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Hillcrest Foods, Inc.: A Model of Logistical Success
Hillcrest Foods, Inc. (Hillcrest) is a wholesale distributor of bakery, dairy and gourmet specialty food items. Chris Barkyoumb, the company’s president and owner, grew up on his family’s poultry farm, which he took over from his father. In 1982 Barkyoumb founded Hillcrest as a company that places its customers’ needs and wants at the center of its operations.
Barkyoumb recalls, “I learned the business by asking what customers needed. I didn’t originally set out to be a bakery supply company, but there seemed to be a void there, so that’s the direction I went in. Our customers tell us what they need. Every product we carry is something a customer wants, and we don’t push products on them.”
In addition to catering very specifically to customers’ needs, Barkyoumb has also learned to double down on Hillcrest’s strengths. He observes, “What you do well, you continue to do well because you buy better.” Barkyoumb credits his wife, Kim, with much of Hillcrest’s success, noting that in her work as sales manager, “She has been a real part of our growth. She has opened up a lot of big accounts and oversees sales. She works really hard at that and has done a good job.”
Issues of purchasing, shipping and logistics in general have driven many of the decisions of the practicality-minded Barkyoumb. Four years ago, Hillcrest’s operations were housed in a facility in northern Vermont. Drawing supplies there from Boston, New Jersey and New York and then distributing into Maine, Massachusetts and New York proved expensive due to fuel costs, so the company headquarters was relocated to Saratoga Springs, N.Y.
In explaining Hillcrest’s move to its current 40,000-square foot facility, Barkyoumb notes, “Logistics was a big factor in our move. Now we go in all directions, distributing to the north, south, east and west.” Another benefit of the company’s current location is that it has a rail spur, so Hillcrest can easily accept rail car shipments.
Logistics is also the reason that Hillcrest has a trucking division that is run as its own completely separate company, Hillcrest Trucking & Storage, Inc. Barkyoumb explains, “By doing that, we can really nail down our trucking cost. When you blend it all together, it can be hard to isolate those costs. And because logistics is such a big factor for us, we need to know what our trucking cost is.” The trucking company handles all of Hillcrest’s distribution in and out of the Saratoga facility, while also providing a small amount of freight for some other companies.
Barkyoumb explains the profound benefit for a bakery supply business to have its own trucking company as follows: “When you sell flour, that’s a relatively low-dollar item. Goods sold by foodservice companies, like beef, typically have higher costs. We have to sell a lot of weight, a lot of bags, so our challenge logistically is to get enough on a truck to make it pay to travel as far as we travel. By having our own trucking company, we can also haul other companies’ products. Though there is an investment up front, the payback is pretty quick.”
The company’s strategy is especially beneficial given that it has a lot of territory to cover. Hillcrest’s radius of travel for its distributions is about 350 miles, whereas a foodservice company might have closer to a 100-mile radius of travel.
Variety and Growth
Another feature of Hillcrest that sets it apart from other suppliers is that it was committed early on to carrying organic products; that commitment has proven successful for the company for years. Barkyoumb notes that Hillcrest has continued to expand its line of organic products as the market for those goods has continued to grow.
Additionally, the firm began doing some redistribution business, buying some items for resale to foodservice companies. Barkyoumb explains, “We sell to some competitors because we buy certain items better, and we sell them at a discounted rate to businesses that sell them to small restaurants. We wouldn’t distribute to those small establishments ourselves, but we sell to those other companies who will distribute to smaller places. We don’t do that a lot, but we have been growing somewhat in that direction.”
Since Hillcrest moved into its facility in Saratoga four years ago, the company has had greater space to expand and carry additional varieties of flours, sugars and other products. Barkyoumb observes, “We do supply a few foodservice companies and pizza shops, and will continue to as we grow; but, no matter what, the bakery side of our operations is where we see the most growth.”
Barkyoumb has been pleased with the growth of his business thus far, which averages 15-percent annually, and he sees even brighter days ahead, remarking, “I don’t see things slowing down. We have enough potential that we don’t always know what to work on next. It’s a good problem to have, and we work to be sure to have the right space, the right equipment and the right amount of help.”
A very hands-on leader well aware of all levels of effort it takes for operations to run efficiently, Barkyoumb credits Hillcrest’s 30-plus employees, including the drivers and sales staff, for contributing in major ways to the company’s success. “The sales staff builds real relationships with customers,” he notes. “They know who they are, and they laugh and joke with them. We care about our customers and we succeed when they succeed.” Given the long track record of practical, sound decision-making and personalized customer service that Hillcrest Foods, Inc. has established, the company’s continued success is a safe bet.