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Tag: South Jersey

NJBIZ stories taking place in and involving South Jersey businesses, companies and business news.

Speak Easy Tiered plans just starting to be studied

SpeakEasy is a running feature in NJBIZ in which we recap presentations given by key business leaders around the state at one of New Jersey’s many conferences and events.

Kate Ho, an economics professor at Columbia University, has been watching the impact of tiered networks as well as their growing popularity around the country.

At a recent event in Princeton held by the New Jersey Health Care Quality Institute, Ho discussed “what economists are trying to do to understand effects of tiered networks” by looking at data reports in the last few years.

“Tiered networks have gained popularity nationally as a method to control cost,” Ho said, adding that, as a result, data has only just started rolling in and economists have been able to begin analyzing it.

Most of the known data has come in from Massachusetts, specifically looking at what the state’s employee benefits plan and Blue Cross Blue Shield have done.

BCBS in Massachusetts first implemented a three-tiered network plan in 2007.

In 2012, the Massachusetts Group Insurance Commission included new incentives for a limited network plan, which included a three-month holiday premium.

How individuals weighed the benefits proved interesting, she said.

“Consumer behavior is very sensitive to financial incentives. This premium holiday caused 10 percent of employees to switch plans,” Ho said. “The healthiest people, not surprisingly, were the most likely to switch.

“In addition, they found that the enrollees that could switch without changing their insurance carrier or their primary care physician were 60 percent more likely to switch than anybody else.”

Switching meant spending 36 percent less than the old plan for a marginal group of people.

While the quantity of care received reduced, the quality of care did not, Ho said.

“Not surprisingly, patients did travel further to get to a hospital than they had before,” she said.

When the hospitals were re-tiered periodically, based on cost and quality, it affected consumer choice for use of the hospitals, Ho said, citing a study.

During the study period of 2009 to 2012, 44 percent of hospitals changed tiers, and when an insurer dropped one of the most popular hospitals from an Affordable Care Act plan on the exchange, 40 percent of patients switched away from using that hospital.

Others, she said, simply switched away from the plan altogether.

“That raises questions about access,” Ho said.

Should the government subsidize bigger, more expensive hospitals in order to ensure access for enrollees?

Or should the insurer just wait and see if those who switched away eventually return?

More questions remain as data continues to roll in from tiered plans popping up around the nation.

One of those questions is: What will happen to hospitals in non-preferred plans, and those which on lower tiers?

“The tradeoff between ensuring access and controlling costs will be interesting to see,” she said.

E-mail to: [email protected]

A Taste of Success Campbell’s move to bring in top chefs from around the world is producing better-tasting products and an increase in profits

New Jersey residents would have gladly accepted a hot bowl of chicken noodle soup last week after shoveling out from Winter Storm Jonas.

But had it been Campbell’s, you might’ve ended up with Homestyle Mexican-Style Chicken Tortilla Soup instead. And thankful for it.

Tom Griffiths — a certified master chef and global vice president of Campbell Soup Co.’s Culinary and Baking Institute in Camden — has been shaking up the 147-year-old company’s portfolio with new flavors and internationally inspired meals since he was hired in 2010.

As authentic as ever, one thing is clear: The predictable Campbell products of our childhoods are exactly that — in the past.

“About six years ago, Campbell leadership decided its chefs were not being leveraged as much as they could be,” Griffiths said. “I was hired to create that culinary voice.”

Today, Griffiths and his team at the institute are one of Campbell’s strongest competitive advantages and a big part of the $8 billion in annual sales the global food company generates.

“We really have an interest in making the food more delicious,” Griffiths said.

Not to mention, keeping the company current with today’s business models.

So far, he has been helping the company do just that.

