Life-long confectionery veteran Pierson Clair was “thrilled” to receive Candy Industry’s 66th Kettle Award. His achievements, which include steering Brown & Haley toward double-digit growth and repealing a candy tax in Washington State, underscore his and the industry’s spirit.
Life-long confectionery veteran Pierson Clair was “thrilled” to receive Candy Industry's 66th Kettle Award. His achievements, which include steering Brown & Haley toward double-digit growth and repealing a candy tax in Washington State, underscore his and the industry's spirit.
By Bernard Pacyniak
Never in a million years” did Pierson Clair think he would be a Kettle recipient. In fact, when Jim Greenberg, co-president of Union Confectionery Machinery Co. and a member of Candy Industry’s Kettle Committee called him about being nominated for the Award this year, Clair thought there was some mistake.
“I have such high respect and regard for the Kettle that I told Jimmy that it couldn’t be me,” he says. But after Greenberg reassured the president and ceo of Tacoma, Wash.-based Brown & Haley that yes, he was, indeed, selected to be one of nominees for this year’s ballot, Clair admitted to being deeply flattered.
Still, as time drew near for the Kettle Award Reception, Clair refused to acknowledge that he had any chance at being called up to the podium.
“The Kettle Committee did such a magnificent job of choosing the nominees,” he says. “Beginning with Judy Cooley from The Hershey Co., I mean a principal scientist, wow, to Rick and Dave [Drehobl of the Georgia Nut Co.] and Doug [Douglas Enstrom of Enstrom Candy Co.], these are wonderful and passionate people in our industry.”
Consequently, on the night of the Kettle Reception, Clair did not have any formal remarks written down, ever so confident that someone else would receive the award. In addition, he told his two grown children not to attend the event, feeling it wouldn’t be necessary.
John Melin, Brown & Haley’s coo, fondly recalls the moment when Katherine Clark read the name of the 2011 Kettle Recipient, “I wanted to make sure I took the drink away from his hand before he went onto the stage.”
Clair describes a “wave of thrill” overcoming him. He then also realized that he would be talking to industry friends, colleagues and comrades.
“I never viewed the industry as customers or competitors,” he says. “When I looked out at the room of people standing there, I saw 40 years of friends. I’m surprised I didn’t tear up.”
No, Clair didn’t tear up. He did, however, give a memorable, off-the-cuff speech, one that reflected his love of the industry. He also managed to take out a small camera to capture the moment, citing memories of Don Gussow, founder of Candy Industry and the Kettle Award, who would always sit in the front row at industry events and stand up and take a photo of the proceedings.
Clair’s snapshot, of course, reflects more than 40 years of working in the industry, beginning first with Blommer Chocolate Co. in 1970, and then moving over to Brown & Haley in 1998.
As Clarence Guimond, chief financial officer for the company and a 45-year veteran at Brown & Haley, explains, it was Clair who - upon coming on board as the new chief executive - changed the company’s direction by refocusing its emphasis on the core brand, Roca.
In doing so, he, together with key hand-picked management team members, transformed Brown & Haley from a traditional, mostly regional multi-line operation into a global premium specialty confectionery producer. The changes also initiated a pattern of continuous growth: This year Brown & Haley has posted growth in excess of 10%; internationally, sales have grown 340% over the past eight years. Revenues are estimated to hover between $40 to $60 million.
As Anne Haley, granddaughter of co-founder J.C. Haley and chairperson of the company, says, “The Kettle Award is the consummate recognition of the role Pierson has played for the company. His presence and contributions have been enormous, not only for Brown & Haley, but for the community here in Tacoma and the community of his peers.”
Perhaps what is even more exciting is that the Kettle recognition comes at the time the company is truly well-positioned for even more exciting opportunities.
“In 2008, we were changing a lot of things,” Clair says. Not all changes and launches worked, but they certainly invigorated the company. For example, despite the early successes of Roca Thins bars (See Candy Industry, April 2008 issue), Brown & Haley’s venture into the premium chocolate bar category, that launch couldn’t be sustained. Still, the consumer learnings gleaned from that launch and subsequent consumer surveys have helped set the direction for critical decisions on the Roca brand, decisions that involved packaging and flavors.
As Melin explains, “We were in the midst of clarifying our brand positioning so that we could focus on the right consumer proposition and the right price points. We also decided to take our foot off the gas pedal a little, adapting a ‘walk before you run’ philosophy.”
In an ongoing review of the key values that constitute the Roca brand, several critical points surfaced, such as the product being made from premium and all natural ingredients as well as its ability to deliver a wonderful and unique taste experience.
Moreover, recent consumer surveys revealed that lovers of Roca care about others. In purchasing Roca products, consumers do so to not only delight themselves, but to enjoy delighting others.
