Few products in the marketplace today have enjoyed the kind
of phenomenal growth that Greenies® has. Starting as a homemade
treat, Greenies has gone from the basement (quite literally) to
top of the sales charts in a relatively short period. The
manufacturing company, S&M NuTec, LLC, is now one of the
top 10 companies worldwide in terms of retail sales in 2004
(US$310 million). In fact, the company has grown 92,000% since
1999 and Greenies has overtaken Milk Bone as the largest US dog
treat brand by value sales.
Dr. Joseph Roetheli and Judy Roetheli co-founded S&M
NuTec in 1996. The company was named for the couple's sons
Steffan and Michael. By no coincidence, the company mascots are
two Greater Swiss Mountain dogs named Serge and Max.
Headquartered in North Kansas City, Missouri, USA, the company
directly employs 95 people and provides jobs for 450-500 more
in the local area.
Joe, an ag economist, managed R&D and commercialization
programs for the US Department of Agriculture for 18 years.
When asked to relocate his family to the Washington, DC area,
Joe opted to stay in Kansas City, Missouri, USA and resign his
USDA position. This gave him the opportunity to spend time
further developing a product he formulated to improve the
breath of the Roetheli family dog, Ivan. With the consultation
of a board-certified nutritionist, Dr. Lon Lewis, and a human
dentist from the University of Missouri School of Dentistry,
the product has evolved into the top-selling pet treat on the
US market today.
From humble beginnings, Greenies (so named because of their
green coloring) have sold exceedingly well. It took some work;
however, as the young, family-run company had to demonstrate
sales of over US$1 million (in one month) before it could
secure bank financing. Now, with simple growth of 70% per
quarter, S&M NuTec strives to deal with its major growing
pains.
At the company headquarters, you can see evidence of a
bustling, employee-friendly workplace. Worker cubicles and
walkways are marked with descriptive street signs displaying
canine and feline names. Dogs are seen walking the hallways
with their human companions, and the walls are covered with
numerous awards and photographs of the good works employees
have accomplished.
Joe is quick to point out that the quality of the people who
work at S&M NuTec is number one. He runs a "fun firm" with
a unique culture where family and community interaction are
highly encouraged. The company donates an impressive amount
(over US$400,000 in 2004) to local and national charities and
dog clubs, as well as contributes time and effort with Heart to
Heart International and the local Community Blood Center. In
fact, over half of S&M NuTec's employees are active in
volunteer programs outside of work, contributing approximately
4,000 hours per year.
The company has earned over 40 awards, honors and forms of
recognition since the beginning of 2002 ranging from national,
regional and local honors, including recognition for
merchandising strategies in the pet industry. For instance,
S&M NuTec was honored by the National District Export
Council with its 2004 Small Business Exporter of the Year
Award. Also, Petco named S&M NuTec as its Vendor of the
Year for 2004 and again in 2005, for supplies.
The American Business Association awarded S&M NuTec with
the award for Best Company in America with less than 100
employees in June 2005. The Kansas City Chamber of Commerce
awarded S&M NuTec its Mr. K award as the Outstanding Small
Business in 2005.
Judy noted that she believes strongly that "one of the keys
to success for S&M NuTec has been the company's ability to
attract great people who are passionate about pets and
passionate about their work, plus persistent in execution
towards goals, and prepared to think creatively and work hard
to achieve success as a team."
There are 95 people employed by the company directly.
S&M NuTec is responsible for providing another 450-500 jobs
in the local area through outsourced manufacturing,
warehousing, packaging and shipping locations within one hour
of Kansas City in Eastern Kansas and Western Missouri.
Co-founders Joe (CEO) and Judy (president) are joined on the
management team by Brad Allen, COO; Russell Fries, (CSO-chief
strategic officer); and Don Coleman, CFO. The mission of the
company is "to provide innovative, practical, top-quality pet
products that meet market needs; provide functional attributes;
and provide value for the welfare of pets and pet owners." It
does this by offering innovative products, which are supported
by creative merchandising efforts. According to Brad, a former
sales and marketing executive for Pepsi Co. with 20 years of
experience, "we do a lot of things right."
As Joe noted, "we don't have the fear of knowing what won't
work." Coming from outside the industry has allowed him to look
at new ideas with an open mind and not be influenced by doubt.
He knows that his company has been "very, very fortunate" and
shows a real enthusiasm for the work. He did note that there
have been challenges in managing such strong growth and that
securing financing to keep up with that growth has been a big
hurdle. Another hurdle has been protecting the company's
intellectual property.
Joe and Brad are obviously proud of the products S&M
NuTec manufactures. They explained that they are still working
on every product in their line to continue to improve them.
With new products being added all the time, and sales growing
by leaps and bounds, the future is bright for S&M NuTec in
the pet industry. Brad is quick to point out that it's "a great
industry to be in." By listening to consumers and supplying
their needs, the company plans to grow even further. The
current demand for functional pet treats and the prominent
positioning the company now holds in pet superstore chains have
been key factors in their rapid expansion.
