When your business is fresh-cut fruits and vegetables, you’re faced with the unpredictable wrath of Mother Nature, food safety issues and a short shelf life for your product.
But those challenges haven’t deterred Steve Karr, CEO of Pride Pak, from leading his Mississauga company to the forefront of the fresh produce processing industry. In Canada, fresh-cut fruits and vegetables and packaged salads represent nearly 20% of the total produce available in grocery stores. The industry is worth an estimated $14 billion a year in North America.
“Perishable commodities are as unpredictable as the stock market,” Karr says. “It’s a complex business because there are so many variables that are impossible to control, such as weather and growing conditions. In my world, you always need a contingency plan.”
Karr got started in the 1970s as a wholesaler, supplying fresh fruits and vegetables to hotels and restaurants in Toronto. Working with buyers and chefs in the early 80s, he recognized that there was a growing demand for pre-packaged cut fruits and vegetables, which would save kitchen space and labour costs.
In early 1984, he produced his first sample of fresh-cut vegetables. Today, his company is one of the largest processors of fresh fruit and vegetables in Canada, and his produce goes to restaurants and retail stores in Canada and the U.S. under a variety of brand names. “We’ve seen significant growth over the years because we’ve responded to a growing demand from consumers who want fresh, high-quality and nutritious food that is easy to use.”
With nearly 200 employees in the peak summer season, Pride Pak is slated to move into a new 120,000-square-foot facility in the coming months. The construction was financed by BDC. The company also opened a second plant in Paradise, Newfoundland 4 years ago, which services the province’s stores and restaurants. “The market was ripe there and I had no real competition,” Karr says.
Apart from his foresight in jumping on business opportunities, he attributes much of his company’s success to an impeccable reputation for food safety in an industry where demands are high. His company pays keen attention to inspections and selecting growers. 4 years ago, a processor in the U.S. had a major E-coli outbreak from tainted spinach, which led to new guidelines in the industry.
“We have our own inspectors that check fields before planting and twice during growing, including pathogen testing prior to harvesting. Our inspector also checks the field to make sure there are no traces of animals such as feces, tracks and nibbled leaves,” he says. “Our growers are our business partners. They are assured of long contracts with us if they comply with our food safety protocols and quality. It’s a win-win.”
The company is also focused on R&D in areas such as food quality. Pride Pak has worked closely with food scientists at the University of Guelph to conduct research in how to extend shelf life and the nutritional content of packaged fresh produce.
For Karr, operational efficiency is also at the top of his agenda. For example, Pride Pak has partnered with the University of Waterloo to build an onion peeling machine. “We’re always looking for ways to produce more, faster,” Karr says.
In an industry where retaining employees more than a few months is a challenge, Karr has stepped up efforts to attract new hires and maintain their loyalty. “Your production line people are your backbone. We offer perks such as profit sharing for employees who are willing to put in those extra hours,” he says. The company also has a social responsibility program, which is committed to treating employees fairly. “That also extends to our suppliers. Our growers in Mexico are expected to treat their employees with respect. That’s a part of the deal when they work with us.”
Pride Pak is a family-run business, so succession planning is a priority for Karr, aged 60. He and his brother work at the company with Karr’s 3 children. Although he’s not ready to retire yet, he has concrete plans to ensure that his business will be in good hands within the family.
“Over the years, I’ve passed on my business philosophy to my family. I believe that when things get rough, you don’t feel sorry for yourself. This is a tough business but you have to get out there and fight for it. The most fulfilling part of being an entrepreneur is getting past those obstacles and winning. It’s what has kept me going all of these years.”
- Keep an eye on your market and be responsive to changes and trends that can increase your company’s sales.
- Be highly selective about your suppliers. They are a key part of your company and its reputation.
- Increase productivity by investing in technology.
- Attract and retain employees with job perks such as profit-sharing.
- Make succession planning a priority to ensure your business will be in good hands.
Content in this section is provided in partnership with the Business Development Bank of Canada. BDC provides entrepreneurs with financing, venture capital and consulting services. To find out more go to BDC.ca.