Top 10 food themes
Campbell Soup Co.’s third annual Culinary TrendScape lists the top 10 influential food themes for 2016:

  • Cooking with fire: Wood-fired grilling — even for cocktails and desserts.
  • Authentic Thai: This influenced Campbell Soup Co.’s Wicked Thai Style Chicken with Rice and Vegetables Soup
  • French Revival: A new wave of French comfort food at bistros and cafes
  • Inspired ice cream: Bold, new flavors such as chorizo-caramel, hibiscus-beet and black pepper-butter pecan
  • Traditional fats: Cooking with fat, from pork fat to avocado to nuts and seeds of all varieties
  • Asian noodle soups: Such as Vietnamese pho
  • Haute dogs: Such as Vietnamese bahn mi flavored links, mac-n-cheese garnishes and croissant buns
  • Veg 2.0: An expanded veggie revolution and a greater vested interest in vegetarian and vegan recipes; influenced V8’s Veggie Blends beverages and Bolthouse Farms’ 1915 cold-pressed organic juices
  • Caramel: From coffees to cocktails; influenced Pepperidge Farm’s Salted Caramel Chocolate Milano Cookies.
  • Simple and real: Wholesome food options; fewer and simpler ingredients; transparent food companies. “I think that is something we always did and continue to do, but, maybe we didn’t have poblanos on the menu, or fire-roasted tomatoes — things that our chefs and I would love to feel we were a part of bringing to people and educating them about,” Campbell Chef Tom Griffiths said.

Griffiths was hired in February 2010, nearly 10 months after Campbell Soup hit a low stock price of $24.87, which is equivalent to $20.22 when dividends are factored in.

Since Griffiths’ hiring, Campbell’s stock has essentially more than doubled, to more than $55 on Jan. 26.

To be clear, it has been a team effort in the kitchen.

After previously serving as the associate dean of advanced global cuisines at the renowned Culinary Institute of America, Griffiths now manages 10 chefs and about 40 “culinologists” — those with both culinary and food science degrees — in Camden; seven chefs at Pepperidge Farm’s headquarters in Connecticut; two chefs in California, one at Bolthouse Farms and the other at Plum Organics; one chef at Garden Fresh Gourmet in Michigan; three chefs in Australia, who cook for Australia, Indonesia and Malaysia; and one chef and culinologist in Toronto.

“We have one of the most highly credentialed culinary and research and development teams in North America,” Griffiths said.

Their job is to not only increase Campbell’s culinary portfolio, but also to expand the company’s presence worldwide.

“(For example), we might hire an expert on paella to come in and teach us about the gastronomy of Spain and send a chef to Washington, D.C., or even Barcelona to study and learn that paella can sometimes include rabbit or snails, has a certain kind of rice or that authentic paella is cooked on an open fire over pine cones and lemon trees — all in the name of coming up with an authentic paella recipe,” Griffiths said.

That recipe is then tested in different markets, with scientists and chefs, before Griffith’s team heads to the grocery store with consumers in mind.

“We’ll purchase every paella we can in order to build a gold standard for consumers based upon our authentic paella recipe — which, perhaps does or does not include rabbit or escargot,” Griffiths said.

Looking forward
At this time last year, Campbell Soup Co. in Camden was undergoing a hefty reorganization:
Rather than continue to be organized by geographies or brand groups, the businesses would be managed within three divisions structured by product categories: Americas Simple Meals and Beverages (Campbell Soup Co., Plum Organics); Global Biscuits and Snacks (Pepperidge Farm, Arnott’s and Kelsen businesses); and Packaged Fresh (Bolthouse Farms).
CEO Denise Morrison had hoped the reorganization would help the company focus on sustainable growth and expansion into new categories, segments, channels and geographies.
“Our industry faces global economic realities with a shrinking American middle class and a growing one in developing markets; major demographic changes, including continued growth of millennial and Hispanic cohorts in the U.S. and a redefinition of the American family; profound changes in consumer preferences for food with increased focus on health and well-being, fresh and organic; and the game-changing impact of digital technologies,” Morrison said in the 2015 annual report. “Traditional food companies have felt the impact for several years. In calendar 2014, on the heels of many of these changes, the industry’s average net sales growth rate slowed to only 1 (to) 2 percent. In response, companies have initiated a series of strategic actions, from spinoffs and consolidation to acquisitions and aggressive cost-cutting.”
It’s why the company’s purpose — “Real food that matters for life’s moments” — has, according to Morrison, spurred “the single most important cultural change in her time” at Campbell.
“Today, everyone at Campbell is thinking, talking and acting differently about our food — from how it is grown and the ingredients we select to how we prepare our foods and the type of acquisitions we pursue,” she said.

