WEBVTT - Vlasic Gets Into a Pickle 0:00:04.120 --> 0:00:07.520 Welcome to Business on the Brink, a production from I 0:00:07.680 --> 0:00:14.320 Heart Radio and How Stuff Works. Joe Lastic had a 0:00:14.400 --> 0:00:17.360 cream of the crop idea when he decided to add 0:00:17.400 --> 0:00:20.799 polish pickles to the family creamery business, and then he 0:00:20.880 --> 0:00:24.479 hated things up further with innovative packaging and marketing. But 0:00:24.680 --> 0:00:28.400 despite holding a majority of this condiments market, things went 0:00:28.760 --> 0:00:33.960 sour and the company soon found themselves in Well find 0:00:33.960 --> 0:00:36.680 out what's the dial when we talk about how Blastic 0:00:36.800 --> 0:00:49.960 became a business on the Brink. Hi everyone, I'm Jonathan 0:00:49.960 --> 0:00:52.680 Strickland and I'm Ario Cast and welcome to Business on 0:00:52.720 --> 0:00:57.520 the Brink and arial. Once again, my proverbial but metaphorical 0:00:57.600 --> 0:01:00.480 hat is off to you for that amazing introduction. Thank you. 0:01:00.520 --> 0:01:02.520 I wasn't sure if you're going to love it or 0:01:02.600 --> 0:01:04.000 hate it. No, you weren't sure if I was going 0:01:04.040 --> 0:01:06.679 to love it or really love it. Well, hopefully the 0:01:06.680 --> 0:01:10.320 person who suggested this topic, Will Codis, will also really 0:01:10.360 --> 0:01:15.119 love it. Yes, so we're talking about Velastic Pickles, which, uh, 0:01:15.200 --> 0:01:17.679 you know, it's one of those those brand names that 0:01:17.760 --> 0:01:20.680 I've certainly come into contact with but for some reason 0:01:20.720 --> 0:01:23.800 didn't have sticking power in my brain. So as I 0:01:23.840 --> 0:01:25.920 was going through the notes, I was sitting there thinking like, 0:01:25.959 --> 0:01:27.319 why do I know this? And as soon as I 0:01:27.360 --> 0:01:31.679 get to the the iconic character that was used to 0:01:31.840 --> 0:01:35.880 market the pickles, and I said, oh, right, that's these guys. 0:01:36.000 --> 0:01:38.640 Well you'd have to because and we'll get to it. 0:01:39.760 --> 0:01:43.080 Most pickle companies don't do a lot of marketing. Yeah. 0:01:43.120 --> 0:01:46.039 I remember the Kates Pickles folks because they were out 0:01:46.040 --> 0:01:50.120 of the Carolina's and they cast an actor as their 0:01:50.120 --> 0:01:54.880 spokesman who was later a slasher killer character on a 0:01:54.880 --> 0:01:57.520 horror movie that I was in. That's a lot of 0:01:57.880 --> 0:01:59.960 tangent that has nothing to do with the rest of 0:02:00.040 --> 0:02:02.800 this episode. You know what, though, It's a glimpse into 0:02:02.800 --> 0:02:05.960 your life, and we're all grateful for it. Jonathan, So, um, 0:02:06.080 --> 0:02:09.320 do you even like pickles? You know what? Um? It 0:02:09.440 --> 0:02:12.040 was a certainly a more recent acquired taste for me 0:02:12.320 --> 0:02:16.840 as a kid. I despised them me too. I could, 0:02:17.800 --> 0:02:20.160 once in a blue moon eats something that pickles in it, 0:02:20.200 --> 0:02:23.880 like a potato salad or something, but I never wanted 0:02:23.880 --> 0:02:26.040 to have a pickle spear. I didn't want pickles on 0:02:26.120 --> 0:02:30.040 my burger. I was one of those those stereotypical picky 0:02:30.080 --> 0:02:33.440 eater kids who there was like maybe three things in 0:02:33.440 --> 0:02:35.040 the world that I wanted to eat, and I only 0:02:35.040 --> 0:02:38.079 wanted to eat those things. But these days, um, actually 0:02:38.400 --> 0:02:41.880 I like a good pickle, me too. I like a 0:02:41.880 --> 0:02:44.919 lot of pickled things, pickled beats, jeered deli, Jeri della. 