– [Announcer] Bran X, brand Y, brand Z, not one sticks. Watch it gain in slow motion.
– Welcome to the “Sticky Branding Podcast.” In this show, we are unpacking how companies grow sticky brands. My name is Jeremy Miller, I am the founder of “Sticky Branding” and host of this podcast. In today’s episode, I am delighted to introduce you to just an absolutely brilliant CEO and entrepreneur, the CEO of Central Smith Creamery, Ian Scates. Ian, welcome to the show.
– Thank you, Jeremy, it’s great to be with you today and I’m always excited about our conversations. So I’m looking forward to this chat.
– Thank you, well, me too. So rather than giving your introduction, I’m just gonna let you do it. Tell me about Central Smith Creamery, who are you guys and what do you do?
– Well, it has a long history, Central Smith. It’s been around since 1896, and it started off as a farmers co-op, or 10 individuals who ran it and did things like making cheese and butter and separating cream, and I think they did some egg grading, and I don’t know how eggs and dairy fit together, but they seem to. And in the ’50s, a private individual bought it from the co-op, and he decided that the area that he liked the most was making ice cream. So he got things initiated with the production process of ice cream. And it’s continued to this day making ice cream. It’s a small company in a very localized business originally, but it’s branched out over the years to making and selling ice cream right across Canada from coast to coast.
– It’s remarkable. And this is your 125th year in business.
– It is.
– What’s it like just going through the generations? Actually, the simpler question is, when did you get started in the business? Were you always destined to be part of this?
– Yeah, so for me, it happened because my father, who was in the finance business, had always longed to be in business for himself. We sold pots and pans out of our basement, and reel-to-reel tapes, and greeting cards, you name it. As a family, we sold those things. So in the corporate world, dad long to get out and do something for himself. And he happened across Central Smith back in 1978, purchased it from the fellow that decided in the ’50s that ice cream was the product that Central Smith was gonna make. And unfortunately, that fellow, who was supposed to be here for a year or so to teach dad how to make ice cream, because, of course, we had no experience whatsoever, he died a couple of weeks after we purchased it. So the learning curve was fairly steep, and I just finished up university and I decided to come and help dad out 41 years ago. And so I’ve been here for a long time and I think I know pretty much everything, but with some young staff onboard these days, sometimes I realized that I don’t know at all.
– They will challenge you, that’s for sure. This is still a family business, you’ve got your wife and your daughter. So this is a plan to continue going for another a 100 years, or where do you see this happening?
– Who knows? I mean, the one thing I do know for myself is that I love working. I love the excitement of every day here. I mean, I dream about it and it’s part of our tagline. “we dream an ice cream,” but I do literally dream about ice cream, 24/7. And I’m excited that Jillian# has decided to come on board recently within the last four years or so. I couldn’t have done it without my wife, Jennifer”, who’s looked after some areas that I have no experience in. And it is very rewarding to see that other family members are just as excited and in Central Smith as I am. So I don’t know what the future holds. We’ll have to let it play itself out and see where it all goes, but I’m hoping it’s still in the Scates family in a 100 years, who knows?
– That’s very cool. Well, if we look at where you are today, you have created just a dominant market position in the frozen dessert category and in Canada. For anyone who’s listening, if you’ve had ice cream in any Canadian restaurant, we’ll chances are, you’ve eaten Central Smith’s ice cream. They are one of the dominant players in the restaurant and food services sector, but also a real leader in co-packing. And why do customers choose Central Smith first? How have you created this market position?
– Yeah, well, I think a couple of things. I mean, I’d be remiss if I didn’t say that we have the best product. I firmly believe, and I really stand behind the product. So that’s the number one thing. And I can tell you that I can speak to somebody on the phone and I can talk about Central Smith and all the wonderful things we do, but if I don’t put a bowl of it or a cone in their hands for them to taste, I am really doing myself a disservice because the proof is definitely in the ice cream. Once they’ve had a taste of it, it’s a pretty easy conversation thereafter. We have unique products and we have those products available to restaurants and customers across the country. And a distribution system that allows us to do that on a weekly basis. So those are a couple of really important parts of why we’ve been successful, and why people want our products. And then also our capabilities, what we’re capable of doing has organically grown to the point that we’ve got a lot of things or a lot in a lot of equipment in place that can turn other people’s dreams into a reality. And that’s what we do on a fairly regular basis.
