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Product Development Firms- How They Did It: Wetzel’s Pretzels

Product development firms go through a lot of ups and downs during their product launch. The beginning of pretzels began well before Rich Wetzel; however, Wetzel and his partner Bill Phelps have been a big proponent of the development of pretzel products. Their products are the big, soft pretzels seen in carnivals, parades, Disneyland, malls, and many more places. These have been extremely popular and have been since 1996 when the brand ‘Wetzel’s pretzels’ was established. Since being created, the Wetzel’s pretzels brand has expanded into 28 states and 6 countries, but its growth was far from expected, considering how it got started.
Founders of Wetzel's Pretzels: Rich Wetzel and Bill Phelps

Founders of Wetzel’s Pretzels: Entrepreneurs Rich Wetzel and Bill Phelps

The two-person duo started from humble invention prototype, from a small kitchen and a big dream. They were the perfect partners because they both worked full-time jobs at Nestle USA in the Marketing department and shared similar interests when conceiving snack-food products. Once they solidified the concept of big, snack-food pretzels, they went to work immediately on invention help by bringing in another partner that could create a recipe. Using Phelps’ kitchen, they brought their invention prototype to life and immediately sought feedback. They got the local mall’s landlord to try the creation and he liked it so much that he rented them their first store. After receiving that positive feedback, it wasn’t long before they had a business plan and were making sales. A true fairytale for Product development firms.

Working on the dream

Aside from the help they received from the landlord, the Wetzel team had to find ways of acquiring money. The funds were required to fuel the business’ growth. Even though they had jobs, it wasn’t sufficient to support their fledgling Product development firms. Beyond that, when Nestle found out about their side project, their jobs were at risk; after one year, Nestle gave them two options, one being a contract buyout (essentially firing them) or moving them to another position in Ohio. They chose the former and dove fully into building Wetzel’s pretzels. Strapped for cash, Wetzel decided to sell his Harley Davidson to help raise funds. A few years later, John Davis, Hollywood movie producer, supported the Wetzel brand by collecting $1 million from Angel investors. Limited capital forced the duo to franchise their business. Their big breakthrough came when they made it into a Disneyland shop. By that time, they knew they had struck something.  By 2007, Wetzel sold his stake to a private equity firm, which paid 8 figures for the business, where Bill still operates as CEO. Despite the challenges and lack of invention help that the Wetzel team went through, the Wetzel’s pretzels brand became highly successful. This has also rewarded them in unimaginable ways. After selling his stake, Wetzel has had time to work on new ventures, such as Blaze Pizza, which has a projected revenue of $350 Million for 2017.      

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LA New Product Development Team is a comprehensive product development firm, offering services from idea generation and product design to manufacturing and marketing. LANPDT collaborates with startups and established businesses to transform concepts into market-ready innovations.

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