0:02:45.800 --> 0:02:47.320 I can't pronounce it, but I like to put it 0:02:47.360 --> 0:02:52.400 in my mouth. Well, I mean so, I also really 0:02:52.400 --> 0:02:55.840 like pickled vegetables too. And uh, and and also you 0:02:55.880 --> 0:02:59.240 and I both worked at a place where pickles were 0:03:00.120 --> 0:03:04.959 pretty important to maintaining your ability to continue to stay upright. Yeah, 0:03:05.000 --> 0:03:08.000 the George Renaissance Festival. Uh, that is actually where I 0:03:08.080 --> 0:03:10.919 learned to enjoy them, because they weren't the little floppy 0:03:10.960 --> 0:03:12.880 things you got next to your sandwich at a fast 0:03:12.880 --> 0:03:17.280 food restaurant. They were nice, crisp pickles, like fresh pickles. Yeah, 0:03:17.280 --> 0:03:19.520 and this was because they had a lot of salt 0:03:19.520 --> 0:03:23.120 and electro lights in them that helped us maintain ourselves 0:03:23.160 --> 0:03:27.200 after sweating like crazy all day. So let's talk about 0:03:27.320 --> 0:03:31.480 Vlastic pickles in particular. And I did not even know 0:03:31.600 --> 0:03:34.600 that they were named after the person who started the 0:03:34.600 --> 0:03:37.880 whole business, Jove Lastic. So tell me a bit about Joe. 0:03:38.200 --> 0:03:41.120 So Joe Lastic was the son of a creation immigrant 0:03:41.200 --> 0:03:43.680 who moved to Detroit with his family and started a 0:03:43.800 --> 0:03:48.640 creamery business. Um. He had been working a factory job 0:03:48.800 --> 0:03:51.880 during the day and was saving his every pen he 0:03:51.920 --> 0:03:55.440 could from his two dollar a day job to start 0:03:55.480 --> 0:03:59.920 this creamery. Wow. Yeah, that's that's definitely a bootstrapped operation 0:04:00.120 --> 0:04:02.640 right there. Yeah. Well, Joe took over the family creamery 0:04:02.640 --> 0:04:06.280 in the twenties and then in seven he added pickles 0:04:06.480 --> 0:04:11.960 to the mix of what this creamery was selling. Logical step. 0:04:13.320 --> 0:04:15.360 There were some reports I read where he was asked 0:04:15.360 --> 0:04:18.359 to distribute them. It might just have been a matter 0:04:18.520 --> 0:04:21.760 of hey, here's this thing. That's it's a very the time, 0:04:21.760 --> 0:04:26.520 pickles were a very regional product. They weren't sold nationwide necessarily, 0:04:26.960 --> 0:04:29.040 and you could give them nationwide, but just they were 0:04:29.080 --> 0:04:32.200 from regional like farmers and picklers like you would get 0:04:32.320 --> 0:04:36.760 milk or cream from the milkman. So creamery pickles, they're 0:04:36.800 --> 0:04:40.800 all very local delivery. Um. And he was selling specifically 0:04:40.880 --> 0:04:44.160 Polish style pickles with garlic and dill. Those are the best. 0:04:46.160 --> 0:04:49.360 They're good. Okay, we're going to have a fight. We're 0:04:49.360 --> 0:04:52.520 going to do that. I also like a nice, nice 0:04:52.560 --> 0:04:58.479 crisp bread and butter pickle. There so sweet, I know, Okay, okay, 0:04:58.480 --> 0:05:02.280 I'm a sour persons, you are all right, um And 0:05:02.839 --> 0:05:07.080 fun fact, Beryl Brant pickles, which is what he was 0:05:07.120 --> 0:05:10.080 distributing and selling, don't really have the same shelf life 0:05:10.120 --> 0:05:12.280 as the pickles you buy in glass jars at the supermarket. 0:05:12.360 --> 0:05:15.520 But at this point they weren't. They weren't in jars. 0:05:15.520 --> 0:05:18.200 They hadn't been canned pickles, they hadn't been camp pickles. 0:05:18.360 --> 0:05:22.280 They might have been like given out in jars, but 0:05:22.320 --> 0:05:26.600 not not like preserve. Yeah. Yeah, So at this point 0:05:26.760 --> 0:05:30.120 you get to the beginning of World War Two, and 0:05:30.160 --> 0:05:32.880 you know, there are a lot of stories about companies 0:05:32.960 --> 0:05:37.400 during World War Two running into challenges because there was 0:05:37.800 --> 0:05:41.760 there were shortages on materials. You wouldn't necessarily think that 0:05:42.279 --> 0:05:47.320 such a thing would affect a pickles business, but in 0:05:47.360 --> 0:05:51.000 fact it did. Yeah, the U. S. Government rationed pickles. 