That’s because the Herman Goelitz Candy Company evolved into the Jelly Belly Candy Company, maker of the world-famous, flavor-rich gourmet jelly beans that have delighted everyone from toddlers to adults, including President Ronald Reagan, for more than 30 years. Each year, Jelly Belly produces more than 34 million pounds of tasty treats, including more than 50 varieties of jelly beans ranging from bubble gum to kiwi. With nearly 800,000 square feet of production facilities in its two U.S. factories, Jelly Belly also makes candy corn, chocolates, gummies, sour candies and other tasty confections.
Such staggering success seemed unimaginable when the Rowlands first began having lunchtime meetings at the family factory with a gentleman Herm remembers only as “Mr. McDaniel,” a SCORE counselor who had previously worked in operations and finance for a Utah salt manufacturer.
Herm recalls McDaniel as being “all-business,” yet genuinely concerned about helping the family turn the business around. And there were no shortage of issues to tackle.
“One problem was that we were operating out of a cramped 10,000-square-foot building, which created a lot of manufacturing inefficiencies,” Herm recalls. “Mr. McDaniel told us that we needed to expand, even though we weren’t making money. Ordinarily, we wouldn’t have even considered taking such a bold step. But we trusted his judgment and decided to move forward.”
Securing the loan to fund the expansion proved to be more emotionally taxing than the Rowlands had expected, but McDaniel helped guide them through the process and before long, the manufacturing operations had some much-needed elbow room. The Rowlands SCORE counselor also helped them revamp their merchandising and costing system, providing lessons that Herm has used to help Jelly Belly achieve an enviable level of fiscal discipline.
“Our profit and loss statements were practically worthless to us,” Herm says. “Mr. McDaniel helped us define our overhead expenses, which formed the basis of a costing system we still use today. We know the exact amount of overhead for each of our products, whereas other companies often just add a fixed percentage. They don’t know if that’s their true overhead cost or not.”
Perhaps more importantly, McDaniel proved to be an ideal mentor for Herm, providing practical business tools and wisdom that would prove valuable as he guided the company through the ups and downs of business, and be positioned for the once-in-a-lifetime opportunity to introduce gourmet jelly beans in 1976.
“There’s no doubt that Mr. McDaniel helped save our family’s company, because he gave me real-life solutions to address our challenges,” Herm says. “But he also taught me that to be successful, you have to think in terms of ‘us’ and ‘we,’ not ‘I’ and ‘me.’ That was a small mental adjustment, but it really woke me up to the importance of teamwork and commitment.”
Herm adds that the lesson is still valuable today. “My name may be at the top of the organizational chart,” he says, “but it’s our 650 employees who are truly doing the work and making things happen.”
Although he lost contact with McDaniel many years ago, Herm likes to think that his SCORE mentor might smile if he could see how far the company has progressed. Jelly Belly recently announced plans to build a plant in Thailand to better serve its growing international customer base. Now the company’s chairman and CEO, Herm has enjoyed watching his children and grandchildren become involved with the business, making Jelly Belly a fifth-generation family enterprise. And speaking of family, Jelly Belly still makes candy corn based on Herman Goelitz’s original recipe.
“I have many fond memories of Mr. McDaniel, and we were so fortunate to have his help and support,” Herm says. “I’ve told many other small business owners that they too can get the same kind of valuable advice by calling SCORE. But remember that SCORE won’t do the work for you. You must be willing to listen and follow through on your counselor’s recommendations.”
Recalling that long-ago Reader’s Digest article, Herm says that, “Everything SCORE promised came true thanks to Mr. McDaniel. SCORE is a wonderful resource for small businesses.”
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