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HOW I DID IT

How I Did It: Bob Moore, Bob's Red Mill

Bob Moore was a middle-aged retiree when he launched his second career. He nurtured it into a $70 million business -- and then gave it away to his employees.
Curious Man A book about an 18th-century gristmill inspired Bob Moore to launch his second career.

Courtesy subject

Full Service Bob Moore, right, sold his house for $4,500 in 1955 to set himself up in the gas station business. A few years later, he lost it all.

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Bob's Red Mill Natural Foods, based in Milwaukie, Oregon, started 32 years ago as a gleam in the eye of a middle-aged retiree. By 2009, Bob Moore had built a company with sales of $70 million a year in whole-grain flours and cereals, with annual growth rates of 20 percent to 30 percent. In February, Moore celebrated his 81st birthday by instituting an employee stock ownership plan, or ESOP, and ceding ownership of Bob's Red Mill to its 200-plus workers. Moore's decision was a product of years of planning -- and of a lifelong commitment to ethical conduct.

I grew up in Los Angeles in the 1930s, when it was a wonderful place to be a child. I got out of the Army in 1950 and went to work for U.S. Electrical Motors -- they're still in business. I had a bright future with them; plus, I was married with three little boys. But I'd always dreamed about going into business for myself.

To put a few extras on my family's table, I'd been working weekends at a Shell station. A sign went up on one corner saying a new Mobil station would be opening. I called, and pretty soon we had a deal. I sold our house and put the $4,500 down on the gas station. I quit my job and went into business.

In those days, you didn't just take care of cars; you took care of people. I would wipe windows, check the tires and underneath the hood. I cleared 4 and a half cents a gallon, 5 cents for high test. My bookkeeper would laugh at me. But I wore a freshly washed uniform every day, and the sun was always shining.

Then the smog started to get bad. Charlee, my wife, and I felt that getting out of L.A. would be good for the boys' health. I drove around the state looking at gas stations for sale and ended up buying one in Mammoth Lakes, California, in September 1959.

I had a pocketful of cash from selling our house and station in Los Angeles. We bought a big mobile home. We took trips with the boys. We bought a lot of things we didn't need. Mammoth Lakes was a ski town. But Thanksgiving and Christmas went by with no snow. Then we got 14 feet of snow in January! The roads were impassable. The snow was still deep in July, and that kept away the summer tourists. One year after leaving Los Angeles, I was broke.

Charlee and I saw an ad for a five-acre dairy farm for rent outside of Sacramento. I got a job at a Firestone tire store. It was about this time that Charlee got into baking bread. We started going to Elliott's Natural Foods in Sacramento to buy whole-grain flour. It's still in business today -- it's one of our customers. Whole grains opened up a whole different life for us.

One of my customers was an executive for Penney's. He told me I should come to work for his company. I drove up to Redding and got a job at the Penney's auto center, and soon we moved the family there. One day in the public library, I came across a book titled John Goffe's Mill, by George Woodbury.

It was about an archaeologist who had inherited an old gristmill in New Hampshire and fixed it up and turned it into a livelihood. That book inspired me. George Woodbury took that mill from a disaster to where everything worked. He had no experience with machinery or business. I knew a lot about both. If this guy could do it, so could I.

I put in 10 years at Penney's. Charlee and I saved enough to retire. We decided to move up to Portland so I could attend seminary. I wasn't thinking about the ministry. My ambition was to learn to read the Bible in its original Greek and Hebrew. I get interested in a subject and can't rest until I've learned everything possible about it. I drive people crazy.

Shortly after we moved to Portland, Charlee and I decided to take a walk. We happened across this abandoned old mill. Its paint was fading, but you could still make out the red color. I realized that this was our mill. It was a providential moment.

Over the next 10 years, we built Bob's Red Mill into a successful small company, supplying natural food stores in the Northwest. We were known for our quality and attention to detail; I had traveled all over the U.S. to find the highest-grade old stones to use in our mill. We were doing about $3 million a year in sales. And then, on the night of June 15, 1988, a deranged woman set fire to the mill and burned it to the ground. I was 59 years old and faced with the prospect of starting again from scratch. Fortunately, we were able to recover our two old-world millstones.

In 1990, we stepped out of our small-business category at the annual natural foods trade show in Anaheim. Our booth got flooded with visitors. Bob's Red Mill was the only company that had gone for the production of deep-down, fundamental whole grains.

When you're in business, there are two doors you can walk through. You can walk through the door where you treat the customer like your guest, operating by the rule that the customer is always right. Or you can be cutthroat. The first door is the door of kindness. That's the one I decided to walk through.

I field a lot of offers from corporations wanting to buy us, but I've never considered that option. If you visit our mill, you'll notice a strong family feeling. A lot of our employees have been with us a long time, some as long as 30 years. One of our electricians put four kids through college while working for Bob's Red Mill. I never plan on retiring, but the day will come when I'm not around anymore. I've done a lot of thinking about that day.

I just can't envision the company in any better hands than those of the workers and management we have now. That's where the ESOP idea comes from. In an ESOP, I'm selling them Bob's Red Mill, but at the same time, as individuals, they don't have to pay for it. The idea might not work for a company with a different philosophy toward its customers and the people who have built the business, but I think it will work for us.

For a full archive of How I Did It features, visit www.inc.com/hidi.

IMAGE: Robbie McClaran
Last updated: May 1, 2010




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