0:05:51.040 --> 0:05:53.560 I mean, if you figure this, they're they're easy to ship, 0:05:53.600 --> 0:05:56.360 they don't go bad right away. Even even if they 0:05:56.360 --> 0:05:59.080 don't last as long as you know today's shelved pickles, 0:05:59.480 --> 0:06:03.240 they still us longer than you know, a cucumber. Let's say, so, 0:06:04.640 --> 0:06:07.760 the US government was rationing about pickles that were produced 0:06:07.800 --> 0:06:10.560 at the time, which meant for everybody else there was 0:06:11.040 --> 0:06:15.479 a pickle shortage there so so so for everyone else 0:06:15.480 --> 0:06:17.560 they were they were not in a pickle because they 0:06:17.600 --> 0:06:21.200 couldn't get ahold of one unfortunately. So this is around 0:06:21.240 --> 0:06:24.960 the time when Joe started testing and um experimenting with 0:06:25.000 --> 0:06:27.479 a new idea, and that new idea was hot pack pickles, 0:06:27.560 --> 0:06:29.960 which meant he put the cucumbers into a glass jar, 0:06:30.520 --> 0:06:32.480 covered them with the hot brine, and then the jar 0:06:32.600 --> 0:06:36.640 was sealed. So this is essentially sort of a very 0:06:36.680 --> 0:06:40.920 primitive version of canning. Okay, well, it essentially was canning 0:06:40.920 --> 0:06:43.720 because it greatly extended the life, the shelf life of 0:06:43.760 --> 0:06:47.480 these pickles. Hot packed pickles are what we get today 0:06:47.880 --> 0:06:52.480 and they last a lot longer than a barrel brind pickle. Yeah, 0:06:52.760 --> 0:06:55.120 and so this was in fact the introduction of the 0:06:55.120 --> 0:06:58.600 plastic pickle. It was in two and people loved it 0:06:59.240 --> 0:07:01.560 so much, so Joe had a hard time keeping up 0:07:01.560 --> 0:07:04.520 with the demand once the war was over. Like you'd 0:07:04.560 --> 0:07:06.200 imagine he'd have a hard time keeping up with the 0:07:06.240 --> 0:07:09.520 demand during the war when pickles are being rationed, but 0:07:09.840 --> 0:07:13.920 even afterwards, people really liked these hot pack pickles, and 0:07:14.000 --> 0:07:19.760 continuing with the whole family business idea, his son, you know, Joe, 0:07:19.800 --> 0:07:22.880 had inherited the creamery from his father. Then his son 0:07:23.000 --> 0:07:28.120 Bob joined the Lastic Pickle Company and would rise to 0:07:28.160 --> 0:07:32.280 the position of general manager for the company. And they 0:07:32.360 --> 0:07:38.960 opened up a vlastic factory in Emily City, Michigan, which 0:07:39.000 --> 0:07:41.000 is in the thumb of the mitten. So you've got 0:07:41.040 --> 0:07:43.360 the mitten, you've got the finger. This is not a 0:07:43.360 --> 0:07:46.560 geography class, Okay. So at the time Classic was still 0:07:46.560 --> 0:07:49.080 doing their creamery business, and they were also making things 0:07:49.160 --> 0:07:51.840 like sauer kraut. It makes sense. You know, you've got 0:07:52.240 --> 0:07:56.080 all of the brining equipment there. Sauer Kraut is, yeah, 0:07:56.200 --> 0:08:01.600 another sort of pickled sarma. Crowds also also, let me 0:08:01.600 --> 0:08:05.640 ask you this areal. So the demand for pickles was 0:08:05.920 --> 0:08:08.800 going through the roof. People were really going crazy for 0:08:08.800 --> 0:08:12.200 these plastic pickles. The company is doing quite well. What 0:08:12.240 --> 0:08:14.680 was give me an idea, what was the size of 0:08:14.840 --> 0:08:21.360 lastic pickles at this point? Well, in they had five employees, which, 0:08:21.520 --> 0:08:24.520 you know, it's a pickle business. Sure, twenty five sounds reasonable, 0:08:24.560 --> 0:08:27.840 exception of the fact that their factory was three large buildings. 0:08:28.880 --> 0:08:34.320 One was tour for receiving cucumbers, and then one was 0:08:34.400 --> 0:08:38.520 for distribution. Basically, they had twenty eight Sauer Kraut tanks 0:08:38.600 --> 0:08:42.240 and they were processing fixed fifty acres worth of cucumbers. 0:08:42.360 --> 0:08:46.360 That's a lot of cucumbers. That is for people. It's 0:08:46.400 --> 0:08:48.200 a lot for anybody. But yeah, when you're thinking about 0:08:48.200 --> 0:08:50.600 twenty people having to deal with that as twice as 0:08:50.600 --> 0:08:52.840 many acres as you have people working, and you know, 0:08:52.960 --> 0:08:54.960 not all those people are out there in the fields 0:08:55.000 --> 0:08:58.720 picking cucumbers. Yeah, some are having to sort through and 0:08:59.360 --> 0:09:02.560 deeply inspect to cucumbers for bruises. I don't know, I'm 0:09:02.600 --> 0:09:05.720 assuming that's a part of the process. Well, Joe Lastic 0:09:05.760 --> 0:09:08.960 would retire in nineteen sixty three and his son Bob 0:09:08.960 --> 0:09:13.080 officially took over the company. And this was at a 0:09:13.160 --> 0:09:15.520 point where Vlastic was really riding high. I mean they 0:09:15.559 --> 0:09:20.760 were they were the lead pickle company and pickle pickle 0:09:20.840 --> 0:09:23.120 provider I guess you could say in the in the 0:09:23.160 --> 0:09:27.240 United States, and they were hitting ten million dollars in 0:09:27.280 --> 0:09:31.360 sales by nineteen sixty seven. Yeah, that's that's not too shabby. 