IT'S A FAMILY AFFAIR

JOHN KAROLEFSKI

BUFFALO, N.Y. -- What's the secret of success for Rich Products Corp.? Its revolutionary nondairy whipped topping? Perhaps its nondairy creamer, the industry's first? How about Freeze Flo, the process that allows foods to remain soft while frozen?

All of them are good answers. But there's only one key ingredient that has propelled Rich into one of the world's largest family-owned makers of frozen foods. It's meeting customer needs through innovation. That was the case when Robert Rich Sr., founder and current chairman, started the business in 1945. And that's the case now as the company completes its 50th year with his son, Bob Jr., at the helm as president.

From modest roots here in western New York, the family business has blossomed into a billion-dollar, multinational, world-class organization. But a "world-class" organization is never satisfied with the status quo, according to Bob Rich Jr., referring to Mission: World Class, the philosophy and business strategy adopted in 1993 as a map to the future. (See story on Page 15.)

"This business strategy clearly states our priorities and makes it absolutely clear what we're all coming to work each and every day to do -- namely, meet and

exceed our customers' needs in dynamic and encompassing ways," he explains. "Mission: World Class defines our culture and emphasizes our values, including constantly striving to improve, encouraging contributions by all our associates and mandating we do the right thing by practicing the highest ethics in all our business endeavors," he says. For Rich Products, those endeavors are represented in four divisions: food service, in-store bakery-deli, consumer products and international. Food service is the biggest part of the business and has been since the beginning. The fastest-growing part is international, with Rich now doing business in 30 countries, including the Far East and the Pacific Rim. Well-known branded consumer products include Rich's Whipped Topping and Coffee Rich. The bakery-deli division was the first to provide frozen dough for in-store bakeries rather than going scratch or mix. Next year the division will launch a line of low-fat or no-fat products, and a "Sensational" line of upscale products containing nationally branded ingredients. Overall, Rich's manufacturing facilities, warehouses and subsidiaries produce a wide variety of products, including nondairy creamers, toppings and icings; frozen doughs, baked goods and sweet goods; bakery finishers; pastas; specialty meats; barbecue; fruits, and frozen seafoods. Fifty years ago, Robert Rich Sr. aimed to find a vegetable-based replacement for whip cream derived from a new source -- the soybean. During lab development, it was discovered that the soybean substance could be frozen, thawed and whipped. Hailed as the "miracle cream from the soybean," the new product revolutionized food processing and unveiled a new world of nondairy products to the budding frozen food industry. Over the next five decades, Rich acquired food companies and also diversified. It now owns minor league professional baseball teams and a local radio station. A statement of success and the importance of innovation is the Rich Renaissance Niagara here. This state-of-the-art facility is home of the Rich Research Center, the Rich Conference Center, Rich's Mother and Child Center and the Rich Wellness Center. "We consider the research facility a key to our future," says Don Torgersen, executive vice president of the food group.

Indeed, it links innovation with customer satisfaction -- the two guiding principles behind Rich's success. "Our heritage has been innovation and paying attention to our customers," he explains. "As well as the technological advances that will be broadly available to everybody, we'll do a lot of product development specifically for customers. But the most fundamental thing is listening to your customers first." Bob Rich Jr. adds, "To constantly strive to be innovative in all aspects of our business has been key to Rich's success. Whether it's new-product development or implementing a new business strategy such as Mission: World Class, we've always embraced change and prided ourselves on our ability to not only keep pace with the fast-paced changing dynamics of the marketplace, but to anticipate those changes and, in fact, be in the forefront of change." Both executives freely acknowledge the importance and contribution of the trade to the company's business success. "When looking at Rich's relationship with retailers in today's marketplace, the word 'partnership' takes on tremendous meaning," Bob Rich Jr. explains. "We do not just manufacture a product and drop it at their door. Today, our entire organization is striving to be a true partner with our customers in every sense of the word."

Torgersen recognizes the strides that both trading partners have made in recent years in figuring out how to work together to have the most efficient system and supply the most value to the consumer. "The relationship today is one -- by the words and by many of the actions -- that is more cooperative than it was not so many years ago," he says. "The food industry has learned some lessons from some other industries and determined that it doesn't make sense to operate in a way that causes excessive costs and therefore reduces value to the consumer, and opens up the possibility for somebody to eat your lunch.

"We're a relatively small player on the consumer packaged goods side of the business. We're up against some pretty big people. So we've made it our business to be the kind of organization that's as easy as possible to do business with and can fit well with what retailers are trying to do. We listen a lot to them."

Bob Rich Jr. gets a first-hand chance to interface with the trade by taking an active role in several industry trade groups, including the Uniform Code Council, the Grocery Manufacturers of America, and the Efficient Consumer Response Joint Industry Committee. Says Torgersen: "We believe in the purpose of the ECR initiatives. They are there to drive waste out of the system and make the whole process more efficient. We're very dedicated to seeing that concept become reality -- in the supermarket and the food-service side." For example, the company has been gradually increasing its use of electronic data interchange for the last eight years. It is using EDI for nearly three-fourths of its ordering and invoicing, and is working to expand into other transaction sets.

As for other areas, Rich Products is now bar-coding and cross-docking. The company will partner with a limited number of retailers in continuous replenishment program pilots next year. It is starting to work with Food Lion and Hannaford Bros. in category management in in-store bakeries.

Torgersen relishes incorporating these new technologies into the business, especially "working with retailers on what the most effective product line would be. There's the whole idea of continuous replenishment. How do you promote the products? When you get into category management," he says, "there's a slew of opportunities." A half-century ago, Robert Rich Sr. also envisioned a slew of opportunities from "the miracle cream from the soybean." But a long line of successful products aside, one constant has underscored Rich's success through the years. Torgersen sums it up best: "This is a family business. Literally it is. When you walk around and talk to people, you get that feeling. It's a business that has a family feeling and a business of people who care and really want to work with their customers. That whole attitude has made us what we are."