Wise Pocket Socks
DEAL
EPISODE SUMMARY
🕓 Air Date: January 12, 2020
Asking For:
$30,000 for 15%
Investor:
Lori Greiner, Daymond John (50/50)
Deal:
$35,000 for 25%
PRODUCT SUMMARY
Wise Pocket Products is an innovative line of socks and leggings designed with patent-pending pockets, providing a stylish and functional solution for kids to carry essential items.
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Background Story
Sofi Overton, a 13-year-old entrepreneur from Bentonville, Arkansas, introduces Wise Pocket Products, showcasing her passion for creating a solution to a common problem. Sofi’s journey began at 11 when she observed her cousin placing a phone in her boot due to the lack of pockets in kids’ and women’s clothing. This discomfort led Sofi to design a prototype by modifying a sock, ultimately resulting in the creation of Wise Pocket Products.
Sofi’s entrepreneurial spirit is evident in her dedication, as she invested $10,000 of her own money into the business, combining personal savings with earnings from business pitches and competitions. The motivation behind Wise Pocket Products extends beyond convenience, with Sofi emphasizing the importance of giving back. For every pair sold, the company donates a pair of socks to children in need, showcasing Sofi’s commitment to social impact.
The Product
Wise Pocket Products addresses the challenge of the lack of pockets in kids’ clothing by introducing socks and leggings with patent-pending pockets. The pockets are designed to hold essential items, such as phones, allowing kids to carry their belongings comfortably during various activities, from playing sports like soccer to engaging in spontaneous dance sessions.
The key innovation lies in the double welt pocket design, ensuring items stay securely in place without falling out, as demonstrated during the pitch. Sofi provides insight into the cost structure, revealing that each sock costs $5.47 to produce, with the slightly higher expense attributed to the double-welt pocket manufacturing process.
The retail price for a pair of Wise Pocket socks is $15, with a wholesale price of $11. The pitch emphasizes the uniqueness of Wise Pocket Products compared to competitors, highlighting the larger pocket size catering to more significant items.
How It Went
The company’s position before Shark Tank
Sofi reports sales of a little under $16,000, showcasing the initial success of Wise Pocket Products in the market. The business, driven by Sofi’s personal investment and earnings, has a strong foundation, with potential for growth. However, the production capacity is currently limited to around 100 units per month, signaling a need for increased efficiency and scale. The decision to seek $30,000 from the Sharks is aimed at streamlining production processes.
The decision to seek $30,000 from the Sharks is aimed at streamlining production processes. Wise Pocket Products operates with a cost-effective social impact model, donating a pair of socks to children in need for every pair sold. Sofi’s dedication to this cause aligns with contemporary consumer preferences, where social responsibility plays a crucial role.
The financials provided include the $5.47 cost per sock and the retail and wholesale prices, giving insight into the company’s pricing strategy. However, it is essential to consider the scalability of the business, especially as Sofi expresses the desire to produce more units per month.
The Negotiations:
The Sharks express admiration for Sofi’s entrepreneurial journey and the product’s concept, emphasizing the importance of her achievements at such a young age. However, Mark and Kevin both opt out, citing a lack of interest in a sock company within their investment portfolios. Lori and Daymond commend Sofi for her accomplishments and express genuine interest in helping her.
The negotiation centers around the Sharks’ offers. Lori and Daymond propose $35,000 for 25%, emphasizing their intention to find a licensing deal to further the product’s reach. Sofi initially expresses concern about giving up a third of her company but eventually accepts the offer, marking a successful negotiation.
Lori and Daymond’s experience in the sock industry, coupled with their commitment to the social impact aspect of Wise Pocket Products, aligns with Sofi’s vision for the company’s future. The negotiation reflects Sofi’s ability to navigate the Sharks’ offers and make a strategic decision that benefits both her business and her vision for Wise Pocket Products.
