The Sacramento Bee -- sacbee.com -- An online information service of The Sacramento Bee

Sacbee: / Bee Search

Sections:

· Search Bee Archive

· Movie Listings

· TV Listings

SEED OF REBELLION YIELDS CAL FRESH

June 15, 1998
Section: BUSINESS
Page: IB3

By Jack Sirard

--It was a classic father-son struggle of wills. Miles Smith had just turned 18 and wrapped up his senior year at Encina High School.

A world of opportunity lay before him and his father believed that the best path led through a college campus.

But young Smith thought otherwise and promptly landed a job loading produce trucks during the overnight hours.

"Dad thought I'd quickly see the error of my ways and decide to go to college after spending a summer seeing how the other half lived," says Smith.

Instead, the teenager loved the physical challenge of the job and for the next 18 years he got a real-life education at the now defunct Lucky Fruit and Produce.

Starting out on the docks in 1969, Smith worked his way up the company ladder to night foreman and then day foreman before moving on to the delivery side driving 45-foot truck and tractor rigs. "I ended up going to the college of people and produce," he says.

The lesson he learned was that the key to the business was developing relationships through strong customer service. And after a short-term stint at another produce company, Smith and his wife, Susan, decided to venture out on their own with a company they called Cal Fresh Produce.

The husband-and-wife team launched the company in 1990 with $25,000 in savings and immediately had to plunk down $8,000 for a used delivery truck.

The couple's strategy was to provide produce delivery service to small retailers and restaurants 24 hours a day, seven days a week. While that greatly taxed their truck and aging family station wagon, the Smiths slowly built the business.

"People who laughed at us then are buying from us now," says Miles Smith, who adds that the company has been profitable from day one. By 1995, Cal Fresh broke the $10 million mark in revenues and made Inc. magazine's list as the 65th fastest growing business in the nation. Last year, company revenues grew to $23 million and this year, the goal is somewhere between $30 million and $35 million.

The key to growth last year, Smith says, was the hiring of five sales people from rival JC Produce, which in turn led to opening of the Reno-Tahoe market.

Cal Fresh now sends anywhere from four to eight truckloads a day to serve the needs of such casino-hotel operations as Harrah's, the Silver Legacy and Harvey's. "That segment accounts for about 25 percent of our business and not only do they pay well, they're easy to deal with," he says.

The Smiths divide their assignments evenly, with Susan handling everything from accounting to computers and Miles handling sales and products, and each shares in the company's success.

While Cal Fresh has grown to 100 employees, the company's goal is not necessarily to be the biggest supplier of fresh fruits and vegetables. With more than 20 competitors in town alone and countless others in surrounding regions, Cal Fresh seeks to distinguish itself through customer service.

"This is not a complicated business," he says. "We follow a basic formula of giving our customers what they want. If we don't, they will find another supplier."

The company only closes three days a year (Thanksgiving, Christmas and New Year's), refuses to install voice mail and literally fills orders at any time of the day.

Smith says he wants his people answering calls. "They can tell our customers what's in season and what's not. They know what the prices are. We believe that direct communication helps us build our business.

"When a high-strung chef at one of our restaurant clients calls and needs something, he or she doesn't want to talk to an answering machine. They want a person who can provide them service right now."

Cal Fresh has a fleet of 36 refrigerated trucks which are used around the clock for deliveries up and down the state. "Refrigerated trucks allow us to deliver fresh products when it's 100 degrees in Sacramento," he says.

Smith estimates that Cal Fresh ships about 150 truckloads a week to local restaurants, grocery stores and even most of the state's prisons. Its trucks are constantly on the road and seldom run empty. "If we have a truck headed to the prison in Coachella, we make the delivery there and then use the same truck to pick up a load of melons that are brought back to the Sacramento warehouse," he says.

While enjoying the success of the business, Smith, 47, doesn't see himself in the same position in five years. "We probably like to see some of our senior employees take over to give them a chance to run their own operation. My corporate attorneys think I'm out of my mind but I think a management buyout which left me with a partial equity position would be good for our devoted employees."

JACK SIRARD's column appears Thursday and Monday. Write him at P.O. Box 15779, Sacramento, 95852; e-mail to jsirard@sacbee.com; or call (916) 321-1041.

Bee photographs / Leilani Hu Miles Smith, 46, learned the produce business from the ground up before striking out on his own, starting Cal Fresh Produce with his wife, Susan, in 1990.

Pedro Grajedo of Sacramento sorts tomatoes at Cal Fresh, which has 90 employees and expects to do at least $30 million in sales this year.

All content © The Sacramento Bee and may not be republished without permission.
Send comments or questions to NewsLibrary


	The Bee's Archive Sign Up for NewsLibrary Account Customer Service NewsLibrary serves, maintains and supplies customer services for The Bee's fee-based archive. Please direct billing and account information inquiries to NewsLibrary. E-mail NewsLibrary Customer Service Search Tips Copyright Information Death Notices Obituaries (News) Funeral Notices

[ Sacramento Bee Web sites ]

Sacbee.com | SacTicket.com | Sacramento.com