College here in St George. It's now Utah Tech. Literally it was a standalone building. It had been a skate ramp park at some point in time, with ramps up the side of it. It had been a U-Haul rental place. It had been through many owners and it was vacant at the time.
Nicole Tanner:But I could see the vision. There was a huge parking lot and then this little 700 square foot building in the middle of the parking lot so I can envision cars wrapping around it getting their drink. It was an older gentleman here in St George who has since passed, but he's like 85 years old and I think he looked at me like I was crazy, like you're going to make money off of just selling fountain drinks, like how. But he gave me like the lowest rent we had for years. It was $500 for that lease, like so cheap. But he's just like I want to give you a shot and honestly, that low rent was probably a big part of why we were able to survive. But then you know, the first year or so you don't pay yourself unless you have money to pay yourself, and so I think that's what helped us to, to continue down the path of surviving, building your own business. It's. It's such a risk because you're your marketing team, you are your HR team, your development team, you're the manager. You know you're, you're everything. But I think, because I was everything and doing all of that, it was very rooted and very I knew what was going on.
Nicole Tanner:In that one location, the team felt like family and um. So we established that really strong culture, which is still who we are. We are a family here at Swig. Our teams we call them team members, not employees we go to the finish line arm in arm. So I think that really is what built us. I was a busy mom of five, so we were going everywhere, but the team, we rallied behind each other and, day in and day out, served those drinks to our customers and really just trying to get to know our customers. I think people looked at Swig back then of like what are they doing? That is like who makes money off of selling fountain drinks, but now they're like. I think people looked at Swig back then of like what are they doing? That is, that is like who makes money off of selling fountain drinks, but now they're like dang.
Nicole Tanner:I should have thought of that you know, but I think people are like, okay, let's go support them. This was 2010, we just been through 2007-2008 the crash, and so people still wanted to do something for themselves. They probably weren't going out to dinner as much, but they wanted to to do something for themselves. They probably weren't going out to dinner as much, but they wanted to go do something for themselves, and whether that was a $3 drink, that was something for them. And so I really think it was. People thought, you know, crazy to open up a new business right after a recession. I honestly think it was a great time because of the cost of what we sold and because people were made to feel special. People were losing their homes, they were losing their jobs and we saw them. Where were they at? We met them, you know, in their car and saw them as a person going through hard times, and then we saw them a great drink afterwards.
Brian Sheehan:So it was something they really needed and it was the right price. You're delivering it in the right way at the right time.
Nicole Tanner:I'll tell you a quick story. So we sold drinks for a dollar for the first two months, just to get people in. Just any size a dollar and just marketing. Right, just come, try us. And within the first month there was a gentleman sitting out on front of our front porch at the original Swig, and Pepsi wouldn't come in, by the way, because we had Coke in there, because of course I need a Coke machine. Pepsi was like, oh, you're either Coke or you're Pepsi, right. And I was like, well, we need Pepsi because we love our Mountain Dew drinker and Pepsi drinkers. But they were like, no, sorry, we just don't do that. So I'm like, well, time's ticking, money's going down the drain. I just opened the doors with no Pepsi machine and was serving Pepsi and Mountain Dew out two liter bottles because I had to.
Nicole Tanner:And within the first couple of weeks month there's a gentleman sitting out in front of the on the patio and I opened the window and said, hey, how is? How's your? Your Pepsi or Mountain Dew? I can't remember which one and he's like this is the best Pepsi I've ever had. He had no idea how it was poured or how it was, how it was prepared. It was how he received it and how he felt sitting there on the chair relaxing with his Pepsi. So it was just it's how you make people feel when you serve something to them. And yeah, it was pretty cool to see that he already felt that within the first month Pepsi, you know, wised up and they came in like a month and a half later and so then we had Pepsi and Coke in the store. Now we have it everywhere.
Brian Sheehan:And I think we kind of created a market where that does exist now in competitors, like what we're doing, how you feel, really impacts the flavor of whatever it is that you're consuming Totally.
Nicole Tanner:It's how you feel in that moment. Yeah, and you remember it right. It's that nostalgia of like, oh yeah, and you know, st George is a vacation destination because we're warm and, you know, in the desert, and so a lot of people were traveling through and so we became their destination spot. We were the place they had to hit when they were on vacation or traveling through or whatever. And I really think that was a big part to the success of Swig is we were in a vacation, you know destination, and so we became that nostalgia of like, hey, when you're in St George, make sure you get your swig. And we became the place to hit.
