story by Kim Souza
ksouza@thecitywire.com
Editor’s note: The City Wire has consulted with people closely affiliated with Northwest Arkansas entrepreneurial programs to compile a list of the five entrepreneurial startups to watch in 2014. Our goal with this effort is to document as much as possible about the ups and downs and other directions a new venture may take as it struggles to prove a product, service or both.
When Fran Free launched Oh Baby Foods in 2009 she saw herself in an apron making baby food in her kitchen well into retirement. She had no idea the natural baby food business she founded would sprout wings and soar, but that’s what has happened.
“Oh my gosh we are so busy. We outgrew our new offices and had to move to a larger suite last week. We have seven offices now and I think a little more growing room,” Free said.
Next Monday (May 18), Free will travel to California to her processing facility for a second production run of the six varieties of natural baby food pouches in her product line.
“It will be a fast trip. My food scientist Dan Heiges, will meet me out there. The three 16-hour days will start at 4 a.m. We sample and test each batch that comes off the line for quality assurance and several taste and texture attributes,” Free said.
This is her second production run of a half million items, split between the six flavors, since transitioning to the baby food squeeze pouch product in August.
“This production round kind of snuck up on us. We sold out of product much faster than we planned. Our production is slated to go quarterly after this round,” Free said.
Free received word May 6 from her largest customer, Whole Foods, that she had made it to national distribution status, which granted her access into nine more states and regions. Those areas are: Colorado, District of Columbia, Kansas, New Jersey, New Mexico, Ohio, Pennsylvania, Utah and Virginia.
Whole Foods has 11 regions, and Oh Baby has been accepted into all but three of those – the Northeast, Florida and the South.
“We have another retailer with 32 stores in the Northeast who wants to bring us on. This new account is on hold until after our production run next week. After that I will back in touch to set up that business,” Free said.
LOGISTICS & STAFF ADDITIONS
Now that Fayetteville-based Oh Baby Foods is a national brand for Whole Foods, Free said sales are expected to spike higher in the new states, particularly the Rocky Mountain states where Whole Foods has a large market share.
“We are now working with CaseStack to help us with the logistics of our growing company. Our product will ship out to CaseStack warehouses in Illinois and Southern California. They will store the product and broker the LTL shipments with tracking ability every step of the way to retailer,” Free said.
She said the company has used two different providers — one for warehousing and one for LTL shipments.
“But these two businesses didn’t talk to one another and I had to be the monitor to make sure the product got to where it was supposed to go on time. I never dreamed I would be running a logistics operation as a baby food maker,” Free said.
She is hopeful the new relationship with CaseStack will free up her time to concentrate on building more sales with new clients. Oh Baby also uses United Natural Foods Inc. as its food distributor which helps set the pricing and sales forecasting for the retail stores.
Oh Baby also recently hired Audrey Chancellor as its office manager. She handles all the accounting and general invoicing for the growing company.
“I no longer go the mailbox. Again Audrey is freeing up my time for other things,” Free said. “Dan, the food scientist, is now on a 20-hour per week contract, that is huge for me, because he handles raw souring protocol, recall process and works with the manufacturer on quality assurance issues.”
Kelley O’Callaghan works as the opportunity analyst for Oh Baby. Free said she tracks daily, weekly and monthly sales through the Whole Foods portal. She also works with retailers and brokers on sales forecasts. All of this help allows Free to concentrate on product expansion and growing company sales through more retail outlets.
Two weeks ago Free went to the Whole Foods headquarters in Austin to get feedback on opportunities to grow the product line to toddler and big kids snacks.
“I am definitely going to pursue this product expansion this fall when the apple harvest is ripe. Until then, I am surveying the market to see what other products are already available in the natural foods segment,” Free said.