Remember Grandma’s secret recipe for hot and spicy spaghetti sauce? Year after year, you would sit and watch her add “a dash of this” and “a pinch of that,” wondering when she would realize that it was good enough to sell. But she never did. Michele Hoskins, owner of Michele Foods Inc. in Calumet City, Illinois, recalls watching her own grandmother serve up a family favorite that reaches back four generations and today has become the flagship product for her $5.5 million premium syrup manufacturing company. “When my grandmother was alive, we used to go to her house every Sunday for breakfast to eat her honey creme syrup over waffles and pancakes,” says Hoskins, whose great-great-grandmother, a slave from Arkansas, developed the recipe in the late 1800s. “Selling everything but the children,” Hoskins raised $100,000 in start-up capital to launch her business with Michele’s Honey Creme Syrup in 1984. The company has since grown to include two additional syrups (Michele’s Butter Pecan and Maple Creme Syrups), a $3.5 million food service contract with Denny’s and a product development project with America’s Favorite Chicken, owners of Popeyes and Churchs franchises.
Hoskins, 49, is not alone when it comes to turning a prized family recipe into a successful food business. Her products share shelf space with thousands of new items ranging from salad dressings to gourmet barbecue sauces to soul food in a can. “Each year, there is a new product,” says Brian Todd, senior vice president of member services for the American Institute of Food Distribution in Fair Lawn, New Jersey. Last year alone, there were 13,266 new food products introduced and the top 10 generated over $2 billion in sales.
According to industry experts, total food expenditures for 1996 totaled about $686 billion. While there’s little information to show how much of this revenue has come from home recipes, a stroll down any grocery store aisle indicates that Mrs. Paul and Sara Lee aren’t the only ones stirring up success. Wally Amos did it in the 1970s with a recipe for homemade chocolate chip cookies that became the Famous Amos Cookie Co. And Bill Williams (president of BE’s 1996 Emerging Company of the Year) continues to carve a niche in the soul food arena with his $10 million operation, Glory Foods Inc. But these successes have not been without the proper planning, research and financing required to take a recipe from the stovetop to the store shelf.
Before building your food empire, first study your market and determine whether your product is something that the general public will want. Also, canvas supermarkets and gourmet shops for similar products because you don’t want to duplicate a hundred other items. “It would be very hard to get a new cookie on the shelf today because you have too much competition,” says Hoskins. “Make sure you have a niche.”
Keep in mind that it takes more than just a few mixing bowls, measuring cups and a kitchen stove to start a successful food business. Depending on