This article originally appeared in the October print issue of Food Manufacturing.
Dan Klock is not your typical food manufacturer. In fact, with a degree in economics and a background as an investment banker, Klock is probably the last person you’d imagine owning a food facility. But that’s precisely what he is doing today — helping those who created a food item, outgrew a home operation and are now looking to upscale.
As CEO of the mid-size Portland, Oregon contract manufacturer Bridgetown Natural Foods, Klock and his wife, Kelly, first invested in the company from afar.
The Bridge to Bridgetown
In 2002, Kelly Klock helped co-found organic granola company Bear Naked out of Connecticut. She and a partner grew the company until 2007, when they sold it to Kashi — a Kellogg’s subsidiary.
“One of the things I learned while the business grew was there really aren’t a lot of food manufacturing options for people who own quickly growing natural, organic food brands,” Dan Klock said.
According to Dan Klock, most of the manufacturing companies in the U.S are either really big or ma and pa multigenerational businesses.
“The push towards food safety would make it harder for those small companies to really measure up to what big retailers wanted,” he added.
So in 2011, the husband and wife team upped their equity investment in the operation and took over the plant. When the couple took over the company, there were only about 35 employees and it was “losing money quickly,” according to Dan Klock.
As the owners of Bridgetown Natural Foods, the Klocks credit their interest in building a manufacturing plant to being foodies.
The two chose Portland because of its great food reputation and the opportunity it presented them.
“There had been a couple of businesses doing what we do that had been acquired, so there was an opportunity on the West Coast to do this,” Dan Klock said. “A lot of people in Portland are really into their food and there’s a lot of innovation that comes out of that.”
Bridgetown custom-makes organic energy and snack bars and granola on contract for other companies. The company opened in May 2010, priding itself on handling allergens through its commitment to producing gluten-free, organic and kosher products.
While you won’t see the Bridgetown name on any products, a large handful of them can be found at Whole Foods and New Seasons grocery stores.
Rising With the Times
Today, Bridgetown employs more than 300 workers and produces 12 to 15 times the amount of food it did three years ago.
Since its beginnings, the company has successfully added a new production line each year. This has helped drastically increase Bridgetown’s production numbers.
“This has been a great success for a small and growing company to add capabilities every year,” Dan Klock said. The highly automated 110,000 square-foot plant has plans to expand another 20,000 square-feet by January 2015.
Bridgetown recently added a fourth production line to continue its growth. The new $5 million production line was just added last year and is capable of producing one million bars a day. The line runs 24 hours a day, seven days a week — unlike the other three that run five or six days a week.
In an average month, Bridgetown produces one million pounds of granola, 20 million cold-form bars and between eight to 10 million baked bars.
While the business has grown and prospered along with the customers, it presents a challenge to Bridgetown.“We’ve grown over 100 percent per year for the past four years consecutively,” Dan Klock said. “That puts a lot of strain on our systems and our people.”
Dan Klock said Bridgetown hopes to focus on keeping the employees engaged through training and involvement in the company’s mission.
“You just have to make sure you get out ahead of it. It’s a big challenge for us, but the goal has always been the same,” he said.
“It’s always really been about the people and the food.”
The aroma coming from Bridgetown is more than just granola cooking in the ovens. That’s the smell of sweet success. The bakery occupies a fast-rising manufacturing niche. At any given time, the facility is working on 10-15 brands.
The process for brands to get started with Bridgetown may seem lengthy, but the company has the potential customers’ best interests in mind. Once the business development manager surveys the reasons for wanting to start a brand, she’ll do a comprehensive intake before bringing it to Dan and Kelly Klock. Bridgetown typically tries to launch a new product within 12 weeks.
In the marketplace, Klock said he sees Bridgetown as being right in the middle.
“Most of the brands we work with still have the original entrepreneur intact,” Klock said. “But the majority are also over $50 million in sales. So, they haven’t transcended to the bigger corporate company — they still have the founder at the steering wheel — but they’ve been successful with what they’re doing.”
Nearly all of what Bridgetown makes comes from products that originated internally. The company will help its customers with one or two products to diversify or help find a national market, but it can’t whisk up a “wannabe” from the home kitchen to the grocery store.
Bridgetown’s Research and Development team will help customers develop an idea from scratch or play off an existing formula already working for them. Kelly Klock said the true innovation is a main reason customers like to work with Bridgetown.
“It’s really a nice resource that we offer,” she said. “I don’t think other contract manufacturers put a lot of resources out there for their customers.”
