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Sky’s the limit for local pie business selling to Wal-Mart

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When Rochester lost General Mills Operations Inc.’s frozen pie business a decade ago, it was a serendipitous moment for Michael Pinkowski. The food industry veteran stepped in and purchased the Balta Drive, Henrietta, facility, saving 45 jobs and setting the course for impressive growth.

SatisPie LLC now has 57 staffers and that could triple, Pinkowski said, as the company has landed a contract with Wal-Mart Stores Inc. that likely will double sales in the coming year. SatisPie is providing frozen, ready-to-bake pies for all 4,600 WalMart locations nationwide, as well as 650 Sam’s Club stores beginning later this year.

It is a contract Pinkowski worked on for two years.

“I cold-called them over a couple of years and then, like any big corporation, they came back to us and said yeah, we’re interested, come in,” Pinkowski said of the WalMart agreement. “We went through probably four or five iterations of samples and they said yes, this is the flavor profile we want.”

When General Mills opted to close the facility it was because it was not strategic to its business, Pinkowski recalled.

“So I bought the company and lost money the first year. Not a surprise since General Mills was losing money,” Pinkowski said. “We then began the process of reformulating all the products and chasing new business.”

Pinkowski, whose children’s pie-covered faces adorn the company’s boxes, said all of SatisPie’s desserts are custom because regionally, customers have different tastes.

“So our customer, which is the retail chain, makes the decision on what flavor profile they want,” Pinkowski explained. “One of the things we do is we try to avoid crossovers. So if we’re designing a product for Wegmans, it’s a Wegmans only product. Or if it’s Tops, it’s a Tops only product.”

SatisPie and WalMart launched the Great Value branded apple, cherry and pumpkin pies last fall, and triple berry in January this year. WalMart will add three more pies to its freezers in 2018, Pinkowski said.

The deal is part of a commitment WalMart made in 2013 to source $250 billion more in U.S.-made products over a 10-year period, said Cindi Marsiglio, WalMart’s vice president of U.S. manufacturing.

“We’re approaching that in a couple different ways: one, growth with our current suppliers, so growing with companies already making products here in the U.S., which accounts for about two-thirds of what we sell at WalMart U.S.,” Marsiglio said.

A second way in which WalMart is sourcing more U.S.-made products is by helping manufacturers move production, when it makes financial and geographic sense, to or back to the U.S.

“And lastly, finding new suppliers and finding companies we weren’t yet doing business with who, through the growth with WalMart, could expand and hire,” Marsiglio said. “The reason behind all of this is very simple: It’s estimated that at the end of the 10th year it could create as many as 1 million U.S. jobs. That’s great for WalMart, that’s great for communities.”

In July, WalMart officials met with government and business leaders to present its Policy Roadmap to Renew U.S. Manufacturing, which offers a comprehensive approach to tackling the major barriers that keep companies from manufacturing more consumer goods in the United States. The presentation included a bipartisan conversation about the current challenges and opportunities in the U.S. manufacturing sector as well as case studies of successful collaboration among key stakeholders.

WalMart officials cited research conducted by the Boston Consulting Group that showed that decreasing policy barriers to domestic manufacturing creates an opportunity to recapture some $300 billion in consumer goods that are currently imported, including furniture, cookware and sporting goods. That could create an estimated 1.5 million American jobs.

And while Pinkowski will see just a small slice of that pie, he said the WalMart and Sam’s Club business will amount to significant sales and a significant increase in the number of jobs. To accommodate that growth, SatisPie is leasing space from Allied Frozen Storage in Brockport.

Pinkowski declined to disclose annual revenues but he said that in the decade since purchasing the business, sales have increased 400 to 500 percent.

“And next year will be 800 to 900 percent,” Pinkowski said. “We’re going to double our sales in the next (year). We may even triple our sales by this time next year.”

That growth comes primarily from the new WalMart business, as well as deals with two other grocery chains that combined have thousands of locations. SatisPie already has a relationship with both Wegmans Food Markets Inc. and Tops Markets LLC.

“I inherited Wegmans as a customer when I bought the business, and as Wegmans has grown, so have we,” Pinkowski said. “We’re launching four new products into Wegmans this fall, no sugar-added pies.”

SatisPie buys between 6 million and 10 million pounds of locally grown apples and cherries each year for use in its desserts, and churns out 40,000 pies on a slow day and about 100,000 on a busy day. The company runs two, 10-hours shifts five days a week until Labor Day, when it moves to a 24/7 schedule to accommodate the busy season of Thanksgiving and Christmas.

Pinkowski pours roughly $500,000 in upgrades into the Balta Drive facility each year and will spend nearly $1 million on racking for the Brockport facility when all is said and done. He continues to work with the County of Monroe Industrial Development Agency on developing incentives and has received sales and property tax incentives for the new facility in Brockport, on which Pinkowski signed a 10-year lease.

And while SatisPie will continue to add jobs as the business grows—Pinkowski expects between 50 and 100 workers at each of the company’s locations—indirect job growth could be much higher.

“You’re talking millions of pounds of raw materials a year that are purchased from everybody else’s companies as well. All these ancillary jobs as a result of us being here,” Pinkowski said.

And those employees are going to be spending their paychecks in the Rochester community, he said, a win/win for the region.

[email protected] / 585-653-4021

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