Under the Radar
March 12, 2008
Some companies just don’t fit the mold. Morris National, undoubtedly, is one such example of a business that prefers to do things its own way.
Take its product lines, for instance. Morris National’s roots run deep in importing European gourmet offerings. While the company continues to sell such products-and today even manufactures some in the U.S.-the focus is now shared with novelty candies to bolster off-season sales.
While it may seem like an unusual tangent for a company known for its sophisticated line of liquor chocolates to take, the relationship with products such as Tangy Zangy Sour Sticks works, delivering added value to the company and its customers.
Another tidbit to support Morris National’s against-the-grain case is its unpretentious status in the industry. With estimated sales of $100 million and double-digit growth over the past several years, it looms large, but just under the radar.
Clearly no small fry in the business, the company keeps a low profile because it remains a family business at its core.
“We’re reasonably low key as people-we’re not very flashy,” admits Gerry Morris, president of Azusa, Calif.-based Morris National. “What’s important to us is that we do a very good job and make a very good product to maintain loyal customers.”
And that’s precisely the key to the company’s success-understanding that pleasing its customers means it must thrive and continuously offer new, exciting products, while also never undermining that the base of the business is built on family.
Evolving from its import rootsThat family foundation begins with Abe Morris, who founded Morris National in 1950 in Montreal, Canada. While he remains involved in the business, Abe appointed his son Gerry as president in 1976. Moreover, Gerry’s wife Marilyn leads the company’s product design team, while the couple’s son Bram uses his creative talents in product development and daughter Jodi handles the mail order side.
“For me, the family life and business life were almost intertwined in my household,” Gerry recalls. “So as I was growing up, the summer jobs would be at the business. It was important for my dad that there was a continuity of the next generation.”
To the delight of the family, Gerry’s son Bram also shares that same loyalty to his grandfather’s business. After having a hand in just about every job within the company-from working in the warehouse to delivering products on trucks, there’s not many jobs he hasn’t done since he started working for the company in the early 1990s.
“When I came to California from Montreal I worked on the production line for a few summers, which was great for me because now I know what it’s like working on the line,” Bram says. “My father and I have been doing this our whole lives; it’s almost a part of us. When you grow up with something, it becomes a part of you.”
Morris National first crossed into the American terrain in 1974 with the opening of sales offices in New York. But it wasn’t until 1986 that the company began manufacturing liquor-filled chocolates in Southern California under the Very Spécial brand name.
“We decided to begin manufacturing liquor-filled chocolates, which was one of the items we were importing, because liquor-filled chocolate production in the U.S. was a completely new concept then,” Gerry recalls. “So we went into the project as a joint venture with one of our French suppliers, Chocometz.”
Five years after establishing stateside production, Morris National’s partners sold their interest in the French company, which allowed Gerry to buy out the remaining interest.
While 40% of Morris National’s output still comes from imported goods, the company currently manufactures the remaining 60% out of its 125,000-sq.-ft. (50% warehouse/50% production), Azusa, Calif. production facility.
The facility churns out a variety of confections-liquor-filled chocolate, premium truffles, hard candies and plenty of sweet, sour and gummy novelty candy.
Innovation through customizationWhile the company itself maintains a hushed public presence, Morris National’s huge product base makes it an obvious magnet for buyers in the club, department, drug, specialty, convenience and mass merchandising markets.
“It’s all a gift business-that’s the unifying theme for this company,” says Rich Clemmensen, v.p.–sales and marketing. “It’s either a gift for someone else or a gift for you.”
The company’s gift-packing operation is thriving in the U.S. and garners about a third of the Canadian business, Gerry says. In fact, Morris National employs about 500 workers in its 185,000-sq.-ft. Montreal facility. During the peak seasons, the company employs over 1,000 to serve the demand. Despite the huge number of employees, Gerry maintains a tightly-collaborative team atmosphere.
The Montreal location exclusively produces gift baskets, and a huge emphasis is placed on presentation and packaging. Shiny gift wrap and hand-tied ribbon transforms the treat into a trinket.
