By Angela Rose | Jun 18, 2017
Employees: 4 (plus contractors)
Industry: Food and Beverage
Products: Natural and organic gourmet popcorn
Thanks to a childhood spent on an organic farm in Iowa, Foster has always had what he describes as a "natural and organic mindset." However, he didn't have any recipe development or food production experience prior to co-founding Oogie's Snacks. He had, in fact, recently started a mortgage company when Thier approached him with the intriguing opportunity to invest in an as yet untapped market.
"At the time, popcorn had historically been treated as sort of a carnival snack," Foster recalls. "You'd find kettle corn at fairs and Cracker Jacks at ballgames. But no one was doing popcorn with interesting, artisanal flavors, even though it is a naturally healthier carrier than potato chips. We were really going to innovate in that space for a gourmet flavor and culinary experience in a popcorn delivery format."
Along with a couple of additional investors, Foster and Thier purchased some equipment and rented a small kitchen. They spent most of 2004 testing and developing recipes while searching for their target market. "We'd make popcorn at night and I'd go back to the mortgage business during the day while Eric went out to sell our popcorn and figure out what worked and what didn't work," he says. "Then we'd repeat it the next day."
In addition to dialing in flavors and processes, they tried out a variety of different corn kernels from growers in the Midwest. "We finally found one that would pop to a nice size yet still have a soft mouthfeel," Foster explains. "We really like that one because it was a combination of the best of both worlds, and we've been using it ever since." While the grower still sells the variety overseas, Oogie's Snacks negotiated exclusive rights to its use in the U.S.
The proprietary hybrid non-GMO kernels are now the foundation of the company's popcorn products, which are available in one- and five-ounce bags and nine flavors ranging from traditional Kettle Corn and Movie Lover's Butter to more exotic Grandpa Ben's Spicy Sriracha and Sun Dried Tomato and Parmesan.
"The bestsellers are still the basics," says Foster, "White Cheddar and Movie Lover's Butter with Kettle Corn as the third. But the ones consumers most identify with Oogie's are the Smoked Gouda and Hatch Chili Con Queso because those are different from anything else on the market."
Foster and Thier find flavor inspiration at restaurants and tradeshows as well as through customer suggestions. "We probably have 18 or 20 flavors that are on the sidelines," he explains. "We've developed them but are just waiting for the right market or a customer interested in a specific flavor. That's how the Hatch Chili Con Queso came about. We had a customer who did a big event each year around the Hatch Chile Fest in the Southwest. They asked if we could come up with a flavor for that, so we did. They had exclusive rights to it for one year. Then we marketed it to everyone else and it has become a favorite."
Though they used to use a co-packer for production of their product, Oogie's Snacks has moved to a "hybrid" manufacturing model in recent years. "We had trouble finding a good quality co-packer that we could rely on for long," Foster says. "We've been at this for 13 years now, and we didn't want to have to change co-packers every two or three years as we outgrew them or they refocused their business or whatever. It's difficult to maintain consistency if you're constantly having to look for a new home."
"As for now, we're part owners in the facility we manufacture in and have our own equipment," he continues. "This allows us to use our expertise -- which is in selling and figuring out how to make the stuff -- and contract with other folks for the production labor piece." Their manufacturing space is about 5,000 square feet, though they have storage offsite in addition.
At present, Foster estimates Oogie's Snacks is producing close to 1 million pounds of popcorn a year. Their product -- which avoids artificial flavors and colors, has no cholesterol or trans-fat, and is air- and kettle-popped in 100 percent corn oil -- is available in smaller regional grocery stores and chains throughout the U.S. including Sprouts, Whole Foods, Vitamin Cottage, and Lucky's Market.
Challenges: "We make a good product," Foster muses, "but it can be a challenge to find distribution channels and customer niches that really appreciate its quality and natural, organic aspect. We get lots of requests every week to partner on projects, but they're usually all about price -- and that's not really where we compete."
Opportunities: Small regional stores that want to stock a private-label product are a good source of new business. "We're able to do some cool, interesting, shorter-run stuff with these stores," Foster explains. "If they have an idea for what they want to do, we can pull flavors from our reservoir and tweak formulas for them."
Needs: Foster says Oogie's currently has few needs. "We've been dialing in some equipment we purchased this spring to expand our line in anticipation of a couple of projects we have coming online in June," he says. "We think that will probably increase our production by 30 or 40 percent this calendar year. I think we just need a few folks in the right places to help us market, sell and manage these new projects. That's probably our next hurdle, but I think we'll get there."