Brash, Bold And Full Of Beans Buckeye Beans Eats Away At Success

As a well-managed, highly efficient food processor - and winner of several prestigious awards - Buckeye Beans & Herbs keeps its 50 employees on a strict production schedule:

8 a.m. - Eat doughnuts.

9 a.m. - Chew bread sticks.

10 a.m. - Slice birthday cake.

11 a.m. - Barbecue hamburgers.

2 p.m. - Down brownies.

Buckeye - the Hillyard-based maker of 130 different soup, bread and pasta mixes - doesn’t consume calories like this every day.

But with awards to celebrate, big contracts to toast and the occasional birthday, the food company likes to consume as well as produce.

“We’re lucky we’re not huge,” says Carol Dingwall, who cooks and handles food displays for Buckeye’s photo sessions and trade shows. “We do an awful lot of eating. This place is really food-minded.”

If food is fun, then working for Buckeye is a party.

The company stands in stark contrast to the popular image of corporate America, where fat executives lord over starving factory drones. Buckeye is more akin to grandma’s hearth-warmed kitchen - a place where relatives and friends congregate to prepare and distribute large amounts of food.

Buckeye’s peculiar way of doing business has won more than simple praise from employees and the chamber of commerce. It has fostered financial and personal success for owners Doug and Jill Smith, who will be honored this week by the president of the United States.

President Clinton tomorrow will present the Smiths the 1996 Small Business Administration award as the best small business in Washington state. The award goes to the company that shows employment and sales growth, fosters innovation, responds to adversity, contributes to community projects, and does all that without going bankrupt. The honor also puts Buckeye in an elite group of 50 companies under consideration for the honor of best small business in America.

“What stands out about the best firms is their corporate culture, and Buckeye has the kind of culture where they have a passion for the product,” says Roger Blackwell, marketing professor at Ohio State University and a national expert in speciality food. “I suppose it takes a special kind of passion when your product is beans.” Buckeye is an $8 million-per-year company where the president earns a modest $48,000, and gets paged to answer phone calls from “Eddie Spaghetti.”

It’s a place where an upset mom can bust in with an idea to sell Buckeye pasta as a school fund-raiser and get hired to take the program nationwide.

It’s a socially active business where workers yawn at orders for 450,000 pounds of beans, but cheer when they raise $2,600 for Habitat for Humanity.

At Buckeye, the bathrooms are labeled “Human Being Rooms.” There’s a packaging machine that used to make condoms. And the owner carries a squirt gun.

“I always say, if you want to make a difference, you got to be different,” says Jill Smith, Buckeye co-owner and Doug’s 28-year partner in marriage.

During its first seven years, Buckeye’s national reputation was as a cute specialty food company located in some distant Seattle suburb that sold funny sounding soups and dolphin-shaped pasta.

But in the past five years, millions of consumers have discovered Buckeye’s homespun recipes, triggering a six-fold explosion in sales and rocketing the specialty food company near the top of its field. With its humorous marketing campaigns and weakness for social causes, Buckeye is earning a reputation as the Ben & Jerry’s of packaged food. At the same time, it’s helped educate consumers on the real location of Spokane.

“We’re the big guys now,” says Doug Smith, a Gerald Ford look-alike who flew reconnaissance planes over Vietnam. “We’re trying to get our whole crew involved in creative thinking.”

That shouldn’t be too difficult. Company employees are used to functioning as food testers, copy writers and the sounding board for Jill’s whacky marketing ideas.

“Even though we’re in production, we’re all the same in this company,” says Beverly Tomala, a six-year veteran of the factory floor. “We can go in to see Doug and Jill anytime. It may not do any good, but they always listen to us.”

The Smiths have to listen to keep the peace. Nearly half their employees are either related to them or have ties through outside interests.

Doug’s sister handles wholesale marketing. The other sister cuts checks for employees. Jill’s brother is the staff photographer.

Three people were hired after playing soccer with Doug, a 51-year-old goalkeeper. His best man is vice president of operations.

“We’ve violated every rule known to business,” says Jill, a hippy potter who wears green frog earrings to “ward off serious people.”

Yet like any family, the company has its spats.

Bonnie Zahara, director of Buckeye’s Fun’raising division, says she recently pounded her fist and screamed at her boss to block a plan to increase the telemarketers’ hours from four to eight. The change might seem more efficient on paper, Zahara argued, but the telemarketers would burn out after four hours and orders would drop.

