Floating Mug
NO DEAL
EPISODE SUMMARY
🕓 Air Date: September 26, 2014
Asking For:
$75,000 for 15%
Investor:
No Deal
Deal:
No Deal
PRODUCT SUMMARY
The Floating Mug is a marriage between a mug and a coaster, designed to prevent coffee stains with an elegant solution.
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Background Story
Tiggs, the charismatic founder of The Floating Mug Company, hails from Mooresville, North Carolina, where he crafted a unique solution to a common problem. The inception of the Floating Mug traces back to Tiggs’ personal experiences and a desire to escape the wrath of his wife’s disapproval. Living in constant fear of the high-pitched “Tiggs!” that accompanied the discovery of coffee stains on furniture, he recognized a need for a practical solution.
Driven by this domestic dilemma, Tiggs embarked on a journey to merge functionality with elegance. Despite lacking a professional design background, he sought to create the “sexiest mug” that not only served its beverage-holding purpose but also seamlessly incorporated a coaster. His pitch humorously highlighted the urgency of his situation and the birth of the Floating Mug as the ultimate marriage between a mug and a coaster. The product was not only a response to personal tribulations but also a testament to Tiggs’ resourcefulness and determination.
From the charming town of Mooresville, he presented samples of the Floating Mug in various colors, showcasing his dedication to solving a relatable problem in a stylish and innovative way. In essence, The Floating Mug Company emerged from the intersection of domestic inconvenience and creative ingenuity, symbolizing the founder’s determination to elevate the everyday mug into a functional and aesthetically pleasing household essential.
The Product
The Floating Mug, presented by Tiggs from The Floating Mug Company, is a revolutionary take on the traditional coffee mug. Crafted with precision and elegance, this porcelain mug ingeniously incorporates an integrated coaster into its design, eliminating the need for separate coasters and adding a touch of sophistication to the drinking experience.
The mug’s innovative design ensures that any condensation or spills are caught by the coaster, preventing those dreaded coffee stains on furniture. The entire mug, including the coaster, is made from high-quality porcelain, offering durability and a sleek aesthetic.
Available in a variety of colors, such as Adrenaline White, Hero White, Perpetual White, and Home Team White, the Floating Mug caters to diverse preferences. Tiggs showcased samples during the pitch, demonstrating the product’s visual appeal and functionality.
While initially manufactured in the Czech Republic at a cost of $12 per unit, Tiggs shifted production to China, significantly reducing the landed cost to $4 per mug. The founder explained that the mugs were initially sold for $29.99, but a new manufacturing partnership allowed for a lower retail price.
The Floating Mug can be purchased directly from The Floating Mug Company, and Tiggs hinted at future product extensions, including a prototype for a drinking glass with integrated coaster functionality.
How It Went
The company’s position before Shark Tank
The Floating Mug Company showcased a promising performance, with first-year sales reaching an impressive $105,000. Tiggs, the founder, disclosed during the pitch that the primary distribution channel was through a key distributor. The specific identity of this distributor was not provided in the pitch, leaving room for speculation about potential partnerships with major retail outlets or online platforms. The company initially manufactured its unique mugs in the Czech Republic, incurring a cost of $12 per unit.
However, in a strategic move to enhance cost-effectiveness, production was shifted to China, drastically reducing the landed cost to an economical $4 per mug. This transition reflected the company’s adaptability and commitment to maintaining a competitive edge. While the pitch did not delve into specific profit and loss figures, Tiggs shared the retail pricing strategy, initially set at $29.99 per mug. He hinted at a new manufacturing partnership with an Italian-based manufacturer, which aimed to further lower production costs.
Tiggs mentioned exploring new manufacturing avenues, indicating a dynamic approach to sourcing and production. In essence, The Floating Mug Company showcased a robust start, with a notable sales record and strategic manufacturing adjustments. The pitch left some financial details undisclosed, leaving room for further exploration of the company’s financial health, funding sources, and structural aspects.
The Negotiations:
The negotiations for The Floating Mug on Shark Tank unfolded with Tiggs seeking a $75,000 investment in exchange for a 15% stake in his business. While the sharks were intrigued by the innovative design, concerns about market acceptance and pricing became pivotal in the negotiation process. Kevin questioned the viability of the product, particularly its pricing compared to standard mugs and coasters. Despite Tiggs’ efforts to justify the premium, Kevin expressed skepticism, leading to his decision to bow out early in the negotiation.
Robert echoed concerns about market viability, stating that the average consumer might not be willing to pay a premium for the Floating Mug. Mark and Lori both expressed reservations about the product’s market potential, with Mark advising a web-focused strategy for selling smaller quantities directly to consumers. Lori, while expressing admiration for Tiggs’ high energy and commitment, ultimately declared herself out due to concerns about the product being a one-time purchase and a potential gift item. Barbara, the last remaining shark, acknowledged the uniqueness of the Floating Mug but expressed reservations about its long-term market appeal. She suggested a lower price point for wider accessibility but ultimately decided to pass on the investment opportunity.
In the end, none of the sharks made an offer, leaving Tiggs without a deal. Despite the disappointment, Tiggs left the Tank determined to improve and capitalize on the opportunity in the future. The negotiation showcased the sharks’ concerns about market positioning, pricing strategy, and long-term appeal, emphasizing the challenges in convincing investors of the Floating Mug’s commercial success.
