Decision Dialogues
Decision Dialogues

Episode 18 · 1 year ago

Sweet Success

ABOUT THIS EPISODE

On Episode 18 of Decision Dialogues, Jennifer Faherty and Tom Orrechio are joined by JJ Krachtus, president of Conrad's Confectionery in Westwood, New Jersey. Conrad's has been serving candy and ice cream in Bergen County since 1928. JJ talks about this multi-generational, family-owned business, the decisions he made which led to him “taking over” the enterprise, and the many difficult choices COVID-19 brought on him and the employees of Conrad's.

Get the full show notes and more resources at ModeraWealth.com/DecisionDialogues 

Are you paving the way for the life you want facing decisions that may affect you personally and financially? The decision dialogs podcast, brought to you by MODARA wealth management, presents personal stories about navigating through life's pivotal moments, narratives that we hope will inspire you as you create your own story. You'll learn what influence their next steps and gain insights that could help you with your own critical choices. Welcome to decision dialogs. Thanks for joining us on decision dialogs for thrilled to have you along. My name is Jennifer Farty and I'm the chief Pine Experience Officer at Modara Wealth Management Llc. Today, my colleague Comarecchio, who is a CEO principle and wealth manager at Modera Wealth Management, and I will be chatting with JJ practice of Conrads. CONRADS confectionary is a family owned business featuring homemade ice cream, chocolate and candy. Conrades is the oldest business in Westwood and one of the oldest in New Jersey, founded in one thousand nine hundred and twenty eight. Very impressive. I can't wait to hear more about that. MODERA's Westwood Office is right down the street from this iconic establishment. Welcome everyone to the show. Thank you, Jennifer, so JJ. Very excited to do this podcast with you. I'm a lifer. I've been going to CONRADS and some I'm a little boy and always loved the ice cream. Love walking up to the window outside as a kid. Just nothing we're exciting than getting an ice cream cone in the summer. So how did CONRADS get it start? So Conrad's got its start Fred Conrad, the original proprietor, actually came over from South Africa. He was orphaned in the Boer War and he came to live with an aunt in the United States and he came to New Jersey and decided to take confectionery classes in New York City. He went there to classes, started the business in one thousand nine hundred and twenty eight and then in the s my grandfather started working for him as a soda jerk and became a partner. Eventually has been in my family ever since. So I'm the third generation in my family. My grandfather worked for Fred Conrad, the WHO started the business. And so what made you decide to get involved in the family business? I Guess Saren dippity played a large part. I went to school for Engineering, got a bachelors of Engineering and spent almost two years in the field of in a municipal engineering capacity, and then I didn't love the office environment. It wasn't I didn't see myself long term. So went out with the surveyors when that opportunity came to be outside and, you know, always in the back of my mind, even in college, you know, I thought about this business, the legacy, and then a lot of things came together and it just became the path to take. You know, Tom said, how did you decide to get to that family business, and so that word decide is interesting because with family businesses sometimes you don't have really a choice. That's this kind of you know, expected that, you willed it. That what happened with you. It's a mixed bag. One parent was no choice in one parent was like the opposite direction, you know. So it was. It was a mixed bag, but in the end it all worked out wonderfully. So every everybody's happy with how it's progressed. And how long have you been at the helm? About seventeen years ago, I guess. I started working for sort of sweat equity, earning shares of the business. I've been sole owner. I guess about got to go so quickly, but I've estimate around six six years I've been a hundred percent owner. And is it turning out to what you envisioned seventeen years ago? Is it different? I think fourteen years ago I stopped envisioning and fourteen years...

