One ‘honey’ of a ham
Dec. 9, 2014
|A spiral slicer helped put HoneyBaked Ham on the map.
As the old adage wisely states, “Good things are worth waiting for”, and HoneyBaked Ham devotees, in particular, are known to wait patiently in line inside busy stores in anticipation of purchasing a coveted spiral-sliced ham for the holidays. For these devoted HoneyBaked Ham fans – the wait is definitely worth it.
The irony, though, is that HoneyBaked Ham’s founder, Harry Hoenselaar, didn’t intend to get in the specialty-ham business when he began working in the meat industry in the late 1930s. Instead, he wanted to work in the machine industry as an inventor.
“He had this idea of creating an automatic slicer that could slice a ham around a bone,” says Craig Kurz, Hoenselaar’s grandson and president of HBH Limited Partnership, the licensor to the national HoneyBaked Ham system.
Kurz is talking about the famed spiral slicer that helped put HoneyBaked Ham on the map. In the late 1930s and early 1940s when Hoenselaar was in his 20s, he built a prototype of the spiral slicer in the basement of his home during his off-hours as a salesman for a Detroit-based meat company. In coming years, Hoenselaar tried to convince the big meat companies at the time – including Swift, Armour and Hormel – to buy his slicer or at least license it as part of a new foray into meat processing. But the big companies balked and rejected his idea.
The determined Hoenselaar didn’t give up, however. He tinkered with the machine to improve it, drawing on ideas he scribbled on napkins. In 1957 he took out a second mortgage on his home and purchased the Detroit meat company that employed him for $500. Hoenselaar decided he would use his own machine to slice his own hams and sell them through a retail store direct to customers.
And HoneyBaked Ham was born.
One ham at a time
This year marks the 65th anniversary of Hoenselaar’s first spiral-slicer patent in 1949; he received a second patent in 1952. Sitting in his Cincinnati-based office, the 52-year-old Kurz, who works with several third-generation family members at HoneyBaked Ham, opens a file on his laptop computer to show a restored film of the early spiral slicer in action. Kurz, who has seen the footage many times, still marvels at it.
|Craig Kurz, president of HBH Limited Partnership, says the family is living his grandfather's heritage every day.
“He created this machine with literally a broom handle, a washing machine motor, a pie tin and a kitchen knife,” Kurz says. “He used a hand drill to rotate the slicer on his prototype machine.”
The spiral slicer has improved with technology – there have been several versions over the years – but its crux is the same.
HoneyBaked Ham didn’t become popular in Detroit and eventually throughout the country solely because of the spiral slicer. Hoenselaar also created an excellent recipe for a crunchy glazed-ham topping. He smoked his hams for several hours over a blend of hardwood chips and hand-glazed them with the sweet concoction. The spiral slicing added to the product’s uniqueness, convenience and premium reputation.
When Hoenselaar’s four daughters grew older and married, they and their spouses joined the business in the late 1960s and 1970s, including Kurz’s parents, Jo Ann and George, who opened the second HoneyBaked Ham store in Cleveland in 1966. Soon, the store in Cleveland, just like in Detroit, gained a reputation as the place to go for a holiday ham.
“People were literally lining up outside the store,” Kurz says.
When Hoenselaar died in 1974, his family had opened six HoneyBaked Ham locations for a total of seven stores. After his death, his family kept the business growing.
And then October 1981 arrived, and as Kurz says, “All bets were off.” That’s when the patent expired on the spiral slicer.
“It was an uncertain time,” says Kurz, who was a student at the Univ. of Kentucky at the time.
|HoneyBaked Ham at retail.
Many of the meat companies that Hoenselaar contacted in the late 1930s and 1940s had since developed their own spiral slicers and began selling spiral-sliced ham through various grocery chains. Those companies took out full-page newspaper advertisements touting their products. But HoneyBaked Ham, still the “mom and pop” of the bunch, continued to grow.
“What the other meat companies didn’t have was HoneyBaked Ham’s product specifications, and smoking or curing process – the cornerstones of our product,” Kurz says.
While the 1980s were uncertain times, it was also the decade of the highest growth in HoneyBaked Ham’s history. The fact that other meat companies were selling spiral-sliced hams uplifted the entire category, but it was also a time when HoneyBaked Ham established its own growth by building more stores and expanding its mail-order operations.
“We put our heads down and started growing the business,” Kurz explains, noting that stores were opened throughout the Midwest as well as in Florida and Texas. “The competition was a good thing. It made us better.”
HoneyBaked Ham ballooned from 33 stores in 1980 to 170 stores by decade’s end.
Kurz and other third-generation family members joined the business in the mid-1980s as full-time employees. In addition to growing the number of stores, the company aimed to heighten the quality perception of its product – that it wasn’t just a ham sold in a bin, but a fresh, sliced and glazed ham wrapped in foil delivered to a customer for a personal inspection.
“That’s the foundation of the HoneyBaked Ham legacy – one ham at a time,” Kurz says.
The late 1980s and 1990s brought other specialty ham competitors, some of which HoneyBaked Ham purchased and converted or purchased and closed. Doing that was a testament to the company’s financial well-being. In 2002, HoneyBaked Ham purchased one of its top competitors, Heavenly Ham, and converted many of the stores while relocating others.
In 2002 the company also began selling franchises, which opened another window of opportunity to grow the business. Today, there are about 210 franchise stores in addition to 200 company-owned stores.
“We have a franchise community that’s extremely passionate about our brand,” Kurz says.