As part of the institute’s Culinary Trends Monitoring Program — which tracks emerging culinary trends and leverages them as inspiration for new Campbell products — Griffith’s team members attend immersion tours and conferences and work in restaurants to network with highly influential chefs.

Their research has not only helped Campbell introduce bold, new flavors, but has also helped educate others as an expert leader in the industry.

“Our chefs will go and meet with other chefs and their leadership teams to present our Culinary TrendScape,” Griffiths said. “It is a viable asset for them.”

The third annual Culinary TrendScape — a report tracking the Top 10 influential food themes for 2016 — has indeed influenced several of Campbell Soup Co.’s newer products.

“We’ve been studying Thai food for three or four years, so this year, we have an authentic Thai Curry Chicken skillet sauce,” Griffiths said.

“We may not always come out with a product immediately, but we are always learning so that we can be proactive about it.”

For example, Griffiths views Latin-inspired food and regional Mexican cuisine as being highly influential on Campbell products in the near future.

“I recently sent several chefs down to Mexico to spend five days learning authentic ways to make moles and salsas,” he said.

It sounds costly — and, Griffiths admits, it is. But while it may initially cost more to use higher-level ingredients in Campbell recipes, Griffith and his team work hard to find ways to make it affordable for the company and its consumers.

“If we are studying French revival, for example, I wouldn’t want a chef to say, ‘Why bother making lobster bisque? Lobsters are expensive.’ That defeats the purpose of our strategy — to educate and inspire,” Griffiths said. “Whatever we do, we need to start at the beginning in order to achieve an authentic gold standard. It may be an inexpensive bean soup or it may be seafood bisque, but, regardless, we’re still going to discover that authentic recipe and create its gold standard. Then, it will evolve over time to be more affordable and delicious.”

Griffiths — one of only 67 master chefs in the world to be certified by the American Culinary Federation — would stake his reputation on his work at Campbell.

“I could inspire and mentor maybe 1,000 students in a year, but I now have the opportunity to literally feed the world delicious food,” he said. “That is a legacy.”

E-mail to: [email protected]
On Twitter: @megfry3

(Editor’s note: After this report was published, representatives of Campbell Soup Co. stated that the company’s stock price has risen over time due to a variety of factors, including but not limited to the addition of master chef Tom Griffiths.)

New leadership, new menu, new success Steck helping Saladworks emerge from bankruptcy with new identity, image

Saladworks — the nation’s largest fresh-to-order salad franchise — opened its first store in 1986 in Cherry Hill.
Last February, the company filed for bankruptcy.

That didn’t keep Paul Steck, CEO and president, from believing in the brand.

“How can we undo the damage done during (the last) two years of chaos?” he said, after taking over as CEO last June.

The answer?

Better leadership; updated research; and, most importantly, a new menu.

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The 30-year-old company, which has about 100 franchise locations, certainly needed a better track.

“The prior owners had had a falling out,” Steck said. “They couldn’t even agree on what day of the week it was.”

After two years of lawsuits and depositions, the company filed in February of last year for Chapter 11 bankruptcy in order to end longstanding disputes between the company’s founder, John Scardapone, and Saladworks’ major investor, Commerce Bank founder Vernon W. Hill.

“The purpose of the bankruptcy was not traditional — it was to force the sale of the company upon the previous owners,” Steck said. “We were in and out of bankruptcy in less than four months.”

Centre Lane Partners, a New York-based private equity firm, purchased Saladworks for $17 million as the company successfully worked to pay off nearly $2 million in debt.

That’s when the real work began.

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“We knew that the menu was old and tired,” Steck said. “It wasn’t responsive to the demands of the marketplace.”

