Position: Owner and CEO
Company: Chef John Folse & Company
Revenue: About $35 million projected this year
Next Goals: “Staying alive.”
Chef John Folse decided to expand his 2-year-old food manufacturing plant in Donaldsonville in 2007. Last year, he cut the ribbon on the new 68,000-square-foot facility. Then the economy nosedived, but it was too late to turn back on his new investment.
Not that he would want to.
“We made a major commitment to our lenders, and they made a major commitment to us,” he says. “I have contracts that determine we should do these expansions, and now I have to protect those contracts. I don’t want to lose those contracts when the time comes for re-bidding. I don’t want to give my customers any reason to look anywhere else.”
Folse runs several companies, but about two-thirds of his revenue comes from specialty food manufacturing for major chains. Have the Jack Daniel’s ribs at any TGI Friday’s in the world, and you’re eating glaze made in Donaldsonville. The high revenue potential comes with high exposure to changes in the global economy.
As the recession causes diners and shoppers to cut back, restaurants and stores are forced to re-examine their spending to companies like Folse’s, which leads Folse to more closely scrutinize his own supply chain. For each of his top 10 volume items, like the cheese orders that fill 18-wheelers, he’s looking at every supplier in North America to see where he can save the odd penny or nickel.
“Even a penny a pound is big, big, big money at the end of the month. We’re calling in everybody that makes cheese in the United States, and saying, ‘What can you do for us?’” Folse says. “At the end of the day, we are leaving no stone unturned, because to leave one stone unturned is to leave a penny on the table, and to leave a penny on the table in these times in food manufacturing is the difference between success and failure.”
Folse always felt his operation was “lean and mean,” but lately he’s been even more attentive to his plant’s efficiency, even holding daily 9 p.m. meetings with his plant’s late-shift managers. His employees have readily accepted any changes, since they also read the news.
“A year ago, it was, ‘Hey, things are going great. I don’t need to worry about any of this,’” Folse says. “Now I realize every cent has to be important to all of us. Productivity, great communication and strong leadership is what’s going to make the difference between success and failure in the next 18 months.”
