Bobs Candies, Inc. History

Company Perspectives:

Bobs Candies has succeeded in a competitive economy because it has been overseen by a family who prided themselves on values, work, and friends. The McCormacks were and are hard workers and thoughtful managers. They were and are innovative, forward thinkers, not afraid to try something new, not paralyzed by the prospect of failure. They did and do feel a sense of responsibility toward their employees and toward the community in general. At Bobs Candies, one continuing thread has spiraled over 80 years of family-owned candy making: Produce quality candy at an affordable price.

Key Dates:

1919:

Bob McCormack starts the Famous Candy Company.

1924:

McCormack's company changes its name to Bobs' Candy Company.

1930:

Late in the decade, McCormack introduces a line of snack foods.

1940:

A tornado destroys much of Albany, Georgia, reducing McCormack's production facility to a pile of rubble.

1956:

Bobs Candies, Inc. becomes the official name of McCormack's business.

1963:

McCormack is succeeded by his son, Bob McCormack, Jr., as president.

1984:

A second production plant is opened in Kingston, Jamaica.

1988:

George McCormack, the founder's grandson, is appointed president.

1997:

The Sweet Stripes line is introduced.

Company History:

Bobs Candies, Inc., makes and distributes candies, ranking as the largest candy cane maker in the world. The company sells its products to discount stores, supermarkets, convenience stores, and drug stores, as well as online through three web sites--bobscandies.com, americancandy.com, and sweetstripes.com. Bobs Candies offers candy canes in a variety of flavors and makes an assortment of other candies, including stick candy, hard candy, sugar free candy, and bag candy. The company is family-owned, led by the third generation of the McCormack family.

Origins

Albany, Georgia became the candy cane capital of the world with seed money from Birmingham, Alabama. The investors who provided the capital for Albany's first commercial candy-making business--a group the Albany newspaper referred to as "Birmingham capitalists"--were persuaded to back the venture by a young candy factory worker named Bob McCormack. In 1919, McCormack left his job at the Nashville, Tennessee-based Martin Biscuit Company to explore the possibility of starting a candy-making operation in Albany. He solicited the financial help of his former boss, E.L. Martin, two Martin Biscuit workers, R.E. (Bob) Mills and Charles Meyer, and his uncle, Lawrence McCormack, a candy salesman. McCormack, in a letter excerpted on Bobs Candies' web site, wrote to his fiancée in February 1919, confident that his entrepreneurial career would be a success. "If conscientiousness and hard work, gall, nerve, stickability, and persistence are any of the roads that lead to success," McCormack wrote, "I do believe I will get by with the very large undertaking of starting a candy making business."

McCormack made good on his claim, beginning production two months after he wrote to his fiancée (the pair were wed the following year). In May 1919, McCormack's Famous Candy Company began production of its first batch of candy, relying on a three-person workforce, some secondhand equipment brought in from Birmingham, and basic supplies procured by McCormack to get started. McCormack succeeded from the beginning, a difficult achievement for any fledgling business, but particularly hard for a candy company starting out amid sugar shortages stemming from World War I. Famous Candy Company initially made and sold coconut, peanut, stick, and hard candy, as well as taffy, but soon chocolate and pecan candies were added to the company's product line. Pecan candies, which later were marketed as "Bobs Pe-Kons" and "Bobs Pe-Kon-ettes," drove the company's sales during its formative decades, serving as a mainstay product until World War II.

Business was brisk during McCormack's first years in business. His workload soon required proactive help from his investors, resulting in the arrival of Bob Mills from Birmingham to assist in running the company. Mills took over the administrative duties in Albany, freeing McCormack to concentrate on sales and production. The division of labor between the two Bobs invigorated sales, enabling the pair to buy out the other investors, an event marked by a change in the company's name to the Mills-McCormack Candy Company. In 1924, the co-owners dropped their surnames from the company's corporate title, opting for the name they had in common, yielding Bobs' Candy Company (the apostrophe was dropped several years later).