Initially, S&M NuTec limited sales of its Greenies
treats to local pet stores and grocery outlets. In 1999, the
company expanded to national distribution. In 2002, Greenies
began to be carried in larger national pet superstore chains
(i.e., Petco and PetSmart). S&M NuTec now distributes its
products to all 50 states and exports to over 50 countries
worldwide. The company's packaging is printed in at least 12
languages. Joe noted that sales of Greenies have topped 650
million units to datea number that if placed end-to-end would
circle the globe one and two-thirds times.
The product line began with the original Greenies dog treat,
an entirely edible injection-molded product with the
distinctive green coloring that gave it the name. The original
Greenies is manufactured in six sizes for dogs (Jumbo, Large,
Regular, Petite, Teenie and Lil' Bits).
Greenies was the first dog treat to receive the Veterinary
Oral Health Council® (VOHC) Seal of Acceptance for both plaque
and tartar removal. Independent studies have shown that feeding
one Greenies per day resulted in:
A second product in the S&M NuTec line-up is Feline
Greenies, released in the summer of 2005. The feline treat is
available in four flavorsOcean Fish, Salmon, Chicken and Liver.
Independent testing of the effects of Feline Greenies on tartar
and plaque accumulation found:
Spin-offs from the original Greenies line include the Smart
Chew, a non-edible chew toy for dogs available in four sizes:
Jumbo, Large, Regular and Petite. A new complete and balanced
baked dog snack named the Smart Biscuit has Greenies Lil' Bits
baked into the green- or gold-colored treat to help freshen
breath. It is available in three sizes (Small, Medium and
Large) and two flavors (Double Green Chunk and Fresh Chip).
This product was scheduled for release in February 2006.
More information on S&M NuTec's complete line of
products is available on their website at
www.nutecforpets.com.
Within a short drive of company headquarters, one of S&M
NuTec's facilities busily produces, packages, stores and ships
products around the globe. In this 300,000-square-foot
facility, over 1,400 truckloads per year are distributed and
hundreds of area workers are provided with jobs. The facility
is impressive in its efficiency and capacity. As the production
process is (of course) highly proprietary, the details cannot
be revealed, but a quick tour provided highlights.
In the injection molding area, Greenies begin as a drum
filled with a resin compound that is brought to the facility to
be molded, cooled and then tumbled to remove any excess edges
or fines. As Joe demonstrated, the ingredients that go into
Greenies are human grade prior to production and are completely
edible by dogs, cats and humans alike.
After cooling, the Greenies are packaged in one of several
ways. Some of them are individually wrapped on Doboy Linium 301
horizontal wrappers in individual pieces. These pieces are
boxed and shrinkwrapped in a Lantech Shrink Tunnel and palleted
for shipping. Others proceed to a Sandi Acre machine where the
Greenies are packaged in resealable bags and then boxed and
palleted for shipment. S&M NuTec's operation, including
local outsource manufacturing, encompasses more than 800,000
square feet. All but one location is within an hour's drive of
the company's headquarters.
S&M NuTec has grown from a simple breath-freshening
concept into a major force in the global pet treat industry. An
entrepreneurial spirit and pure dedication have propelled
S&M NuTec to the top seller of pet treats after just 7
years of sales. Joe and Judy Roetheli's simple plan to freshen
their dog's breath has turned into a business success that
neither one first envisioned. The future is bright for S&M
NuTec with a growing product line, a focus on customer service,
a growing work force and a skyrocketing bottom line.
S&M NuTech has been under intense media scrutiny in
recent weeks. In response to consumer complaints and a
single lawsuit filed against the company for incidents
involving pets with intestinal and esophageal obstructions,
the maker of Greenies said it plans to make some changes to
its packaging. Joe Roetheli said the company plans to make
the instructions more prominent on the packaging telling
pet owners to carefully monitor their pets when feeding
Greenies and make sure they feed their animal the right
size treat. The company warns owners that dogs who gulp
their food, or otherwise do not adequately chew Greenies,
could have trouble digesting the treat, as could animals
which eat Greenies that are too big or too small for their
body size. Reportedly, the US Food and Drug Administration
has received dozens of complaints about Greenies and is in
the process of an informal inquiry, with which Roetheli
said his company is cooperating.
In the wake of the press attention, some retailers have
removed Greenies from their shelves. Roetheli stated that
he didn't believe that sales of the treats had been
affected too adversely, even with the negative publicity.
In a recent press conference, Roetheli emphasized the
incidence rate was incredibly low based on the number of
treats sold. "The worst-case scenario statistics we have
seen have one incident reported for every 8.1 million
Greenies sold," he said. He also noted that the biggest
misconception to come out of the press was that the
Greenies packaging stated that the treat was 100%
digestible. The packaging actually states that the treat is
100% edible. Roetheli commented that he would consider
removing that statement from the label to prevent consumer
confusion.
He added that too little focus has been given to the
ability of Greenies to help keep dogs' teeth clean, saying
complications from gum and tooth decay take three to five
years off a dog's life.