...ago I just envisioned a lot of different paths. One of my favorite analogy is for business is mining and you put chafts in the ground and you see how the ore is and it's good to have a lot of chafts in the ground when one dries up, but it's harder to have more. So I had a lot of vision for what could happen, but now I don't put any hardstock into it and sort of ride the wave of where the business is directing itself and where it's telling me to go and constantly try to try new things and constantly try to improve the things that are working. So running a small business is there are a lot of things that are similar and running a small business, whether it's your business or our business, but there are things that are certainly unique to your business. Tell us some of the things that are unique to conrads and how you tackle those issues. Yet third first thing that jumps out to me would be the business model being, quote unquote, antiquated. You don't see Goose Neck Soda Parlors, all right, you know. You have to go a long way to see a genuine Soda Fountain that's Been Open since one thousand nine hundred and twenty eight, and there's a reason for that. So I think the business model is somewhat unique and that's been a challenge over the years, sort of when and what to adapt and how to change properly. So that's that's kind of been unique to Conrads. And all the generational aspect is a wonderful unique part of Conrads to have that customer base. You know, nothing's better than to swap stories with someone who's you would have been with my grandparents right generation, you know, or to see for generations. I've we've actually had four generations of customers in the same booth, you know, at the same time, a little baby and, you know, a great grandma, you know. So those are somewhat unique to my business. So it's I appreciate them. What do you like most about the business. It suits me. It's it's extremely challenging, but I couldn't just work with my mind, I couldn't just work with my hands. I enjoy shifting rolls and being able to use the business to scratch all kinds of different itches. So that's what one of the things I enjoy most about it. So, seventeen years in, you obviously have a lot of wisdom, not just knowledge but wisdom on working in the business and working on the business. If you could rewind seventeen years, what would be the piece of advice you'd give yourself seventeen years ago? Yes, so I would tell myself mine my own perfectionism and OCD and not to waste energy in that, just to be more aware of those two aspects of my personality, my example being, like first thing I did was, let's get a website. Websites got to be it was like when websites were new. You it for for businesses like this, sure, and I learned photo shop and I spent so many hours making the pictures look good, whereas you know, a little bit more of slap the picture up and sell them. PARREL's kid would have been. You know something, I would you know I would have done. That's good. So that's the advice you would give yourself. What's the best piece of advice you receive from someone else? That would have to be my GRANDPA. In a prophetic moment, I guess, when I was growing up, you know, just a kid coming into Conrad's, watching him do whatever he was doing at the time. I remember he turned to me and he said take care of the quality and this business will take care of you. That's great. Yeah, and it's just been one of the foundations of the designing and running...

...the business. What what would you say is the biggest challenge to running the business? Man, it's I think the so many plates you have to spend is one of the biggest challenges. Not Having enough time really to give any one aspect of the business and managing that energy in a way where I can grow, get more people on board and, you know, give each aspect of the business the human attention it really requires. Okay, I know that the business can be somewhat seasonal. I know that there are certain times of the year were the chocolate part of your business is huge, whether it's around the holidays or again around Easter, and then obviously the ice cream in the summertime. Do you have a favorite of the seasons? I appreciate the change. I often tell people, by the time you're sick of candy, it's ice cream time and by the time I'm sick of ice cream it's candy time. And they're the the candy is like build, build bill, Bill, Bill, build inventory, inventory for the holiday. The holiday comes up and then things and you know, you go crazy. Everything's empty. It's a disaster. You start picking up the pieces. But and then ice creams are grind. You know whether it's good, sales are good, weather's bad, sales bad, but like sort of day and day out, and they're both. I appreciate being able to jump into both of those modes. That's great. Tell me a little bit about your people. Have you had long term employees? Yeah, so. Well, my mom taught me was the people aspect of the business and the the importance of keeping people happy. And we actually have one of my employees is on the third boss you worked for. So she started in high school for my grandparents, wow, and then she worked for my parents and now I'm the boss, you know. So like in a way she's more of a cornerstone than any of us. Wow, that's great. One of my closest friends is wife works for you and she's been working there a long time. I teacher every time I come in what a what a sweet job she has and she finds some humor. And who's that? Sharon? Oh, that's who I'm talking about. You're kidding? Yeah, your friends with Sean. Yeah, I've known the ESMENS for a long time. Billy, I am very close friends. Okay, yeah, Charon. Sharon started for my grandparents. That's great. That's yeah, past very nice to hear. That must be so rewarding in many ways it's amazing. It's amazing what I hope to be a part of, because I'm an engineer, you know. I see the world. Everybody wants the same thing and we all get more of it working together. And why isn't it working out as well as it could be? And I just want to in this time very optimistic about how systems and communication could pair with the business models that facilitate that for everybody's mutual happiness. And I'm hoping to be somewhat part of that in my designs and sharing that some day in the future. So I asked what was one of your greatest challenges earlier. Let's talk about recent challenge. You know, how did you guys fare getting through the pandemic? Yeah, I lost a lot of hair. I thank last of what was left. It was very challenging. So, for some background, easters our biggest holiday. So we, like I said, you build, you build your build all your inventory. The shutdown happened I think three or four weeks before Easter, like literally worst possible time for us, when I also signed a lease for March first for our expansion facility. Wow, so that was you know, that was very interesting. It's incredibly challenging. I wouldn't wish it...

