Sourcing Organic Produce with Initiative Foods’ John Ypma

September 5, 2011

JOHN SHEGERIAN: Welcome back to Green is Good, and we’re so excited to have with us in studio today, John Ypma and Rob Hunt from Initiative Foods. Welcome to Green is Good, John and Rob. JOHN YPMA: Thank you very much. We’re glad to be here. JOHN SHEGERIAN: I have to tell a secret, Mike. We’ve been here in studio, before we went into this segment, we’ve been eating this delicious baby food, this organic baby food that Rob and John create at their wonderful factory. I’ve been eating this starburst, the mango, the sweet potato. I’m going to tell you. I eat baby food every day, Mike. MIKE BRADY: As long as I’ve known you, this is a revelation to me. JOHN SHEGERIAN: This is true confession time, and this is the best baby food I’ve ever eaten in my life. MIKE BRADY: Well, I haven’t had a baby food, pardon the pun, since I was a baby, but with little ones and grandkids, it’s always interesting to taste what the little ones are eating. You don’t really have to, but guys, this is just amazing. I just finished off the berry, it’s berry, cinnamon, apple, and oatmeal, and it was just fantastic. Really. I guess baby food is not just for babies anymore, huh? JOHN SHEGERIAN: Rob and John, we’ve got ask first how they even here. This is the first time ever we’ve had organic baby food creators on our show, people who produce it. John, what does the journey look like? How did you get to this position? And Rob, how did you become the R & D Chef at Initiative Foods? John, why don’t you start? JOHN YPMA: I’ve pretty much always been in the food business. I worked for companies like Nabisco in creating different types of foods and marketing different types of foods. At one point, I actually worked for Gerber, so I was pretty knowledgeable about what was going on in baby food. It struck me that one of the things that was missing was there was no private label baby food, and there was no private label organic baby food. In fact, organic baby food wasn’t all that big. So one day I decided this was what I wanted to do. I laugh because it was done at a pizza parlor in Washington. I laugh that we had too much beer and we decided that this was going to be a good idea. So, I came down to Fresno, and it’s central to a lot of the fresh fruits and vegetables. Ten years ago, I started Initiative Foods, and we’ve been making baby food ever since. JOHN SHEGERIAN: Rob, how did you join, and how did you decide that you were going to take your amazing chef skills and join John’s venture? ROB HUNT: Well, actually, it all started about a year-and-a-half ago, when I saw an ad. John was looking for an R & D chef that would come in and create new ideas and more initiative making products. I applied, and me being in the restaurant and hotel business for 30 years with an R & D background from Marie Callender’s back in the old days, I kind of showed a little interest in it, and they got back to me and interviewed me over the phone. I came in. I started, and they just kind of told me this is what we need to do. We need to work fast, get some ideas, we need to put it together, we need to stay in these costs. Can we do it? I said yes. They didn’t see me in the office for two-and-a-half weeks. After that time, I came out and I presented some ideas to them. They said OK. We got something. Start R & D. JOHN SHEGERIAN: Was this a new challenge for you? ROB HUNT: Actually, baby food is different. It’s not where you’re actually working with frozen food types of products and different types of pies and cakes and types of things. Here, it’s more working with fruits and vegetables, condensing it down to more of a blend of flavor, and that’s the key of it all right there. JOHN SHEGERIAN: And, you went to Cornell? ROB HUNT: Yes, I’m a graduate of Cornell. JOHN SHEGERIAN: Which is one of the greatest culinary schools in the world. ROB HUNT: Yes, it is. Actually, it’s supplied by the Merrick Corporation. JOHN SHEGERIAN: That is just great. John and Rob, explain exactly what the company does. For our listeners, we’ve got Initiative Foods in here. Again, if you’ve got your laptop and your iPad like Mike and I do, they have a beautiful website, www.initiativefoods.com. Explain, though, for our listeners, what exactly are the goals and mission of Initiative and what you do? JOHN YPMA: Well, what we do every day is we bring in fresh fruits and fresh vegetables. We get pretty much everything within about 100 miles from the plant. And then we take it and we make it into baby food. The goal that we had was just starting with fresh fruits and vegetables takes a lot of the cost out of the system, but also makes it more efficient, more green, because we’re not buying, like a lot of the people that make baby food buy, purees that have already been processed once. We’re doing it once and only once. JOHN SHEGERIAN: From scratch. JOHN YPMA: From scratch, yeah. Absolutely. JOHN SHEGERIAN: And, let me just say this. This is organic baby food. JOHN YPMA: It is. Yeah. JOHN SHEGERIAN: So, all the baby food you create is organic. JOHN YPMA: We do have some that’s not, but it’s a very small part of the line. 98% of what we do is organic. JOHN SHEGERIAN: You do have an advantage in Fresno, given that you’re in the Central Valley and you have access. This was done on purpose. JOHN YPMA: Absolutely. If you had a plant in New York or a business in New York, it’d be very difficult to do because almost all of the organic stuff is grown out here. It’s very close by, whether it be in Bakersfield or up in Northern California. It’s pretty much here. JOHN SHEGERIAN: Mike and I are the wonderful beneficiaries of this delicious baby food you brought in. For our listeners out there, I’ve got to just tell you, we have just been chowing down on the sweet potatoes, the mango, the starburst, Mike’s got the bottles open on his side. There are a lot of brands on the labels. The private label industry means you’re making for other brands, bigger brands, and then they’re using your delicious food. Talk a little bit about some of the great customers, some of the brands out there, so our listeners across America and around the world can be buying your food under different labels, so they know which ones to buy. What are some of the clients that you have? ROB HUNT: Well, actually, we work with Safeway, which is a Bay Area corporation. We’ve been with them for many, many, many years. They have different label companies that we work with. Second would be Kroger. It’s a back East corporation. JOHN SHEGERIAN: One of the biggest supermarket chains in America. ROB HUNT: That is correct. Yes it is. SuperValu is also another large company that we work with, primarily back East as well. Full Circle labeled brand is mostly here. It’s a company out of Chicago, but it’s known as Full Circle here, which is sold here at Safemart, I believe. So actually we have quite a few. Then there’s a few of them that are actually doing R & D that come to us for ideas and put things together. They’re more of like a separate specialty type of baby food. A few of them actually came across my desk in the past year-and-a-half, which is Dr. Sue’s Baby Foods. We have one sample here that I brought with me, which is the beets. She had a few complete line of foods that we actually put in a research pattern, so for example, we don’t just make it, but we actually research it out to see how it’s going to turn out. JOHN SHEGERIAN: Talking about turning out, Mike and I are so impressed. Talk a little bit about what really goes into it in terms of the purity and how you really don’t add all the other things. The President and his wife have made it such a great agenda in America in terms of salt and sugar and us limiting it in our diets. Talk a little bit about the greatness and the purity of your foods. ROB HUNT: Well, actually, if you really want to know, we use 100% top-quality fruits and vegetables, no other additives whatsoever, such as salts or sugars, are ever added into any of the products. JOHN SHEGERIAN: So, no extra salt, no extra sugar. ROB HUNT: That is correct. JOHN YPMA: No added salt, no added sugar. There’s going to be sugar naturally occurring in the fruits. ROB HUNT: In other words, we’re not putting C & H Sugar in any of the products that we put together, so we condense it all out. I use the blends of different types of fruits to get the things that I need. JOHN SHEGERIAN: How about the P word? Everyone is always worried about nowadays pesticides. Talk a little bit about the nature of your organic baby food, and mom and dad’s worries about pesticides. ROB HUNT: Well, we don’t take anything. Organic means no pesticides. It means nothing, so in other words, if they put it in the ground, they just watch it grow. JOHN SHEGERIAN: So, no extra salt, no extra sugar, no filler, no pesticides. JOHN YPMA: No GMOs. It’s all good stuff, stuff that you would find at a natural foods store. JOHN SHEGERIAN: Mike, I want to be a baby again. This is good stuff. MIKE BRADY: Really. If it doesn’t occur in nature, it doesn’t find its way into the jar. JOHN YPMA: It sure doesn’t. JOHN SHEGERIAN: So, talk a little bit about the differential. We’re getting a great education with you guys today on organic baby food. I’ve eaten baby food, like I said to you while we were just coming on the air. I eat it every morning with my oatmeal. I’ve never eaten your brands. I’m now going to switch to you brands. I’ve tasted the difference. Share with our listeners here in the United States and around the world what are the differences that you can explain over the air? JOHN YPMA: Oh, gosh. The two things we really like to talk about, because they really do make a difference, is we start from fresh fruits and vegetables. We only do it once. We have to cook them, obviously, to get them into the jar, but there are very few things that taste good cooked twice. A