The C.F. Sauer Company

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The C.F. Sauer Company

2000 West Broad Street
Richmond, Virginia 23220
U.S.A.
Telephone: (804) 359-5786
Toll Free: (800) 688-5676
Fax: (804) 359-2263
Web site: http://www.cfsauer.com

Private Company
Incorporated: 1887
Employees: 900
Sales: $294.6 million (2006 est.)
NAIC: 311225 Fats and Oils Refining and Blending; 311421 Fruit and Vegetable Canning; 311423 Dried and Dehydrated Food Manufacturing; 311930 Flavoring Syrup and Concentrate Manufacturing

The C.F. Sauer Company, a family owned and operated company based in Richmond, Virginia, produces a wide range of flavorings and extracts, spices, gravy and other mixes under both the Sauer and Gold Medal labels, as well as barbecue sauces, cooking oils, margarine, and spreads. The company also offers Duke's mayonnaise, tartar sauce, other sandwich condiments, and vegetable oils; Bama mayonnaise and salad products; and Mrs. Filberts mayonnaise. Serving the foodservice industry with these products is subsidiary C.F Sauer Foods, which also prepares special spice blends for customers and does private label work. Another unit, Spice Hunter, Inc., offers more than 300 gourmet and organic spices, herbs, and blends. Manufacturing sites include Richmond and Sandston, Virginia; Greenville, South Carolina; and New Century, Kansas. In addition, the company invests in real estate through subsidiary Sauer Properties. C.F. Sauer is run by the fourth generation of the Sauer family.

COMPANY FOUNDED: 1887

The C.F. Sauer Company was founded in 1887 in Richmond, Virginia, by 21-year-old Conrad Frederick Sauer. Four years earlier, as an aspiring pharmacist, he had gone to work as a clerk for a retail and wholesale drug house, Bodeker Bros., often refilling bottles with flavoring extracts for Richmond housewives who were dissatisfied with the quality of the grocery store varieties. The young man recognized that there was a business opportunity in providing prepackaged flavorings of good quality for sale at a reasonable price in both groceries and drug stores, and so he struck out on his own. He set up shop at 17th and Broad Street in Richmond and began selling fifteen-cent five-gram bottles, and twenty-five-cent ten-gram bottles of vanilla, sherry, and other flavored extracts. Deliveries to local stores were done by donkey cart. Sauer's wife Olga played a key role in the growth of the business. Aside from helping to mix and taste-test the flavorings, she designed an exhibit for the 1889 Virginia State Fair to advertise the quality of C.F. Sauer extracts. The exhibit took home top honors in its competition and not only served to promote the company at home but also became a model for international competitions to come, including the Chicago's World Fair in 1893, resulting in medals and the spreading of the C.F. Sauer name across the globe.

Being the first in the United States to sell prepackaged flavor extracts provided the company with an open field, and with strong demand came rapid growth. C.F. Sauer quickly outgrew its original location, leading to a number of moves over the next 20 years. Finally, in 1911, the company settled in its present home at 2000 West Broad Street in Richmond. At the time, the company employed 250 people, one-fifth of which were salesmen who traveled throughout the country, primarily the South, writing up orders. In 1920, Sauer added herbs and spices to his product lines as well as other companies to his portfolio, mostly in support of the flavor extract business. He tried making his own glass bottles for a time, establishing American Glass Works, operating factories in both Richmond and Paden City, West Virginia. After the Richmond facility was destroyed by fire in 1923, he elected to exit the bottle business and to buy the containers ready-made.

FOUNDER DIES: 1927

Sauer died in 1927, leaving a company that was America's largest producer of flavor extracts and spices, and was soon to become the top supplier of black pepper. Succeeding him as president was his son, Conrad Frederick Sauer, Jr., who brought a more modern and aggressive approach to running the family business. Soon after taking the helm, he moved the company into household drugs and remedies with the acquisition of the Interstate Commerce Company. Two years later, C.F. Sauer became involved in condiments with the purchase of Duke's Products Company.

Based in Greenville, South Carolina, Duke's had been launched a dozen years earlier by Mrs. Eugenia Duke, who became well known for her homemade mayonnaise after she began using it on the sandwiches she sold to soldiers at Fort Sevier, which at the time was teeming with soldiers due to World War I. Upon returning home, many of the soldiers would write to her, asking for the recipe for her mayonnaise. Duke began to bottle her mayonnaise and convinced a local grocery to sell it on a consignment basis. While the sandwich-making business grew to the point that she was producing 11,000 sandwiches a day, she eventually switched her focus to bottled mayonnaise, which had become popular throughout the South by the time C.F. Sauer acquired the business and made Eugenia Duke its lead salesperson.