In order to meet changing customer tastes and drive-up sales, Steck created a research and development task force last year consisting of seven franchisees and corporate team members.

“We were definitely behind the curve in doing that,” he said.

Additionally, to ensure the revamp was executed correctly, Steck hired a market research company to travel to 40 Saladworks locations and interview almost 900 customers about what they wanted to see on the menu.

“Younger generations in particular were looking for more unique ingredients, as they have different taste profiles than others are used to,” he said.

But Steck didn’t rush to make immediate menu changes across the board.

“We collected the market research data and shared it with at least 20 percent of our franchisees,” Steck said. “We wanted both customer and franchisee feedback — from dedicated and passionate individuals who own these restaurants with their own money at risk. Providing input and guidance for them just made a lot of sense.”

Where’d ya go?
Though Saladworks was founded in Cherry Hill, the company has since relocated to the Philadelphia area.
“There are the obvious tax implications, with New Jersey having some of the highest taxes in the country,” CEO and President Paul Steck said. “But there are also franchise laws in place in New Jersey that are not typical around the country.”
For example, Steck said, if a franchisee violates an agreement in New Jersey, the business is automatically provided 60 days to correct infractions before a franchisor can terminate its rights.
“Which means the franchisee can violate the agreement for 59 and a half days before addressing the problem,” Steck said. “If a change can be made overnight — especially if it is a health and safety violation — let’s fix that right now.”

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One of the biggest collective concerns was how Saladworks could remain competitive in a market when everywhere from gas stations to fast food establishments were now selling salads.

“We can’t compete with the Wendy’s and the WaWas of the world, so we have to offer elevated products that are intriguing to people,” Steck said.

“Kale was what you used to decorate salad bars with 20 years ago. Now, people are demanding it in their salads. And just six years ago, no one had even heard of quinoa, let alone be able to spell it — now, it’s on every menu you look at.”

Including Saladworks’. The brand’s new menu — which launched in January — includes a new Thai chicken salad, Mediterranean salad and farmhouse salad; seven new toppings, from roasted Brussels sprouts and butternut squash to goat cheese and grapes; five new sandwiches; and a new apple cider vinaigrette dressing.

“We have a very loyal fan base and a large number of customers who visit our stores three to four times a week,” Steck said. “Our product lends itself to that. There is so much more choice with 64 ingredients and 14 different types of dressing.”

Good thing, then, that the average salad with dressing is only 430 calories.

And that’s not the only way Saladworks is striving to become the healthiest fast-casual option for consumers.

“Our industry is abuzz about the concept of farm-to-table, but in reality, you can only get a Jersey tomato two months out of the year at most,” Steck said. “So we have to come up with other ways to source products.

“For us, it’s more about where the food came from, how it was cared for, who grew it and how it was transported. We are always looking for vendors that could help us with all natural and organic products, as well as hydroponic lettuce — we’d love to be able to grow lettuce closer to home here.”

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Even though home is really its headquarters in Conshohocken, Pennsylvania, Saladworks has more units in the state of New Jersey — 31, to be exact — than any other state.

“What I want to do is expand the brand from its position of strength and move outward,” Steck said. “Certainly, New Jersey is the epicenter of Saladworks.”

But there are still plenty of towns where Steck would like to build the brand’s new, more space- and cost-efficient and sustainable store designs, such as Freehold, Brick and Jackson.

“We should be in those towns,” Steck said. “Cape May is also thriving in the offseason, as is Ocean City — why aren’t we there?

“Let’s focus on New Jersey, where the brand resonates well and we have a ton of loyal customers. Let’s finish what we started here.”

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Saladworks is well on its way to continued success.

Today, Saladworks has 101 franchise locations in 14 states and three countries, totaling $80 million in revenue for 2015. That number is up 8 percent from 2014.

And Saladworks plans to open 11 new locations this year — four of which will be in New Jersey.

“I’m most proud of the results to date and look forward to improved results in the years to come,” Steck said.

E-mail to: [email protected]
On Twitter: @megfry3