By Jana Soeldner Danger, The Miami Herald Knight Ridder/Tribune Business News
May 13--From egg creams to electrolytes, Mark Streisfeld and Alan Posner have moved from the nostalgic past to cutting-edge, dietary trendiness. In January, the founders of Boca Raton-based Meridian USA Holdings introduced ChampionLyte, a sugarless, no-calorie sports drink that they expect to take off with today's health-minded, weight-conscious public.
Marketing efforts include TV ads featuring Miami Dolphins quarterback Jay Fiedler and Miami Heat forward Anthony Mason. 'The challenge is to get the product onto the shelves,' Posner said. 'Once it's there, it's easy to advertise to consumers.'
It all began with what the partners describe as an obsessive search for chocolate syrup. Posner, retired from the diamond and art business, and Streisfeld, retired from the healthcare industry, started Meridian in 1995 with an investment of $100,000 from personal funds.
Streisfeld had a dream: to recreate and sell in Florida the tasty egg creams he remembered from his youth in New York, where the drinks made with milk, seltzer and flavored syrup (no eggs and no cream) are still popular. The confections had, after all, played an important part in Streisfeld's own history: His paternal grandfather owned a seltzer company on Coney Island and candy stores with fountains. 'My mother went to work for him when she was 12, making egg creams in the window,' Streisfeld said.
Her job led to romance and marriage to Streisfeld's father. The partners believed that with so many former New Yorkers in South Florida, the area should be ripe for egg cream sales. Shortly after they began making the drinks, they discovered a potential new market.
'Everybody started asking for sugarless egg creams.' Streisfeld said. 'So we went out looking for a sugar-free chocolate syrup.' The search was a difficult one. 'It became a quest for us,' Posner said. 'We worked with various food laboratories around the U.S., and invested hundreds of thousands of dollars of our own money.'
By the time they found the right syrup two years later, the development investment totaled about $450,000. 'We knew we had the right product when it tasted good and was specifically a syrup. It mixed well with milk, and blended with other food products,' Streisfeld said.
They began selling the syrup door-to-door to small stores. Then they negotiated with Cumberland Packing, the company that manufactures Sweet & Low, to license the name, even though the product doesn't contain that sweetener. 'Sweet & Low says `sugar free,' ' Posner said. The company developed two other flavors, vanilla and strawberry, and soon the syrup was being sold in 20,000 stores nationwide.
'We liked the idea of being first with a product, and we looked for other things with a sugar content that needed a sugar-free alternative,' Posner said. 'We knew there were 16 million diabetics in the country, and countless dieters.'
The partners decided to jump on the sports drink bandwagon. The result was ChampionLyte, a drink the partners say is carbohydrate and sugar free, using a potassium-based, non-nutritive sweetener. 'It's the potassium and sodium content that make it electrolyte-replacing,' Posner said.
The sports drink industry accounts for $1.9 billion in annual wholesale sales in the United States, compared with $42 billion for carbonated soft drinks, said Gary Hemphill of Beverage Marketing in New York City. Gatorade dominates the sports drink industry with an 85 percent share of the market. 'Growth has been steady at eight to 10 percent annually through most of the '90s and 2000,' Hemphill said. 'The drinks are targeted mainly to younger, active male consumers, and those who think of themselves as active.'
Lewis Beyda, an owner of Delights, a health food store in Boca Raton, and J.A.M.B., a distributor of low carbohydrate, sugar-free products, stocks ChampionLyte. 'There's definitely a market for it,' he said.
Meridian has 11 employees, including sales and office staff. It went public a little more than a year ago with a reverse merger, and the partners expect it to be profitable by the end of 2002. Last year, revenue based on syrup sales only was $1.2 million; the partners predict $6 million during 2001 with the introduction of ChampionLyte.
'We're building a base this year,' Posner said.
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(c) 2001, The Miami Herald. Distributed by Knight Ridder/Tribune Business News.