0:09:31.440 --> 0:09:35.360 That's a lot of pickles. Yeah. Uh. By the seventies 0:09:35.400 --> 0:09:37.880 because they had these pickles that had this long shelf life, 0:09:37.880 --> 0:09:40.720 they were expanding nationally. Yeah, they could actually ship them 0:09:40.760 --> 0:09:42.800 across the country and they'd be still be good when 0:09:42.800 --> 0:09:45.240 they got to their destinations. Yes, And they were really 0:09:45.280 --> 0:09:47.600 really smart. So Plastic did a lot of things that 0:09:47.600 --> 0:09:51.360 were really smart. So they were really smart about using 0:09:51.480 --> 0:09:53.400 the entirety of their crop, or at least as much 0:09:53.400 --> 0:09:55.360 of the crop as they could. So pickles that were 0:09:55.360 --> 0:09:57.000 too big, cucumbers that were too big to fit in 0:09:57.040 --> 0:09:59.600 a pickle jar that we cut up into chips or 0:10:00.360 --> 0:10:04.360 spears or relish, so that they're using as much of 0:10:04.400 --> 0:10:07.440 their stock as they possibly can, as much of their produce, 0:10:07.520 --> 0:10:12.560 cutting down on waste dramatically. Yeah. And by four the 0:10:12.600 --> 0:10:15.480 pickle consumption in the country was up from two pounds 0:10:15.480 --> 0:10:20.360 per capita when the Plastic started to eight pounds per capita, 0:10:20.559 --> 0:10:24.960 all because of last Yeah. Yeah, and that's when they decided, Okay, 0:10:24.960 --> 0:10:26.920 we don't need to do the milk and cheese business anymore. 0:10:26.960 --> 0:10:29.360 We're just gonna focus on pickle and pickle related things 0:10:29.360 --> 0:10:33.200 and relishes. And people are eating four times as many pickles, 0:10:33.200 --> 0:10:35.400 but they're drinking as much milk and eating as much 0:10:35.480 --> 0:10:38.640 cheese as ever, Let's let's stick to the the growing, 0:10:39.320 --> 0:10:42.160 incredible business of pickles. So Vlastic was number one, but 0:10:43.200 --> 0:10:45.800 they were kind of number one at first, So at 0:10:45.840 --> 0:10:48.040 this time they owned ten percent of the national pickle market. 0:10:48.559 --> 0:10:52.080 Hines also owned Tempersition in the pickle market, but Lastic 0:10:52.840 --> 0:10:57.360 did surpass Hines oily. So around this time this is 0:10:57.400 --> 0:11:02.480 when Vlastic would introduce that advertising mascot, the one I said. 0:11:02.920 --> 0:11:07.040 Once I saw who it was, I merely went, oh, right, 0:11:07.120 --> 0:11:11.280 I know this company, and the mascot is a stork. Yes, 0:11:11.320 --> 0:11:13.960 stork who sounds like Gratcho Marks. Yeah, and it's like, 0:11:14.559 --> 0:11:16.920 you know, holds a pickle occasionally kind of like a cigar, 0:11:17.320 --> 0:11:19.640 sort of like you know, Gratcho Marks would hold it 0:11:20.040 --> 0:11:23.520 a cigar that looked like a cigar. Yeah. Yeah, but 0:11:23.600 --> 0:11:27.400 it's a pickle, so it's healthier for you, definitely side 0:11:27.800 --> 0:11:31.160 side effect curbing the smoking craze. Yeah, I don't know 0:11:31.200 --> 0:11:34.160 anyhow storks. They picked a stork because they wanted to 0:11:34.240 --> 0:11:39.400 capitalize on the idea that pregnant women craft pickles. Oh interesting, okay, 0:11:39.440 --> 0:11:43.520 so they're they're playing on a stereotype, yes, that that 0:11:43.559 --> 0:11:47.520 women when they are pregnant have cravings that people might 0:11:47.679 --> 0:11:50.320 describe as being out of the ordinary, and pickles frequently 0:11:50.360 --> 0:11:52.160 are among those. Crazy Yeah, and because you know of 0:11:52.240 --> 0:11:54.040 vlass is the best pickle, of course, are going to 0:11:54.080 --> 0:11:56.199 