“We discovered that Roca is different from other brands, in that it has a nurturing element,” Melin says.
This prompted a subtle shift in packaging, in brand communication, he continues. A re-emphasis on the fact that Roca products are made using local butter, California almonds, pure vanilla and no preservatives reinforced the brand’s all-natural premium ingredients positioning.
Additional research revealed that consumers favored $5 and $10 price points. The $6.99 to $7.99 price tags were “no man’s land,” Melin says.
To accommodate the price points, the company reduced product volume. It also executed some other changes, all reflective of consumer feedback.
One of them involved going from a stand-up pouch to a stand-up box.
“Consumers told us that the stand-up pouch didn’t live up to the Roca brand,” Melin says. The company has since come out with an elegant 5-oz. stand-up gable box that re-asserts a premium presentation.
Known for its beautiful gift tins, the company also is now offering retailers more high-end gift items, the coo adds. This year, the company revamped its Valentine’s Day offering to include a premium, upscale tin heart containing Roca products.
For the upcoming winter holiday season, Brown & Haley looks to debut a Nutcracker tin containing Roca items. The company hopes to work with ballet companies staging the Nutcracker, starting with the Pacific Northwest Ballet in Seattle.
Then there’s the upcoming 100th anniversary year-long celebration, which will commence November 2012. Although plans haven’t been finalized for the various promotions and activities on the drawing board, there’s one sure thing in the offing: the debut of a Roca Dark product.
As with other line extensions for the Roca product that Clair has initiated and overseen, such as Mocha Roca, Cashew Roca and Candy Cane Roca, the product development team understands the importance of balancing the buttercrunch center with a dark chocolate coating.
“We found that even with 85% cocoa content dark chocolate, the chopped almonds on the outside had a way of overpowering the dark chocolate,” explains Melin. “Our challenge was to find a way to meet consumers expectations for Roca and dark chocolate.”
The most recent test runs suggest that the company has met those challenges, and the timetable for launching the newest Roca member is the summer of 2012.
As it so happens, the company will also celebrate its 100 anniversary during the time the Chinese welcome the year of the dragon, a most fortuitous sign. According to Chinese lore, the celestial Dragon represents an emperor and power. Today, it is the ultimate auspicious symbol signifying success and happiness.
In Brown & Haley’s case, the last few years seem to have been all dragon years, with China and all of Asia contributing to explosive exports. Interestingly, Roca means “Happy Family” in Chinese, a perfect brand in a culture that places a great emphasis on family culture as well as gift-giving.
Having entered the Chinese market in 1988, Brown & Haley has nurtured its evolution into the Chinese premium confectionery segment. The rapid economic growth in China has spurred export sales to where they now constitute 30% of total revenues. Forty percent of Roca sales now come from abroad.
Cognizant that China’s economic engine could encounter a slowdown in the near future, Melin is concerned about continued sustained growth. A drop from a 9% GNP growth rate to a 4% would have a significant impact on premium purchases, he says. At the same time there’s a major demographic shift coming that offers enormous opportunities, Melin adds.
“During the next five years, there are 280 million Chinese that will enter into the $3,000 to $5,000 annual per capita income bracket,” he says. “It’s at that level that consumers develop a modern branded lifestyle. Consequently, this is the largest opportunity for consumer packaged goods in the history of the world.”
To put the number in a proper context, it took the United States and the UK sixty years (1900-1960) for 220 million to accomplish the same threshold, Melin says.
Given the high regard that the Chinese view Roca products as an ideal gift -”It’s gold and red coloring, elegant tin, all-natural ingredients and American heritage all fit into the Chinese notion of premium gifting,” he explains - the company believes there’s continued growth potential in China, and Asia as well.
That growth potential, coupled with steady sales within the United States has prompted several critical investments in operations. First, the company has upped its output of confections by 27% to meet sales demand.
“We added cooking capacity in the kitchen as well as cooling capacity, which allowed us to pump up the speeds and increase the volume,” explains David Armstrong, senior v.p. – supply chain/operations.
As a result, the company now turns out 2.1 million pieces of Roca daily. This year, given the demand and orders for the coming fall and winter holiday season, production will begin working a six-day, three shift schedule a month earlier.
To accommodate the shift from a stand-up pouch to a gable box, the company invested nearly $400,000 in a new Tishma Innovations box former. Although it wasn’t quite a “plug and play” installation, Armstrong says that putting in the box former went very smoothly.
A matrix bagger seals the individually wrapped Roca pieces into a 5-oz. bag, which is then placed into the gable boxes formed by the Tishma unit at a rate of 42 boxes per minute.
The company’s also embraced recycling as its strategy to becoming greener.