lot of the baby food is cooked twice; it’s either cooked at another facility and made into a puree, comes in a 55-gallon drum, and they’re dropping it in, they’re cooking it again. We don’t do that. The other thing is our pasteurization. You have to pasteurize the product to make sure it’s safe. What we do differently is the way that we pasteurize. It actually leads to a whole lot less heat in the product, so that we’re not overcooking the product and getting the burnt notes and things of that nature. We like to keep it as natural as we can keep it. JOHN SHEGERIAN: In terms of closing the sustainability loop, Rob and John, by buying local, you really are being as true to the roots of organic foods as possible. When people eat this great organic baby food that you create at Initiative Foods, it’s really been made locally. ROB HUNT: Yes, it does, because when we buy all our fruits and vegetables locally, it’s passed around. So, actually, from the time we get it and process it, get it through the facility, get it in the jar, it’s just a cycle. JOHN SHEGERIAN: That’s a great advantage you have. If someone wants to open up this kind of business in Tennessee or Florida, the fact that there are so many organic farms here in the Central Valley of California gives you a real advantage over your competitors. JOHN YMPA: Yeah, and the other thing is we can go visit them. We go and we visit our sweet potato guy and our carrot guy and our pear guy and our apple guy. We have an ongoing relationship to where they know what we need, they understand they’re feeding babies so they’re more careful, and we can go work with them. If they have a really good crop, we’re going to work with them. If they have sort of not so good of a crop, we’ll work with them and figure out what’s going to work for them, what’s going to work for us. It turns out to be a wonderful relationship. Most of the guys that we’ve worked with, we’ve worked with for eight to 10 years. We continuously work with them. They know us, we know them. JOHN SHEGERIAN: For our listeners out there who just joined us, we’re with John Ypma and Rob Hunt from Initiative Foods right now. You can open up your laptop, your iPad, and check out their wonderful website and their wonderful organic baby food at www.initiativefoods.com. Under what label do you sell your product that’s not private label? By the way, for our listeners out there, they make the O Organic brand. What is your own brand that you sell it under? ROB HUNT: Actually, we have Mom’s. JOHN SHEGERIAN: Mom’s is the name of the brand. That’s a great brand. I love that. Talk a little bit about a lot of people think if you’re organic or a green company, it’s more expensive. Is that true when it comes to organic baby food, or is that just mostly an urban legend that really isn’t true? JOHN YPMA: In general, you’re going to see it’s more expensive in the stores for organic than conventional or regular baby food. But through the bigger companies, you’re paying for a lot of things that really aren’t all that advantageous to you. You’re paying for the marketing, you’re paying for them to have purees made for them and shipped. I’ll give you a quick difference. Sweet potatoes for us will cost one-third of what it’s costing for them because we’re able to source locally here. So, it’s a significant difference. What we try to do is we try to offer our baby food pretty close to what you’re going to buy a regular brand of baby food that’s not organic. So, you’re going to get organic, and you’re going to pay the price of a non-organic branded baby food. You’re getting a tremendous benefit. We actually sort of have fun. Every year we go out and we buy all the baby food out on the market, and Rob and others, they put it together, they blind it, and we get to taste it. We see how does ours taste versus competition? How are we faring? Every year, we’ll find one where we need to make some improvements, and we’ll make those improvements. But by and large, we’re as good as or better than our competition, which is some pretty big names out there that everybody knows. JOHN SHEGERIAN: I’ve tasted your competition’s organic baby food. Yours is for sure better. For sure better. I’m a fan, and now I’m going to be a client too. MIKE BRADY: John, let me ask you one thing too. When you do these taste tests, obviously, there are adults that are tasting, but the ultimate arbiter of taste, I think, would include little babies. So, do you have babies on the panel too? JOHN YPMA: Well, we don’t. What we do is we get moms in the plant, so they’ve had little babies. We have a number of ladies that have babies now, and they’re actually the ones that we listen to carefully because they’re eating it now. The babies are a little hard. They have a hard time telling us how they feel. MIKE BRADY: You’re going to score this electronically, OK? You have a little device. Come on now, Tommy, pay attention. JOHN SHEGERIAN: You know, part of