Lost in the Supermarket

From Pot Pies to a Top 50 US Brand

March 30, 2021 SupermarketGuru
Lost in the Supermarket
From Pot Pies to a Top 50 US Brand
Show Notes Transcript

Phil Lempert Interviews Amy's Kitchen  co-founders Rachel and Andy Berliner.  Started in 1987, Amy’s, for the first time, was named one of the Top 50 Brands in the U.S. in the Prophet Brand Relevance Index based on a survey of 13,000 consumers.  Join us as we discuss the past, present and future for Amy's.

Phil:

Welcome to a very special Lost in the Supermarket. Now, the people that you see on your screen, you might not recognize, but you certainly would recognize their products. Uh, and if you'd look in your freezer or in your cupboard, you probably have them in there. Um, I met , uh, Rachel and Andy probably over 30 years ago. Um, when they first came out with this fabulous product called Amy's , um, and the differences between Amy's then, and Amy's now , um, not a lot of people cared about plant-based . There were some vegetarians, there were some vegans, but not to the point that we have now. So, you know, Rachel , uh, Andy, thank you for joining us today on Lost in the Supermarket.

Andy:

You are most welcome. I'm excited to be here talking to you again. Yeah.

Phil:

So talk to me about the difference when you first started back in 1987 , um, you were banging on, you know , supermarket retailers doors and trying to make Amy's, you know, a name for itself , uh, today. Um, I don't know how many tens of thousands, probably a hundred thousand stores , uh, that your line of products are in. Uh , but it's certainly a success story, but bring us back, you know, 30 years ago, what was it like?

Andy:

Well, in the very beginning, we were just in natural food stores for a number of years and we called on a few grocery stores supermarkets, and they said, wait until you have a broader range of products. So we did. And , um , but you know, the idea of vegetarian and our organic in particular people didn't know what that word organic meant. Uh , I never forget when we first did some demos in Costco and people were saying, what does that mean? So it's just little by little year by year. It's continued to change to the point where now it's , uh , so many people , um , want to eat better and know that it's related to their health. And , uh,

Rachel:

You know, I remember that FMI show where we first met you. Um, so I'm used to people knowing who we are and coming, and just having the booth in the natural food shows, being crowded around the table and eating our food. And so I had to really, for the grocery stores, they didn't know who we were and all these people in suits would walk by and I would felt like I was a, you know, saying , come and try. Amy's gonna try and pull them in . And then suddenly we found one grocery store. Can I mentioned the name? Yeah, of course. So there was a woman who came in and she loved the food. She just loved everything. She'd let me bring my husband over. I think he'll like it, he was a vegetarian and I think he was the president of Publix and he came over and he loved the food. He brought all his salespeople. He took us, you know, we started, I dunno , that would actually happen how it was, but we started selling to them. And at that point, everyone looked to Publix as the , um, you know, the, the model of what is trendsetter . And , and then after that, it seemed like all the grocery stores started asking for us because we had a whole line of organic food, you know, pizza, lasagna burritos, and we just had everything. So they could just say, Oh, we want organic. We'll just put Amy's in. And there were already a known, but we had no idea when we started that we would be a big company. We thought we'd be just a little pot pie company. Yeah , no idea.

Phil:

So, so you didn't mention my favorite. I think the first Amy's product that I tasted was the macaroni and cheese, which to this day I still buy and still think it's the best Mac and cheese.

Andy:

Yeah. It's huge for us. And our Mac and cheese comes in regular Mac and cheese with wheat noodles and cheddar cheese. And it comes in a gluten-free version, which is incredibly popular. And then w hen there's a d airy f ree and g luten f ree version of the Mac and cheese, u h, so it's

Rachel:

The Mac and cheese with, with kale and cauliflower. And then we have, anyway , we just, it's just , you picked a good ones , chili, Mac, and cheese.

Phil:

So, you know, you've been watching this space for a long time, as it relates to trends and consumers. Um, what , what was that aha moment that really said we should be organic. We should be vegan or vegetarian.

Andy:

Well, really it was an extension of our lifestyle. You know, I don't know if you ever read the story or remember it, but the whole company started because we were eating organic foods. A lot of them, one of our garden, living in California and , um, Rachel was pregnant with Amy and , uh , she got to a point in your pregnancy where she couldn't cook anymore. And she wanted me to make dinner and my eliminated ability to boil water. I went to a health food store and saw to see what was available on convenience foods. And I brought things home and they were, they were horrible and they weren't organic. And so that's where the idea really , uh , we thought there has to be other people like us that want to convenience meal, but want to eat healthy and money. Great tasting food too.

Rachel:

Yeah . So basically we ate vegetarian and there was nothing in the restaurants. Really. You get a baked potato or some pasta. So the alternatives, when you didn't feel like cooking were slim and we ate organic. So that's just the , these are just the who we were. We're not, we weren't, trend-setters looking at the marketing . Ooh . You know , this is the next trend, organic and vegetarian. It's just an extension of our own selves.