Expansion soon gave way to retrenchment for C.F. Sauer after the stock market crash in the autumn of 1929 led to the decade-long Great Depression. It was a challenging period for the company, which during the 1930s had to contend with shrinking markets. After the United States entered World War II in December 1941, military spending stimulated the economy, bringing an end to the Depression, but conditions remained difficult for C.F Sauer. Because the needs of the military took precedence, the company had trouble procuring raw materials, leading to limited production and the suspension of some products altogether. Despite poor conditions that spanned some 15 years, the company avoided pay cuts and layoffs to its workforce.

Following a brief recession a year after the war ended in 1945, the U.S. economy soared, and like many companies, C.F. Sauer rode the wave of prosperity. Spurring its growth was a commitment to mass-market advertising, taking advantage in particular of radio. In 1948 C.F. Sauer became the lone sponsor of The Joan Brooks Show, a local variety show that was then picked up by CBS and broadcast throughout the South as The Sauer Show. The show originated from the Radio Center Theater in Richmond and aired four nights a week from 1949 to 1951, sponsored by Duke's Mayonnaise.

COMPANY PERSPECTIVES

The original company founded by C. F. Sauer, Sr., in 1887, manufactured, packaged and sold pure flavoring extracts in five- and ten-gram cartoned bottles.

The third generation of the Sauer family, Conrad Sauer's sons Conrad Frederick Sauer III (Connie) and Tremaine Sauer, began making significant contributions to the company during the postwar years. After their father's death in early 1953, Connie took over as president. He was well seasoned, having served as assistant treasurer and as an executive vice-president. He focused his attention on sales and promotion while his brother was in charge of production. Tremaine helped to design many of the machines that the plant would now rely on. A 50,000-square-foot addition to modernize the Duke's plant in Greenville, South Carolina, was completed in 1955. Under the leadership of a new generation, C.F. Sauer expanded in other ways as well. In 1956 the company acquired the Charlotte Refinery Co., based in Charlotte, North Carolina. Renamed C&T Refinery Inc. (the initials stood for Conrad and Tremaine), the operation refined vegetable oil to be sold under the Duke's label. The vegetable oil was also sold to such potato and corn chip manufacturers as Frito-Lay and Wise. In addition, in 1957 and 1958, C.F. Sauer began offering liquid salad dressings and other salad products, Connoisseur spices, and Gold Medal ground black pepper.

In the early 1960s the company added Duke's Corn Oil and bulk Gold Medal Mustard. It was also during this time, in 1961, that C.F. Sauer acquired Lynchburg, Virginia-based Famous Virginia Foods Corp., maker of pickles and other condiments, shortly before that company filed for bankruptcy. Three years later Richmond-based Dean Foods Co. was acquired. A margarine manufacturer, Dean produced private-label retail items as well as bulk-packaged margarine and other butter substitutes for both the foodservice and institutional markets. Another important acquisition of the 1960s was the 1967 purchase of Petersburg, Virginia-based Alford's Barbecue Sauce, Inc. Production was subsequently moved to the Duke's plant in Green-ville, South Carolina, and the product was renamed Sauer's Barbecue Sauce.

METROLINA PLASTICS ACQUIRED

C.F. Sauer added new equipment in 1971 and expanded its product lines to include seasonings, gravy mixes, and sauces. In another major development during the decade, the company added a plastics operations. In 1976 Connie Sauer learned from the Wall Street Journal of a small Shelby, North Carolina-based custom plastic molding company, Metrolina Plastics, Inc., that was for sale. Once acquired, Metrolina developed proprietary plastic spice containers, bottles, and tops for C.F. Sauer, which became the first company in its field to adopt plastic containers for spices. The seamless plastic container was a marked improvement over traditional spice tins, being both lighter and resistant to moisture and infestation.

The business did so well that in 1982 a second Metrolina plant was opened in Richmond. By this time C.F. Sauer had expanded its Richmond operations, having purchased a nearby Sears, Roebuck and Co., Inc., building in 1981 for about $7.7 million. The new Metrolina plant opened behind this building. With extra production capacity, C.F. Sauer expanded a new line of "Bakin' Bags," seasoning mixes in plastic bags ready to coat chicken and fish.