The Albany candy operation faced its greatest challenge during its second decade of business. The Great Depression delivered economic blows to industries nationwide, causing companies of all types to reel from its effects and, in many cases, collapse. The candy industry was no exception, its ranks winnowed drastically by the bleak economic conditions, leaving only the hardiest members to survive the decade-long catastrophe. By 1933, as the Great Depression reached its trough, candy sales throughout the country were down 45 percent and nearly 900 candy makers had declared bankruptcy. The Albany candy operation stood as an exception to the pervasive trend of financial collapse surrounding it, not only surviving through the decade but demonstrating the ability to expand during the harshest of economic times. McCormack increased the production of low-cost pecan candies, a luxury Southerners continued to budget for as a relief from the strife of poverty. The company changed its name again as a result, calling itself Bobs Candy & Pecan Company. McCormack also introduced a line of snack foods during the 1930s, selling salted peanuts and peanut butter crackers, items that would help his company stay afloat when the next calamity arrived a decade later. Last, in a move that belied the economic conditions of the time, Bobs Candy & Pecan Company moved into larger facilities, having outgrown the accommodations of its original quarters during the black years of the Great Depression.

Persevering During World War II

McCormack barely had the chance to celebrate his fortune at surviving through the 1930s when misfortune struck the company. As the 1940s neared, consumers had begun to act as the consumers of a decade earlier, enjoying discretionary income that allowed them to spend more freely. McCormack's sales began to rise robustly, driven in large part by the popularity of Bobs Candy & Pecan Company's line of traditional candies and its snack line of salted peanuts, peanut candies, peanut brittle, and peanut butter candies. On February 11, 1940, all of that was lost, both the company's products and its ability to make products. Early in the morning, a tornado swept through Albany's business district, killing and injuring more than 500 residents, and completely destroying Bobs Candy & Pecan Company, a company without tornado insurance. It took 256 truckloads to remove the rubble at the Bobs Candy & Pecan Company site.

McCormack was forced to start from scratch after the tornado. By using his cash reserves, he was able to rebuild his business within six months. The company stopped making chocolate candy after the tornado, but introduced a candy bar that paid homage to the natural disaster. Bobs Tornado Bar, a peanut, coconut, and popcorn bar that was advertised as "worth a dime but costs five cents," sold well, helping the company to gain its footing.

Stability was elusive during the war years, as McCormack and his company had to adapt to changing dynamics within the candy industry. Again, the company faced a sugar crisis, as rationing measures were implemented, but the most defining change was engendered by the price of pecans. Within months, the price of pecans tripled, forcing the company to stop using pecans, which had been a mainstay ingredient in its products. McCormack fell back on his snack food line for financial support, focusing on the sale of peanut butter crackers and vacuum-packed peanuts. The switch in product emphasis was enough to warrant a change in the company's name, marking the end of Bobs Candy & Pecan Company in 1943 and the beginning of Bobs Candy and Peanut Company.

Innovations highlighted the company's postwar years, enabling it to record robust sales growth in the 1950s and 1960s. Hard candies were particularly popular during the late 1940s, but high humidity in southern Georgia meant the candies had to be shipped quickly and remain on store shelves for only a short time or else they would become gummy and bleed color. In 1946, McCormack solved the problem by installing large air conditioners to de-humidify the company's wrapping room. In 1949, further improvements in product quality were achieved when a new machine was introduced that sealed candy stick in moisture-proof wrappers. A third innovation arrived as the 1950s began, its creation the work of Father Harding Keller, McCormack's brother-in-law. During the 1940s, Keller invented a machine to dispense ribbons of peanut butter on the company's peanut butter crackers, an invention that greatly improved the consistency and quality of the product. In 1950, Keller scored another success with the invention of a machine that twisted soft candy into the spiral striping that defined the look of candy canes. The Keller Machine, combined with the improvements in wrapping, allowed for mass production. Soon, the company's candies and snacks were stocked in 600 A&P stores throughout the southern United States.

McCormack's company ended the 1950s having evolved past its stature as a regional wholesaler to become a nationally-oriented enterprise. Break-proof packaging, developed in 1956, the year the company changed its name to Bobs Candies, Inc., enabled the company to distribute its candy canes on a national basis. In 1958, the refinement of a machine first developed by Keller accelerated national distribution, giving the company the ability to create the crook in candy canes automatically. By the end of the decade, when the company claimed to be the largest candy cane producer in the world, annual sales eclipsed $3 million, a total derived from the production of 1.8 million sticks of candy and 500,000 candy canes on a daily basis.

Growth and Leadership Changes in the Late 20th Century

The 1960s brought an end to McCormack's longstanding leadership, paving the way for a new generation of McCormacks to guide the company. McCormack relinquished the title of president in 1963, passing control to his son, Bob McCormack, Jr. One of the first projects undertaken by McCormack, Jr., was to move the company to larger quarters. Bobs Candies occupied six buildings in downtown Albany, using nearly 100,000 square feet of space, but the rapid growth of the company demanded more space. Construction began in 1967 and production at the new 130,000-square-foot facility began the following year. The new facility, which boasted 260 tons of air conditioning units, doubled the company's production capacity.

