Survival Of The Freshest
July 1, 2006
Survival Of The Freshest
By Deborah Cassell
Private label manufacturer Richelieu Foods, Inc. is making a “Big Bang” with its line of certified organic pizzas and innovative variety of crusts and toppings, all of which are taking the Braintree, Mass.-based company straight to the top of the industry food chain.
Fresh from the oven, cold for breakfast or even reheated the next day, pizza is an international consumer favorite in this “Slice Age.” The meat-and-cheese-topped product has been tempting taste buds — and burning the roofs of mouths — since the first crust was tossed. Although there is evidence that an early version of pizza originated in Persia back in 6th Century B.C., most people credit the Italian people with the creation of the aromatic, tomato-based pie.
In America, pizza found a home in the aptly named pizza parlors and pizzerias that popped up first in New York and then throughout the United States. The piping hot pies went even more mainstream in 1957, when a frozen version appeared in grocery stores. At the time, frozen pizza still had room for improvement when it came to taste.
“When people look back 20 or 30 years and they think about what a frozen pizza was, they think about that sort of cardboard product,” says Vincent V. Fantegrossi, president and chief executive officer of private label pizza manufacturer Richelieu Foods, Inc.
But that was then, and this is now. Yesterday’s tasteless frozen product “does not exist anymore,” Fantegrossi asserts. “There is so much innovation, so much variation. … There’s really a pizza for anybody.”
Indeed, frozen pizza has evolved into a quick and affordable lunch, dinner and even breakfast option for kids and adults alike. Modern-day pies from branded and private label producers feature an assortment of crusts — from self-rising to deep dish — and come in multiple shapes and sizes. Today’s diverse and tasty toppings range from traditional pepperoni and sausage to sandwich-inspired bacon, lettuce and tomato to veggie lovers’ gourmet spinach and feta.
In fact, the category has become so competitive that pizza producers find themselves facing off not just against their rivals in supermarket freezer cases, but the high-priced pies served by restaurants. This increased competition has led to even higher-quality product offerings, influencing time-crunched and convenience-craving Americans to eschew pizza parlors and delivery charges in favor of store-bought selections that can be baked at home for a fraction of the cost … and without the long wait.
“When you compare what you spent for a frozen pizza, bring it home, put it in the oven, and in 25 minutes you have a beautiful pizza, why go to a pizzeria?” Fantegrossi asks.
Enter Richelieu. The Braintree, Mass-based manufacturer — which also offers deli salads, meal solutions, desserts, bagel spreads, salad dressings, salsa, sauces, dips, marinades, and canned fruits and vegetables — has been producing frozen pizza since 1978, when its Beaver Dam, Wis., manufacturing facility served as a Jewel store commissary.
About a decade ago, frozen pizza took on yet another new characteristic with the invention of the self-rising crust, which forever changed the category.
“Our volume really began to pick up in ’96 and ’97 with the advent of the self-rising pizza,” says Neil Whitman, vice president of research and development, quality assurance. Richelieu’s pizza crusts now include thin, extra thin, brick oven-style, 8- by 8-in.-square Sicilian-style and self-rising. All are baked at the company’s plant in Washington Court House, Ohio, and shipped fresh daily to the Beaver Dam facility, where the pizzas are topped, frozen and packaged. (See “Double Play” for details.)
As if that weren’t enough, two to three years ago, Richelieu followed its instincts to create an all-organic pizza line — a first in the private label sector, according to Fantegrossi. All three of Richelieu’s manufacturing facilities — a third plant is located in Grundy Center, Iowa — now are certified organic by the United States Department of Agriculture.
Although organic foods have been an area of interest since the ‘80s, “organic” only recently became an industry buzzword, thanks to increased consumer demand, as well as one retailer’s decision to double the number of organic stock-keeping units on its shelves.
And even though organic still is a very small part of the total pizza category, “it continues to grow double digits every year,” says Anthony P. Raucci, senior vice president of sales for Richelieu. It was with this knowledge in mind that Richelieu unveiled a selection of organic offerings, from pizza to salad dressing.