the discussion with companies as they get bigger now is what’s in their green DNA. Talk a little bit about how you handle the food waste and the other waste products and the byproducts that come out of your factory. JOHN YPMA: We’re very careful not to generate a lot of waste. The way that we process the fruit and the vegetables, we don’t actually end up with a lot waste. If we were to use 40,000 pounds during the day, which would be a typical day, we’re probably going to have less than 5,000 pounds of waste. So there isn’t a lot of waste there to begin with. The waste that we get, we actually work with local farmers that will use it for their cattle. JOHN SHEGERIAN: So you repurpose it. Is it like compost or some kind of fertilizer? JOHN YPMA: It could be compost. It still has nutritional value, feed, that sort of thing. JOHN SHEGERIAN: So it doesn’t go to a landfill. JOHN YPMA: No. ROB HUNT: No, definitely not. JOHN SHEGERIAN: Wow. So, in the production of your organic baby food, your processes and procedures are very green unto themselves. ROB HUNT: Absolutely. JOHN YPMA: They are. JOHN SHEGERIAN: That is just great. Talk a little bit about the culture of your company and the mission of your company for our listeners. You started 10 years ago? JOHN YPMA: Yeah. JOHN SHEGERIAN: You started up in Washington. Now you’re in Fresno. It was three employees and zero income, and now you’re a multimillion-dollar company. How do you stay true to the mission? Talk a little bit about your mission and the culture. You bring on great people like Rob, and now you’re growing the brand. What does that look like? What do your culture and mission look like? JOHN YPMA: It’s kind of interesting because virtually every new employee that we hire, I talk to before they come in, before we actually put them on the line or we put them in the office or wherever they’re going to be working. The things that I talk to them about are pretty simple because I like to keep things pretty simple so you can remember them. I tell them that there are three things that I expect from them that I’m sure that they can deliver to us. The first one is do right, that whatever they do, that I want them to make the right decision. That will depend, but I explain to them also that making the right decision is oftentimes a hard thing to do, but we expect them to make the right decision. The second thing that I ask them to do is show you care, and that’s very important to show you care to the group that’s there, to show you care. I keep reminding them we’re making baby food, and I remind them, whether they have children themselves or they’ve got nieces and nephews or brothers and sisters, that that really makes a difference. You’re not just here for a paycheck; you’re here because we’re feeding babies. That’s really what we’re about. So that’s the second thing I ask them to do, show you care. Then I’ve got a third thing I ask them to do, which is do your best. Nobody can tell you what your best is. You know what your best is, but we do expect you to do your best every day you come to work, whatever that is, whatever level that is. We try to fit people to the jobs that they like to do because we find that they do a lot better. The last thing I’ll finally throw out, which is sort of an adjunct, I’ll say, “I expect you’re going to make a mistake. We all do. All I ask you to do is clean up from the mistake that you make. Admit you made it and move on. If you can do that, then you’ve got a job here, and we’ll enjoy working with you.” We’ve got a good culture. People like working there. We like working with them. We have a lot of fun. We’re very serious about our business, but it’s a good environment. People like working. JOHN SHEGERIAN: It’s a serious business. ROB HUNT: There’s competition out there. JOHN SHEGERIAN: And, you’re feeding America’s future. JOHN YPMA: Yes, we are. ROB HUNT: Absolutely. JOHN SHEGERIAN: And, you’re feeding them well. ROB HUNT: It’s like the moms and the grandmoms of today, the children will be our customers of tomorrow as they grow. If you show that, they’ll be loyal. JOHN SHEGERIAN: Rob, to that point, because you don’t use extra salt and extra sugar and fillers and preservatives and all that other junk that America of my generation has sort of become numb to and used to, are you then prepping the next generation to have a better palate and not crave that kind of stuff, and then hopefully be healthier people? ROB HUNT: Well, it’s like this. If they’re looking at something wholesome and something that’s going to actually have a nutritional value, people are going to come back and get it. They’re going to keep buying it. The thing is that sometimes there is a lot of stuff that goes into these products, and it’s not really healthy for you. JOHN SHEGERIAN: Then does that get their palate jaded? ROB HUNT: It does. JOHN YPMA: They’ve shown over and again that the kids, if you start a child on a healthy diet, they’ll