crave a Lastic Yeah. I mean, why would you crave 0:11:56.240 --> 0:11:59.360 anything less for your unborn child? Yeah. Well, and also 0:11:59.360 --> 0:12:02.600 on the Plastic upset, it says that the stork became 0:12:02.640 --> 0:12:04.960 the mascot because the national birth rate at that time 0:12:05.000 --> 0:12:07.840 was down, and so he was low on babies to deliver, 0:12:07.960 --> 0:12:11.800 so time his Lastic managers wanted to offer him a 0:12:11.880 --> 0:12:15.360 chance to deliver pickles instead. So, you know, a couple 0:12:15.400 --> 0:12:19.959 of mixed stories. I don't think they're necessarily mutually exclusive. Well, 0:12:19.960 --> 0:12:24.240 and more importantly, Lastic was actually taking the step to 0:12:24.320 --> 0:12:27.520 advertise on a national level, which was sort of unprecedented 0:12:27.600 --> 0:12:31.520 for companies that were, you know, selling pickles. It was 0:12:31.800 --> 0:12:34.240 sort of a new thing. I mean, you certainly don't 0:12:34.280 --> 0:12:37.319 see entire ad campaigns or mascots about it. You might 0:12:37.320 --> 0:12:39.880 occasionally get a oh, here's a pickle to put on 0:12:39.920 --> 0:12:46.000 your sandwich, add but you know nothing. Big by seven, 0:12:46.280 --> 0:12:50.520 they held a quarter of the national pickle market. Yeah, 0:12:50.600 --> 0:12:53.040 and it bumped up their sales two hundred million dollars 0:12:53.080 --> 0:12:57.640 a year. Yah, that's so many picks. It's hard for 0:12:57.640 --> 0:12:59.640 me to wrap my head around this. I mean, like 0:12:59.800 --> 0:13:01.400 a yeah, it's one of those things where you know, yeah, 0:13:01.480 --> 0:13:03.559 of course there's pickles everywhere. You see them, go down 0:13:03.559 --> 0:13:06.120 the grocery store. You see jars and jars of the things. 0:13:06.120 --> 0:13:09.040 But you don't think of a hundred million dollar business. 0:13:09.440 --> 0:13:11.280 Well you have to realize, like in the seventies, were 0:13:11.320 --> 0:13:14.400 still getting out of the aspect aspect in the jello 0:13:14.600 --> 0:13:22.440 Like sure, the Jello castrole era kind of it's it's 0:13:22.480 --> 0:13:24.440 a little past that. But you know, you also have 0:13:24.520 --> 0:13:27.520 restaurants who get pickles, who include pickles with their sandwiches, delis, 0:13:27.559 --> 0:13:31.880 things like that. So it's not necessarily just the homeowner. Yeah, 0:13:31.960 --> 0:13:34.200 just gonna going through jar after jar. I mean to 0:13:34.240 --> 0:13:36.480 be fair, I go through snack foods like that too, 0:13:36.520 --> 0:13:38.560 they're just not pickles. There are some people who would 0:13:38.559 --> 0:13:40.559 go through jar of jar after pickle, and we'll get 0:13:40.600 --> 0:13:46.079 to that. But you know this, this marketing really skyrocketed them. 0:13:46.120 --> 0:13:48.800 They convince bires to pay a premium for their pickles, 0:13:49.800 --> 0:13:53.079 which is good because they spent two million dollars of 0:13:53.200 --> 0:13:56.040 marketing for it, for the for the new pickle line, 0:13:56.120 --> 0:13:57.680 and by this time there are up to about a 0:13:57.720 --> 0:14:01.000 hundred and thirty eight pickle products. Yeah. What you know 0:14:01.360 --> 0:14:04.840 that you really hit an unprecedented level of success as 0:14:04.840 --> 0:14:08.960 a company. When that success is so great that the 0:14:09.080 --> 0:14:14.000 Federal Trade Commission starts to think that maybe something is up. Yeah, yeah, 0:14:14.040 --> 0:14:16.520 the Federal Trade Commission did do an investigation on them. 0:14:16.559 --> 0:14:19.920 But they're just selling pickles. They just chose to market them. 0:14:19.960 --> 0:14:24.400 They were just selling pickles way better than anybody else was. Uh. 0:14:24.440 --> 0:14:29.440 And then Lassie Pickles who sold to Campbell's, like Campbell 0:14:29.520 --> 0:14:32.480 Soup Campbell's for thirty three million dollars, which was one 0:14:32.520 --> 0:14:37.560 of Campbell's large acquisitions ever. Um, And this decision is 0:14:37.600 --> 0:14:41.320 actually what would put Lastic Pickles eventually on the brink. 