Cloid Smith founded the American Pop Corn Company in 1914 in Sioux City, Iowa, after he was unable to get a satisfactory price for his harvest. Rather than sell too cheap, Mr. Smith, with the help of his high school–age son, decided to process and sell the popcorn himself.
By 1925, the Jolly Time brand was developed and had earned the Good Housekeeping Seal of Approval, a designation that it has held longer than any other food product has. By aggressively advertising on radio, the company grew through the Depression. By taking advantage of movie theater concessions, the rise of television (as an advertising medium and a venue for popcorn eating), and the introduction of microwave popcorn, the company prospered through the early 1990s.
But faced with massive competition from ConAgra and General Mills and possessing dated products, packaging, and organization, Jolly Time fell on hard times in the mid-1990s. Market share fell to the 3.5% range, the company was losing money, and a consultant recommended that the company become a private-label producer.
Rather than give up on Jolly Time, Garry Smith, CEO and great-grandson of the company’s founder, dug in. With a strong balance sheet, in 1995 he began a turnaround. He reorganized the sales staff, developed new products and new packaging, and introduced Jolly Time Blast O Butter in the summer of 1997. A year later, it was the nation’s fastest-selling microwave popcorn. While Jolly Time overall was available in only 35% of places where popcorn was sold, new products achieved 80% distribution. In the late 1990s, annual growth hit 20%–25%. Market share in microwave popcorn increased from 3.5% to 10%. In 2003, the company hit a major milestone, producing its billionth bag of popcorn.
A stodgy old family business was saved from the brink. Garry Smith explained American Pop Corn’s new success in one word: “Commitment.”
“I suspect our commitment is greater than that of the brand managers of our competitors, which might explain why a small one-product company like ours can compete against the large food conglomerates,” said Smith. “This commitment has created a culture of hard work, integrity, focus, and quality that permeates all aspects of our business.
“Beyond commitment, I feel successful family businesses in general are more focused on long-term goals rather than short-term profits. That’s the benefit of not having (public) shareholders to answer to when there happens to be a bump in the road. I also find family businesses to be more ethical, and in the world that I work in, ethics is a forgotten virtue, which has made doing business more difficult and much more inefficient.
“Most importantly,” Smith concluded, “I believe family businesses place a greater premium on satisfying customer expectations. Family businesses feel deeply about the quality of their product and about the general welfare and job satisfaction of their employees.
“At least we do at the American Pop Corn Company.”