Kurz is partnering with his cousins in leading a successful third-generation run of the business as the licensors’ president, a position he has held since 2003. Nationally, HoneyBaked Ham is divided into three divisions, all operated independently by third-generation family members. Kurz is the CEO of the Ohio division, cousin Lou Schmidt is CEO of the Michigan division and cousin Linda van Rees is chairman and CEO of the Georgia division. One non-family member is licensed to operate 40 locations in California.
While their agreement calls to grow the divisions as separate entities, they are unified under HoneyBaked Ham’s national umbrella, Kurz explains. The divisions share best practices and work closely on marketing and branding to ensure consistency.
“We recognize there are things we can learn from each other and leverage,” Kurz says.
Kurz points out that today’s HoneyBaked Ham isn’t the same company his grandfather began, but he stresses that little has changed in the way the spiral-sliced ham is processed. The company has introduced smaller hams as well as a boneless ham, but all are smoked and glazed the same way they have always been.
In an ongoing effort to evolve the brand and broaden appeal, HoneyBaked Ham has also expanded its product line to include roasted and smoked sliced and glazed turkey breast, barbecue ribs, signature bacon and other products.
|There were about 700 distribution points for HoneyBaked Ham across the country for the holidays.
Kurz elects not to talk about the company’s suppliers for competitive reasons, but says HoneyBaked Ham has worked with an unnamed meat scientist since the 1980s, who has helped the company maintain its high quality by sourcing suitable raw materials that meet product specifications, among other things.
The longtime consultant says HoneyBaked Ham’s “secret to success” is embedded in its meat specifications for color, muscle quality and desired fat cover. The consultant noted the company’s hams are injected with an exclusive brine and held for an extended time to achieve desired color and flavor development.
“Their hams are cooked and smoked much slower than many processors cook hams,” he says. “They do that to achieve the mahogany color, smoky taste and tender texture that their hams are noted for.”
The consultant noted the way a ham is mounted in the spiral slicer is critical to its quality of cut.
“If there’s one thing about the HoneyBaked Ham process, it’s that nothing happens by accident,” the consultant said. “Every step of the process is precisely specified, monitored and controlled.”
Forward and beyond
Nobody has to tell Kurz that consumers are crazy busy. Hence, HoneyBaked Ham is placing a big emphasis on e-commerce to extend its brand. At www.honeybaked.com, consumers can find stores, study product offerings and place orders for pickup and learn about franchise opportunities.
|HoneyBaked Ham expanded its product line to include roasted and smoked sliced and glazed turkey breast and other products.
HoneyBaked Ham’s typical customer is 45 years old and older, but the company is growing its younger consumer base by utilizing social media, Kurz says, noting that 20-something, fourth-generation family employees are helping to direct those efforts.
To increase brand awareness and garner more sales, the company has partnered with grocery chains to establish pop-up retail stands or kiosks within those chains’ outlets. HoneyBaked Ham has about 275 pop-up locations with grocery stores.
The company is also in the “express” business. If there’s a strip center with an empty space in a desirable location, Honeybaked Ham may rent it out for a few months around the holidays. Both kiosks and express stores are staffed with HoneyBaked Ham employees and are selling the same products from the stores.
Through its stores, pop-up-retail sites and express locations, Kurz estimates there were about 700 distribution points for HoneyBaked Ham across the country this holiday season.
The company also continues to grow through bricks and mortar, building more company-owned and franchise stores. Maggie DeCan, president and COO of HoneyBaked Ham’s Georgia Division and the HoneyBaked Ham Franchise Co., says the company has territory available that could double its store capacity in the next five to 10 years. The company also recently sold the franchise rights in Tokyo to a local entrepreneur, who hopes to explore more locations across Asia.
A franchise fee is $30,000 and it costs an estimated $282,000 to $432,000 to build a full-service store in a leased space. Potential owners will be taught all about the business if they purchase a franchise.
Product development is ongoing, as HoneyBaked Ham works to diversify its offerings, especially at the foodservice level. While HoneyBaked Ham is best known for its holiday hams and turkeys, the company’s stores don’t pack it in when the holidays are over.
“We have a unique business model with the seasonality of our business,” Kurz says. “You must be able to scale up and scale down. If you can’t do that efficiently, there will be challenges.”
Regarding challenges, HoneyBaked Ham has fought through difficult economic times over the years, such as the Great Recession. If you’re in the upscale product business, you’re going to feel the pinch of an economic downturn, Kurz says.
During the Great Recession, the company didn’t change the specs on its products to sell them cheaper, Kurz says. The company concentrated on business as usual. “We controlled what we could control,” he says.
While he wouldn’t reveal annual sales, Kurz says HoneyBaked Ham has experienced solid growth the last three years and is poised for even more growth the next few years.
Hoenselaar’s daughter and Kurz’s mother, Jo Ann, who spent 42 years in the business, remains in awe of what HoneyBaked Ham has evolved into.
“It’s amazing how it all came together,” she says. “The third generation is taking it beyond anything we could have imagined.”
Jo Ann remembers how hard her father worked to establish the business. It was difficult at times, especially after his spiral slicer failed to gain the attention of the big meat companies.
In the Cincinnati office, there are remnants of HoneyBaked Ham’s beginning, including original handwritten notes that Hoenselaar jotted down as memos to himself. One says, “Thanksgiving 1958. Didn’t advertise and sold 158 hams. Probably could have sold 200 hams with ads.”
HoneyBaked Ham was founded on Hoenselaar’s hard work, as well as his perseverance, which his family members have maintained in his honor.
“We’re living this 24/7,” Kurz says. “We want to continue to grow the brand that’s anchored in my grandpa’s heritage.”