Ronald Reagan Is Making At Least One Business Boom
Ever since Ronald Reagan began munching them in public, the lowly jelly bean has been transformed into a symbol of ultra-chic, born-again Republicanism. Herman Rowland wears a shiny gold jelly bean on a chain around his neck-but not because it's fashionable. Rowland has a much better reason: He's the man who makes the fancy gourmet jelly beans that Ronald Reagan nibbles incessantly. He makes them in 36 different flavors (including passion fruit, strawberry daiquiri, and marzipan), and lately he has been making jelly beans in quantities so vast he had to reprogram his computer to keep track of orders. Last year, Rowland's Oakland, Calif., company and its sister company in Chicago sold $5 million worth of jelly beans; this year, he expects to see sales at least double.
Rowland, 40, has been in the candy business for most of his adult life, but nothing prepared him to become an instant celebrity -- or an instant business success. "It's exciting," he says, "but I have never been under the pressure in 22 years that I've been under in the past six months."
It all started innocently enough, back in 1967, when Rowland sent a package of miniature jelly beans to Reagan, who was then governor of California. Not until 1976, though, did Reagan become a true addict of gourmet beans when Goelitz introduced its tiny, highly flavored Jelly Bellys. He carried them with him during his campaign for president and doled them out to reporters and staff members. In the first weeks of his presidency, practically every photograph showed him with a jar of Jelly Bellys nearby: Reagan and his cabinet at their first meeting dwarfed by a center-piece of Jelly Bellys in a tall cut-glass jar; Reagan picking reporters' names out of a jelly bean jar for a press conference in March; and later, after the assassination attempt, Nancy stepping out of a car with a jar of beans to take to the recuperating President.
Herman Rowland was an unknown figure, though, until a month before the inauguration, when a reporter for the San Jose Mercury 's Living section wrote a story about how the President-elect's favorite jelly beans were made by Herman Goelitz Inc., a small family owned candy company that's been making candy since 1922. Within two weeks, Rowland's candy factory in Oakland was besieged by reporters and television crews. The limelight posed a difficult question for Rowland. He wasn't sure about the protocol of implying that the President endorsed Jelly Bellys. Says Rowland, "I should have called the White House and said, 'Ronnie, what do I tell them?' But I didn't have the guts."
So instead, he decided not to talk about Reagan at all -- only about Jelly Bellys -- and started scheduling times for television crews to interview him. "My God, I went through terros those first few times," says Rowland, "knowing that the next day I was going to have to go in front of the camera and answer some interviewer's questions. And then I worried about whether what I was going to say would reflect on the business in a positive manner."
Tuesday, January 6, brought another problem for Rowland to deal with. A member of the Inaugural Committee called and asked him if he wanted to donate some Jelly Bellys. Rowland, a strong Reagan supporter, said yes and asked how many they needed. "When he told me 7,000 pounds, I just about died," he recalls. "We had to pack them and get them shipped in 10 days."
The contribution of $28,000 worth of jelly beans also brought an unexpected benefit -- an opportunity to purchase tickets to the inauguration and festivities. For the next week, Rowland gave interviews and tried to run his company, while his secretaries ran around bringing him tuxedos he could try on in his office. He and his wife, Andrea, were due to fly out to the East Coast at 6 a.m. Thursday morning.
On Wednesday, a People magazine reporter and photographer showed up on his doorstep. "That photographer set up dozens of shots and had me doing things like sticking out my belly or poking my head up amidst a bunch of pallets loaded with Jelly Bellys. We were only a week into being deluged by the media -- I was green -- I let them do everything."
The day after Rowland arrived in Washington, People magazine called again. This time, they wanted a shot of Rowland on the steps of the Capitol. "It was freezing," says Rowland. "It must have been 7 degrees below zero. The photographer had me throwing Jelly Bellys in the air while he clicked away. It was so pecking cold that those Jelly Bellys were exploding and sticking to the ground. When we were done, I said, 'Hey, we've got to clean this mess up off the steps,' and the photographer said, 'No, forget it, the birds will eat 'em.' Finally I convinced him, and there we were on the steps of the Capitol picking up hundreds of Jelly Bellys."
