DogonnitIn 1996, in an ardent moment, Gerry Shreiber told a couple hundred of his employees that he wanted J&J Snack Foods to be a $1 billion company in 10 years. Back then, the Pennsauken, N.J., business had annual sales of $186 million, and Shreiber figured the company could reach that goal with 15% compound annual growth.
Then someone corrected him, noting that such a growth rate would only take the company to $800 million annually.
“I said, ‘Well, if we get to that part, I’ll think of something,’” he recalls.
Today, Shreiber calls that goal a “moon shot statement” that was meant to motivate his troops. Although the company has yet to reach that lofty goal, J&J has done well. In fact, it’s more than tripled annual sales from 13 years ago. Additionally, over the long haul, it has had 37 years of sales growth and made more than 30 acquisitions since Shreiber purchased the tiny, money-losing pretzel company at a bankruptcy auction.
“Rather than get to that magic sales figure, which we could have, and maybe taken some risk with acquisitions, I think the emphasis has been on building shareholder value, growing our business, and we have zero debt,” he says.
During the past two years, J&J has been quiet on the acquisition front. That’s not because the company isn’t looking. It’s just that the multiples of selling are absolutely ridiculous, Shreiber notes, although not everyone agrees with him.
For example, during a recent Wall Street presentation, he notes, a portfolio manager complained about J&J having no debt and suggested that the company wasn’t making a good return on equity.
“I said, ‘I’m not understanding this right, but I never heard of a company going out of business because they had too much cash. I heard of companies going out of business because they had too much debt.' Our management style has changed over the years as we have gotten more mature or more experienced and as we have gotten better organizational management within the company,’” he says. “Way in back of the room, somebody started to clap, and the whole room built into a crescendo.”
Because of its sound management and healthy finances, as well as its continued growth, leadership and innovation in the baking industry, we named J&J our 2009 Wholesale Baker of the Year. It’s not just a soft pretzel and frozen beverage company, although it’s best known for those products. If you take the sales of all if its bakery-related products, which range from churros and funnel cakes to cookies, croissants, bagels, bread and other conventional products, J&J’s bakery business tops around $400 million a year.
In addition to its burgeoning product portfolio, J&J is diversified in the channels it serves. The company supplies products from sports arenas and theme parks with tens of thousands of its heated SuperPretzel display warmers to restaurants, school lunch programs, fast food chains, in-store bakeries and, of course, the freezer case.
Then there are those other variables such as leadership in the community. Through the Gerald B. Shreiber Foundation, J&J’s chief executive contributes to everything from ALS Association and the Komen Foundation to a host of animal rescue societies, animal orphanages and even a pet therapy program at The Children’s Hospital of Philadelphia.
A well-known animal lover, Shreiber currently has five dogs that he’s rescued from animal shelters. They are currently living on his 100-acre farm and horse corral in New Jersey. It’s nothing new. For years, one lucky pooch has joined him at work. Currently, Teddy, a German Shepherd, is the chosen one. Is it any surprise that J&J’s newest products are Dogsters ice cream-style treats for dogs and Blue Dog Bakery low-fat dog treats that come in 100-calorie packs?
Shreiber is confident that J&J eventually will become a $1 billion company. Until then, dogonnit, he’ll just have to settle for what is priceless in his life.
Dan Malovany, editor