Brian Sheehan:That's so important. I think about the trips we've been able to take as a family, and you do. You create these memories around a shared meal or, in this case, a drink beverage. I guess I'm also thinking too, that there's a nostalgia for a soda fountain, but there's so many people alive today that had no experience of a soda fountain. I mean, I'm old enough to remember going there with grandparents and getting a soda and thinking it was a very special experience. But now you're in a position to create that same dynamic through Swig.
Nicole Tanner:And a drive-thru and a car, yeah yeah. Instead of walking up to the old soda fountain, you know, at the drugstore or whatever, whatever we had back in the day, this is in your car in the air conditioned of your car and it's convenient, but you still feel that connection and that value.
Brian Sheehan:You know clearly, nicole, you have a passion for this business. I guess I'm curious what is it that you love most about operating a drive-thru?
Nicole Tanner:I think everybody, every person on this planet, has something they are going through Everyone. You may not see it, you know, you may not know it, but I love that. I get to be and SWIG gets to be, and we get to be the best part of people's day and I tell our team show up for that customer every time if you can, because you don't know what they're going through. So treat every customer like they're your favorite customer. So for me it is helping lift the load of anybody. And it sounds so silly like it's through a drink, but again, it's not just a drink. It is about how you feel in that drive-through line and making them feel special. So, lifting a load, we have our givebacks, our save the cups. We can talk about that later, but it's our charity for women fighting breast cancer. I'm a breast cancer survivor and so we give back to women fighting breast cancer. But we want to be a part of each community and so we give to women in those communities. We pay for their medical bills as they fight breast cancer. So it's being a part of the community. Lifting a load, whether it's a drink, whatever, it is just making it a fun family outing, like let's go to Swig and you get that family bonding time. So that's the big part for me.
Nicole Tanner:The second part is growing leaders. You know, we hire, we start. Usually they're usually 16 year olds, it's their first job and we teach them leadership skills. We teach them. Nowadays it's kind of hard for teenagers to talk to adults or to talk to people in general, you know. So we're teaching them leadership skills and getting outside of their, you know, comfort zone, and so it's growing leaders. I now say many times when I'm talking to people sharing the story is that we are a leadership company. Now that happens to sell a great beverage because we have over 1,500 team members. We have leaders who've started at 16, and now our district managers or area directors or training managers, or literally the sky's the limit. Especially right now, as we're growing, there is so much opportunity for our amazing team, and so it's just it's really cool to see where it's at and to be able to grow leaders and then lift the load for our customers through the drive-thru.
Brian Sheehan:I can understand how that would be really personally rewarding. When you started the business, was that part of the vision that you had in mind, or you just opened the one and kind of hope and see where it goes from there?
Nicole Tanner:Yeah. So the vision for the people, the customers, was definitely there. I didn't know that this business was going to scale like it did and then I would have this many team members. But I love people, like I really do, like I just love people. And so I felt that right away within the first swig of like oh, these are like my kids.
Nicole Tanner:You know the first, I had 15 employees when we started team members and two of them were my own kids, so they were 14 and 16, but they felt all like they were my kids and then just see them, you know, grow up and to do other things. But like we've had some people meet and get married because they met each other at swig. Like we've had some people meet and get married because they met each other at Swig and we've had like long lasting, deep friendships built because they worked at Swig. Like it's pretty incredible to see how it's just from one little idea just expanded into friendships and marriages and like literally just connection. I guess that's what I'm saying is it's that connection and I hope that it would be that. So, yeah, connection through the drive-thru and in the store.
Brian Sheehan:I think about you as an inventor of a category. I mean Sonic, as he's mentioned, has been around for a while, been familiar, gone through drive-thrus for food, what feels like my whole life. But there's something really unique about Swig, and I don't think it's just the maybe limited menu or focus on a specific product, but I guess I'm curious how you think about that. And then also, since your creation it seems like, and really especially so since COVID, there's been this explosion of growth in kind of the drive-through only the limited menu use category and I guess I'm curious how you think about that.
