Waffle-making executive earns Small Business Person of the Year honors.
by Steve Kaelble
What's it take to bring about dramatic business growth? Some revolutionary new technology? Maybe. Or maybe just a new way to present a traditional ware, even an old product. And what could be more traditional than a piping hot breakfast, with delicious Belgian waffles?
Rick McKeel's company has been making waffle mixes for decades, and the product tastes pretty much like it always has. McKeel, president and CEO of New Carbon Co. Inc. of South Bend, earned the Small Business Administration's Indiana District Small Business Person of the Year award by figuring out how to make waffles a hot growth industry. If you've stayed at a hotel with a decent breakfast buffet in the past several years, you've probably been part of this success story.
“We supply the customer with the equipment at no charge, and they buy our mix,” McKeel explains. The equipment to which he refers is the waffle iron that allows hotel patrons to cook their own waffles–they pour in a cupful of batter, close the waffle iron and wait for the automatic timer to sound. It's simple, delicious… and showing up at more and more hotels all over, even in a down economy.
In fact, McKeel believes his company's growth during tough times is what impressed the SBA award committee the most. “We were really positive,” he says. “I told my staff that there was no reason we shouldn't be growing.” In this case, it wasn't so much the product that was sparking dramatic growth, but rather the sales arrangements that win new customers and keep them coming back for more.
New Carbon Co. now has more than 80 employees, up from three dozen a few years ago. Sales were $12 million in 2004, and by 2010 were in the $40 million range. The company is by far the leader in its industry, with 70 percent of the market, according to McKeel. “And we've expanded into 18 foreign countries,” he says.
Not bad at all for a company that would seem to be doing about the same thing it was doing back in the 1930s, when Fred Carbon created the F.S. Carbon Co. to make waffle flour and related cooking equipment. Four of the company's largest distributors bought the company in 1998 and created the New Carbon Co. The longtime brand name on its products is Golden Malted.
McKeel, originally from Niles, Mich., has been with the company for 19 years. He started in sales, and worked his way up through sales management and operations. He became vice president of operations and vice president of finance before New Carbon named him president and CEO in January 2002.
Around a decade ago, McKeel spotted a competitor's product in a South Bend hotel's breakfast buffet. “We went back to the drawing board and our R&D built a better mousetrap,” he says. Following 9/11, when the hotel business was struggling, “we reduced our prices by 40 percent; we said we would drop our prices in exchange for long-term deals. That's what got us market share.”
The business goes far beyond hotel breakfast rooms, though. “Most restaurant chains that serve waffles are serving our product,” McKeel says.
Now that Golden Malted waffles are on the menu of so many restaurants and at so many hotels, where does the growth come? “We still have tremendous opportunities in the international market,” he says, “and we're also doing retail sales now. We sell our products online and at specialty gourmet stores.”
