Snack Food & Wholesale Bakery - September 2008 - (Page 9)

2008 W h ol e s a l e Ba k e r o f t h e Y e a r For odness Sakes new, especially if it’s yet-another report from a company touting the sudden emergence of organic baked goods. Believe it or not, these cynics wouldn’t get an argument from Foley and his colleagues. Three years ago, Charter Baking began acquiring entrepreneurial baking companies that have been around since the mid- to late 1970s. Its Rudi’s Organic brand, for instance, was founded in 1976. The Vermont Bread line made its debut in 1978, and The Baker emerged in 1979. Over the past three decades, Foley says, these brands have built their credibility as recognized, natural, preservative-free names in consumers’ households in their core markets. “It’s the authenticity of the brand that resonates with consumers,” Foley says. “It’s not someone trying to leverage a trend or take advantage of a segment. These are companies and people who have been in the category a long time.” Charter Baking is a relatively new portfolio company of the Charterhouse Group, a New York private equity firm that specializes in investing in established entrepreneurial and middle-market companies in dynamic industry segments where it can develop the businesses to reach between $75 and $300 million in value. Founded in 1973, the Charterhouse Group founded Charter Baking as a build-up proposition within the natural and organic baked goods segment. Today, with around $70 million in sales, the goal is to create an organization with $150 million in annual sales within the next three to five years. “The strategy we had three years ago is still in place today,” Foley says. “With these acquisitions, we wanted to build the premier organic and natural company in the baking industry. Our overall strategy was to have DSD [direct-store delivery] operations where the demand for organic products was sustainable and could support our DSD operation, and to have a freeze-thaw opportunity in other areas where there was not enough critical mass to support a DSD operation.” Continued on page 10 Charter Baking has built the largest organic baked goods company in the nation. Now, the company bets it can transform the organic baked goods market into a more mainstream segment like organic milk, meat and produce. By Dan Malovany C ynics view the glass half empty. Optimists see it as half full. When the veteran management team at Charter Baking looks at the glass, they wonder if it contains organic milk. If it does, then they perceive it loaded with opportunity. That’s because a decade ago, organic milk emerged as a gateway category into the world of organic foods. Today, Charter Baking is betting that organic bread and other baked goods are poised to be in the same position as organic milk was in the late 1990s. No longer is organic simply a niche for the baking industry. “I think organic is a segment, and the segment is growing and it’s getting bigger,” says John Foley, president and CEO of Charter Baking Co., which is headquartered in Boulder, Colo., otherwise known as one of the self-proclaimed epicenters for organic foods. The cynics may argue that they’ve heard this all before, and that nothing is ever SEPTEMBER 2008 - Snack Food & Wholesale Bakery 9

Table of Contents Feed for the Digital Edition of Snack Food & Wholesale Bakery - September 2008

Snack Food & Wholesale Bakery - September 2008 Contents Editor’s Note For Goodness Sakes Better Than the Rest Unconventional Thinking Easy Does It New Products In the Comfort Zone Engineering Management The ASB Column Printer Keeps Production Running Equipment Briefs Better Than the Rest The Final Word

Snack Food & Wholesale Bakery - September 2008

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