Phil:

So I know you're a private company. So I'm going to ask you about sales, but tell us, you know, how big is Amy's? You've got five or six plants now.

Andy:

We have four now and the fifth under construction about to start next month in Goshen, New York. But we have one in California, our initial one , or where we moved to. Um, one in Oregon, one in Idaho, we just opened one in San Jose, California , uh , to help us , um, we had a tremendous boost from COVID in terms of , uh , sales. And we just are struggling to catch up with a capacity demands. So yeah , the company we have about 3000 employees, and I guess everybody knows, I guess in gross sales, it's about $700 million now. And , um ,

Phil:

You mentioned Goshen and , and for those of our viewers and listeners that aren't familiar with, it that's Woodstock any , is that the reason that you're in Goshen?

Rachel:

No. And one of the people that we, yeah, everyone always talks about what stuck in the planet ,

Andy:

The people who helped us get in there on the city council actually , uh, has helped organize Woodstock into what's called Bethel Woods now, which is like a center there.

Phil:

So, max Yasgur's son, Sam Yasgur. Uh , when I was back in New York was my attorney. Um, and so on. So, you know, great family , uh, they , they really are. So you, you were recently named a top 50 brand , um , in the U S in the profit brand relevance index. What does that mean and why is it important?

Andy:

Well, to me, it's, it's , um, it's , um , just kind of amazing because we've never marketed the product we've never advertised, or we do some social media, but to be recognized as number 21 brand relevance to consumers, and number one in the food industry was kind of a , it felt really good to know that just something that comes from the heart that we're doing, as largely as a service , uh, can grow to that kind of , uh , prominence in the , as a brand.

Rachel:

And what was surprising is when we were talking to , um, Scott, who was very, I don't know what his position is there, but he, he said that usually they have a group of brands that are sort of expected, and then they always have some that are chosen and then they have a surprise. They have some surprises and you , they don't know because these are just customers that, that they're working with. They're not, I mean , consumers, they're not stores or, you know , just regular people. And we were one of the surprises and he said he was thrilled because he's eaten Amy's his whole life. And it's so he said it was so great to see that cause he knew about it. It was great to see that other people know about it.

Phil:

So it's important. Um , to note that in addition to organic vegan, clean ingredients, vegetarian, I would suggest that the reason that people keep on coming back myself included is the taste. Absolutely number one , that's that's number one. Um, and I just had , um, the , uh , butternut squash soup , um, the other day and some of the new frozen items. Um, and they're terrific. So talk to me about, you know, product development. How are you, how are you figuring out product development now that you're big?

Rachel:

Well, we do it the same way that we started, which is

Andy:

We taste at the same table. It's getting old.

Rachel:

How do we choose a product? It's, it's very organic process. So let's say we were in new ma in Sedona and we went to a restaurant and we tried this stuffed delicata squash. We loved it so much. So we met with the chef owner and we asked her if she would come in and develop some meals for us because she , she knows vegetables. She's really competent with sauces. And so she came and she developed some of our new meals. It was just a ,

Andy:

Well, the real difference is that from anyone can make them a meal good in the kitchen, but at Amy's , we, we, we won't stop scaling up and working on it and tell us as good as the original. And we do a lot of hand work people to our Amy's plant and say, this isn't a food manufacturing facility. This is a big restaurant. And the reason if it tastes good is because it's cooked just the way you would cook it at home and then frozen. It's not

Rachel:

No preservatives , no starches ,

Andy:

Mostly it's just, you know, we make rows , we marinade things overnight. We do things so that the product tastes authentic and great. And uh, the food industry in general, isn't set up that way.

Rachel:

Yeah. And there , we don't often sit here and say, okay, this is the , this is what our next product is going to be. It's usually something found it's . Um, when we travel around the world, we've find a recipe and we go, somebody makes something really good. We, I met a person from Africa and he's made some soup spoon us, East Africa, nobody's eaten, he's African suits . They're very different. They're delicious. He sent us the recipes and then we worked on it back and forth. And that'll be the next product that we're coming out with. It, it's a ,

Andy:

I don't think it's so much what we pick. It's the fact that they all taste great. Like you said,

Phil:

So, you know, you mentioned that during the pandemic , uh , sales went through the roof , uh, consumers wanting to buy , uh, more, more Amy's pizza and leave it in the freezer to be ready. Everybody knows that everybody around the table is going to love it. Uh, what happens to the food industry? I'm not talking about Amy's, but you know, the consumer trends post pandemic, what do we think is going to happen is e-commerce going to fall down again. Are people going to go back to eating Twinkies , uh , versus Amy's look into your crystal ball. Uh, Rachel, why don't you go first?

Rachel:

I think I was going to call you up the other day. I said, I'm going to call Phil and ask him what he thinks, what we're going to be like after the pandemic. And now you're asking us , um , personally, I've always had a feeling that once people tried Amy's they buy it again was, it was never, we didn't need to be on sale for people to buy Amy's. So the fact that so many new customers have found Amy's , um, this is just the personal part of looking into the crystal ball. I'm sure it will be, you know , last , I don't think we're going to be in the same amount of food, but I think that there's a big jump and if the product is good , um, I think they'll keep buying it. And as far as , um , e-commerce, I think people just the way people are liking working from home, I think it's going to grow tremendously.