“Organics in general has been growing at a 20% pace since the mid-1980s,” Fantegrossi says. Even though organics probably makes up just 2.5% of total food sales in the United States today, it’s a rapidly growing category, he adds.
“In the past year, most retailers have determined through the success of Whole Foods that they should have more of an organic presence than they’ve had,” Fantegrossi continues. Now that Wal-Mart has announced its plans to launch 400 organic items, “interest in organics has just multiplied,” he adds.
However, producing a successful organic product presents some challenges.
It’s taken Richelieu two years to identify the right suppliers, those that promote “the highest quality organic materials,” says company chairman Henk Hartong.
“We worked hard to get all three of our plants organically certified and, more importantly, establish solid lines of organic supply that would be consistent and available throughout the year,” Fantegrossi adds. “Maintaining an organic supply chain is really the whole ball game in organics today. … It’s really only been the last year that we’ve been really solid and able to really rely on those ingredients coming in.”
Now that Richelieu has the organic formula down, more innovative products — such as the manufacturer’s branded line — are sure to follow.
Brand of Plenty
Few consumers, if any, recall the name of that first frozen pizza product. But today, brands play an important role in building supermarket sales. In order to provide retailers with an exclusive in-store product, Richelieu developed its first branded product, Chef Antonio, which today is available in 20 stock keeping units.
Chef Antonio was designed to accommodate “regional supermarket chains that do not have the critical mass to support their own private label, but have a desire to have a control label that sets them apart from the competitors carrying national brands,” Fantegrossi explains.
That said, Chef Antonio only makes up about 5% of Richelieu’s business.
“While we are thrilled with the success of our Chef Antonio brand, we are primarily a private label company,” Fantegrossi says.
Richelieu takes great pride in being a private label manufacturer, which allows it to experiment with new ideas and signature products under store brands, perhaps more so than national brands can.
“Because we are primarily a private label, contract packing company, we are required to have a manufacturing configuration that has a tremendous amount of flexibility and that can accommodate many different products and multiple changeovers a day,” Fantegrossi says. “Flexibility is a key of our business.”
The Future of the Freezer Case
Although traditional cheese, pepperoni, sausage and supreme remain top-selling varieties, pizza makers must remain flexible by looking to consumer market trends for more adventurous and distinctive flavor profiles. Just as national brands have ample offerings for all flavor preferences, so must private label manufacturers expand their horizons in order to compete.
As a means of expanding its R&D offerings, Richelieu works with a chef services organization composed of former high-end restaurant chefs for help in formulating ideas, concepts and products, and in identifying taste and nutrition trends, such as gourmet flavors and seasonings and gluten-free products, a current area of interest for diabetic consumers, according to Whitman.
“We’re looking at what’s on-trend in the way of either flavors or health and wellness,” Whitman says. “Obviously, the whole wheat crust and multigrain crust are in line with the healthy market.”
As for taste profiles, Margherita is one of the biggest flavors on the market right now, Whitman notes. “It’s been very popular within the last couple of years,” he says.
However, Richelieu also is beginning to look at more unique and complex toppings, such as a steak and bleu cheese or steak and peppers. A barbecue “drizzle,” as opposed to a barbecue sauce, also is in the works. The company is considering a half-moon eggplant topping, as well. And it recently started producing a pizza with a large-slice peppered ham topping.
Product innovation and experimentation obviously creates major challenges for Richelieu’s operations, Whitman explains. “But it’s something where we have to push and see if we can do it or not, explore it to see if it makes sense and try to make it happen,” he says.
The Evolution Continues
To accommodate the changing tastes of today’s consumers, Richelieu is constantly looking to expand and grow its product offerings.
“Right now, we believe that we are well-positioned in our respective categories — dressings and sauces, pizzas and meal solutions,” Fantegrossi says. “We are pleased to see that we have good growth and available capacity in those categories.”