– When you talk about those assets in terms of your distribution network and the products and your capabilities, obviously you have spent time developing and investing and building up that capacity. Do you look at the asset itself, say your distribution network, as the competitive advantage, or is it more just how your team approaches things in terms of identifying these opportunities and building it out so that they become your competitive advantage? How do you look at this from your perspective?
– I think they go hand in hand. You know, certainly having that… I’ll just back up a little bit. I mean, in the early days, in 1978, when we got here, trucking was pretty limited, especially when we’re talking about the distribution of ice cream. People couldn’t carry products that were minus-20 on a regular basis. And it had to be done by the manufacturers. Well, a lot has changed with these broad line distributors that existed all over the world. So now our products are riding on trucks that will be ambient temperature, mid range, and also frozen. So it’s given us a lot more scope for our business to do well. So yeah, innovation is definitely a plus for us, but if we didn’t have that distribution, we wouldn’t doing as well as we are these days. So I think the young team is now capitalizing on the fact that we do have distribution to these areas and saying, “Okay, what else can we do, and how do we get even more products in front of people across this country?” It’s a big country.
– Now, this is really, what is so interesting and neat with family business brands, is that you can actually be building your business through the generations and the accomplishments of each generation, you can stand on and then innovate from, it gives you a platform for these next levels of growth. So it really does set you up very well.
– Yeah, I think being an entrepreneur is just looking for those opportunities for growth. I mean, when I put in a type of machinery, I might not be putting it in and thinking, oh, I could do this with it, but something comes along and I say, “You know what? I think we could actually do that.” You know, sometimes to a fault of mine, I usually say, “Oh, of course I can do that.” And then I struggled for a little while trying to figure it out. But the more you know about your strengths, I think the better off you are, and probably success is probably a little easier to attain, if you know those overall capabilities.
– Changing gears for a moment. We’ve just gone… Well, we’re not even through it, but we’re coming through the tail-end of the pandemic, and being that Central Smith had such a dominant place in the food services category, that side of your business basically closed down on March 13th, 2020, how did that impact you and how did you navigate the crisis?
– Yeah, I remember vividly at the end of March in 2020, sitting down with Jen and Brat, and we were figuring out what our burn rate was, how long could we keep our nose above water? And we were worried about our employees, we’ve gotta pay them. We were really just figuring out whether or not we could last it out, and how long was it gonna be that we had the last out? Was it gonna be a couple of months? Was it gonna be a year? Nobody knew. But it was only maybe a month or month and a half later, that we could already see things transitioning. And, yes, we lost the food service side of it, but things in the retail world, as we all know, we’re picking up, everybody was going to their local grocery store and they weren’t eating out. So that side of our business certainly had lots of opportunities. So we transitioned and made ourselves more available to doing that type of packing or co-packing for companies that were selling within the retail grocery side of things. Also healthcare. Healthcare was typically always large containers, 11.4 liters of ice cream, and we were already making portions, which are sundae cups. But that side of the business really grew because a lot of these places we were selling to said, “We don’t wanna touch the product, we don’t wanna scoop the product.” So we wanted in a pre-portioned cup. And so that side of our business grew immensely as well. So we just had to be open to what was in demand and just make sure that we weren’t stuck in a rut, and saying, “Oh, no, this is all we can do.” And we pivoted and changed and looked after everybody that we could.
– How did your team… Or how did they manage? What did they accomplish through all of us? As much uncertainty as it has for the executive team, what about the rest of your employees?
– Yeah, I mean, I think initially, they were somewhat in shock. So it was, I mean, here on one hand, we’re looking at how long are we going to exist for? And then next hand we’re saying, “Oh, we’re an essential business.” And we had this ability to thrive within a very topsy-turvy world that existed. And so that excitement we capitalized on and people were coming to the table. We have huddles every morning with a very young dynamic team that we have here now. We’ve got quite a few twenty-somethings and thirty-somethings that are working here. And they’re firing off ideas left, right and center. And we’re taking some of those suggestions and incorporating them into our everyday existence. And some of those still exist today, and we’re very thankful for those ideas and thoughts that came to the table.
