Mrs. Gerry’s has long been known in the Midwest for making high-quality products — specifically salads — that offered consistent taste and reliability. The Albert Lea. MN-based company started in 1973 by producing potato salads and other salads in a 1,100-square-foot space.
The company expanded multiple times over the next few decades before the addition of side dishes spurred a major growth in the mid-2000s. That growth led to a dilemma just a few years ago.
“We wanted to go after some of the larger national foodservice accounts,” says Mrs. Gerry’s CEO Chad Vogt. “There’s not a lot of capacity in our industry for sides, so we decided we wanted to try to fill in those gaps.”
That meant additional production space needed to be in the works.
Mrs. Gerry’s was at the point where its production of the side dishes was outgrowing its square-footage. New space was needed regardless, but a call had to be made.
“We were at a point with our side dishes that we were able to make them in our existing plant and we were getting to the point where capacity was an issue for us,” says Brenda Donahe-Stevens, director of sales and marketing for the company. “Our consideration needed to be: do we add on just enough to take care of our capacity issues, or do we grow this even more to help out others in the industry?”
The result was a new 93,600 square feet of production space that was completed in the fall of 2015. The addition houses the production of side dishes like mashed potatoes, pasta products, gravies and others.
“We’re using the same processes, now we just have newer equipment and technologies,” says Vogt. “It gives us the same quality product we’ve always had with the capability to make even more. We’re looking at mixtures of all our products to see how else we can utilize our equipment.”
The company worked with some key suppliers for its new space — Idaho Steel for process lines, RMF for refrigeration, Multi-Conveyor for conveying systems, and Phelps Industries for truck dumps.
“We’re currently in the midst of bringing in the new technologies and equipment to be able to run at higher volumes.” Vogt says.
Location, location, location
The new facility, along with the rest of Mrs. Gerry’s 200,000 square feet of production space and its 201 employees, sits less than two miles from the intersection of Interstates 35 and 90 in southern Minnesota, about 12 miles north of the Iowa border.
This prime real estate is big for two reasons: logistics and farming.
The crossing of two interstates obviously lends itself to quickly and easily getting Mrs. Gerry’s products on the road and on their way to retailers and has undoubtedly helped the company transition to a nation-wide operation.
But the company also sits very near some prime potato-growing soil, which leads to the claim that 90 percent of all Mrs. Gerry’s potato salad is made with local potatoes.
“Fifteen miles from here, we’ve got some of the most fertile soil in the Midwest for growing potatoes,” Vogt says. “It’s a swamp that dried up and created a very dense, peat-type soil that holds moisture and is great for growing a potato.”
Throughout the company’s lifetime, it has worked with the same farmer for its potato supply, highlighting the importance of strong relationships with suppliers. “Over the last 43 years, we’ve basically had the same grower and he understands our needs and has been able to grow with us and accommodate us in areas of storage,” Vogt says.
This means that when the company’s three busiest months hit — April, May and June — it no longer has to rely on West Coast growers for its additional potato needs. The local supplier added extensive storage with temperature and humidity control and is able to provide enough to meet Mrs. Gerry’s demand.
Mrs. Gerry’s has branched out from its 13-state Midwest area and the company’s products can now be found across the country.
“Not only is our product getting out there, but our name is getting out there,” Donahe-Stevens says. “People are finally hearing our name and seeing what we stand for. We’re getting requests, asking where people can find our products in California, on the East Coast, Florida, etc.”
Part of this growth began nine years ago, when Mrs. Gerry’s added side dishes to its core salad offerings. After 30 years of being knows primarily as a salad manufacturer, the company was now producing premium mashed potatoes, macaroni and cheese, gravies and more.
“That kind of helped us set our seasonality, especially in the Midwest,” Donahe-Stevens says. Salads sold well from May until September, but once the weather began to get colder, sales would drop and the company would struggle through the winter months. “Now, those side dishes take over and they go well. What we’ve learned is they sell well all year long. You’d think the hot side dishes would fall off in the summer months, but they don’t.”
Of course, with a larger distribution area comes additional challenges, one of the biggest being logistics, especially when it comes to cost. If a customer’s order is below a certain threshold, Mrs. Gerry’s must absorb the rising LTL (less than truckload) shipping costs. “LTL loads can get very expensive and managing those fresh costs can be a challenge at times,” Donahe-Stevens says.
Obviously, the more product on the truck, the lower the per-pound shipping cost. “If a customer can order both our side dishes and our salads, we normally hit that higher volume that warrants shipping that isn’t as costly,” she says. “We have the carriers that our able to do any of it, it’s just that at the smaller volumes, the cost of the freight is much higher.”
Mrs. Gerry’s uses batch processes to produce its salads, relying on longtime employees and their accumulated knowledge to maintain the consistency that has helped the company cultivate a loyal consumer base.
Although the batch recipes are specific, the company produces more than 35 million pounds of product every year. That means a monumental amount of produce is entering the company’s facilities each day.
“Produce can vary; It can be more moist or less at times,” Donahe-Stevens says. “Truly, beyond our great recipes we have, it’s the great personnel we have on the line watching to make sure the product looks the same every day.”
In addition, the previous day’s products are routinely brought into product testing, where employees are able to determine that everything looks and tastes the way it should.
Gauging consumer demands
Donahe-Stevens says Mrs. Gerry’s adds anywhere from five to eight new products every year. At this year’s IDDBA Dairy-Deli-Bake show in Houston last month, the company was showing off five new offerings — Sweet Pepper Cole Slaw, Smoke Gouda Pasta, Sweet Bacon Tortellini, Honey Ginger Pasta and an updated Country Style Gravy.
“For 43 years we have made very high-quality, consistent products that are great-tasting,” Donahe-Stevens says. “We have outstanding customer service, a great fill rate and I think we do an excellent job of introducing new products.”
The company also keeps its finger on the pulse of consumer trends, including the much-discussed clean label movement, which can prove problematic for salad manufacturing. “We understand the need for that, but with the types of products we manufacture, that can be very difficult,” she says. “We’re trying to do that with our side dishes, but it’s quite hard to achieve it with salads.”
On top of that, the company must weigh what the consumer says it wants and what the consumer actually purchases from supermarket shelves. “To be honest, what we have found is that those aren’t always the same thing,” she says. “What consumers are saying they want is a cleaner label, non-mayo-based products, more grains and ethnic flavors.”
While balancing those needs, Mrs. Gerry’s also introduces products that are extensions of its largest categories, which Donahe-Stevens says oftentimes seem to be more successful than other specialty products.
“We are at a full understanding that you need all of those to satisfy consumer needs,” she says.