The Small Business Professor

In a Pickle

Family businesses, like pickles, come in all varieties. In Pat Hunn’s case, his Dad purchased a brand and a recipe for a specialty pickle about 50 years ago, near Dallas, TX. Like many kids with parental entrepreneurs, Pat wasn’t interested in the food business; yet, family dynamics affect choices and life decisions. For Hunn, letting his Dad down wasn’t an option he could live with, so after graduation from Baylor University in 1979, Hunn joined the family business.

At first, Hunn was miserable; his Dad was too busy for training, so Hunn just watched and listened, his desk side-by-side with Dad’s. Eventually, the entrepreneurial spirit took hold and he began to develop his own relationships with customers, agents, and brokers. By the third year, Hunn was running the company, sales had tripled to 120,000 cases annually, and his Dad started taking more time off.

During the 80’s they experienced tremendous growth, selling 450,000 cases per year by 1989. A chance conversation with a Vlasic executive set a buy-out in motion and Hunn was offered a job with Vlasic’s parent company, Campbell’s, where he worked for 11 years, concentrating for the final eight years specifically on Wal-Mart. By the late 90’s, the resulting chaos of Vlassic’s corporate spin-off so changed Pat’s attitude toward big business, that he decided to become an entrepreneur again.

Early in 2002, Hunn put together a plan to re-establish the kind of company he and his Dad had sold to Vlassic; utilizing unique recipes, other manufacturers’ line time to produce, and his own business savvy to build the brand. He spent six months working with food technologists to help create the best tasting pickle possible. He decided to call it Hunn’s Private Stock, to build upon the idea that this was an exclusive, gourmet pickle.

Based on the relationships he had built over the years, Wal-Mart committed to bringing on his new line in August, but they weren’t sure how many cases or exactly when the product would hit the stores. Because the pickle packing season ends in October, Hunn personally financed several hundred thousand cases in anticipation of Wal-Mart’s needs.

Hunn tried to keep his cool as he waited, month after month, for the Wal-Mart paperwork – many jar-packed pickles have a one year expiration date and time was ticking away. Finally, he received his first order, but the product wasn’t distributed until July, almost nine months after the pickles were packed. Since the brand was new to Wal-Mart customers, sales were slow, and the expiration date problem began to loom ever larger.

In an effort to survive, Hunn began to sell the rest of his inventory to close-out retailers, losing money on every case and angering Wal-Mart executives. Since he had financed the production run himself, taking back Wal-Mart’s inventory wasn’t an option, so he requested a meeting to work things out. As he left the meeting reeling, Hunn took the advice of a Wal-Mart executive, “Stop trying to out Vlasic, Vlasic. Take your upscale product and find your own niche – be something special and you’ll be successful.”

Hunn thought about it and realized that traditional channels of distribution were not right for this line. He needed to appeal to gourmet and specialty retailers, repositioning and restructuring the business to exclusive clientele. It has been two hard fought years since the transformation and Hunn’s biggest challenge is still to get people to try the product, but there is light at the end of the tunnel. Chili Pepper Magazine, which focuses on hot and spicy foods invited Hunn to participate in their annual food show, Zest Fest, where several of Hunn’s Private Stock “Hot and Spicy” varieties won 1st place in category awards as Best Condiment and their “Bread and Butter” Pickles won 2nd place in the People’s Choice awards in the broader category of “Snacks”.

The Small Business Professors' Words of Wisdom

Even with 20 years of experience and a good business model, Pat Hunn learned a hard lesson. But, his story has much to offer many entrepreneurs. Risk taking is a fact of life for entrepreneurs, but perseverance through hard times and learning from your mistakes is the key. Working for someone else can broaden your horizons, but running family business leverages knowledge you don’t even realize you have. Pat Hunn’s son recently graduated from Baylor just like Dad, and he’s looking forward to the day when his son is in a pickle too.

Case History: www.focusfoods,com

Entrepreneur’s Strategy: Reposition the product line to a different market.

Could This Work For Me? If your product sales are declining, repositioning may be an option. Try to transition if possible, to decrease financial exposure.