Each Friday during fishing season, a refrigerated semi truck rolls into the tank station at Akron Wholesale Live Bait Inc. to deliver 5,000 pounds of bait — from worms to minnows.
And every day, route trucks transport the company’s outgoing shipments of bulk bait to about 250 fish-and-tackle stores across the nation.
Never before has there been so much activity at this Mogadore-based bait business, says Ken Robb, president.
“Before I bought the company in 1997, it had nine straight years of declining sales. Since I’ve owned it, we’re up about 60 percent,” he says.
That’s partly because, two years ago, Robb collaborated with Paul Giannaris, a Toronto-based business partner, to develop a new product for the industry.
In doing so, Robb opened a can of worms. Literally.
Known as NitroWorms, the bait they developed is a natural Canadian nightcrawler that’s altered to enhance its quality as freshwater fishing bait. What’s unique and alluring about the product is that the worms are fluorescent green.
“The fish can see these chartreuse worms underwater better than a natural worm because the fluorescent bait is more visible in deeper and murky waters. The brighter the worm, the easier the fish can see it. If they see it, they eat it — hook, line and sinker,” he laughs.
In April 1999, Robb and Giannaris introduced the product to the industry, selling it to retailers and wholesalers through Akron Wholesale Live Bait — initially under the trade name Neon Worm. But when they learned a national company had a rubber worm called Neonz, they renamed their product to avoid trademark infringement issues.
They also created a venture called Specialty Worms Inc. as the authorized U.S. distributor and licensed representative for NitroWorms. About a dozen distributors have since been established across the nation.
To market NitroWorms, Robb hired a Fairlawn ad agency to develop a NitroMan logo and design brochures, signs, a trade show booth — even a NitroMan mascot.
“One of the things we’re trying to do is interest more kids in fishing, because ours isn’t a growth industry and it’s lacking in baby boomers,” Robb explains. “So we hire a guy to wear the NitroMan suit at the trade shows and it’s a great draw for the kids. If you can lure them, you get their parents’ attention, too.”
Sounds fishy to me
At first, NitroWorms were a big hit — because they caught big fish.
“This spring, a pro fisherman used our NitroWorms at the Detroit River Walleye Tournament, and our bait lured the second largest walleye ever caught in the Michigan pro series,” Robb boasts.
But then, a dastardly thing happened. NitroWorms gained so much attention, everybody wanted a piece of the action.
It started when Robb learned that imitation green worms were crawling around at Wal-Mart.
“One of our Maryland distributors saw a similar product being sold at a Wal-Mart out there. We notified them that this was a knock-off of our patent-pending bait. It took a couple of calls, but Wal-Mart has since pulled the imitation from their shelves,” says Robb.
But the buck didn’t stop at Sam’s. Almost weekly, Robb receives tips that imitations are being sold elsewhere.
“There are at least five national companies I’m aware of that are making knock-off versions. They’re not using our name, but they’re using part of our chemistry. They analyze our product and try to mimic the formula,” he explains. “A tremendous amount of our business has been knocked off as a result of these cheap imitations.”
Last winter, Robb’s sales forecast looked promising. Based on the 1 billion night crawlers sold annually in the States — 70 percent of those in the Midwest — he predicted NitroWorms would capture 15 percent of that market.
“When the season opened, sales ramped up fast. But then, the knock-offs started coming out, and our sales picture changed drastically. Frankly, we were getting our butts kicked.”
When the worm turns
The bottom line isn’t Robb’s only concern. He’s worried about the effects of the rip-off formulas.
Robb — who has a sales, marketing and application background in the industrial gas business — explains that the original NitroWorms formula uses a patent-pending colorant that’s approved for human use by the FDA and EPA. Nightcrawlers released into the formulated dirt feed on the soil for three days, metamorphosing from their natural color to fluorescent green.
The NitroWorms formula allows the worms to remain green for six to eight weeks, while retaining their natural scent and motility. Once released back into their natural soil environment, the worms return to their natural color.
In contrast, Robb says the imitation formulas isolate NitroWorms’ special ingredient, and the food coloring or industrial-grade dyes being substituted can kill the worms or harm the fish.
“Worms are sensitive creatures, and if you feed them chemicals that might be safe for humans, you could still kill the worms. Worse yet, some of these knock-offs are using dyes not purified to the level of human use, which could leave trace metals in the fish.”
As for the coloring effect of the imitators, Robb says the worms will turn green. But only a dull green — not the fluorescent that draws the fish.
“The industrial grade dyes will also permanently stain your fingers, your boat and anything else the dye makes contact with,” he says.
The one that got away
“Is it ironic that Paul and I were careful not to infringe on anyone else’s trademark, and now, others are taking our idea and selling it?” Robb asks.
He confides that when they first brainstormed the idea, they approached select companies that might help advance the product, to benefit the entire industry.
“We thought we had some major deals with big companies, but nine out of 10, their preference was, ‘I’d rather steal it from you than help you.’ It’s been a sad lesson in business ethics and I’m cynical now. It’s really disheartening because Paul spent two years developing the formula,” Robb says, noting that Giannaris is a second-generation worm broker with a Ph.D. in organic chemistry.
There’s not much they can do to shut down the imitators until the NitroWorms patent is approved, he explains.
“If they were using our trademark name or logo, we could act on that. And if someone sneaked into our files and stole the formula, we could go after them. But as long as our formula is still patent-pending, we can’t stop people from buying our product, analyzing it, reverse engineering it and selling it under a different name.”
If you can’t beat ’em …
Determined, the partners sought a solution. At a recent trade show, the light dawned.
“People started asking if they could just buy our formulated soil and add their own nightcrawlers to grow NitroWorms. So, Paul and I discussed it and decided to start selling 50-cup cases of our dirt to the bait stores,” Robb says.
The decision put the team back on track — and boosted the bottom line in other ways.
“Shipping the NitroWorms costs more because they’re perishable, and you’ve got to have a high volume to ship perishables cost effectively,” Robb says. “Now, we can inexpensively ground ship a 50-cup case of the soil anywhere in the U.S., because the dirt won’t spoil.”
In addition, the middleman is eliminated in the soil-only sales.
“We still ship NitroWorms to specific areas, depending on shipping costs. And if we pick up a major wholesaler in a given market, we’ll pull out of that area’s store market,” Robb says.
The partners also developed a retail pouch kit specifically for fisherman, which they debuted at a national fish-and-tackle trade show. The product won best in class for new specialty bait. Carefully casting their line this time, they’ve signed on with a national tackle company to package and mass market the kit, which will be sold next spring under the label “Lindy-Little Joe’s NitroWorms.”
“Bringing on a big player like this will advance our product tremendously,” says Robb.
The future, he says, looks fluorescent.
“We’re not selling out. It’s more like, ‘If you can’t beat ’em, join ’em,'” he laughs. “I guess the up side is, if our product wasn’t such a great idea, people wouldn’t be rushing to copy it.” How to reach: Akron Wholesale Live Bait Inc., (330) 628-5663; Specialty Worms, (877) 84WORMS; www.specialtyworms.com; www.nitroworms.com
