A Chat with Frank Glaser, president/owner, James’ and Fralinger’s Salt Water Taffy

© Profile of Success, Catalog Success magazine, 2007

Catalog Success: When was the catalog established?
Frank Glaser: James’ and Fralingers are two of the oldest candy companies in the United States. Both of them were started in the 1880s on the Atlantic City boardwalk. Both claim to be the originators of salt water taffy. But the only similar is me. We still market them differently. We keep the look of the two companies separate, and we still use different formulas for the candies. They are different products, we just put them together in our catalog. I own both companies.

CS: When did that come about?
FG: James’ is a family business. I’m the fourth generation; my children are the fifth. And we acquired Fralinger’s in 1991.

CS: How long have you had a catalog?
FG: Being in business that long, we started as a mailer just because our customers would ask for something to be sent to them at Christmas time. Way back when, when people came into the store, each store had a post office in it. People would mail right out of the store. That was the beginning of it. It just kept growing like that and about five years ago, I decided I better do something about it, and get serious about it, do it in a professional way. I had made enough mistakes already.

CS: Where are your headquarters?
FG: Right on the boardwalk in Atlantic City.

CS: What is your primary merchandise?
FG: Candy, and of that salt water taffy, fudge and macaroons are our major products. Chocolates after that.

CS: What are your primary customer demographics?
FG: Most of our customers are from 40 to 60 in age, maybe a little older. The east coast is popular with us. Obviously that because people know about us because they’ve visited Atlantic City. We’re an east coast company. On the west coast, we have a large following because of displaced easterners. After that, the product takes over.

CS: What are your main sales channels, and what percentage of sales does each represent?
FG: Retail is our major source of revenue, second is mail order, then it’s wholesale and fundraising. Broken down, I’d say we’re about 80 percent retail, 15 percent mail order and 5 percent wholesale.

CS: And how many stores do you have?
FG: Thirteen, up and down the east coast.

CS: I noticed recently that you have your name up at Bayard’s Chocolates.
FG: Yes, we also own Bayard’s Chocolates and manufacture all of our own chocolates. We just bought Bayard’s two years ago. We’re trying to bring some life back to that brand.

CS: How did the company/catalog get started?
FG: The James’ family started it in the 1880s. Atlantic City was the major resort for the United States in the 1890s and 1900s. That’s when folks started coming.

CS: And as a part of the family business, had you any experience in cataloging?
FG: No, none at all.

CS: What was your biggest challenge in the first few years in dealing with the mail order side of things?
FG: We got really serious about it about five years ago. In the two years before that, I tried to do this myself, thinking that I knew something about the catalog industry. I realized right away that I didn’t. It’s an entirely different animal. I needed to find someone who knew how to run the catalog business, and I needed to run it separately from the retail business. It had to be a stand-alone operation. But I didn’t think I needed to do that early on.

CS: What made you realize it needed to be separate?
FG: We really didn’t understand how to grow a catalog. We were trying a lot of things that didn’t work. The learning curve and the pain was too long. We either had a marketable business or we didn’t, but we didn’t know how to figure it out quickly. If we just went along testing little things in our spare time, we probably would have driven ourselves crazy and we wouldn’t have received any where close to the growth we’ve seen in the past five years.

CS: How did you deal with it?
FG: I hired a catalog consultant, Tony Cox. He deals almost entirely with food. He helped us get things together.

CS: Did you hire additional staff then?
FG: Oh yeah. We had to. The catalog business is on a 30 percent growth curve every year. We used to have one person, now we have to half a whole phone staff and fulfillment place. My daughter is the catalog manager, and she works very closely with Tony.

CS: What’s the biggest business mistake you ever made, and how did you deal with it?
FG: The biggest fallacy is not spending enough on getting knowledge. You look at hiring a consultant and you say “Good God, look how much money we’re spending.” But without that knowledge, without that leg up, if you don’t know what you’re doing, it’s such a waste of time and energy when you don’t know what you’re doing. It pays for itself immediately. I fought against that for too long.

CS: What is your current biggest business challenge and how do you plan to resolve it?
FG: Things are changing so rapidly everywhere. In the retail market, the wholesale market. To stay competitive, it’s a daunting task. You have to find outside sources that can help you through that. The catalog industry, we’re learning so much every year, it’s incredible. Everything that was a big problem last year we solved, but now we have a whole new set of problems. The best thing is just trying to keep up with the change that’s coming at you faster than you can do your normal everyday things. And then you have to stay on top of the change at the same time.

