Baby food is big business. In the U.S., containers of diced peaches, pureed carrots and the like account for $1.4 billion a year in retail sales.
The market is dominated by Gerber. But a still-small upstart company based in Duluth is looking to find its place in the industry by offering organic baby and toddler foods that are culinary-inspired and smartly packaged.
Sprout Baby Foods, founded in 2009 by celebrity chef and father Tyler Florence, was later moved to metro Atlanta from New York under CEO Ron Davis, a food business veteran who lives here and was brought in to manage the company in 2010.
Sales have increased from $1.5 million in 2009 to $4.5 million in 2010 to $15 million in 2011, and they’re expected to hit $25 million this year and more than $30 million next year, Davis said. The company had its first profitable month in October, and its products are in 14,000 grocery stores, including Wal-Mart, Kroger and Whole Foods, he added.
Sprout’s growth is linked to its use of pouch packaging rather than the traditional jars. This, the company said, allows for healthful, better-tasting and higher quality food that comes in combinations such as carrot, apple and mango that were created and tested by Florence.
The company is also trying to catch the wave of modern moms who want healthy, good tasting organic options for their babies and who like being able to order products online and have them delivered to their homes if they choose.
A market research report from Euromonitor International said Sprout “is positioned for parents who consider themselves to be health conscious foodies. Sprout has the advantage of name recognition through the involvement of celebrity chef Tyler Florence.”
It also noted that besides nutrition, Sprout “focuses on the great taste of its foods.”
Davis figures $100 million or more within three years is a reasonable sales goal for the company, provided it can acquire additional funding for expansion. The company has been financed by private investors and is seeking a strategic partner to propel it.
“Our goal is to build it to the point where we turn it over to someone who can take it to the next level,” he said.
Sprout’s presence in metro Atlanta is relatively small. Its executive offices are here, and it employs 13 people full time with about five other full-time contract workers.
Manufacturing is done in Illinois, Indiana, Kentucky and Wisconsin.
While Sprout is focused on babies and toddlers, the company thinks it can hold on to those young customers in the future by making and selling high-quality organic snacks and other foods that they may buy as older children and as teenagers.
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