Tastee Apple: How One Business Copes With Extreme Seasonality
Every August, Greg Hackenbracht’s production payroll swells from five to about 150. Every November, it shrinks back down to five again. This has been the annual fluctuation at Tastee Apple, Inc. since Hackenbracht and his father started the Newcomerstown, Ohio-based caramel-coated fruit maker more than 40 years ago.
While it’s safe to say that seasonality affects virtually every business, few are as radically seasonal as Tastee Apple. It’s not as if Hackenbracht experiences a slow period from the end of October through the end of July. The company’s main product line generates no sales at all after Halloween, and orders don’t pick up until the following fall.
'Tis the Season
Hackenbracht struggled for decades trying various means of extending the selling season for their caramel apples. Apples are, of course, harvested in fall, but freshness wasn’t the primary issue. Although the apples have a shelf life of just 17 days after being processed, he says modern storage methods can keep unprocessed fruit fresh for a year after harvesting.
The problem was that customers just didn’t want candy-covered apples outside that narrow window. This understanding was finally brought home by a consumer’s focus group comment. “She basically said, ‘My kids come home from Halloween with all this candy. Do you actually think I’m going to buy something sweet the next week?’” Hackenbracht recalls.
By the end of November, when consumers were ready to indulge in candied fruit again, Hackenbracht’s efforts were stymied by the massive influx of holiday products. “To get shelf space at that time of year in a grocery store is extremely difficult with all the holiday items that are already in place,” he says, adding, “I think the consumers would buy them, but it’s getting past store buyers now.”
Still, Hackenbracht—who is apparently not inclined to give up easily—even tested putting apples out at no cost, in hopes consumers would be more willing to gratify a sweet tooth if it didn’t involve spending money. “It didn’t happen,” he admits. At some point, reality sank in: “It was the understanding that there are certain things, it doesn’t matter how much marketing money I put behind that, I’m not going to change,” he says.
Although forced to concede nearly 10 months of the year as an off-season for its main product lines, the company tried to ease the seasonal impact with year-round sales of apple cider and vacuum-dried apple chips. But neither was a good fit and Tastee Apple got out of apple chips in 2007 and sold the cider processing business a few years later. Now, aside from a modest business selling chocolate-covered apples at various holidays, the company is sustained by a few weeks of caramel apples every fall.
The Seasonal Mindset
How does Hackenbracht manage? A lot, according to him, consists of having the right attitude. “It’s a mindset,” he says. “You’re going to be going crazy for a period of time and then you’re not. You have to understand that and always look ahead to see what you can do to make that short period better.”
For Hackenbracht, looking ahead starts as soon as the busy season is over. The unneeded employees leave and the remaining ones devote themselves, for the most part, to overhauling and maintaining the production equipment. “Amazingly, it’s extremely busy,” he says of the off-season. “Every machine we have is totally taken apart. Every gear is looked at. Everything is put back to new condition.”
The purpose of the intensive off-season maintenance is to ensure that when the boom hits, none of the machinery goes bust. “If a machine is down for a half an hour, it really hurts,” he says. “So we really do a lot of maintenance.”
Equipment maintenance is primarily done by a small core of managers who have all been with the company for more than a decade each. Hackenbracht himself spends much of his off-season poring over spreadsheets to find ways to improve product quality and customer service. By opening bottlenecks and removing sticking points, he’s able to respond to customer orders within 24 hours, even though they don’t process apples until an order is received.
The speedy turnaround is necessary because of the product’s perishability. “We have a relatively short shelf life,” Hackenbracht says. “So we work hard to shorten the distribution chain and work with customers in terms of how they’re selling.”
Product development is another activity Hackenbracht engages in extensively during the off-season. He’s introduced a number of variations on the standard candy apple, including fruit dipped in caramel and then rolled in peanuts, coconut, chocolate chips and other treats. “I’m always looking at ways to come up with new coated apples,” he says. “I have a couple I’m working on now.” He draws the line at tinkering with the basic coating, however. “The caramel is a formula I developed 40 years ago,” he says. “And we’re still using that formula.”
Another thing that hasn’t changed at Tastee Apple is the overwhelming influence of seasonality. Midway through spring, Hackenbracht is still running a skeleton staff but already thinking about recruiting seasonal production workers, starting training and gearing up the factory. “Most of the machines are put back together,” he says. “We’re putting lines back together and we’ll start our testing process so we are ready to rock and roll.”
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