Ben & Jerry’s President to Quit After 20 Months in the Position
Turns out that Ben & Jerry Homemade Inc.'s first professional president, hired amid much fanfare, was just the flavor of the year. Well, 20 months to be exact.
Robert Holland Jr., a management consultant who was hired to head the Waterbury, Vt.-based company after a nationwide essay-writing contest, will resign, the company said Friday. It didn’t say why.
Holland, 55, a former consultant at New York City-based management consultants McKinsey & Co., has experience in turning around struggling companies. He was hired in February 1995 to work his magic at the company that has given the world Cherry Garcia, Chunky Monkey and other premium ice cream flavors.
The company’s stock has been trading at its lowest levels, and the company has projected that its third-quarter earnings will be less than those of a year ago because of high dairy costs and slower ice cream sales.
The official scoop on the latest development was terse. “Bob arrived just when we needed him to help straighten out our operations,” said Ben Cohen, chairman and co-founder. “Get our new plant up and running, start our international business and launch our new sorbet line. We are grateful for his contributions.”
Holland’s statement was cryptic.
“When you couple the marketplace challenges with the predictably tough demands associated with succeeding founders,” he said, “the need for accelerated succession is clear.”
Holland was hired to replace Cohen, who wanted to spend more time developing new flavors. Holland will leave Oct. 31 but will remain as a director through June. 1997.
Ben & Jerry’s is known for its folksy image, and the search that led to Holland’s appointment began with an essay contest on why the participant wanted to head the company. About 25,000 people entered. Although that homespun part of the executive hunt got all the media attention, the company had in fact hired an executive search firm to supplement the contest. It was the search firm that found Holland.
But don’t look for another essay contest this time. A board subcommittee will look for a successor.
The company’s stock lost $1, or almost 8%, after the news was announced. The shares later recovered a bit to close at $12.75, down 50 cents, on Nasdaq.
Although Wall Street analysts credited Holland with solving production problems and temporarily boosting earnings, he couldn’t stop a loss of customers. U.S. demand for high-fat ice cream is waning even as rival Haagen-Dazs gives discounts to boost market share.
The resignation “creates an opportunity for them to bring in a real consumer-goods sales and marketing type of leader,” Hambrecht & Quist analyst Jean-Michel Valette said.
Ben & Jerry’s ice cream sales fell 4.1% to $116.4 million in the 52 weeks ended July 14, whereas Haagen-Dazs sales rose 3.9% to $138.4 million, according to Information Resources Inc. Haagen-Dazs is owned by Grand Metropolitan.
Although Holland tried to preserve the company’s reputation for liberal political activism, he concentrated its efforts on increasing earnings.
He got off to a good start, writing down the company’s investment in a troubled new plant and reporting earnings above Wall Street expectations for four straight quarters. In addition, Ben & Jerry’s in February rolled out nonfat sorbets, which have been well received.
Holland said the firm’s expansion into Europe is on target, although “not as fast as I would like.”
Times wire services contributed to this report.