John B. Sanfilippo & Son (JBSS) has built an empire out of working for peanuts. The company is one the largest processors of peanuts, almonds, pecans, walnuts, cashews, and other nuts in the US. JBSS markets the nuts as a snack and a baking product under a number of private labels, as well as its own name brands, including Fisher, Orchard Valley Harvest, and Sunshine Country. It also produces and distributes other foods and snacks, such as peanut butter, dried fruit and trail mixes, corn snacks, sesame sticks, and candy. JBSS's products are sold worldwide to consumers (via retailers) and, less so, commercial ingredient channels (foodservice and industrial markets), contract packagers, and export distributors.
JBSS combines its headquarters and processing, packaging, warehousing, distribution operations, and a warehouse in Elgin, Illinois. The company also owns production facilities in Bainbridge, Georgia; Garysburg, North Carolina; Selma, Texas; and Gustine, California. It runs an outlet store at its production facility in Elgin, and one retail store in the Chicago area. The stores offer bulk products made by JBSS and other vendors.
Most of JBSS's business is in the US. In 2012 exports represented 5% of the company's sales.
Consumer demand drives 60% of JBSS's sales. Among its significant consumer pipelines, Wal-Mart is its largest, accounting for more than 20% of JBSS's 2012 sales, followed by Target, 15% of sales. Other food retailers include Kroger, Publix, SUPERVALU, Hannaford, Jewel, and Giant Eagle. JBSS's commercial ingredient customers (generating one quarter of sales) comprise commercial bakeries, ice cream and candy manufacturers, and other food processors, as well as foodservice operators, such as hospitals, schools, universities, airlines, restaurants, and national foodservice franchises. JBSS also distributes a modest number of products manufactured or processed by others.
In fiscal 2012 (ends June) JBSS reported more than a 500% jump in earnings atop a single digit increase in sales over 2011. Although sales volumes have decreased (as Americans cut back on luxury products in all sectors, fancy food included), net sales have consistently grown over the last five years due to the company's success in passing through price increases to offset higher costs, mostly for nuts. JBSS's bottom line, albeit improved, largely reflected the difference of charging $5.7 million to goodwill impairment in the prior year. (The impairment was triggered by the impact of a troubled economy on JBSS's market value and operating results.)
As part of its strategy to expand its market presence through an enhanced portfolio, in 2010 JBSS acquired Modesto, California-based Orchard Valley Harvest for approximately $32.9 million. The addition gave JBSS an established manufacturer of branded and private-label nut and dried fruit products sold in the prized produce department of food stores. Produce is cited by JBSS as a fast growing sector in food retailing, with consumers spending more time and more money in such "perimeter of the store" areas. This trend is fueled by the continued popularity of convenience foods paired with consumer demand for healthier-eating alternatives. To cut costs, JBSS relocated Orchard Valley Harvest's operation in Modesto to facilities in Gustine, California, and Elgin, Illinois.
The Sanfilippo family owns some 52% of the company; the Valentine Group (headed by board member and former president Mathias Valentine) owns about 24%.