0:14:42.280 --> 0:14:44.600 It would make them a business on the brink. Well, 0:14:44.640 --> 0:14:46.720 I need to hear more about that, but before we 0:14:46.760 --> 0:14:55.160 get to that, let's take a quick break. Okay, So, Ariel, 0:14:55.240 --> 0:14:58.960 before the break, you mentioned that Vlastic Pickles was acquired 0:14:59.160 --> 0:15:02.720 by Campbell's. But we also had just mentioned that Lastic 0:15:02.760 --> 0:15:05.640 Pickles was doing business like gang busters. They were doing 0:15:05.720 --> 0:15:09.240 incredibly well on their own. So what would lead to 0:15:09.280 --> 0:15:13.600 the decision to actually agree to this acquisition. Well, according 0:15:13.680 --> 0:15:17.480 to Atlas obscura dot com, the price of cucumbers was 0:15:18.520 --> 0:15:22.800 rising a lot by like over thirty five cent since 0:15:22.840 --> 0:15:26.360 seventy three, and Lastic had to take loans to buy 0:15:26.360 --> 0:15:31.000 their cucumbers about twenty million dollars worth. Okay, so this 0:15:31.120 --> 0:15:34.840 was literally the raw materials that they were using. The 0:15:34.880 --> 0:15:36.720 price was going up, and it's not like you could 0:15:36.920 --> 0:15:40.360 easily switch to something else. I mean, pickles as we 0:15:40.800 --> 0:15:43.760 think of them are like the word pickles, we think 0:15:43.760 --> 0:15:46.600 of pickled cucumbers. So they didn't have a whole of 0:15:46.640 --> 0:15:49.480 other options now, and I mean they were making they're 0:15:49.480 --> 0:15:51.680 making about one point three million profit off of the 0:15:52.040 --> 0:15:55.440 hundred million dollars worth of sales recording reports that I saw. Wow, 0:15:55.480 --> 0:15:57.560 that is but that is eye opening. Right to do 0:15:57.600 --> 0:16:00.840 a hundred million dollars in sales, but that's how much 0:16:00.840 --> 0:16:02.400 you make in sales. And when you look at the 0:16:02.440 --> 0:16:06.360 actual profit being one point three million, that is that 0:16:06.520 --> 0:16:08.520 is different. That is amazing. I mean, well, they were 0:16:08.520 --> 0:16:11.840 also spending money on expansion and renovation and things like that, 0:16:12.080 --> 0:16:15.760 marketing as well, and and then the pickle market also 0:16:15.800 --> 0:16:19.080 slowed down, So everybody was really excited about pickles for 0:16:19.120 --> 0:16:23.320 a while. It was the food trend, and then people pickles. 0:16:23.720 --> 0:16:26.240 Yeah I'm kind of I'm kind of pickled out, so yeah, 0:16:26.400 --> 0:16:30.640 I'm so over it. Also, at the time, Campbell's was 0:16:30.760 --> 0:16:34.120 looking at a competitor, right, they were. They were acquiring 0:16:34.200 --> 0:16:38.600 companies like Classic, largely because they wanted to have a 0:16:38.640 --> 0:16:44.560 better position against Hinns. So, you know, these are companies 0:16:44.600 --> 0:16:47.600 that were known for the you know, really dominating things 0:16:47.600 --> 0:16:51.640 like grocery store shelves, and obviously you want to have 0:16:51.760 --> 0:16:56.720 the best, best potential position against your competitors. So that 0:16:56.840 --> 0:17:02.120 was the the idea behind the camp Old side of it. Yeah. Um. 0:17:02.360 --> 0:17:05.920 And then they did work on on growing the Lastic 0:17:05.960 --> 0:17:08.360 brand and increasing sales even though the market wasn't really 0:17:08.400 --> 0:17:11.560 growing in the eighties. The improof packaging, so they color 0:17:11.600 --> 0:17:13.560 coded a lot of their packaging so you could better 0:17:13.560 --> 0:17:15.560 tell what sort of product you're getting in the jar. 0:17:16.240 --> 0:17:19.399 They improved the jars that the pickles came in, and 0:17:19.440 --> 0:17:22.440 then they decided to expand Classic into other specialty food 0:17:22.440 --> 0:17:26.600 arenas like open pit barbecue, sauce and olives and cheese. 