Riding a Sugar High
Raisinets, M&Ms, chocolate strawberries. What do all these delicious treats have in common? They are part of a well-established, but relatively unknown category: chocolate-covered snacks. Realizing that none of the major confectionary brands owned this niche was a lightbulb moment for Brad Van Dam, CEO of Hollister, CA-based Marich Premium Chocolates.
A producer of premium chocolate-covered goods and other sweets, Marich’s products are sold to retailers including Whole Foods, specialty cookware shops and major candy companies. Since inheriting the business from his father in 1997, Brad has led the company to tremendous new highs, realizing over 700% growth in sales in that time.
“It happened completely by accident,” Brad says of becoming CEO. He took pause from pursuing an engineering degree to help out with the family business. Though his intention was never to make a career out of candy, over time he learned the process, holding almost every role within the business – from product to purchasing to operations and finally, sales. “My father and I argued for six months about whether I should try sales. He finally broke me down,” says Brad.
Sweetening the Brand
In 2011, Brad started to think about how Marich could compete in a crowded market. “Our goal was to double the business by 2017,” says Brad. Brad and his team engaged in a formal study of the Marich brand. “We had a bulleted vision of what we wanted to look like in five years,” he says. Going on year four, Brad says everything is right where it needs to be.
This makeover included an audit and relaunch of just about everything from logos, to packaging, catalogues and trade show presence. “Our category has a stigma,” says Brad. “It’s fragmented and ubiquitous at the same time. If I say ‘chocolate bars’, you just thought of a couple names. If I say ‘chocolate-covered products’, radio silence. It’s part of Godiva’s and Hershey’s lines, but nobody owns it as a category. I wanted that.”
“Nobody owned this category. I wanted that.”
The project called for due diligence on the company’s food safety standards, distribution strategy, pricing and operations. “It’s been incredible,” says Brad.
Brad spoke of the inherent values of his company and how that helped inform the outward transformation. In the last decade, Marich has made a commitment to removing artificial ingredients from their products. According to Brad, they said “let’s do the right thing here.”
The biggest challenge was how to create a product that was still rich in color and flavor, while still natural. “There is a very tiny sliver of people that will buy stale-looking, dull candies just because they are natural,” explained Brad.
Another stake in the ground for Brad and his company was the use of fair-trade cocoa beans in the production of their chocolate. Brad explains the reason behind this ties back to a sense of responsibility to its customers, employees and suppliers. After all, Brad reminds us, “it’s a family business.” How Marich sources cocoa is where Brad felt they could have the biggest impact. “There’s a history here,” he says. “[Our brand] needs to help make it fair and environmentally sustainable.”
Everything Marich has done on the brand side has been in an effort to become the masters of their own destiny. Speaking of the advantages brand-centric companies have, Brad points to higher growth rates and stability. As it turns out, the brand refresh has helped Marich bring a balance to their revenue and increase the value of the company. “And by the way,” Brad reflects. “Who doesn’t want to build a brand? It’s fun.”
More than Just One Willy Wonka
Brad couldn’t get through a discussion on the branding project without a nod to his growing team. Over the last four years, Marich expanded its sales force, brought on a CFO, a CMO, and revamped its supply chain. “HR is next,” says Brad.
“‘Culture’ and ‘values’ are thrown around so much, they become trite and overused.” Brad knew he needed to focus on finding the meaning behind these words when the company’s tradition of celebrating Halloween started to fade. “Halloween is the largest holiday for our industry,” he says. It got to a point where only two of Marich’s employees were dressing up. “It seems like a weird indicator,” says Brad. “But people need to be willing to bring their full selves to work, be vulnerable and be a little goofy.”
Brad describes Marich as an informal environment with a strong respect for the fact that its employees have a life outside of work. Even so, the company seems to attract committed and professional talent. “I’ve had people in my office in tears either because they are so happy at work or because they’ve made a mistake and disappointed the customer. People care here. I’m really proud of it,” he says.
Definition of a CEO
Brad’s secret sauce to leadership has always been working with people who know more and can see further than he can. Throughout his 30 years as CEO, he’s sought out mentors and educational experiences to help better himself. Taking advantage of the company’s proximity to Silicon Valley, he’s sought out the guidance of industry leaders and visionaries.
One of the things Brad is constantly getting guidance on is how to fuse the strategy and direction of the business throughout the entire company. He wants it so that every individual in the business understands where they’re going and why and how they can contribute. “You might say, what can a manufacturer do to help sales?” says Brad. “You make a great product, you make it better than anyone else, you make it on time. We sell it, we ship it.”
His current mentor, a former IBM executive with plenty of experience buying, selling and improving companies, seems to have taken Brad on as a project. “I recently asked him, what’s my job?” recounts Brad. “He summed it up very simply. ‘Everyone you interact with, whether it’s a supplier, employee, customer, should walk away a better person for having interacted with your business.” Today, that’s how Brad defines his role as CEO.