The Snack Food That's Eating America

Portrait of a very hot product

Most people view product as the one aspect of a business over which they have absolute control -- unlike capital, say, or employees. But most products I have seen develop a life of their own, beyond anyone's power to control. Just look at this innocent little snack called Smartfood, which has managed to reroute the lives of everyone drawn into its orbit. -- J.P.K.

Let us strip away the mystery right here and get down to what we're really talking about. We're talking about cheese popcorn. In a bag. Good popcorn, to be sure. Premium-quality, white Kentucky-kernel popcorn, seasoned with aged cheddar cheese. Wholesome, natural, no artificial preservatives or coloring. Clever packaging -- ever see a snack food in basic black before? -- complete with cute little messages from the manufacturer. Very zippy, very hip. But, nevertheless, cheese popcorn.

And let us further reflect upon how this particular cheese popcorn came to be. It did not come out of the R&D department of Borden or Frito-Lay. Years of expensive consumer testing did not produce this popcorn, which, if truth be known, was originally intended as mere bag filler for a new concept in snack-food packaging. No, this popcorn came from Ann Withey's kitchen stove. Withey, 21, perfected the recipe after fooling around with dozens of different combinations of ingredients. She then fed the results to her 29-year-old husband, Andrew Martin, and their 26-year-old friend and business associate, Ken Meyers. Martin and Meyers thought it tasted swell. They also thought it would make a very smart idea for an all-natural snack food -- so smart they decided to name it Smartfood.

What none of them knew was that they held in their hands a product most entrepreneurs only dream about -- a product so sensational, so right, that it had the potential to utterly transform not only their lives but the lives of hundreds of people they didn't even know. Before long, investors would rush in to finance it, competitors would scramble to imitate it, distributors would alter their product mix to carry it, and even the giants in this $8-billion industry, the ones spending millions each year to develop and market new snack foods, would be forced to sit up and say: Who are these guys?

But all that was down a long and winding road. At the time it was just . . . cheese popcorn. Even the black bag came later.

So did the message.

The Distributor

Tom Protheroe is sitting in his cramped office at Hartford Snack Distributors Inc., a Connecticut-based snack-food distributorship he took over in 1975. Strewn about him are the bags and sacks and cellophane-wrapped morsels of a junk-food vendor's livelihood. Protheroe, 52, is explaining, insofar as explanations matter, how he, a grown man with children, could gain (and later shed) 37 pounds of excess body weight by consuming two four-ounce bags of cheese popcorn a day for -- gulp -- 18 months. The word that comes up most often is "addiction.'

"In my 30 years in the business," avers Protheroe, "I have never -- never -- seen a snack-food item catch on like Smartfood has. This stuff is completely addictive. It flies out of my warehouse. I've probably carried a hundred or so snack-food lines over the years, and believe me, of all those, Smartfood stands alone. It has fundamentally and absolutely changed our business.'

Changes in his own waistline notwithstanding, Protheroe's perspective on the Smartfood phenomenon is keener than most. Four years ago, he was sitting in this same office at the end of the day when two strangers appeared. One of them was Andrew Martin, a dark-haired, bearded man with pixie eyes, a beguiling smile, and a degree in economics. Martin's professional credentials included driving a New York City taxi for four years and working for a research group investigating U.S. defense-technology transfer to the Soviet Union. The other was Ken Meyers. Boyish and fair-haired, Meyers, a former journalism student, had played press secretary to a Connecticut congressman before fleeing Capitol Hill in search of "something I could sink my teeth into." Hardly a likely pair to be interested in the snack business, but you never know.

"The first time they just wanted to talk about the snack-food industry in general," recalls Protheroe. "I really didn't think much of it. They were asking things like, 'If we came up with an unusual snack item, what would we do next?' A few weeks later they turned up again, only this time they brought a bag of cheese popcorn.'

Protheroe was polite. He explained that he already carried a line of cheese popcorn -- the orange-yellowish variety that had been around for years -- and that there was no such category as "premium cheese popcorn. "Funny thing was," he smiles, "while I was sitting there, I ate my way through the whole damn bag.'

On their next visit, the discussion became more focused. Protheroe lectured them on operating costs, profit margins, and how to set up a store-door delivery system. Reading through their business plan, he alerted them to potential problems with quality control and suppliers. When he'd finished, they showed him a mock-up of the first Smartfood bag. It featured a coal-black background with a bright green cornstalk and neon-yellow kernels spilling out of the top -- a piece of true pop art. (To this was later added a note on the back from the founders. "Unlike naughty junk-food companies who do mean and nasty things to their popcorn," they wrote, "we treat our kernels with the love and respect that real food deserves.')

Protheroe didn't know quite what to make of the packaging, either. "It looked weird," he says. "I mean, a black bag? People in my company thought we were crazy, that we'd never be able to sell a four-ounce bag of popcorn for $1.39 no matter how good it tasted. But I wasn't so sure.'

The Founders

Andrew Martin swears to this day that it was the Tug-N-Tie resealable bag -- not cheese popcorn -- that initially fueled his entrepreneurial ambition. "Building a business around Smartfood didn't excite me at all," he says. "What Ken and I were focused on was coming up with a vehicle to launch Tug-N-Tie. See, for all the money companies like Frito-Lay had spent trying, nobody in the snack-food industry had ever come up with a reclosable bag that was, one, cheap to produce, and two, easily adaptable to existing technology. Everyone we talked to told us that resealable bags were a potential gold mine if we could solve those problems. So it seemed logical that the market for Tug-N-Tie would be enormous -- maybe $30 million a year in royalties.'