– Partially, some of that’s probably even understated as just your willingness and your management team’s willingness to empower your employees to bring their ideas forward and act on them, is one of the things I believe is Central Smith’s a competitive advantage. I wrote about it in my little ebook last year, “Crisis Marketing,” of how you took on e-commerce and curbside pickup, where within the… Correct me if I’m getting this wrong, but it’s, in the span of a week, you put up a Shopify store, got the word out through the Chamber of Commerce and local food bloggers. And the first week that online store was up, outsold the standard month of the retail store.
– Yeah, it’s one area that I’m still in very much in shock over. I’d always said to Jen, “it’s be nice to have some sort of presence on e-commerce.” I mean, everybody’s doing it. You know, I don’t have to tell anybody how prevalent it is in our society, but it’s hard to actually imagine e-commerce and ice cream. I mean, it just doesn’t seem like a natural fit. But you’re right. I mean, Jillian and Megan decided that a variety pack. So I should back up a tiny little bit and say, “We’ve got our freezer full of 11.4-liter tubs that are supposed to be going out to food service.” And so our thought was, well, how are we gonna move this product? We’ve got, literally, tens of thousands of tubs. So they said, “Well, let’s see if we can put together a variety packs, six flavors, and each week we’ll scoop six different flavors into one-liter containers, and sell them on e-commerce.” We live in a great community. I mean, Peter Bros. is very committed to buying local. And we had throngs of people going online, buying these products that the girls had set up on Shopify. And in December and January, to give you an example, we were out selling what we were doing in August of the typical year. So it was a great success, and we also got to move through a whole bunch of that inventory, which was even a bigger success in my mind. I didn’t have to go and throw it out at the dump. We didn’t throw away one single piece of inventory through that whole period of COVID. So, yeah, what they were able to do was just an example of how we were pivoting and changing and looking for new opportunity.
– But I think this also speaks just to a leadership question I’d like your perspective on. Because when you’re in a crisis, when the world feels like it’s falling beneath you, giving that empowerment, taking those ideas and letting people act on them is scary, the stakes are very high. How do you create that culture inside of Central Smith so that you have all these young and inspiring and engaged staff, but giving them the freedom to do what, say, Jillian and Megan did?
– It’s a really tough thing to talk about. But I think I was lucky enough to understand that I couldn’t micromanage things or Jen and I couldn’t micromanage things. Luckily, maybe a year or two before the COVID had hit, we understood that people needed the right runway to do their jobs, and they needed to have the right input. So I would say that we got a little bit lucky in the fact that we had started a lot of this work about empowerment and just them owning their position in their jobs to the point that this seemed to be a little bit more seamless when March of 20 came along. But yeah, we had to enhance it. And we had to, certainly, make everybody understand that we needed to make these changes for survival purposes. It wasn’t about making the company better and richer, this was just like, let’s try and keep it afloat. And I guess, if we’re all in the same dinghy here and mothership has left, we’re all in that survival mode and all working for a common cause and everybody was aligned to chipping in. And even so much so, one of the proudest facts that I have that happened through this period is that we only have four days of absenteeism in 14 months, which was incredible. I mean, I expected people to… There were a few people that self-selected because they had elderly parents or immune-compromised kids, there was a few of those, but the people that decided to stay on, we only have four days of absenteeism. And it’s remarkable, they were all here.
– COVID, in many ways, was an accelerant, took the culture and the work that you were doing beforehand and in terms of retail and co-packing as well as the team, the developments, and it just forced it. But now that we’re coming to the tail end of the pandemic, how do you maintain that culture, that energy, that magic that was happening in that moment in time?
– Yeah. I think, just trusting that all of that good foundational work that we’ve done and then reinforced through food through the time of COVID that it’s gonna continue. I mean, it has, I mean, it feels, in some respects, like we were all stuck in the starting blocks, that the starter had the gun up and, and yeah, we’re all making do, but even in the last month or two, that the gun’s gone off and we’re running faster than ever right now. So it’s exciting times.