Although the Beaver Dam plant has ample manufacturing capacity right now, Richelieu currently is increasing the capacity for warehousing and production at its Iowa plant. And the company always is looking for acquisition opportunities that fit in with its manufacturing strategy.
“Our interest over the next few years is to continue to grow this in a controlled and profitable fashion,” Fantegrossi says. “We’re not looking to get into new businesses, but if it’s a natural extension of what we’re doing, we’re interested.”
“We don’t believe that we should be the steady-Eddie company that just produces more self-rising, more thin-crust pizza,” Fantegrossi says. “We’re always trying to push the envelope. We experiment with a lot of items. At the end of the day, only a small percentage go to market, but that’s the nature of our R&D function.”
Clearly, the executives at Richelieu recognize the need to adapt to today’s ever-evolving marketplace. For pizza manufacturers, survival is dependant on producing the freshest-tasting frozen product possible, from buttery crust to tomatoey top. SF&WB
At A Glance
Company: Richelieu Foods, Inc.
Headquarters: Braintree, Mass.
Plants: Beaver Dam, Wis.; Washington Court House, Ohio; Grundy Center, Iowa
Annual Sales: $125 million
No. of Employees: 525
Products: Super-premium, premium and value pizzas; specialty and bulk salads; meal solutions; desserts; bagel spreads; salad dressings, salsa, sauces, dips and marinades; and canned fruits and vegetables
Brands: Mostly private label, but also offers the following brands: Chef Antonio (pizza), Grocer’s Garden (dressings, sauces and salsa) and Willow Farms (deli products)
Distribution: National, club stores and natural food retailers
Web site: www.richelieufoods.com
Chairman: Henk Hartong
President & CEO: Vincent V. Fantegrossi
Sr. VP of Sales: Anthony Raucci
VP of Sales: Philip H. Scolley
General Manager: James N. Campbell
VP of Research & Develop., Quality Assurance: Neil Whitman
VP of Mfg., Pizza & Deli: Colin Swift
VP of Mfg., Dressings & Sauces: Walt Grineski
The Pizza Challenge
On Fridays, Richelieu Foods, Inc. team members at its headquarters in Braintree, Mass., visit the stores that carry its product, purchase several pizzas, bring them back to the office and eat them as if they are ordinary shoppers. The plants go through a similar process during the week in their respective areas. Through this weekly “pizza party,” Richelieu can walk in the shoes of its consumers.
The Frozen Food Chain of Command
Richelieu Foods, Inc. relies on its strengths — product innovation and sales — to succeed in the frozen pizza biz. Its secret weapons: a strong R&D department and sales staff.
Led by Neil Whitman, vice president of research and development, quality assurance, Richelieu’s R&D team thinks outside of the box, literally, in creating new pizza flavor profiles.
“Every time I come up with some kind of idea, Whitman finds a way to get it done, whether it’s an extra-thin crust pizza or organics,” says Vincent Fantegrossi, president and chief executive officer. “I think Whitman knows as much about making frozen pizza as anyone in the United States, and I don’t think that’s an exaggeration.”
However, without its dynamic sales duo, Richelieu would be order-less.
“We have a really solid sales team, with regional directors of sales across the United States and two VPs of sales,” Fantegrossi says, referring to Philip H. Scolley, vice president of sales, and Anthony P. Raucci, senior vice president of sales.
Even Richelieu chairman Henk Hartong is involved in the sales side of the business.
Management at the Braintree-Mass.-based company is very hands-on, Hartong says. “We’re not making decisions from an ivory tower,” he asserts. “People running the business are really running the business. Everyone is actively selling. I’m chairman of the company, and I still manage a few customer relations.”
Evolution of Pizza
6th Century B.C.
Persia: The first “pizza” is created
Late 19th Century
Naples, Italy: Pizza is sold in the streets
Richelieu is founded
Frozen pizza appears in American grocery stores
Richelieu starts making pizza as Jewel store commissary
The self-rising crust is popularized
Richelieu unveils its Chef Antonio brand
Richelieu develops the first private label organic pizza line