“We are currently recycling 85% of everything we generate, such as paper, carton, foil, etc.” says Armstrong. “Our goal is to reach 90%,”
Working in conjunction with the Sutta Co., a major West Coast recycler, the company has …changed its waste to… if not wealth than into planet well-being. Brown & Haley’s efforts have paid off in savings as well as recognition. This August, the Sutta Co. will present the company with its Recycler of the Year award.
Another major change that demanded a “fair outlay” was the consolidation of its two warehouse operations and administrative offices into a new 120,000-sq.-ft. facility that’s capable of housing 8,000 pallets. The move not only cut back on the added costs of having a raw materials and a finished goods warehouse, it improved operations by centralizing supply chain and sales personnel under one roof.
“We’re saving as much as 20% on fuel costs with a truck now simply going to the plant and our warehouse compared to making additional stops,” says Brad Degerman, distribution manager. “Moreover, it’s made our deliveries much more efficient.”
Complete with 26-ft. ceiling, the new warehouse and administrative center highlights the transformation that’s been going on with Brown & Haley since Clair’s arrival. There may be even more dramatic changes down the road for the company when Tacoma’s new LeMay Museum opens this fall.
Upon completion, this $60-million project will house the largest auto museum (165,000 sq. ft. to ultimately showcase 500 cars) in the world. Current projections envision 425,000 visitors contributing $34 million to the local economy annually.
Because Brown & Haley’s existing 110,000-sq.-ft. facility sits virtually at the doorstep of the museum (it’s shaped like a stylish car hood), it’s likely the ensuring economic development of the area will prompt moving operations into a new facility.
“The economic impact of a straight-line manufacturing would be significant for us,” Melin says. It would enhance process control, improve supervision and optimize throughput. Our facility has had seven to eight add-ons during its history.”
A new manufacturing facility is something Clair sees as a possibility say five to seven years from now, although he wouldn’t complain if the timetable is shortened.
In the interim, Clair is focusing attention on how best to continue leveraging the Roca brand through product development, exploring new exports markets, such as Russia and defending confectionery industry interests (Washington’s candy tax) whenever the need arises.
“You have to remember that I cut my teeth on candy taxes with the likes of Russ Albers and Herm Rowland of the Jelly Belly Candy Co.,” Clair says. “Russ would call and there would be about 10 of us who would go to the California legislature. As Russ would point out, ‘We put in the same ingredients as in a cake, but you never see anyone taxing cake.’”
Thus Clair credits learning his argumentation skills from two Kettle recipients, Albers and Rowland, skills he put to great use in fighting against a candy tax and eventually organizing a successful initiative to repeal the tax in 2010.
“Larry Graham and his staff were so helpful,” he adds. Proposition 1107 required more than 241,000 signatures of registered voters. With the help of the NCA as well as other Washington State candy manufacturers, Clair convinced the public to strike down the candy tax, with 68% voting yes on the initiative.
Clair’s next crusade? Of course, it’s sugar reform. Who better than the 66th Kettle Award recipient to take on that challenge?
At a Glance
Brown & Haley
Headquarters: Tacoma, Wash.
Plant: One (110,000 sq. ft., three lines)
Sales: $40 - 60 million (Candy Industry estimate)
Employees: 250
Output: 2.1 million Roca buttercrunch pieces daily
Brands: Almond Roca, Cashew Roca, Mocha Roca, Candy Cane Roca, Macadamia Roca, Mountain Bars
Products: Buttercrunch based confections; enrobed grahams; nut clusters; bars.
Management team: Pierson Clair, president & ceo; John Melin, coo; Clarence Guimond, executive v.p., treasurer & cfo; David Armstrong, sr. v.p. – supply chain /operations; Paula Siburkis, director of national accounts; Rick Nicks, director of international sales; Kathi Rennaker, marketing and product manager.
Captions:
Almond Roca production begins with the buttercrunch coming off the cooling wheel, then going through a slitter, a guillotine cutter and then into a Baker Perkins enrober. After cooling, the chocolate-enrobed pieces receive a shower of chopped almond pieces before heading toward packaging. At left, new holiday tins featuring Almond Roca.
Finished Almond Roca pieces head toward a bank of six Carle & Montanari wrappers, each capable of handling 450 pieces per minute. An employee checks wrapped pieces before they head toward a scaling area via conveyor and then into appropriate packaging stations.
Brown & Haley’s management team: (Sitting, l. to r.) David Armstrong, sr. v.p. - supply chain/operations; Paula Siburkis, director of national accounts; Pierson Clair, president and ceo. (Standing, l. to r.) Clarence Guimond, executive v.p., treasurer and cfo; John Melin, coo; Kathi Rennaker, marketing and product manager; and Anne Haley, chairperson. (Below) Members of David Armstrong’s operations team (third from right) pose in front of the company’s new Tishma Innovations gable box former.