“I could never do that at another company,” Zahara says. “I’d get fired.”

But at Buckeye, Zahara is a hero.

“Our crew can be very blunt, we train them that way,” Jill says.

She should know. She’s the company’s No. 1 pitbull who refuses to compromise company values for quick profit.

Food brokers whine that she could make millions shipping the latest Buckeye products to Price-Costco, Target and other mass merchandisers. But Smith refuses to change Buckeye’s longstanding policy of giving the nation’s 3,000 specialty stores a two-year head start on mass marketers with new products. Because these shops put Buckeye products on the shelf when the company was young, Smith refuses to dump them now.

Some of the Spokane stores that sell Buckeye products include Harry O’s, Mel’s Nursery, Made in Washington, Joel’s, Egger Meats and Simply Northwest. In Kootenai County, the products are sold at Trip to Bountiful, Partners, Kitchen Connection, Michael’s Restaurant and Northwest Best.

Selling through specialty stores is not necessarily bad business, says Blackwell, the Ohio State professor. Specialty food is one the fastest-growing industries in the nation. Many food companies have succeeded because they fill niches too small for major food processors while offering an alternative to mass-produced food.

“It’s a rebellion against a Wal-Mart world,” says Blackwell, who co-wrote the widely used textbook, “Consumer Behavior.” “Consumers are looking for a kinder, simpler world.”

Buckeye began tapping that market during Christmas 1983. On a whim, Smith and a friend spent $1,000 on beans, recipe cards and ribbons to sell packaged bean soup mixes at local kitchenware stores familiar with Jill’s pottery work. They sold 600 hand-filled bags and Buckeye was born.

Her partner later dropped out and Doug, wising up to the potential of Buckeye, quit his job as a pilot for Salair in Spokane and became company president.

Buckeye took out its first $50,000 bank loan in 1987 and hired some employees. Beans and lentils were purchased from Inland Northwest farmers and Jill continued to concoct new recipes. She gave them eye-catching names such as Great Leap’n’ Lentils and Rip Roar’n Lentil Chili, which warns consumers to “watch out for the stampede.”

By the late 1980s, Smith hit on a winner with endless possibilities - shaped pasta. She created dolphin-shaped pasta for environmentalists, heart-shaped pasta for romantics, baseball-shaped pasta for sports fans and angel-shaped pasta for those seeking a religious dining experience. A 15-ounce bag typically sells for $4.25.

The company also produces a line of bread mixes and owns a California-based maker of jellies and condiments, Judyth’s Mountain.

Buckeye predicts sales will reach $11 million by 1998. That would make it one of America’s largest specialty food companies, Blackwell says.

But managing that growth is the most serious challenge that the Smiths have ever faced. It’s a problem other small food companies, including the vaunted Ben & Jerry’s, have had trouble handling.

The couple admits that as Buckeye topped $7 million in annual sales last year, they began to lose control because they had failed to delegate day-to-day tasks to other workers.

A consultant helped the pair restructure the company, set up an executive board and focus on the future. An incentive plan was installed to return employees 20 percent of all profits over $250,000, a potentially plump bonus for production workers who earn $5.50 to $9.50 an hour.

“Jill would probably kill me to see this in print, but the hardest thing we had to learn was how to fight,” Doug says. “We had to learn to have a disagreement without taking it personal. We had to quit messing around with the gas pedal and pay attention to where we’re going.”

The Smiths are still undecided about the company’s long-term future. The company is raising $500,000 with a private stock offer to retire debts and acquire new equipment. But it also may be the first step toward taking the company public.

A lot depends on the energy of Jill.

“We still see a lot of growth potential and we’d like to be involved in that,” says Smith, a frizzy-haired former art instructor at Whitworth College. “We’re still having a lot of fun.”

And getting lots of attention. Smith is such an unabashed publicity hound she’ll roll over and play dead if it means a few lines in True Story or Ebony. In New York, she wines and dines swank food editors; in Spokane, she puts her husband on a dunk tank and invites photographers to come take his picture.

But the tactics work. In 1995, Buckeye got mentioned in more than 120 publications, including Family Circle and Modern Romance magazines.

Doug, the confident and serious half of the couple, takes all this attention in stride. He knows that as head of a well-managed, award-winning company, everything is under control.

“But God help me if I don’t bring the doughnuts,” he says. “I swear, it’s become an entitlement.” , DataTimes ILLUSTRATION: 3 Photos (2 Color); Graphic: Buckeye Beans