B&G Foods builds up natural snacks empire, sees “huge upside” for True North and Pirate’s Booty

Natural snack brands including Pirate’s Booty (gluten-free rice and corn puffs) and True North (premium nut clusters) have huge untapped growth potential, bosses at B&G Foods told delegates at the Barclays back to School conference this week.

While New Jersey-based B&G is best known for grocery brands such as Grandma’s Molasses, Ortega and Cream of Wheat, it has recently made a series of acquisitions in the natural snacking arena, said executive vice president Bob Cantwell.  

‘We now have a snack sales organization to go after these brands and really move the needle’

The buying spree started in October 2012 with the $62.5m acquisition of the New York Style bagel crisps and Old London snack brands (Melba Toasts, Devonsheer, JJ Flats) from Chipita America.

Just seven months later in May 2013, B&G snapped up the True North nut clusters brand from DeMet's Candy, rapidly followed in July 2013 by the $195m acquisition of Robert's American Gourmet Food (‘Pirate Brands’), adding the gluten-free Pirate's Booty, Smart Puffs, and Original Tings brands to its stable.

 “As we go forward, the snacks in our portfolio, the snacks business, the three businesses combined are about $150m in sales”, said Cantwell. “Snacks become 19% of our business.”

He added: “We think the Pirate’s Booty name is a great name. It has been growing at over 20% a year. There is a lot more growth to it and a lot more ability to take that Pirate’s Booty name outside of its existing product line.”

However, there was also “huge upside” for True North, he said. “One of the little diamonds in the rough is the TrueNorth brand. It’s all natural. It’s gluten free.”

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B&G acquired the True North nut clusters brand from DeMet's Candy in May 2013

“[There is] huge opportunity [to grow] this brand and… we have added 15 people from Pirate Brands all in sales and marketing. They are top notch people and we now have a real sales snack organization to go after these snack brands and really move the needle.”

‘Pirate’s Booty has been growing at over 20% a year’

As for Pirate’s Booty, he said, it primarily appealed to women aged 18-40: “This is a very young women’s product. It’s a better for you snack. It’s still a salty snack but it’s better for you. It’s fairly low calories per one ounce bag.”

But it also appealed to kids, he added: “Pirate’s Booty can mean a lot of things to a lot of people. You know it could be kid’s crackers and shapes of pirates, it could be a lots of things. I mean we could be in Mac and Cheese, we could be in fruit roll, there are a lot of things that this brand we think can translate to.”

Walmart struggles with the whole natural category

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B&G: 'Walmart struggles with the whole natural category'

As for distribution, he said, “the business today is heavily distributed on the east coast, pretty good distribution on the west coast, not very good on the center of this country, it’s spotty.

“So it [is stocked in] all the grocery stores on the east coast. It’s in Target. Target is growing substantially for this brand. You are finding it in CVS, [but] you don’t usually find them in 7-Eleven yet. It should be there and the biggest customer that doesn’t sell them today which we need to get them into is Walmart.

“Wal-Mart is the first huge opportunity for this brand… [But] Walmart struggles with the whole natural category. So it’s problematic within their store but it needs to be there.”

A steady stream of acquisitions

B&G Foods has grown sales from $467m in 2008 to $634m in 2012 through a stream of acquisitions of unloved brands often from larger players such as Kraft and Unilever that were unable to give them the attention they deserved, said Cantwell.

Net income rose from $9.7m to $59.3m during the same period.