Nicole Tanner:Yeah, I mean, here's the thing we were always built on a drive-through, right, as you heard the story now, like that's how it was. So we had been in operation 10 years when 2020 hit and we already were so well equipped for what came we had all of our locations were drive-thrus. We just partnered with Savory Fund and invested in technology and just systems inside the store so we were able to handle what was coming down the pipeline from the CDC of like, okay, now you need to wash your hands this many times, and now you need gloves, and now you need masks. You couldn't find masks anywhere and we had one of the team at Savory sew 500 masks for all of our team members. So that is kind of who we were. But, yeah, I feel like during COVID, everybody's like, oh, drive-thrus, okay, let's now invest in drive-thrus. And so end caps all of a sudden came like very scarce in 2021, 22. Yeah, it was just hard to find words before we were able to. It was for the picking Like you could find them pretty easy. But after COVID, we all learned that the essentialism of a drive-thru and how amazing it can be still and you can connect through a drive-thru but still get your product, your food, whatever it is. So, yeah, it really has kind of skyrocketed us out. That's where we were and we prepped for just growth. And then COVID hit and we opened still probably six locations in 2020, because we were just prepped and ready. But everybody now saw drive-thrus as like valued right.
Nicole Tanner:And then Swig is like oh and so definitely more attention on Swig post 2020, because we'd already built a strong base. We'd already had we had, I think, 22 locations at least, and so we were already growing. And so then people realized wait, what is this Swig thing? And then we got recognized for Dirty Soda. And so then people realize wait, what is this Swig thing? And then we got recognized for Dirty Soda. We were on TikTok.
Nicole Tanner:Olivia Rodrigo posted on her Instagram page in 2021, I think 2022. I don't know 2021. And she'd gone to one of our Swigs in Salt Lake City. She loves Swig, and so she talked about Dirty Soda. And then everybody started trying to make D soda at home and went viral on TikTok. We've been serving dirty soda since 2010. The Today Show called me and wanted to know about dirty soda and Al Roker was drinking their version of a dirty soda on the Today Show. So, yeah, after 2020, definitely more eyes were on Swig and what is this dirty soda? What are these drive-through soda chains, going on, and it definitely brought a lot of eyes to what we were doing.
Brian Sheehan:So you've continued to grow since then. It's really exciting to get to be a part of that. We've done a few deals with Swig. We're hopefully going to do many more in the future. We just love it. It's such a great fit for Grocery Anchored Shopping Center and I guess I'm curious as founder and your description of your role now in the company where do you want to see Swig be in five years, 10 years? What do you see in the future for Swig in five?
Nicole Tanner:years, 10 years. What do you see in the future for Swig? You know, brian, it's really an incredible, surreal anytime I look at where we are right now. The last year has been pretty unreal as far as, like, the amount of franchisees that have wanted to join in. Here's the thing I knew that this was super franchisable and I could have franchised literally seven, eight years ago, but I just knew we weren't quite ready for it. We needed the systems in place, we needed the training and I really wanted to protect it because I knew how special it was. Everybody's business is special but one of my business partners years ago said do you realize? You caught lightning in a bottle, like that's how special this is, and so I wanted to protect it. And franchising if you're not ready can sometimes ruin that. So I waited and waited until we built the systems in place and had the team in place, because you have to have the team to support it. And so we were finally ready, turned it on 15 months ago, as you're aware, and we sold 500 units already and that's pretty incredible.
Nicole Tanner:But now to see it actually happening, to be at these franchisee store openings. I was just in Wichita, kansas, and they opened their first location there and to see these franchisees which are our partners, they are my partners, they've invested in this brand with me and I'm so grateful. But to see their eyes light up and go. It actually works. Like the cars come, you build it and they will come. And like we served almost a thousand cars on Saturday and so that was pretty incredible to see. And to build out our team. Like we just hired somebody from Dutch Bros and he's going to come on as our CDO, and so it's incredible the talent that we're attracting and to see our team build, our corporate team build, so that we can support all of these amazing locations. We're going to grow corporately as well. But, yeah, it's the fever pitch that I've never seen and we've had some crazy growth modes. But to see us at 70 plus stores, I see in the future five years.
Nicole Tanner:To answer your question, I've always thought that Swig should be and deserves to be everywhere. I really do. If Starbucks can be everywhere, swig can be everywhere. It's really that simple. But I also think every community deserves to have a Swig. They need their happiness in the cup, they need their best part of their day.
