Ben and Jerry Have Kept Their Cool : Once-Nerdy, ‘60s Pals Taste Success With Ice Cream Firm
It wasn’t the prospect of failure that bothered Bennett Cohen and Jerry Greenfield. Success was the problem.
They had, after all, racked up an impressive array of flops together over the 20-year course of a friendship formed between “the two fattest, slowest guys” in seventh-grade gym class and cemented through four nerdy, girlfriendless years of high school, Jerry’s failure to get into medical school and Ben’s career as college dropout, janitor and potter.
Then they set out to open a modest ice cream shop--and wound up with the nation’s third-largest super-premium ice cream company (just behind Haagen-Dazs and Frusen Gladje).
It didn’t happen overnight, of course. Success sort of sneaked up on Ben and Jerry, and with it came trauma.
“Two or three years into this, there came a day when I had to look myself in the eye and say, ‘I’m not an ice cream man anymore. I’m a businessman,’ ” recalls Ben, the company president. “It was a real bitter pill.”
Cling to ‘60s Values
Bitter because Ben and Jerry grew up during the ‘60s.
Backpacks were “in.”
MBAs were “out.”
Old values die hard. The prospect of success in business literally sent Jerry packing. He moved to Arizona for 2 1/2 years, leaving Ben behind to contemplate selling the company.
“That’s when I realized I had another option,” said Ben. “I thought, if I can create a business with no negative things, a business that’s a positive force, there’d be nothing wrong with that.”
And that, ice cream lovers, is why they do things a bit differently at Ben & Jerry’s Homemade Inc., perhaps the nation’s only $30-million business run by two guys who don’t own a suit.
Yes, $30 million in sales is what Ben & Jerry’s expects this year, provided America’s appetite for premium and super-premium ice cream continues to be insatiable. Market research shows sales of top-of-the-line ice creams rising by 13.3% a year and headed for $3.4 billion by 1990.
According to FIND/SVP, a New York-based firm, perhaps 14 super-premium ice cream brands are now competing for space in supermarket freezers. Many, such as Steve’s Homemade Ice Cream Inc., launched 15 years ago by a former cab driver in Somerville, Mass., are regional companies that started small and are expanding to meet the growing demand for high-quality ice cream.
More Fat, Less Air
Premium and super-premium ice creams contain less air and more butterfat than garden-variety supermarket ice creams, which may be up to 50% air and may weigh as little as 4 1/2 pounds per gallon. A gallon of Ben & Jerry’s ice cream tips the scales at 7 pounds and is 17% air.
Ben & Jerry’s aficionados tend to talk less about butterfat and air than they do about, say, the white and dark chocolate chunks, pecans, walnuts and chocolate-covered almonds in New York Super Fudge Chunk, or the bing cherries and chocolate chunks in Cherry Garcia--just two of the company’s 39 flavors.
But it’s not just unusual flavors that sets Ben & Jerry’s apart.
Each year, 7 1/2% of the company’s pretax profit is donated to charity. “Corporate America considers 2% to be real generous,” Ben said.
One of every 100 Vermont households owns a piece of the company, which went public three years ago with an equity offering made available first to Vermonters, then to the rest of the nation.
Limits on Salaries
And neither the company’s president nor its “director of mobile promotions,” as Jerry is calling himself this week, earns more than $60,000, and nobody earns less than $12,000. “No one deserves to make the kind of money big business people make,” said Ben, who still lives in a rented apartment.
At 37, he is bearded and balding, with thoughtful blue eyes and the first blush of a summer sunburn. He arrives for an interview with a shiny new set of wheels--two wheels, not four. The bicycle turns out to be his only major purchase since he became an ice cream magnate.
Jerry, who is dark-haired, outgoing and rumpled, arrives in a green T-shirt bearing the company logo: Holstein cows on a field of green grass, with blue sky and clouds overhead.
The nerdiness of their youth is long gone, as are most of the extra pounds, although both have slight ice cream bellies and either can point out the best local sources of French fries, hot dogs and other junk-food standbys.
