MSU Product Center Start-up to Watch awardees: Where are they now?
Successful MSU Product Center client, Herkner’s Cherry Topping, has gone from start-up to succession in six short years.
When Sue Ellen Keegstra and her sisters, Lynda and Judy, were awarded Michigan State University Product Center’s first Start-up to Watch award in 2009 their only goal was to make money.
In response to a family member’s financial distress during the great recession, they decided to start making the Herkner family cherry topping. They understood that they probably needed product testing and a commercial-scale recipe. That’s when they were matched with counselor Matt Birbeck of the Michigan State University Product Center.
“A lot of our success was doing what Matt told us to do,” Sue Ellen said.
They learned that they had a niche product with no real competitors in the market. They established their business entity and began production at The Starting Block, an incubator kitchen in Hart, Michigan, where they made 600 jars on their first run. After selling out in two weeks, they decided to find a co-packer to make the product for them.
Finding the right co-packer was one of the trials for the business. “At times, we didn’t think that we could go on,” Sue Ellen said. She believes that the decision-making process they put in place when they established their business structure, majority rules, saved them.
When a weather disaster caused a cherry shortage, Lynda turned her talents to developing a blueberry topping. Cherry Chipotle has since joined Blueberry and Cherry in the product line up.
Financing the enterprise was difficult because traditional lenders rely on history. The local SCORE chapter provided a small loan so that they could sample the topping at the National Cherry Festival. This loan and personal loans funded their early growth.
On the recommendation of Birbeck, the sisters formed an advisory board of six individuals who had extensive entrepreneurial experience. They credit the board’s input on product development, marketing, and financial management with making a huge difference in the growth of their business.
Their breakthrough came when Herkner’s Cherry Topping was accepted by Meijer for their Made in Michigan promotion. They did a lot of in-store sampling because people were not familiar with the product. When customers tasted it, they bought it. Today, Herkner’s Original Fruit Toppings may be found with national brands on the shelves of Michigan Meijer stores, and more than 100 other grocers in the Great Lakes region.
Today the sisters make appearances and tell the story of Herkner’s Original Fruit Toppings on behalf of the company’s new ownership. A person familiar with the operation and strong product offerings approached them with an offer to buy the company. In 2015 the sale was approved unanimously.
For information on marketing, managing, or starting a food, agriculture, bio economy and natural resources business development, contact the Michigan State University Product Center at www.productcenter.msu.edu or 517-432-8750. Michigan State University Extension Innovation Counselors are available statewide for free business counseling.