0:17:27.359 --> 0:17:32.480 Oh interesting. So Lastic, which started as an sort of 0:17:32.520 --> 0:17:36.200 a additional business on top of a creamery now would 0:17:36.240 --> 0:17:40.359 actually include a dairy product in its line. Yeah, the 0:17:40.440 --> 0:17:43.760 cheese didn't do well. The cheese company they acquired when 0:17:43.760 --> 0:17:46.400 bankrupt and they dropped it. The olives actually did well 0:17:46.400 --> 0:17:52.159 and they became a leading all of wine, and that 0:17:52.320 --> 0:17:55.040 I have less it's less of a logical leap for me. 0:17:55.359 --> 0:17:58.920 You know, olives and pickles. You often see them next 0:17:58.960 --> 0:18:01.360 to each other in grocery stores because again, I think 0:18:01.359 --> 0:18:03.440 a lot of people just sort of have that association, 0:18:03.760 --> 0:18:07.840 even though it's a slightly different process pickling and the 0:18:07.920 --> 0:18:09.800 process you have to make you have to go through 0:18:09.840 --> 0:18:12.880 to make olives edible. But yeah, I can I can 0:18:12.920 --> 0:18:14.840 see that the cheese is what it was sort of 0:18:14.880 --> 0:18:17.280 like when we talked about how cheese save PBR for 0:18:17.320 --> 0:18:20.000 a while. Yeah, well, I mean they also bought a 0:18:20.040 --> 0:18:22.959 barbecue sauce. They're kind of buying all of these condiments 0:18:23.359 --> 0:18:26.040 sort of things. So I guess some people view cheese 0:18:26.040 --> 0:18:30.040 as a condiment. I view it as a staple of life. Yes, yes, 0:18:30.119 --> 0:18:32.640 I think of as a lifeline. Also. I don't really 0:18:32.640 --> 0:18:34.720 go into it in the notes because it's it's its 0:18:34.720 --> 0:18:39.160 own story. But Campbell's did acquire Swanson, the company Swanson 0:18:39.760 --> 0:18:42.480 um and that will factor in and just a little bit. 0:18:42.760 --> 0:18:48.320 So in Campbell's consolidated the lastic division to New Jersey 0:18:48.520 --> 0:18:51.280 and kind of hundred and forty jobs. So because last 0:18:51.440 --> 0:18:54.800 had expanded out, they brought them all back together and 0:18:54.880 --> 0:18:59.160 made I guess the production of it a smaller production. 0:18:59.359 --> 0:19:02.439 I got you, Yeah, gotcha. And they also started to 0:19:03.119 --> 0:19:07.240 look into other new ways to package and market pickles, 0:19:07.320 --> 0:19:13.720 including the the pickles snack packs, and sandwich stackers. Yeah. 0:19:13.760 --> 0:19:15.640 So these aren't like little pickle chips, like the little 0:19:15.720 --> 0:19:18.040 round things if you pick if you cut a pickle 0:19:18.119 --> 0:19:20.840 long way, you get a long slice. So it's a 0:19:20.880 --> 0:19:23.560 cross section of a pickle. Yeah, And and so that 0:19:24.000 --> 0:19:26.159 you know, they're basically trying to find new ways to 0:19:26.200 --> 0:19:29.119 get people to buy pickles. You know, like I have 0:19:29.200 --> 0:19:30.960 a jar of pickles in my fridge for whenever I 0:19:31.000 --> 0:19:33.320 make a sandwich. How often do I make sandwiches? Okay, well, 0:19:33.320 --> 0:19:34.439 now you need to buy them to put in your 0:19:34.480 --> 0:19:38.840 kids lunchbox as a snack. And up again it worked. 0:19:40.000 --> 0:19:45.040 It didn't work enough because Campbells was viewing Glassic as 0:19:45.080 --> 0:19:51.280 an underperforming brand. Now in you had mentioned that Campbell's 0:19:51.280 --> 0:19:57.040 had acquired Swanson, and in they thought, let's offload this. Yeah, 0:19:57.119 --> 0:19:59.680 they tried to sell it, it didn't go as planned. 0:20:00.240 --> 0:20:03.439 They so they decided to spin off all of their 0:20:03.560 --> 0:20:07.879 quote unquote non strategic brands into their own entity. I 0:20:07.880 --> 0:20:13.560 guess non strategic is the nice way of saying unprofitable, unprofitable, superfluous. 0:20:15.680 --> 0:20:19.159 The Pickles, along with Swanson, Open Bit Barbecue, and a 0:20:19.160 --> 0:20:24.399 few other specialty feuds feuds feuds, especially foods, were spun 0:20:24.400 --> 0:20:31.040 off from Campbell's into Lastic Foods International, Incorporated, and then 0:20:32.040 --> 0:20:37.399 they eventually became publicly traded. Now we got Lastic as 0:20:37.400 --> 0:20:40.520 its own company again, and its own company with other 0:20:41.000 --> 0:20:46.600 companies now lumped in underneath it. Yes, Campbell's reasoning behind 0:20:46.640 --> 0:20:49.720 it was, you know, last Ach and Swanson are both 0:20:49.960 --> 0:20:55.080 strong brands, their historically