The intensity of their ice cream flavors can be attributed to Ben’s underdeveloped taste buds, which, in turn, they trace to his mother’s cooking. “Ben was the only kid in our school who thought school food was good,” said Jerry.
He describes Ben as “the creative one, the risk-taker, the perfectionist.” Jerry, says Ben, is “a great boss, a team player, a good coach.”
Pals Become Partners
Jerry was the good student, Ben the underachiever. Ben was voted “Most Likely to Succeed” in sixth grade, but it wasn’t success he seemed headed for in 1977, when he teamed up with his pal Jerry, a former lab technician.
They pooled their $6,000 savings, borrowed $2,000 from Ben’s father and set about fulfilling their boyhood dream of starting their own business.
Their plan was to bring some sort of big-city food to a small college town. After long debates about shish kebab and fondue, they narrowed their choices to ice cream and bagels and the potential locations to either Burlington or Saratoga Springs, N.Y.
Like most of their decisions, this one proved serendipitous. While they were thinking things over, a guy in Saratoga opened an ice cream shop. Then they learned that bagel-making machinery would cost $40,000.
So much for market research.
With a $5 correspondence course in ice cream-making under their rapidly expanding belts, they patched the roof of an abandoned Burlington gas station and opened their scoop shop on May 5, 1978.
Times being tough, they often were forced to use whatever free samples came in that day’s mail. This led to some memorable experiments: “Lemon Peppermint Carob Chip,” Ben recalled. “Honey Apple Raisin Oreo. Whew!”
Still, they made far more good ice cream than bad, and the shop was an immediate hit. Yet despite the endless lines that formed outside the gas station, they barely eked out a living that year and the next.
When area restaurants began clamoring for their ice cream, Ben packed up a Styrofoam cooler, loaded it into his venerable Volkswagen squareback and began speeding around the state making deliveries. Eventually, it dawned on him that he was driving past an awful lot of supermarkets on his daily rounds.
So they borrowed $15,000 from the Small Business Administration and in 1980, began manufacturing ice cream in pints. Their growth rate since has been 100% each year. Ben & Jerry’s ice cream is now available in 35 states.
The gas station is long gone now, replaced by three company-owned stores in Burlington, Waterbury and Montpelier, and a growing string of franchise shops--29 at last count, and 10 more due to open by year’s end.
Modern Factory Opened
The original 5-gallon, rock-salt-and-ice freezer has been supplanted by a gleaming factory in Waterbury that churns out 17,000 gallons a day.
But the Ben & Jerry’s philosophy hasn’t changed. As the company has grown and prospered, Vermonters have prospered along with it, as have school kids, old people, farmers and the unemployed.
The decision to spurn venture capital in favor of selling shares to Vermonters has proven a sound one. “Our advisers said it was a stupid thing to do,” said Ben, “but we really wanted the community to become the owners.”
Ben retains control of 30% of the stock and Jerry owns 10%.
The Ben & Jerry’s Foundation, established with $500,000 from the initial stock offering, has helped pay for everything from cooperative day-care centers to job-retraining programs, as well as community celebrations and cultural events. Last year, the foundation awarded grants totaling $140,000 and the company gave away $160,000 worth of ice cream.
So far this year, 160,000 pints of ice cream have been given to food banks, day-care centers, soup kitchens and housing projects in Boston, New York, Philadelphia and Washington.
Special Flavor Sales
Dreaming up new ways to give away ice cream is one of the majority stockholders’ favorite duties--right up there with taste-testing.
A “Hall of Fame” at their Waterbury plant commemorates some of the more memorable giveaways: the January White Sale, in which every white flavor is discounted 10% (whipped cream included); the Win-Your-Weight-in-Ice-Cream Coloring Contest, and the Aug. 20 “Dog Day” Promotion, when every four-legged customer got a free dish.
“The nice thing about ice cream,” Ben says, “is that it’s not innately harmful to people or the environment.”