Nicole Tanner:So I see, in five years, this being worldwide and that to me, I'm like I can't believe I'm saying those words, but it's a very real, it's very real. It's a good reality. Because of just the eyes on it, people now get it. You know, the margins are great, the profit's great, these franchisees will be able to make money Like. It's a good investment because we've done it slow and steady. I started 14 and a half years ago but it's been slow and steady building that base and it's always been that way. The first year was three years before I opened up store number two, just trying to figure out who we are and building out the team. So I see, I see Swigs dotting the United States for sure, which is crazy to me, but not crazy Cool. And then the world, which is astounding.
Brian Sheehan:I know when we first started talking with some people on your team who are very exceptional and there was a question internally about how well it could do in other parts of the country, how weather dependent it was, when did you know that SWIG could be successful pretty much anywhere?
Nicole Tanner:You know it was there's two things to that. So opened up two locations in Southern Utah there's two things to that. So opened up two locations in Southern Utah so just in those three years time and I thought, okay, let's see if it will exist in a cold climate. So up in Northern Utah, where it snows, you know, and it's cold four or five months out of the year, like, can it exist in a cold climate? Will they still drink an icy beverage? And we opened up in Provo, utah, right across from Cougar Stadium, byu, and within like a week I was like and yes, it works. And I was like, okay, because they were super busy. And so then we really started expanding into northern Utah. So that was the first like okay, will that work in this climate?
Nicole Tanner:And then we had to prove ourselves outside of our heritage market, which was Idaho, utah, arizona, and just because everybody kind of travels in between there and we're like I knew it could, but we had to prove it. I mean, coke and Pepsi are billion dollar companies for a reason, and it's not because of Utah or Swig, it is because people drink soda everywhere. So we went to Oklahoma first because, again, coke and Pepsi are great partners. They gave us the data of soda consumption and we're more than just soda, and you know that. Like, we have sparkling water, water, energy drinks. If people say I've never been to Swig because I don't drink soda, I'm like, well, you're missing out, because we have so many amazing refreshers, revivers, that aren't soda. So please come, if you think we're just soda, we're absolutely not. Come and get something that's completely sugar-free and water-based and you'll love it. You'll feel special. So we went to Oklahoma.
Nicole Tanner:First, we have six locations in Oklahoma City, doing super well. Dallas, second 10 locations in Dallas, kickin' butt there. We have four locations in Houston. Texas will be the new Utah for Swig. Mark my word. Like, we'll have that many in Texas. So we proved it there as well. Like, willa exists out of this, you know, the Rocky Mountain front. And again, same type of thing where it's like, within a couple of weeks, like, and yes, we served over a thousand cars day one, opening day of our first store in Texas, boom, done so, it worked. So those were the two things Will it work in a cold climate and will it work outside of our heritage market? And, yes, it did so. Then we were hitting the ground running of like okay, who would like to join us in this amazing race, or whatever you want to call it journey?
Brian Sheehan:and that's a real hurdle for you, knowing if we can serve a thousand cars per day at our new location, we're good to go here yeah, those are our grand openings.
Nicole Tanner:we everything's free, so that's how we pull them in. I was like hey, come try us. Once you try us, you will love us. So we do three free days for about eight hours, from 11 to 7, and we just did that in wichita, and our goal is like we want you to try us. We know that we're new, you know we want to earn your trust in your business, so they come try us. Anybody who dares to get in that line, which is sometimes 50, 60, 70 cars deep, all for a free you know, 24 ounce drink. They do it, though, because they feel cool and special and it's fun. It's like a Disneyland ride. I'm like get in your car, let's go for a ride, and we usually can get them in and out within like 15, 20 minutes, because we're that smooth now on it. So, yeah, that's our grand opening days. Those are free days, but, in general, we have some locations that are our top locations that will do that same volume in a day.
Brian Sheehan:That's really exciting. Yeah, it's just such an incredible story. I really appreciate you taking the time with me today. I guess maybe I'll ask one final question here. You're thinking about how you know from that first unit you were in there every day, all day, had a small team of people, and maybe no one has a better handle on, kind of, where things are going in the future. I'm curious about how the model might evolve for you. Are you using AI? Are you interested in robotics? Kind of talk about what's happening inside a SWIG location and how that might change over time going forward.