Buyers are welcome to choose their own baskets, crates, ribbons, gift wrap and products to suit their own specific needs and tastes. Customization for retailers constitutes a whopping 80% of the company’s business, according to Clemmensen.
“We’re able to customize for each of our customers and still have off-the-shelf products for customers who don’t meet the large-scale order requirements,” Clemmensen adds.
The ability to cater through customization not only keeps its buyers happy to have an active part in creating the products that appear in their stores, but it also allows a greater flow of interaction between the company and customer.
“We actually feed off our customers’ feedback because they often have a different point-of-view than we have as manufacturers and importers,” Gerry says. “Many times, our customers’ ideas spark whole new ideas for us.”
A grand ideaOne such customer suggestion resulted in Morris National’s Grand Truffles, which were launched in 1993. The company hoped the truffles would add revenue throughout the year since the liquor-filled chocolates garnered primarily seasonal sales.
“Once we had a developing business in liquor-filled chocolate, then it was a natural thing to start adding on more to our chocolate production,” Gerry says. “One of the things we did was try to come out with some different types of chocolate that would sell more evenly throughout the course of the year.”
The Grand Truffles are made with Belgian chocolate (as opposed to German chocolate for the liquor-filled confections, which works better for viscosity and machine flow reasons), according to Claude Douessin, v.p.–manufacturing. At any one time, there’s 130,000 lbs. of liquid chocolate in storage-a critical inventory considering how many truffles the facility churns out during peak season.
An Aasted Mikroverk moulding line handles all truffle production. Curved to accommodate its extensive 220 ft., the line can produce 35,000 truffles an hour. During peak season, it runs 24 hours a day, 5 days a week.
Offering a 50-50 split selection of milk and dark truffles in rich flavors like Chocolate Mousse, Mississippi Mud, Almond Praline and French Vanilla, Douessin says he’s noticed an undeniable preference for dark chocolate.
“People now in the U.S. eat more dark chocolate than they used to,” Douessin says. “Our tastes have been changing a lot these past 20 years.”
The truffle’s origins begin in a 56-count truffle mould, which runs in a continuous line to a one-shot depositor. The moulds are raised to the depositor, which fills the moulds with tempered milk or dark chocolate and a variety of other fillings, such as peanut butter, caramel and lemon cream.
After a 30-minute stint in the cooling tunnel, the moulds are turned upside down and smacked with a hammer to de-mould.
The next stop is at one of two A.E. Nielsen enrobers (one for milk, the other for dark). Once enrobed, the truffles roll under a Woody Stringer, which paints them with decorative stripes. Each variety of truffle features its own stripe design in either milk, dark or white chocolate.
The truffles receive a final, 20-minute run down the cooling tunnel before undergoing metal detection and are then packed in bulk.
While the Grand Truffles certainly offered a new product avenue for the company, they did not sustain expected year-round sales. In fact, as Gerry jokes, the truffles merely added onto the holiday business.
Additionally, the company’s liquor-filled chocolates-though very popular-constituted only a small sector of the industry.
Tapping into the non-chocolate marketBecause Morris National had been importing non-chocolate candy for years in Canada, Gerry understood the importance of manufacturing a wider variety candy to breathe new life into non-seasonal sales.
“In the context of the whole chocolate business, liquor-filled chocolate is still very much a niche specialty item, although the quantities are quite big,” Gerry notes. “The addition of the candy business to our U.S. subsidiary was a natural extension for us because we’d been doing that in Canada since 1950, so it wasn’t new for us. It was born out of our Canadian experience.”
In its continuing effort to keep the facility busy all year round, the company formed The McKeever & Danlee Confectionery Co. in 1995. Named after the cross streets of its Azusa facility, the upscale hard candy brand features sophisticated gold tins filled with Pear & Blackberry, Mango & Kiwi, Sour Lemon and even Coffee flavored fruit drops.
Further expanding its non-chocolate lines, Morris National launched Gummy Zone brand novelty candies in 2002. Since then, the company has introduced a slew of candy brands, including Zip Sours and Just for Fun in 2004 and Tangy Zangy in 2007.
