Watkins Draws On Past To Chart Future

J.R. Watkins began selling red liniment from a horse-drawn wagon 129 years ago, bringing home remedies to rural areas where few doctors practiced and were too expensive for many farm folks.

Watkins Inc. is now returning to those wellness roots, aligning its marketing with the popular themes of healthy living and environmental protection.

The full catalog - with nearly 400 items - will remain largely unchanged. But Watkins now has a second catalog that advertises “healthier living since 1868” on the cover and stresses wellness throughout.

The main catalog still includes dessert mixes, snack and dip mixes, imitation butter-flavored spray and beverage concentrates.

But the 32-page health-oriented catalog offers products such as grapeseed oil, and boasts, “With half the saturated fat of olive oil and a powerhouse of natural antioxidants, your cardiologist will give it the green light. And because it’s ‘recycled’ from wine grapes, it doesn’t use up precious farmland or water.”

Customers are also invited to “attain inner peace” with aloe vera juice and gel capsules, “enhancing protein digestion and assimilation and decreasing elimination time while helping to regulate bacteria growth.”

Mark Jacobs, Watkins’ president and chief operating officer, says the company isn’t trying to peddle snake oil.

“We promote common sense health and wellness,” he said. “There is no quick pill that’s going to get you on the road to health and wellness. You have to look at everything that goes into your body and your environment.”

The company knows all too well that the road back can be a long one.

Watkins was approaching it’s 100th anniversary when it took ill. The company had moved into a fourth generation of family management and was placing more of its emphasis on drink and dessert mixes. It also attempted to launch a line called J. Zachary for sale in retail stores that failed.

In 1977, Watkins sought bankruptcy protection.

It was purchased a year later for $4.1 million by Minneapolis businessman Irwin Jacobs, who pumped another $7 million into Watkins in the first two years and slowly returned the company to profitability by aggressively developing new products and rebuilding the sales force.

Then in the early 1990s, there was another setback. The company tried to develop a more upscale image by downplaying the Watkins name, hiring other companies to make more of its products and raising prices. Fewer people signed on to sell Watkins products and profits began dropping.

That’s when Irwin Jacobs’ son, Mark, began taking notice. He was 14 when his father bought Watkins, and had always been captivated by the company. He even sold Watkins products while attending high school.

In December 1995, Mark Jacobs joined the company and moved to this southeastern Minnesota city 120 miles south of Minneapolis where most of Watkins products are produced or processed.

“I saw this as a diamond in the rough,” Jacobs said. “I decided it needed somebody living here and caring for it.”

The nurturing has paid off. Last year, North American sales of Watkins products totaled more than $100 million. It will expand into New Zealand this fall, Japan next year, and hopes to add two new countries each year after that.

Irwin Jacobs is pleased with the changes at Watkins.

“Mark has a passion for what he’s doing,” said Jacobs, who says his son is the best executive the company has had since emerging from bankruptcy.

“Mark has created and promoted a mission statement for the company,” Irwin Jacobs said of his son’s efforts to link Watkins products with healthy lifestyles. “It is the next generation’s view, but none of it extinguishes the past. It promotes the past in going into the future.”