In this #FiduciaryFlashback Mini-cast, we take a quick dip into The ESOP Podcast Episode 43 with Larry Filipski, CFO of the 100% ESOP Once Again Nut Butter and President of The ESOP Association's NY/NJ State Chapter.
We spoke with him directly from the conference floor in Hershey, PA at The ESOP Association's PA/DE & NY/NJ Chapters Multi-State Conference in September 2018.
In this clip, Larry Filipski highlights how employee ownership has helped Once Again Nut Butter maintain its values, independence, and vision in a time of tightening margins and industry consolidation. He credits this commitment as being the reason why when the SPINS agency ranked the top-ten nut butters in the country, five of those top ten were from Once Again!
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You can hear the original conversation from this episode in full at "Episode 43" of The ESOP Podcast.
Mini-cast 36 Transcript
Brian Keisling: 00:12 Welcome to The ESOP Mini-cast brought to you by Capital Trustees. A great way to wrap up the week.
Brian Keisling: 00:22 Hi, everybody and welcome to The ESOP Mini-cast. This is Brian Keisling with Capital Trustees and on today's Mini-cast we are throwing it back to Episode 43 of The ESOP Podcast where we sat down with Larry Filipski. He is the CFO of Once Again Nut Butter and President of The ESOP Association's, New York/New Jersey Chapter. In this conversation, Larry, which took place at the Hershey Lodge at last year's multistate conference with the New York, New Jersey, Pennsylvania, Delaware chapters, we were able to talk with Larry about Once Again Nut Butter and how being an ESOP has altered the path of that company in a way that some of their competitors didn't experience. So you will hear in this clip, Larry, talk a little bit about how some of their competitors had reached a point where they were bought out by larger companies in the organic foods market. And because the market was changing, once again had a choice to make and they decided to maintain their ESOP and focus instead on maximizing as much profits as humanly possible on how they can make enough money to continue their employee's benefits, continue to grow their operations, but also do things like provide healthcare for the employee owners.
Brian Keisling: 01:34 Larry is a really good example of how to successfully run an ESOP company and put a focus on ESOP culture and we really hope you enjoy this clip. Afterwards, don't forget, that we will be back on Tuesday with a full episode of The ESOP Podcast and we hope everyone has a wonderful weekend. Until then, here is Bret and Larry Filipski.
Larry Filipski: 01:57 And if you look at our major competitors, our competitors were companies of our size. Our biggest competitors are companies of roughly our size. You know, 10 years ago. MaraNatha makes an organic peanut butter or almond butter and they are owned by Hain Celestial. Golden Boy was a competitor, they are owned by Post. And Justin's Nut Butter was one of our biggest competitors, they are now owned by Hormel. Hain's Celestial, Hormel, and Post might ring a bell with you as deep pockets! [Laughter.]
Bret Keisling: 02:37 And it's kind of reminiscent, Larry, to me, ESOPs are surprisingly strong, surprising in one respect, but in the craft brewers. And at a certain point as the craft breweries developed over the last couple of decades, a lot of them reached the fork in the road and many of them sold out to the corporate parents. And so now it's, can a craft brewery that's owned by [Anheuser-Busch] InBev, which owns Budweiser really be true to their roots? And it sounds like a number of your competitors had to peel off, but you guys are on the path to stay independent?
Larry Filipski: 03:10 Right. That's our goal is to remain an independent employee owned company, maintain our brand. We do actually have the number one brand in the nut butter category nationwide.
Bret Keisling: 03:24 And based on which ranking?
Larry Filipski: 03:26 It's based on the SPINS data is what it's called. I don't know what SPINS stands for - I'm sure it's an acronym.
Bret Keisling: 03:32 [Laughter.] Let us hope!
Larry Filipski: 03:34 No idea what that means. But we - they ranked the nut butter category and of the top 10 selling nut butters in the country, we had five of them!
Bret Keisling: 03:45 Oh, wow.
Larry Filipski: 03:46 So...
Bret Keisling: 03:46 That's very impressive.
Larry Filipski: 03:48 We're definitely up there. Justin's is up there. They've got a couple now. Their squeeze packs became very popular. We're getting into that. But it's a changing world and the margins are squeezing. We are trying very hard as a company to maintain the phenomenal employee benefits that we have always enjoyed. And one of the big draws of working at Once Again Nut Butter, is employee benefits. Just so, so strong. Just as an example, Once Again Nut butter still pays 100% of health insurance for all the employees.
Bret Keisling: 04:25 That must be wrong because nobody pays 100%.
Larry Filipski: 04:28 Nobody does, but Once Again Nut Butter does!
Bret Keisling: 04:31 Larry, this part of the reason I love conversations, and you're here with a couple of different hats, but with the CFOs or CEOs, is there are decisions to be made and from a business decision it would be perhaps understandable to not pay 100% because that's the trend that is going, but probably, I'm assuming that's where the employee ownership comes in and if you're going to devote dollars that benefit everybody, that certainly is a reasonable part of employee ownership. Is that sort of you?
Larry Filipski: 05:02 That's right. And the, the idea with an employee owned company is not to make every penny that you can. The idea is to make enough that you can maintain your business model, keep going, keep growing, keep improving things. But you don't have to squeeze every penny out of the margins. You are able to say, you know what, we have goals. We have values as a company. And one of our values is that we will be providing a living for our employees. The ESOP is great, but it is a retirement plan.
Bret Keisling: 05:38 Right.
Larry Filipski: 05:39 If you're 24 years old, you're probably not all that worried about your retirement plan at this point in time. But if you're 24 years old, that means you're a about a year and a half away from being kicked off of your father's health insurance plan, and therefore you might be thinking that, what am I going to do there? And working for a company that provides health insurance, paid for, is something that would be very meaningful to you.
[Closing music.]
We'd love to hear from you! To contact us, find us on Facebook at KEISOP, LLC and on Twitter @ESOPPodcast. To reach Bret, with one "T", email Bret@KEISOP.com, on LinkedIn at Bret Keisling, and most actively on Twitter at @EO_Bret. Again, that's one "T". This podcast has been produced by The KEISOP Group, technical assistance provided by Third Circle, Inc. and BitsyPlus Design. Original music composed by Max Keisling, archival podcast material edited and produced by Brian Keisling.
Standard Disclaimer: The views expressed herein are my own and don't represent those of my own firms or the organizations to which I belong. Nothing in the podcast should be construed as guidance or advice of any kind in any field and the fact that I mentioned an organizational website or an advocate or a company on a podcast does not reflect an endorsement, but if you've heard your name or your group's name mentioned on this podcast, I'd love to have you come on and talk about it yourself.