Nicole Tanner:Yeah, obviously know, obviously technology is ever evolving and there's some really cool things out there. Anything that we bring on, like I said, anything that comes on the menu, has to fit those three categories. So, um, like, if we bring on a food item that takes longer than a minute to prep, we won't bring it on because that slows down our line. But if we bring anything on that takes away from that personalization and that drive-through, we won't bring it on either. But inside we have totally looked at robotics and you know, from measuring the amount of pumps that go into its drink and then even putting it, you know along that that soda machine, uh, that could totally speed up the line actually and make it even better and create a more superior product, because, again, it was that superior product and a fast moving, friendly line that built us. So if it could speed us up even more and make it even more superior, like product that you know you're going to get every single time super consistent, that would be amazing and that would save on labor. You still need a team inside to make sure that that works, but there's a lot that is very positive about some of that technology robotics, especially in a SWIG. So we're definitely yeah, we're definitely looking into it and seeing if it's a possibility for SWIG.
Nicole Tanner:I would love to not ever take away from taking orders person to person. I would. I want people to be seen and valued, and so I would. That's the part that I don't want to sacrifice on. So someone at the window handing you your drink and someone taking your order is very important to me. I think we've got to stay true to. We're in it because of the people we have a business, because of our customers, so let's make sure we see them as amazing people in our drive-thru.
Brian Sheehan:It seems like such a core part of who you are, what Swig is. It's important to never lose that element.
Nicole Tanner:Right, yeah, and there's going to be pressure to go, hey, but you'll save on this and this and this, yeah, but then we we might, you know, lose sales because we just don't have that interaction. So it's very intentional. I'm very intentional on the partners I bring on and also just where we go and what we bring on our menu. I'm protective of this business, for good reason, and my role is very different as founder. Now I don't have even a quarter of the hats I used to wear in my head, and that's nice. And I'm not getting any younger and I have a growing family and I love being a grandma. So, um, my role is very different, but I love what I do.
Nicole Tanner:I love seeing our teams grow. I'm like a culture you know, enthusiast, and so I can walk into a location. I can tell pretty quickly if there's something kind of off. So I take that to the district manager and say, hey, something feels off. You want to go in there, but I love to be in the stores. You'll oftentimes catch me in the stores making drinks, talking to the team. I'd rather do that any day than go into an office.
Brian Sheehan:So yeah, there's nothing that can really replace that time in a store to help you feel connected to the business.
Nicole Tanner:That's how you know how you're doing. If you're not connected in that store, you know in the trenches. You don't know how you're doing. So we have a new director of operations that's been with us for almost a year and he's been phenomenal at that. You'll see him in the stores, not in the office. That's how you know your business. What it's doing is when you're in the stores with the team in the trenches, and I'm going to get there and make drinks alongside you and take orders and do whatever is needed, because I'm grateful for you that you're showing up every day and doing all the heart.
Brian Sheehan:So and that, in a nutshell, is why Swig is so successful your willingness to get in there and continue to be on the front line and support your team and interact with customers face to face.
Nicole Tanner:I love my customers and my team. I don't have a business or a brand without them. They it takes. It takes an army to do what we're going to do and to see our team even growing even more so like really quickly lately, because we see this growth coming. So we're prepping for it is really cool and people want to be a part of it, and how cool is that? I mean you go back to how it all started and you just go amazing, a part of it. And how cool is that. I mean you go back to how it all started and you just go amazing. I'm very blessed, brian, I'm so blessed.
Brian Sheehan:Yeah, and I'll start it with, just like a love of a Diet Coke with lime. Who would have thought you are? Nicole, it was great speaking with you today. Thank you for joining me on Retail Intel. Be on the lookout for new Swig locations opening near you and be sure to check them out on Instagram at Swig Drinks. Whether you are an aspiring real estate mogul, a seasoned pro or simply curious about the places where we shop, dine, play and work, this podcast is your all-access pass to the world of commercial real estate. Connect with me on LinkedIn and if you're interested in being a part of the Retail Intel Podcast, please send a message to nationalaccounts at phillipsedisoncom. If you want to hear more about new and expanding brands like Swig, keep tuning in to Retail Intel and please subscribe, follow, like and repost. Talk to you next time.