Bobs Candies expanded its production facility twice in the 1970s, once at the beginning of the decade and again at the end of the decade. As it had during the 1960s, production capacity doubled during the 1970s, a decade that witnessed another packaging innovation, shrink-wrapping. Shrink-wrapping provided a more aesthetically pleasing look to the company's candies, which attracted more customers. The company's customers eyed the new shrink-wrapped selections from Bobs Candies at a different type of retail outlet during the 1970s. Although supermarkets remained the biggest purchasers of the company's candies, Bobs Candies increasingly was selling its products to convenience stores, which became the primary outlet for the company's individually wrapped candies. The 1970s also witnessed the emergence of large discount chains such as Wal-Mart Stores, which supplanted supermarkets as the biggest purchasers of the company's candies in the 1980s.

Leadership passed to the third generation of the McCormack family in the 1980s as Bobs Candies neared its 70th anniversary. Greg McCormack was named president in 1988, but, like others in the McCormack family, he spent years working for the family business. Before being named president, Greg McCormack was selected to oversee a major new addition to the company's operation. A second production facility was opened in 1984, a facility that gave the company its first overseas presence. The facility was located in Kingston, Jamaica, where Greg McCormack spent nearly three years managing the operation of the 13,000-square-foot plant that produced unwrapped, pure-sugar stick candy. Not long after returning home, Greg McCormack was named president, assuming the post the same year Bobs Candies acquired Fine Candy. A competitor, Fine Candy generated more than $4 million in annual sales when it was acquired by Bobs Candies, adding a substantial boost to the company's sales. "Our sales grew fairly dramatically when we acquired them," Greg McCormack confirmed in a May 1998 interview with Candy Industry.

After the spike in sales from the Fine Candy acquisition, Bobs Candies' revenue growth leveled out, but at a robust rate, increasing between 10 percent and 15 percent annually throughout much of the 1990s. Revenue growth was fueled, in part, by another expansion program in 1994, one that increased the size of the company's production facility by 175,000 square feet. Greg McCormack, in his first full decade in charge, concentrated on long-range planning, something he believed his predecessors in large part had ignored. Part of his strategic outlook involved increasing the business generated by the company's non-candy cane products. Bobs Candies distributed its candy canes nationwide, but the company could not claim the same for its line of other hard candies. Further, the sale of candy canes was a seasonal business, leaving Bobs Candies less well-rounded than Greg McCormack would have liked. To give the company a broader, more reliable business base, Greg McCormack focused on pure sugar candies, a segment of the company's business that first began to grow in the 1970s. After numerous rebranding efforts, the company unveiled its line of pure sugar candies under the Sweet Stripes banner in 1997. "Sweet Stripes is what we're focusing on now," McCormack explained in his May 1998 interview with Candy Industry. "That is an evolving strategy that we are continuing to work on. We're expanding our production capabilities of it by more than 100 percent to keep up with demand and expected demand."

As Bobs Candies entered the 21st century, the growth of the 1990s had created a candy maker with more than $40 million in sales. Although the company was nearing its 90th anniversary, it employed modern marketing and production techniques, ensuring that Bobs Candies would remain the world's preeminent candy cane manufacturer in the years ahead. At the company's production facility in Albany, cooling and de-humidifying systems developed by the National Aeronautics and Space Administration (NASA) ensured product quality and consistency. On the marketing front, the company used three web sites to sell its candies, maintaining an online presence through bobscandies.com, sweetstripes.com, and americancandy.com. With its proven ability to adapt to changing times and market conditions, the company promised to play a prominent role in the candy business well into the future.

Principal Subsidiaries: Click Foods, LLC; Sweet Stripes, Inc.

Principal Competitors: See's Candies, Inc.; Russell Stover Candies Inc.; Kraft Foods Inc.

Further Reading:

• Amire, Roula, "Rain or Shine, Bobs Candies Delivers," Candy Industry, May 1998, p. 20.
• "Bobs Candies," April 5, 1999, p. 17.
• "Bobs Candies Moves Candy Cane Production to Mexico," Candy Industry, December 2001, p. 11.
• "Bobs Candies Saves with 'Space Age' Heat Pipes," Air Conditioning, Heating & Refrigeration News, January 22, 1990, p. 64.

Source: International Directory of Company Histories, Vol. 70. St. James Press, 2005.

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