– That’s remarkable. Change gears one more time. I’ve had the privilege of working with you in the Central Smith team, now for several years, and helping be a part of the growth that you’ve gone through, but for our listeners, I’d love it if you could share, what’s it been like for you? What’s it like working with Sticky Branding myself?
– Well, a couple of things I jotted down, exciting, there’s never a dull moment with Jeremy, he’s puts us on our toes, and he’s always challenging us, extremely engaging. And Jeremy knows so much about our business and typically, outside consultants, I mean, they have their worth, but Jeremy has lived and breathed our business to the point where he knows the lingo and he knows the acronyms and it’s been wonderful, motivating. I mean, you motivate us at every session that we have with you. And there’s been lots of them with our team. And certainly we’ve done AGMs and inspirational talks and all sorts of things. So it’s been great. And it’s just fun talking to you, Jeremy, about our business and you understand what we’re living through, and you’ve always got great ideas on how to help us and you care, so it’s great.
– Thank you, that means the world to me. I really appreciate that. And it is a super ton of fun. Like how can you ever go wrong marketing and branding ice cream? Everybody loves ice cream, you got the best job in the world. Last question for you is, you’ve been an entrepreneur and a leader for many years, this is what you live and breathe. What would be your best advice to other CEOs and entrepreneurs, especially as we’re coming out of this crisis? What advice do you have for others?
– People ask me this all the time and I find it really hard to answer because there’s so many different facets to success. I think what I’ve learned more recently is that, just putting in more hours is not really the route to success. I think the bigger thing, or what we’re taking advantage of lately, is that, the people that we’re hiring have so much knowledge and they really probably are not given enough credit for what education has done for them or what job experience has done for them. But if you can rely on some good people to help you… You can’t do it by yourself, you have to surround yourself with good people. And we’ve been really fortunate in making sure that who we’re hiring. And those people are fundamental in that movement forward. And that’s unfortunately not the straight line to success, more like a web, but it certainly makes it a lot easier if you can rely on it so that you can get some sleep and maybe some free time to take a holiday. And because you really do need to recharge your batteries, you can’t do it 24/7.
– Yeah, well, I think that’s just such brilliant advice, both in that it’s contrary to so much of what people see on social media with the whole hustle porn of you gotta work harder and all the memes and stuff that we’re pushing there. But I think more importantly is, all great brands are built by people and it’s smart, ambitious, creative people that are gonna put in the time. And so your job and your mission to bring in the right team is what creates the freedom. And that’s amazing.
– Yeah, very exciting.
– Where can people find you in Central Smith?
– Well, and you mentioned at the beginning that we’re in lots of restaurants. And I happy to say that a lot of those restaurants are coming back on online again, and we certainly see the volume picking up. We do make products, I can’t tell here because of confidentiality, but a lot of our products, we’re making people’s formulas and using their packaging and it ends up on store shelves across Canada as well. And yeah, retail is not our game, we don’t have our own brands on the retail shelves. Now, there’s a lot more pressure these days for that to happen. And as our brand becomes a bit stronger, we certainly are getting lots of call for it, but at this point in time, we don’t have plans for that to happen. But you’ll see us in scooping parlors. That’s probably where we’re most visible, everywhere from Gros Morne, in Newfoundland to places in the Northwest territories in Benkovac, and right across this great country, we’re scooping and parlors. And if you come to our website, you probably see evidence of where it is. And certainly on Twitter and Facebook, there’s lots of postings about where it is and where it can be found. So please look us up, centralsmith.ca, it’s pretty straightforward.
– We’ll put a link into the show notes for centralsmith.ca. Check them out on all the social media. Again, we’ll put the links out there, but also go visit the factory. And they’ve got the scooping parlor through the Summer months too. So again, I’ll put those into the show notes. And thank you so much for participating today, you’ve got such a remarkable story that the Central Smith team is truly amazing. And I hope people do try your ice cream ’cause it is delicious. And for everybody else, thank you for listening to today’s episode of the “Sticky Branding Podcast.” Be sure to subscribe to us wherever you get your favorite podcasts. We’re also up on YouTube. You can watch the video and subscribe there too. And at stickybranding.com is where you’ll find more ideas, best practices and services to help your business grow into a sticky brand.