stay on a healthy diet. So, if you can start them off right and you don’t send them to McDonald’s and things like that, they’ll like that sort of thing. It’s just a habit they develop. JOHN SHEGERIAN: We’re down to the last three or four minutes. What’s the next step? I mean, now you’ve got it to a multi-million dollar companies, 55 or so employees, you’re making this amazing and delicious organic baby food for the O brand and Kroger and all these great food chains out there. Where do you go next? JOHN YPMA: Well, we’ve got a lot of things that we want to do. One of them, which we’re going to talk about here in a little bit, is we also make food, and because we can do it at favorable prices, we donate some of it to needy families. We also participate in the Women, Infants, and Children program here in the state of California and other states, where moms who don’t have the money to buy baby food can get vouchers. JOHN SHEGERIAN: That’s your giving back to the communities that you guys serve. JOHN YPMA: We’ve got some new formulations coming out, particularly for the WIC, and I can tell you a little bit about it. You’ve eaten a couple of them. You love them, so we think they will too. JOHN SHEGERIAN: So, new formulations you’re working on. ROB HUNT: New formulation, that’s correct. Actually, we have 10 in all. They’ll choose, it’s up to them, but I usually give a variance of different types of products, different attributes to taste, and so on where it’s affordable. I look at the quality. It’s A, B, and C quality these days, so just because it might be government ran or something of that nature, we still look at giving them the quality. We want to make sure that the texture and the color and the taste is available to everything. The key of that is the consistency that goes into it. Everyone deserves to have that, no matter who they are and what they are. JOHN SHEGERIAN: Right. How big can this get? When you guys dream about the next five years, how many employees around the world? ROB HUNT: I can sum that up in 10 seconds. Watch out, competition, I’m coming through. JOHN SHEGERIAN: Wow! I love it. I mean, can this be sold around the world? Is there a market for this? JOHN YPMA: Well, we’re already doing that. We’re pretty much here in North America, but we do sell in Moldova, and where else? ROB HUNT: Actually, it’s a lot. I’ve got to keep up a little bit more with that, but they’re out there. JOHN SHEGERIAN: But it’s going. ROB HUNT: It’s going. JOHN SHEGERIAN: So, this is not just the United States. ROB HUNT: We do a lot of business in Canada, actually. We have Safeway Canada we do business with. JOHN SHEGERIAN: Got it. So, there’s a big future here. JOHN YPMA: There is. ROB HUNT: Yes, there is. JOHN SHEGERIAN: Wow. That is just great. You know, we’re down to the last minute, minute-and-a-half. Share some final thoughts, guys. This is your platform. We’re just so thrilled to have you both in studio and try your delicious foods. Both of you, share some final thoughts. ROB HUNT: The biggest success that we’ve actually had put together was the foods for Safeway and SuperValu stores. The thing is that they had an idea. John has worked on the project with prior people, trying to get it off the ground. When I first came aboard, it was brought to me. They said, “Can we do it? Can we stay at this cost? Can we stay at this color? Can we stay with this texture? Can we stay with this taste?” Let me run with it. After a year of doing 11 products, six of them were sold. Even the people at Safeway, when they actually came back, they said, “Can Rob do this? Can Rob do that?” We can make the changes, and we did it. We perfected it. Now it’s done. JOHN SHEGERIAN: Wow. That is just great. ROB HUNT: And, if I remember correctly, as they all said, we have a superior product for a label. JOHN YPMA: I think that’s sort of the key, because one of the things that when I started doing this, I said that nurturing doesn’t mean to be pricy. That’s something that we’ve always believed with and worked with, is that we’re doing good nurturing for children, and we’re offering it at tremendous values. We just look at it and say we can do a lot more. We’ve got the advantage here, and we’re going to take advantage and pass it on to the babies that we’re feeding. JOHN SHEGERIAN: That is just great. Listen, John and Rob, you’re always both invited back here on this show to share your new lines of food. Mike and I are just so thrilled that you both came in today. For our listeners out there, to learn more about Initiative Foods, please go to www.initiativefoods.com. Buy their product. Eat their product. Have your kids eat it. I mean, it is delicious. Mike and I have just eaten about three or four jars while we’ve been taping this show today. John Ypma, Rob Hunt, you both are sustainability leaders in the organic baby food business, and truly living proof that green is good. JOHN YPMA: Thank you. ROB HUNT: Thank you very much.