By the time C.F. Sauer celebrated its centennial in 1987, sales had reached the $200 million neighborhood. The 1980s were prosperous times on a number of levels for the company, due in large measure to the increasing popularity of ethnic cooking that drove demand in the herb and spice industry. To take advantage of this situation, the company formed C.F. Sauer Food Service in 1984 to provide commercial customers with custom spice blends and flavorings, as well as bulk items, such as mayonnaise, mustard, oils, margarine, and liquid butter substitutes. Restaurant customers included Chick-fil-A, Golden Skillet, and Church's Fried Chicken, while salad dressings were prepared for the Hidden Valley Ranch label.

The 1980s also saw C.F. Sauer enter the frozen foods sector. Gerard's Le Sorbet of Alexandria, maker of a fruit frozen dessert, was acquired. In 1989 the High's Ice Cream parlor chain of more than 30 stores was acquired as well, followed a year later by the addition of the Knoxville, Tennessee-based Kay's Ice Cream chain. The move into the ice cream business did not work out for C.F. Sauer, however. A recession hampered business, as did the arrival of chains like Ben & Jerry's and the addition of premium brands of ice cream to supermarket and convenience store freezers. The Kay's chain declared bankruptcy in 1992 and the High's stores began to close, so that within a few years only a single High's store remained of a chain that had once numbered in the hundreds in the mid-Atlantic states. C.F. Sauer ventured even further afield in 1989 when it acquired Richmond-based Pleasants Hardware, Inc.

KEY DATES

1887:: Conrad Frederick Sauer, Sr., founds company.
1920:: Company begins offering herbs and spices.
1927:: Sauer dies; his son Conrad Frederick Sauer, Jr., succeeds him as president.
1929:: Duke's Products Company is acquired.
1953:: Conrad Frederick Sauer III assumes presidency after the death of his father.
1964:: Dean Foods Co. is acquired.
1976:: Metrolina Plastics, Inc., is acquired.
1984:: C.F. Sauer Food Service is formed.
1993:: Conrad Frederick Sauer IV assumes presidency.
1999:: The Spice Hunter and Mrs. Filberts Mayonnaise are added.

To meet the demand of its core businesses, C.F. Sauer in 1990 completed a major upgrade of its Green-ville plant. A year later a new distribution center was opened as part of the Richmond complex. The fourth generation of the Sauer family gained day-to-day control of the business in 1993 when Conrad Frederick Sauer IV succeeded his father as president. The elder Sauer remained very much involved, however, staying on as chairman of the board. Other fourth-generation executives included Mark A. Sauer, vice-president of sales; R. Tyler Sauer, plant manager of the Richmond facility; Matthew P. Sauer, manager of an Orlando, Florida, foodservice warehouse; and Bradford B. Sauer, vice-president of Sauer Properties, the family's real estate arm.

Under the guidance of new leadership, the family company, content to remain a regional concern, continued to grow within its means. In 1996 the company acquired the Bama Oils Division of Welch Foods, Inc., adding the Bama mayonnaise, salad dressing, sandwich spread, and tartar sauce lines. Bama mayonnaise was the leading brand in Alabama and Mississippi, and popular in Louisiana and Georgia. Production was then moved from the Bama plant in Birmingham, Alabama, to Greenville. C.F. Sauer closed the decade with a pair of significant deals. In August 1999, The Spice Hunter was acquired. Operating out of San Luis Obispo, California, the 20-year-old supplier handled more than 300 exotic spices, spice blends, and all-natural foods. Next, C.F. Sauer purchased the Mrs. Filberts Mayonnaise product line, a move that expanded C.F. Sauer's geographic reach. To keep pace with steady growth, the company began to upgrade its inventory and data management systems, the first elements rolling out in 1999.

Now operating in its third century, C.F. Sauer showed no interest in selling out to a larger national competitor, content to remain a regional independent. There also seemed little interest to take the company public and feel the pressure of shareholders to make quarterly numbers. Instead, the company, staffed at all levels with members of the Sauer family, continued to nurture its varied businesses and to further its reach across the country. A new unit operating as C.F. Sauer Foods West LLC opened a 210,000-square-foot plant in New Century, Kansas, to produce mayonnaise and margarine products for sale in the western part of the United States. The Dean Foods plant in Sandston was expanded, and the Greenville complex received an upgrade as well. Moreover, C.F. Sauer turned to the Internet, making many of its products available to customers around the world.

Ed Dinger