Andy:

Yeah. The other reason that that people continue to eat convenience meals, is that more people, even when offices open up again , uh , we're feeling are in place. We'll work from home two to three days a week now. So that eating lunch, which is a big time where people will go out to restaurants instead, they'll still be eating Amy's , we'll definitely see a decline when the restaurants open up, hopefully, and everybody's happy, happy, and mingling and mingling and mixing again, but there'll be a longterm benefit to , to our, to the industry and to our foods.

Phil:

So I want to also congratulate you on achieving the B Corp certification. Congratulations, but let's look into the future. Um, I know a couple of years ago at this point, it might even be longer. Um, you decide to have an Amy's , uh , restaurant, a fast food restaurant. How is that going? What's the expansion of that? Or has the pandemic really shut that down?

Andy:

It does . One interesting story is that we all , we had , we have one success story. One failure from the pandemic success is we opened our first store in Rohnert park about five years ago. And when the pandemic yet sales dropped by 50%, it was a disaster. We focused on the drive-through part of the business and sales for 2020 were higher than 2019. Wow . And on that airport, unfortunately we opened a few months. We run a bit down , we get, and there's no money in the airport . So we're hoping to open , where are we opening Corda Madera, which is Marin County in the middle of the pandemic. And it's going very well. Um, and then we're opening in Roseville, California, this fall and thousand Oaks, California , uh , this coming fall early, the following year. So there , the sales are fantastic. It's , it's an amazing,

Rachel:

And people are very, the, one of the reasons the drive-through is such a success. And actually it's kind of the success of the Amy's brand. When we first started Amy's and we started making food that parents could feel , um , comfortable, and they feel that their kids are getting something good. We have handheld foods that, you know , their kids could heat up. When they came home from school, I received so many letters of gratitude that , that we were giving them something, they could feed their kids as a working mothers, as working mothers. So then the , um , drive through so many parents don't would never take their kids to drive throughs. And , and this was an alternative that they could do. And so that you'd see the kids going into the drive-through , there's just so excited they're running in and you know, they'd never had, some of them are , they don't eat dairy. So we have a dairy free milkshake, or because we, everything, you can get everything vegan, gluten-free regular with cheese. And , uh , what else? I think that's it. So everyone is taken care of and it's very successful. It's really fun.

Andy:

Yeah. It's a great atmosphere. Everybody's kind of safe.

Phil:

Yeah. So what's next? Um, you, you conquered frozen foods, you've conquered canned soups. You've conquered , uh, what I'm going to call fast food. Drive-throughs what's what's next for you guys and Amy?

Andy:

Well, I think the main focus right now is for us , uh , short-term is to catch up with supply and the drive will grow slowly and then it'll grow more quickly as the, as a game . So momentum and as the years go on , um, we have a great team there and all that beyond that international is , um, starting to be a focus we're doing very well in England with our soups where the number two grand in England. And , um, uh , there's a lot, a lot to do outside of that.

Rachel:

Well, one of the things I was thinking about what is our mission to provide , um, what is that mission statement? I was forgetting

Andy:

Delicious, convenient food for people that want to eat with us .

Rachel:

Yeah. Delicious and convenient food for people that want to eat well. And so I think it's just that we're going to continue to do more of the same. We're we're focusing a lot on the international meals are fantastic because every country has some really fantastic meal that translate into veganism, but vegan, it can be vegan or vegetarian. And so we're just feeding people. Our goal is just to feed people and to feed them healthy, tasty food, you know, it can't, it has to taste good. So I don't think we're going to go into different categories. You know , we have so many, we have the whole country to do drive-throughs,

Andy:

But you never know. I mean, the drive-thru wasn't our idea. It was our consumer's idea. Right . So maybe they'll come up with another direction for us. We listened to them.

Rachel:

Yeah. I read all the consumer letters. And

Phil:

That's , uh , you mentioned your success in the UK. Uh, if memory serves me, right. When Amy graduated college, you sent her over there to run, you know, the , the European group

Andy:

To learn it, to learn it. Yeah. Yeah. She did. She had a great time. She was there for a year. And , uh, then , uh, she came home and got married and , uh, had a son who's . My five-year-old turned about turned five grandson who was a wild, wild character and a lot of fun. And , uh, now that he's , um , but to start starting to be in school a little bit, she'll have more time to come back and help her .

Phil:

And , uh , and your grandson, you know, who's going to have the CEO title after his name in just what, five years, the way, the way you guys move. It

Andy:

Could be with knowing him

Phil:

Well, Rachel and Andy , um, it's always a pleasure. Uh , thank you for joining us today on Washington supermarket.

Andy:

Yes.

Rachel:

Thank you so much.

Andy:

Take care.