Bridgetown is built around everything the couple had once looked for in a trusted contract manufacturer: top notch R&D capabilities and validity through food certifications.
What clients find in Bridgetown is a flexible company that can mass-produce and package the product under the customer’s label, and offer organic, gluten-free, kosher and international Safe Quality Food certification. Achieving the latter opens potential markets such as Target and Wal-Mart, should clients seek to reach that size.
Cooking Up Certifications
The company boasts its all-natural scene with Organic, Gluten-Free and Kosher certificates. Dan Klock said the brands they work with are largely sales- and marketing-driven organizations, so having the ability to differentiate around the quality of their products is an important aspect.
“The natural foods industry is something Kelly and I believe in,” he said. “For us, this is an opportunity to get in the right customers.”
A handful of Bridgetown’s ingredients are grown right there in the Northwest. Because the company uses a lot of locally grown fruit, nuts and seeds in its products, it has earned a good reputation in the marketplace.
Kelly Klock said the company receives a lot of phone calls from potential customers looking to partner with Bridgetown. Their sizes range from “tiny, tiny to big.” She believes the certificates have helped build the company’s reputation.
“We’re in a position to be selective in who we partner with,” Kelly Klock said. “We can really do our research and decide what brands we want to work with.”
From a trends standpoint, Bridgetown is right where it needs to be. In general, consumers are turning to products that are less processed. The company tends to steer clear of highly refined products and instead focuses on minimally processed items. While consumer trends still show that people love snacking, they don’t want them loaded with unhealthy or artificial sweeteners, oils, colors, flavors or preservatives.
Portable snacking continues to be a great trend for Bridgetown. Consumers are moving away from big, heavy meals and shifting toward multiple snacking occasions throughout the day.
“I think bars and granola fit and continue to fit the trend because they are portable and they fulfill the need for taking very basic, whole ingredients and putting them together in a way that is easy to get eaten,” Dan Klock said.
Building Better Health
Bridgetown recently joined the roster of the very few food manufacturers to become B-Corporation certified. Bridgetown’s commitment to social and environmental responsibility is an important step for the company. The B-Corp certification is an industry best practices template to help Bridgetown incorporate better standards.
The third-party framework measures and audits the well-being and development of Bridgetown’s team. The company strives to be an example for sustainable modern food production by demonstrating that a manufacturer can thrive in a socially responsible business model.
“Certifications, for us, is our way of knowing we’re doing the right thing,” Dan Klock said. “We want to build a good business, so what these (certifications) do is rubber stamp it.”
Bridgetown strongly believes that one of the most important commitments a company can make is to its employees. That’s why, in July 2013, the company launched “Bridges to Better Health,” an employee wellness program designed to help staff build healthy lifestyles.
The free wellness classes are held on a regular basis in the company’s R&D kitchen. Bridgetown brings in experts to educate the workers about nutritious eating and meal planning. The employees are paid their hourly wage to take the classes and are also rewarded with an in-house currency to spend on fresh fruits and vegetables at the company’s bi-weekly employee farm stand.
“Developing the team and continuing to find opportunities for them to grow and develop as people — and as part of this company — is a big passion of mine,” Dan Klock said. “I can keep adding plants, but if the people who work here aren’t doing any better as the company is doing better, I wouldn’t feel like we were doing a very good job.”
Room for Growth
Ideally, Bridgetown would like to find a way to make packaging more sustainable. Dan Klock said the amount of waste that comes out of the packaged food industry is staggering.
“Continuing to get in to more and more packaging is not attractive for us,” he said. “There’s a big opportunity for us there.”
Although the packaging technically belongs to their customers, Bridgetown is still the custodian of any unused film or pouches. The company continues to search for ways to reduce the high packaging waste. In terms of food waste, Bridgetown sells anything that is not converted into a finished food product to local hog farmers.
Bridgetown’s manufacturing processes are not particularly energy intensive. The company has done a complete overhaul in the facility, working around LED lighting, motion detection and carefully choosing which parts of the plant need to be air conditioned.
The company’s sustainable business practices — including its implementation of energy efficiency measures in lighting, process machinery and facility cooling — helped earn it a “Rising Star” award from the Oregon Sustainability Board.
Bridgetown continues to work on cultivating a great reputation in the baking industry by giving companies a place to innovate product ideas, and the knowledge to know they are doing things the right way by focusing on true quality products.
“On the product side I think we do it pretty well,” Dan Klock said. “We’re well-positioned for the trends in the industry, we have the opportunity to keep growing and we do things epically.”