...on anybody. But because of the people we had and just because of the love of all the employees, like getting through it together. We just faced every day and every challenge that popped up, you know, as best we could. And if wasn't from my team, you know, we wouldn't be here and we just we're just face it together. I think that's the bottom the bottom line of what you got to do. But it was yeah, it was a trip man, and it's not over. No, it's not over. The supply chain. You can't get anything right, you know, in price, in a kind of kind of pivots did you have to make specifically during that time in terms of like did you have to think about different ways to grow the business, how to reach different how to be customers, different inventory? Absolutely. First Pivot was I'm sitting on flick five team percent of my annual revenue. That usually goes in the next three weeks and if it doesn't, I'm tapped from a cash flow perspective as far as like line of credit. So it's like what can I get ten percent of that out the door? You know, the the initial question was can we be in business? And like, thank God they determined take out food was okay. So, you know, if people need cheeseburgers and prize, you can make a case they need ice cream. So we started going at it. Sarendipitous leaf and because we're growing business, we had just got our entire product catalog onto shopify, everything inventoried. So transitioning to a hundred percent phone call Internet based sales model, whereas typically it was eighty twenty in store to online. Now we're a hundred percent online. And does this framework have what it takes to to get it done. My first full time higher was my cousin, Tony's kind of Tech Whiz. Had experience with logistics and things like that. And you know, with spit and duct tape, day by day, you know, you kept that get things going. You know, rip down all the merchandising shelves, set up packing stations. serendipitously we had trucks because we're moving into the expansion, was moving into events things, so use the trucks directed door delivery and we managed to get it all out the door, which was looking back, I can't even believe it. Honestly, like, would just say one of the blessings was it. It kind of forced you to Change Your Business model a bit and that's something that'll stick going forward. Absolutely there's a lot of silver linings to it and that that was one of them. Being able to realize we can offer next day delivery, sort of like an Amazon, so we you know, when Christmas comes, you know it's just as easy to get your candy gifts delivered next day. So that convenience factor. So there's a number of silver linings to the stress and I would say with the because you have that history and you these customers that probably know you from throwing up, but they don't necessarily live locally. Now you have the whole other market that you might be able to reach if they absolutely away something like that, where they can get conrads just like they were, you know, back in Westwood. Absolutely, and there's a lot of people out there looking for an Easter bunny that couldn't get it their traditional way, you know, and we were shipping. So we ate the shipping into free shipping through the entire northeast just to move product from a cash flow standpoint and probably built decent amount of customers, you know, who tried us for the first time because of that. How do you build on that, because it sounds like it's going to be a big part of your business going forward. Mean, some people like look, I'm out. Like I said, I'm a lifer and I live right around the corner from Westwood. I only found out recently that you ship because I'm so close with the esmen family and they told us that, Oh yeah, we shipped now, and how do you get that word out? Yeah, you know, I struggle with that. It's...

...a great point. I ran into someone who lived in Westwood for thirty years and didn't know we sold ice cream like it was a candy customer boy, and I've done a lot of thinking about it and what I've come to realize is, you know, we are so inundated. Every business is trying to get in our heads. So we walk around the world with natural defense mechanism of like we got these walls. Yep, because otherwise you know your brain space is going to be coopted by a business. It's amazing. The best is always word of mouth. Yep, that's always the best. And then cross selling. I got a lot of different mind chafts in the ground ground right now we're doing events, birthday parties. I have the trucks, so we have delivery locally where we deliver nationally candy, you know. So developing a team inhouse for content creation is my biggest goal in the I'd say next year or two as far as facilitating communication to to my customers, because as a video and a quick video, you could do a lot more if you can produce content in house and just constantly get it out there. So have you done any co marketing or delivery? It a commercial where they don't have that in house and you become their outsourced opportunity. I mean you're doing birthdays, are you doing events anywhere? How do you mean commercial? Well, well, so, have you partnered with any any other retail outfits where they don't do what you do but could offer it because they put on other events or birthday parties where you could be their supplier? Yes, that's actually right now. It's sort of the swim club to me. So it's you know, I would love to place a freezer or a cart at a swim club or a country club right and I'm actually working with someone right now and my new product land of call is the sweets and treats menu, which is our homemade ice cream sandwich, prepackaged ice creams essentially. So everything's prepackaged and designed to be able to do that and where I could just, you know, fill the freezer check into the inventory. So right now we're looking for partners like that and just on brainstorming and if you got any thoughts, I'd love to hear them. But, like the the swim club is a great fit country clubs or a great fit. I even like have some vision of a either a car dealership or nights of Columbus. That's on the like busy road and, you know, partnering up with them somehow making it work where we're either tracting attention or a certain percentage of the proceeds go to the benefit of their choice. Right. A lot of the towns in the area to do town days. Yeah, usually over the summer or in September, two and the summer, and they're always looking for sponsors and you could park a cart. Oh, yeah, that's what the the expansion was. It in large part towards big events. We've were part of Mahwa food truck festival and Oldtapan Town Day is something we might be doing in I think, September. But yeah, that that was like. That was what I was looking towards with the expansion and some corporate gift type stuff, and those both dried up instantly. So the way, I even learned that your ship was my son broke his shoulder back in April and your ice cream sandwiches showed up in our front door, which was great. Yeah, he was thrilled, he couldn't wait, he couldn't wait to dig again. Yeah, so we do. We do the ice cream locally. I think most of the towns and Burton County we do next day, and so I have like software in the works because I got the trucks and you know, theoretically, with the right people I can run them all day long. So we want to be able to do...

