March 6, 2023
Very few companies can make the claim that 80% of U.S. homes have their products in their pantries. But when you are as diverse as the J.M. Smucker Company (Tii:SJM) with brands like Jif peanut butter, Folgers coffee, Milk-Bone dog snacks and Café Bustelo, it’s easy to understand Smucker’s reach.
The company was founded in Orrville, Ohio in 1897 by Jerome Monroe Smucker. Smucker built a cider mill and sold apple cider and apple butter door-to-door from the back of his horse-drawn wagon, with each stone crock sold hand-signed as his personal guarantee of quality. The operation grew selling goods made from apples said to be cultivated by Johnny Appleseed himself.
The company was incorporated in 1921. It expanded its operations in 1935 to increase demand. The expansion included opening a fruit-processing facility in Washington. In 1942 national distribution started with the shipment of fruit spreads to Los Angeles, Calif. Smucker also added ice cream to its product line. Its apple butter became part of American soldiers’ rations while serving overseas in World War II.
The company went public in 1959, issuing over 165,000 common shares. The stock was listed on the New York Stock Exchange in 1965.
In the 1960s Smucker further diversified its products. The company started selling ketchup in 1963, and Kellogg’s began to use Smucker’s jam in its Pop-Tarts the following year. In 1965, the company began to manufacture peanut butter. By the late 1980s, Smuckers was producing and marketing its products internationally, first in Canada and then in Australia. In 1982, Smucker’s purchased the Magic Shell product line, a squeezable topping that hardens on ice cream. In 1998, it acquired MenUSAver, makers of a frozen, crustless sandwich now known as Smucker’s Uncrustables. Expansion continued into the 2000s. It acquired Jif and Crisco in 2002, purchased the Folgers coffee brand division from Procter & Gamble in 2008, and the Big Heart Pet Brands in 2015, which marked the largest acquisition in the company’s history.
J.M. Smucker currently has three major business units: consumer foods, pet foods, and coffee.
Despite being a public company, Smucker’s has been family-run since the beginning. Jerome Smucker died in 1968 and since then, direct descendants of Smucker have managed the company in a six-generation chain passed from father to son. Still, it’s no easy path. Before a Smucker descendent can become CEO, they are required to have an advanced degree and work for some time outside the company. Current CEO Mark Smucker started his career as a middle school science teacher.
The company has appeared on Fortune magazine’s annual listing of the 100 Best Companies to Work For in the United States several times since 1998, ranking number one in 2004. It assumed a spot on the Standard & Poor’s 500 Index in 2008 and the Fortune 500 in 2015.
Its brands continue to grow, including Uncrustables, which CEO Mark Smucker described in an interview as a “shining star.” Uncrustables has grown 30 consecutive quarters and the company built a second plant for the product and expects to reach sales of more than $500 million for the product. A third plant is expected to help Smucker’s reach $1 billion in sales for Uncrustables alone.
Smucker reported last month that its first quarter sales rose 8.3% to $2.22 billion, its growth reflecting inflationary price increases. The food giant said that ongoing cost inflation, volatility in supply chains and the overall macroeconomic environment continue to impact financial results and cause uncertainty and risk for the 2023 outlook. Since 1962 Smucker has marketed its products with the slogan “With a name like Smucker's, it has to be good!”
Is Smucker’s a good investment for retail shareholders? That’s for you to decide after careful consideration. But the company continues to diversify and add to its portfolio of brands and its products remain true staples for most U.S. consumers.
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