CS: What are some key points to your success, both in the candy business in general and the catalog business specifically?
FG: In the catalog business, we are a unique product. We have a definite niche. And we have a lot of history, a lot of nostalgia and memories. It’s fun. People look at it and it recreates a childhood memory, especially for anyone who’s visited a seaside resort. It’s an “I remember when” kind of feeling. Our advantage is really our history, the company’s history and the nostalgic packing that we’ve created or really resurrected. It’s nice to have a story, and ours is more than 100 years old. That helps an awful lot.

CS: What goals do you have for the catalog, and what steps will you take to get achieve them?
FG: We’re looking to expand at the same rate we have been, about 30 percent per year. But we’re going about it in a very conservative, careful process. We’re not trying to bite off more than we can chew though. I don’t think we yet have enough experience to grow faster than that without getting into trouble. Once we get a few more years of steady growth, we’ll look for a major jump, but we don’t have enough information just yet to try to grow any faster comfortably.

CS: Have you had any mentors?
FG: This is a family business, so I grew up under the tutelage of my father and his three brothers. They all were tough, hard-working, German guys who taught me that nothing works unless you work hard. They were my mentors and taught be a strong work ethic.

CS: What about the business appeals to you?
FG: The catalog I like because your customer base really feels limitless. Anyone into whose hands you can put your catalog, that’s a potential customer. Whether they turn into a customer is another question, because they have to show an interest in your product. But the marketing of it, and the ability to reach so many people is really exciting to someone who’s worked so long in retail. In that market, you’ve got to wait for someone to walk by your front door. In the catalog business, you can bring your front door to the customer, and hopefully you have something in common.

CS: One of the keys to success you mentioned was the fact that you have a great nostalgia-filled story to tell. How do you tell that story?
FG: We do it in a number of ways. We use or recreate the packaging that was used going all the way back to the 1900s on some boxes. And on most of the boxes, there’s a story about the product on the box. Most of them are a little light-hearted, but there’s a story about the product which people enjoy. The decor in the stores also reflects the history of this old-time business. Packaging has a lot to do with it.

CS: You also said that when you started the catalog in 1999, you lacked experience. What specifically did you struggle with in those first two years?
FG: The biggest thing is that we didn’t understand the basic concepts of how to market to customers in the mail order industry. And the actual construction of that catalog... we worked with a local advertising agency/marketing firm that really wasn’t a catalog marketing firm. That really wasn’t a catalog company or specializing in catalogs. Our success was very limited. Whereas once we went to people who knew did this all the time and understood how to present something in a catalog, then success started to happen. We were trying to fly blind, or rather, we were running things like a retailer. Just put the product out there and people will buy it. But that’s not how this works.

CS: You also mentioned you didn’t have much in the way of call center or fulfillment employees. How many catalog employees do you have now?
FG: Being in the food business, selling food through a catalog is seasonal, typically only at Christmas. Everybody who’s in this building is either working on the catalog, fulfilling the catalog, answering the phones or producing the product that goes into the catalog. Literally almost all of the stores. This is a small catalog business, about 60 people.

CS: Are people working on the catalog at multiple locations?
FG: We’re presenting a product that has to be unique in its nostalgic appearance. For us to slap a box into another box, especially at Christmastime, that’s not going to keep that customer. So we wrap every box that goes out of here during the holiday season, which is a big plus for the customer, but really difficult for us. That puts everybody, whether they’re at this location or another location, usually doing some sort of packaging work that’s done in the facilitation area. Because we’re really not that busy in the stores when it’s not summertime, with the exception of the chocolate stores. Rather the chocolate stores are very busy this time of year, the taffy stores are not.

CS: And you said you’ve seen 30 percent growth in the past few years. How have you built out the infrastructure in that time?
FG: We undertook what I’d call a lean manufacturing endeavor about four years ago. Usually when people do that, they find an awful lot of space left over because you’re not maintaining such large inventories. We emptied a floor when we did that, but now this year, the mail order facilitation area is taking up that entire floor that we vacated. The facilitation department doubled this year. I don’t know whether I’ll be able to keep it in this building next year.

CS: So you grew up in Atlantic City?
FG: That’s right. I grew up on the beach. Our family always has been in Atlantic City. I grew up just yards from the beach; I was a lifeguard and everything. My whole history is related to the ocean and the beach, which is kind of neat since salt water taffy is our product.

CS: What are your hobbies?
FG: I fish and ski. When I go skiing we head out west, but I do a lot of boating and fishing out on the ocean. I do some ocean kayaking as well.

CS: You do most of your fishing off the Jersey shore?
FG: Yes, absolutely.

CS: What’s the biggest you’ve ever caught?
FG: Tuna, maybe 100 pounds or so.