Soon after the inauguration, Rowland finally got a chance to visit his famous customer in the Oval Office. "I was so damn hyper," says Rowland, "that I forgot to get him to sign one of our Jelly Belly recipe cards. But I did ask him what his favorite flavor was, and he told me he didn't have one, that the ate them a handful at a time."
Back in Oakland a few days later, still reeling from the whirlwind of the inauguration and his instant celebrity status, Rowland was soon brought down to earth by a different kind of problem. Now that the whole world seemed to know that Jelly Bellys were Ronald Reagan's favorite jelly bean, Rowland had to figure out a way to keep ahead of the demand.
"We had irate customers on the phone telling us we were putting them out of business because we weren't delivering Jelly Bellys to them," says Rowland. "And our computer was going freako, the order figures were so big."
In fact, the number of orders has jumped from an average of 25 a day to 100 a day. Goelitz has stopped taking most orders from new customers, "because it wouldn't be fair to our existing customers," says Rowland. In a move to increase the supply of Jelly Bellys, Rowland has discontinued six lines of candy -- items that interfered with the production of Jelly Bellys. "My main concern is to concentrate on producing every single pound of Jelly Bellys that we can in both plants," says Rowland. "We're up to capacity now in both Oakland and Chicago, and still our backlogs have gone from 2 weeks to 30 in Oakland and 44 weeks in Chicago."
Three more steps that Rowland is taking right now to increase production are moving to 16-hour shifts from 8-hour shifts, hiring 40 more people for each plant, and buying new equipment that will allow him to shave off one day's worth of drying time from the seven days it now takes to make one Jelly Belly. "We have to be careful to maintain our quality, even as we increase our quantity," he says, "because without quality, we're nothing."
Another improvement Rowland is particularly proud of is his new system that keeps track of customers' orders. Now, when a customer places an order, he automatically receives an acknowledgement of the order and is given a date when he can expect his shipment of Jelly Bellys. "We were getting into trouble with our customers," says Rowland, "simply because we weren't communicating with them. This way, our customers know immediately how long they're going to have to wait, plus we're giving them a chance to plan ahead by checking off dates in the future that they want a delivery." Plans are to computerize this system as soon as possible.
Rowland recognizes that all these steps will still not solve his biggest problem -- his need for a larger facility to produce more Jelly Bellys. But he's equally aware that growing too fast could kill his company. "I know you're supposed to think big, big, big," he says, "but they don't talk about those who thought big and dropped out at the bottom. They only talk about those who thought big and made it. We're on a rampage right now because of the huge increae in sales, and we've never been on better financial footing. We've moved ahead in three months what would normally have taken us a couple of years. But we're conservative about capital expenditures, because we're always thinking, What happens if Jelly Bellys flattens out?"
Rowland claims he won't move into a larger facility until he can totally capitalize it himself, and he thinks six months from now he'll be in better control of growth and able to set a date for the company's move to new quarters outside the city limits of Oakland.
And besides, he says, you've got to live, too. The increased demand for Jelly Bellys and new-found notoriety has already "raised hell" with his family life because of his long working hours. "I used to think 8 a.m. to 6 p.m. was a long day," Rowland sighs, "but now I'm in here 12 hours a day. It really bothers me that the President of the United States can run the whole pecking country on 8 hours a day -- that's his philosophy -- and I can't run my own little company on 8 hours a day. It means I'm not delegating enough, because I like to have my fingers in everything."
The one area that he has delegated, though, is his dealings with the press. Now, he has his secretary route all requests for interviews through his own public relations man."We wouldn't be where we are today if I hadn't talked to the press," he says, "but I was letting it take time from what I should have been concentrating on -- making more Jelly Bellys."
For all the long hours and the pressure of trying to keep up with the demand for Jelly Bellys, Rowland still enjoys what he's doing. He talks with the White House weekly to take orders for Jelly Bellys. Sometimes he calls to get advice on what he's allowed to say about the President's Jelly Belly habit. "I've got so many phone numbers," he says, "that I just list them all under W for White House."
Then he puts away the address book he was flipping through and gets serious.
"Sure it's tough to be suddenly thrust into the limelight," he says, "but how can you say that you don't want to be in a situation like this when it does such good things for your business? It's not a normal progression for growth, so you have to recondition your thinking and you have to recognize that some things are going to become a little ragged when you're under pressure. But one thing's for sure: You don't want to miss the boat when an opportunity like this comes along."