Zip Sours, for instance, is hardly your average sour hard candy. The candy features a subtle sour note that lingers throughout the entire consumption process, a characteristic that attracts more teens and young adults as opposed to younger children who crave a more extreme sour flavor.
“We’ve tried to differentiate Zip Sours as much as possible from our competitors,” Clemmensen says. “It’s a round, smooth piece, and it’s a soft sour experience throughout the piece. Our competitors will do a hard-hitting sour on the outside, but then it turns to a plain hard candy on the inside.”
Morris National is in the midst of re-launching Zip Sours with new package design and flavors, including Black Cherry, Apple Cranberry and Orange Splash.
“We had gorgeous packaging, but it was understated,” Clemmensen explains. “The design is meant to pop off the shelf more and convey that it is a natural flavor candy through the use of fruits on the cover, label and simply through the description that says it’s a natural candy.”
Zip Sours contain no artificial colors or flavors, which will attract the segment of the population that desires natural products, Clemmensen adds.
On that same note, the company’s most recent brand, Tangy Zangy Sour Sticks and Belts, features some notable benefits of its own.
Though not positioned as a healthy candy, Tangy Zangy contains the incremental benefit of real fruit juice.
“Tangy Zangy is a good choice for vegetarians because it’s made with wheat flour instead of an animal-based gelatin,” explains Bram, who was closely involved in the creation of Tangy Zangy and the redesign of Zip Sours. “It also has real pineapple juice and is a healthier snack for children. We want to expand the natural and healthier snack items for kids.”
Re-charging chocolate in 2008While continuing to expand the candy side, the company has not neglected its chocolate foundation. A whole new chocolate brand and a refreshing extension to its liquor chocolate line are on the horizon.
“We still struggle with making this an all-year chocolate business, but we have some things in development that we’re really excited about for next year,” Gerry notes.
Dubbed Cocoa D’or, Morris National’s latest endeavor hopes to capitalize on the premium chocolate wave.
“Cocoa D’or is an upscale chocolate line that will go across the board-pastilles, nut truffles, caramels, seashells, coffee-flavored confections,” Bram explains. “It’s all going to tie in together, but they’re all going to have their own unique looks as well.”
Aiming toward the specialty and mass markets, the line will hit shelves in the fourth quarter 2008.
Another impressive launch is Chocolate Cocktails. Available in both non-alcoholic and alcoholic versions, the individually wrapped Chocolate Cocktails were released in the fourth quarter 2007 in a chic wine canister case.
A fresh addition to its Very Spécial line, Chocolate Cocktails feature fun Strawberry Daiquiri, Cosmopolitan, Margarita and Apple Martini flavors. The new extension breathes new life into the traditionally “old world” reputation of the liquor chocolate sector.
As Morris National continues expanding its chocolate portfolio, it’s hard not to wonder if it will follow in the organic and Fair Trade trends that so many in the industry have adopted.
“We know that in Europe, the whole organic and Fair Trade movements are quite important,” Gerry says. “They’re not nearly as important here in the States, but they will be. It’s something for us to seriously consider making a part of our range.”
With that said, the prospect of plenty more new chocolate products seems like a real possibility.
Another unusual, yet no less viable, opportunity for Morris National may come courtesy of the weakening American dollar in 2008: the option to sell its liquor chocolates to the Europeans.
“Selling liquor-filled chocolate to the Europeans, where it all began, would be like selling coals to Newcastle,” Gerry says, half jokingly. “Having said that, there may be an opportunity in the coming year because the U.S. dollar is dropping and the euro has been flying. It may make sense for an American producer to sell back into Europe.”
For a company built on importing European chocolate, it would be ironic and uniquely telling for Morris National to sell its own product back to the countries that helped build its business in the first place. Talk about returning the favor.
But depending on economics, that is still far into the future. What Gerry Morris and his family are looking forward to is a successful 2008-all of it.
“The factory will hopefully be busy every single day of the year.”
At a glance Morris National, Inc.Headquarters: Toronto and Montreal Canada and Azusa, Calif.