...almost like pizza delivery to with the sweets and treats menu. So you can, if you're in the backyard at the barbecue you're just hanging out like order you know. Hopefully we'll be there as soon as possible. That's great. Yeah, so it sounds like a fair amount of expansion going on at your place. Yeah, definitely expanding. Like I said, our old business model. It's the foundation of bed rock of who we are, but with essentially labor cost in New Jersey's doubling from where we started. So that's going to be a huge challenge. How does that sort of Fountain look? I mean I I can have forty or fifty high school and college kids on the payroll working for me. So figuring out how to make that work. It's going to be nice to have different areas of the business to different minds in the bringing in different cash flow and be able to figure out how to adapt to that. That's great. So it sounds like with this expansion. There's going to be a fair amount of new parts of the business to manage. Do you have a favorite book or or author or method of learning about business and how you can expand it? Yeah, I wish I had time to read. I definitely a more of a podcast guy. I listened to a lot of podcasts. Honestly, Lou Lamarillo, the old day New Jersey Devil's manager. Yep, I think it is. Yeah, GM was a big influence on me of how it you know, how to run the run the business. So he seeaged. He jumps out as as sort of someone I've always, I think, learned from, not even realizing it, just being a huge devil's fan growing up. He did it in two sports. Yeah, he built a dynasty with the devils. Yeah, a lot of what he said was, you know, spoken to the core of a long term quality product, long term business model. That that I'm trying to achieve. So where do you think you'd like to take the business next? What's the big is it the online sales we've been talking about? Is it delivery franchise? I don't know if you'd ever think of that, or opening up another location? Yeah, I think it's the new locations where it is like that next big step in my mind. So space is a huge factor in Burton county with the prices of everything. We got this, I guess, five hundred square foot extra production space and instantly you know I need more, but it's so expensive. So the thought now with real estate is absolutely crazy. Commercial real estates kind of high too, but I think like avenue, retail real estate is maybe not so high, not even positive. But if Fred Conrad didn't buy the building and pass along with the business, the business wouldn't be here. So the there's a lesson there in considering purchasing a building that I could on retail, second retail Conrads with an apartment above I could live, sort of make it work cash flow wise and then start that second store. And my vision for increasing production would is sort of instead of a large factory producing everything, I'd sort of like to if the trend is such that retail is more affordable, I'd like to maybe combine each new retail establishment with a one aspect of the production. So, you know, this store would would be the clusters and bark store. You know, this store could be things that would work on a small hand basis, which is a lot of what we do because we're, you know, we're a lot of our stuff is is by hand. So that's sort of my vision as far as increasing production...

...as well as sales, and then having the the online shipping, the drive in the truck to a place like that. Can All work out of a central facility, warehouse type type place. So that's sort of where my heads at right now. You put a smile on a lot of people's faces with what you do. We're going to wrap up with one last question that we always ask, and that is what was the last non financial related decision that you made? Today, yesterday, most recently, whether to clean up that mess in the background? And it's a big no. That's good. This is all audio, right, this is all idea. Well, it's a pleasure having you on the show. I look forward to seeing you over the summer for sure. Thanks for taking the time today. Thank you for having me. It's been a pleasure. I appreciate it. So thanks very much to Tom and JJ for letting US listen in on their conversation. We appreciate their time and perspective and thank you for tuning in. We hope you'll join US next time on decision dialogs for more stories from successful disis owner. So long for now. Thank you for listening to decision dialogs. We hope you found today's stories helpful for your own decisionmaking. If you like to listen to more episodes, you can subscribe on your preferred podcasting APP or visit our website, where you'll also find show notes and important disclosures. WWW DOT wellcom. Forward Slash decision dialogs. This has been a production of twin flames studios.

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