strong maybe they can turn around 0:20:55.240 --> 0:20:58.640 under new management. This whole move was called a leverage spinoff, 0:20:58.680 --> 0:21:02.399 which meant they incorporated the new subsidiary, and then the 0:21:02.440 --> 0:21:07.679 subsidiary would take on the debt that Campbell's attributed to 0:21:07.720 --> 0:21:10.520 those companies when they owned it as a way of 0:21:10.560 --> 0:21:16.080 purchasing the division. So when last Signs and Swanson and 0:21:16.080 --> 0:21:18.960 all that was spun off. They took on five million 0:21:19.000 --> 0:21:21.600 dollars in debt. Seems like a pretty convenient way for 0:21:21.680 --> 0:21:25.760 Campbell's to try and just shed some debt of its own. Yeah, 0:21:25.880 --> 0:21:30.199 and and so they actually it was a whole big thing. Uh. 0:21:32.280 --> 0:21:34.640 Lastic took them to court over this. They said they 0:21:34.640 --> 0:21:40.600 were being fraudulent, that it was a a that the 0:21:41.080 --> 0:21:46.840 debt transfer was underhanded, Yeah, that they used false financial 0:21:46.920 --> 0:21:50.240 data to push the spin off and the debt transfer um, 0:21:50.280 --> 0:21:52.359 and that by doing so they aided a breach of 0:21:52.359 --> 0:21:59.520 fiduciary duty by the by Flastic Foods Internationals directors um. Yeah. 0:22:00.000 --> 0:22:03.119 Plastic also said that Campbell's overstated plastics of value in 0:22:03.160 --> 0:22:06.680 this transaction to get tax saving measures. And some people 0:22:06.720 --> 0:22:12.399 said that it saved both Campbell's and Lastic taxes they 0:22:12.400 --> 0:22:17.440 didn't have to pay UM, but it really didn't help 0:22:17.480 --> 0:22:22.440 Plastic obviously. Yeah. So this is one of those things 0:22:22.440 --> 0:22:25.520 where there were lots and lots and lots of articles 0:22:25.560 --> 0:22:30.199 that were written about this particular controversy, I guess is 0:22:30.240 --> 0:22:32.960 what we could call it. Yeah, because this was and 0:22:33.040 --> 0:22:35.600 this was a big deal. You're half a billion dollars 0:22:35.640 --> 0:22:40.199 in debt, I mean that's that's enormous and it's you 0:22:40.200 --> 0:22:43.640 would think this is also a great way to uh, 0:22:43.680 --> 0:22:46.560 to not just shed debt, but to scuttle a company 0:22:46.600 --> 0:22:48.639 before it even gets a chance to get going. Well, 0:22:48.960 --> 0:22:51.480 the courts ruled that Campbell's was on the up and 0:22:51.560 --> 0:22:54.600 up in this spinoff, in this debt trade off, that 0:22:54.640 --> 0:22:58.160 it was in fact liabilities costed the sale. Uh, some 0:22:58.240 --> 0:23:01.399 other debt that maybe last took on after they became 0:23:01.400 --> 0:23:06.879 an independent company, maybe close to the spinoff. But um, 0:23:06.920 --> 0:23:12.359 you know, Lastic did file an appeal to that. Um, 0:23:12.400 --> 0:23:15.000 there are a whole bunch of legal documents that you 0:23:15.000 --> 0:23:17.680 guys can can go look at if you want more 0:23:17.720 --> 0:23:21.480 information on that. But it kind of gets into the weeds. 0:23:22.200 --> 0:23:29.320 You So we get to Lastic is an independent company 0:23:29.359 --> 0:23:35.040 again and their sales are not exactly performing up to 0:23:35.240 --> 0:23:38.520 what they were hoping. Yeah, pickle consumption was down by seven. 0:23:39.520 --> 0:23:43.960 They were spending millions on advertising new products, and then 0:23:45.080 --> 0:23:48.159 they did a hill Mary. So when Will wrote us 0:23:48.200 --> 0:23:50.320 about this, he had mentioned that he had read about 0:23:50.520 --> 0:23:53.520 Lastic pickles in the Walmart Effect book, and so he 0:23:53.560 --> 0:23:55.280 thought it was a bigger story, and it certainly was. 0:23:55.720 --> 0:24:01.440 But in Walmart started selling gallon jars of lastic pickles. 0:24:02.200 --> 0:24:08.040 H they were twelve pounds ajar. Okay, twelve pounds for 0:24:08.040 --> 0:24:12.880 for essentially a almost a bucket of pickles. How much 0:24:12.880 --> 0:24:16.480 did they cost? Two dollars and nineties seven cents a jar. 0:24:17.280 --> 0:24:19.800 So for less than three dollars you can take home 0:24:19.880 --> 0:24:25.400