Sales: $100 million (Candy Industry estimate)
Brands: Very Spécial, Cocoa D’or Chocolats, McKeever & Danlee, Zip Sours, Tangy Zangy, Bubble Roller, Bubble Doctor, Gummy Zone, Gummy Fangs, Just For Fun, Fatty Ratty, Creepy Crawlers, Ooze Toobz, Sips, The Jelly Candy Factory.
Products: Liquor-filled chocolates, truffles, customized box assortments, hard candies and novelty candies.
Exclusive Agents in Canada for: Bazooka, Just Born, Best Sweets, etc.
Employees: 110 permanent and 550 temporary in the U.S.; 100 permanent and 500 temporary in Canada.
Plants: 3-Montreal, Canada (185,000 sq.ft.), Toronto, Canada (55,000 sq.ft.), and Azusa, Calif. (125,000 sq.ft.).
U.S. Management team: Abe Morris, founder; Gerry Morris, president; David Pistole, coo; Rich Clemmensen, v.p.–sales and marketing; Claude Douessin, v.p.–manufacturing; Bram Morris, v.p.–product development; Marilyn Morris, product designer.
Canada Management Team: Ossie Neuman, coo; Craig Matthews, v.p.– sales; Lorraine Koshman,v.p. gift packing.
Blurring the (state) linesWhen it comes to the rules and regulations of liquor-filled confectionery in the U.S., it all depends on where you live.
The production and importation of liquor-filled chocolates in the U.S. has lacked clear-cut regulation since it was banned during Prohibition.
Though the days of Prohibition have long past, Congress today still considers liquor-filled confectionery an adulterated product. However, it has allowed individual states the right to determine whether to sell it.
“The Federal Food, Drug, and Cosmetic Act (which applies only to products in interstate commerce, not those produced and sold only within a state) says that alcohol not in excess of one-half of 1% by volume derived solely from the use of flavoring extracts is allowed in confectionery,” wrote Dodi Schultz in the July-August 1994 issue of FDA Consumer. “Beyond that, alcohol is deemed an impermissible adulterant except that the rule doesn't apply ‘if the sale of such confectionery is permitted under the laws of the state in which such confectionery is intended to be offered for sale.’”
Today, 19 states allow for the legal sale of liquor-filled confections. The exact terms, however, vary between each state. For instance, some states allow only individuals 21 and over to purchase candy containing alcohol, while others mandate that it may only be sold to consumers directly from the manufacturer or by a vendor licensed to sell alcohol.
“States vary significantly in their approach to these products - both in terms of alcohol allowance and enforcement,” says Alison Bodor, v.p. of regulatory affairs for the National Confectioners Association (NCA).
Despite the fact that liquor chocolates cannot be sold in every state, Morris National has had little problem marketing its liquor-filled chocolates. It remains today one of their most sought out products.
“The U.S. is still a top market [for liquor-filled chocolates], despite some states not allowing their sale,” notes Claude Douessin, v.p. manufacturing for Morris National.
Looking back while moving forwardWhen Abe Morris founded Morris National in 1950 in Montreal, Canada, he never imagined that the company’s modest roots would flourish into a successful multi-national organization.
“It is with great pride that I see how we have developed as a company over the years from very humble beginnings,” Abe says.
Abe’s son Gerry joined Morris National in 1972 and helped usher in an international presence by running the company’s first stateside operations, which were established in New York in 1974. In 1980 Morris National opened a sales and distribution office in southern California, followed by a manufacturing facility six years later in Azusa, Calif.
Additionally, Gerry’s son Bram now also plays an active role in his family’s business through product development. Most notably, Bram’s involvement in creating novelty confections that balance the company’s more adult, seasonal portfolio has secured the company year-round sales.
Throughout the evolution of Morris National-and by passing down his business to his younger generations-Abe has enjoyed not only the loyalty of his family, but also the satisfaction of creating products that please a wide range of people.
“Most importantly, we have a dedicated and loyal management team both in the U.S. and Canada that make it all possible.
“It has been a long ride with a lot of memories and many ups and downs,” Abe recalls. “Selling candy can become a labor of love when you consider how exciting it is to sell to so many different potential customers and with the endless variety of confectionery you can offer them-be they children or adults.”