Few secrets behind best ice cream in the country
Blue Bell CEO Paul Kruse says 105-year Texas institution has succeeded in staying the course.
by Rick Waters '95
Updated: Wednesday, April 18, 2012
president and CEO of Blue Bell Paul Kruse, grandson of the company's founder, has guided the creamery since 2004.
The president and CEO of Blue Bell admits the "little creamery in Brenham" does far less market and product analysis than the rest of big business.
Its company philosophy is pretty simple: Use only the highest quality ingredients, focus on the core product and do the right thing.
After 105 years, the family-owned creamery/delivery-business turned Texas-ice-cream-institution has gotten a lot right with that mindset, from keeping half-gallon carton sizes while competitors are downsizing to retaining its "country" brand identity to rejecting distracting side ventures like bottling Blue Bell milk.
But even top boss Paul Kruse, grandson of the company's founder, admits he flubbed a flavor a few years back.
"Our peanut butter and jelly flavor flopped," he admitted Tuesday to a crowd of 300 at the final installment of the Neeley School of Business's 2011-12 Tandy Executive Speaker Series. "It didn't sell. No one wanted it. We ended up giving the whole supply to the Houston Food Bank."
Kruse shared few secrets, mainly because there just aren't many.
"We spend on a lot of ingredients. We bake a lot of ingredients," he said. "Making ice cream isn't complicated, but it's difficult. It takes a lot of steps."
Blue Bell ranks third-best in ice cream sales nationally, but it's only available in 20 states. Its products can be found in only about 26 percent of the country's supermarkets.
That's by design, he said.
"We're still a family business," said Kruse, who's just the company's fourth chief executive. (His granddad, uncle and father were the others.) "We have a bit of a different value system. Making and selling ice cream works for us. So we just focus on that."
In the markets with a Blue Bell presence, it dominates. It holds a 60 percent market share of ice cream sold in supermarkets in Houston, 58 percent in Dallas/Fort Worth, 40 percent in San Antonio/Austin, 57 percent in New Orleans/Mobile, 41 percent in Oklahoma City/Tulsa and 35 percent in Birmingham. Sales last year were about $400 million.
Typically, the company adds just one new market every year or so, Kruse said. In March 2011, it added Denver, opening a full-fledged 15,000 square-foot distribution center in Englewood, which will serve a population of about 2.5 million in 100-mile radius, including Boulder, Fort Collins, Colorado Springs and Pueblo. In just 13 weeks, it was the top-seller in Denver and has expanded its fleet of delivery trucks from six to 26 in less than 12 months.
The company also introduced an exclusive flavor just for Coloradoans called Rocky Mountain Road, a rich, dark chocolate with dark chocolate-coated peanuts, milk chocolate-coated pecans, white chocolate-coated almonds and roasted walnuts, all surrounded by a marshmallow-sauce swirl. It even comes in a special container—navy blue with a white silhouette of snow-capped mountains—to represent the state’s magnificent Rocky Mountain scenery.
It's those personal touches that give the company a cult-like following and backs up the Blue Bell slogan of "the best ice cream in the country," Kruse said.
Ironically, that tag developed in the 1950s as the creamery was trying to make inroads in Houston. Back then, grocers swore off the Brenham brand, saying that city folk wanted city ice cream, not the stuff from the country.
"We sort of took that to heart and started saying our ice was better because we're closer to the cows. We really were the best ice cream in the country," he said. "That slogan hasn't changed. We're still working hard."
Blue Bell doesn't outsource to outside distributors, Kruse said. It's more expensive to deliver product with its own employees, but it ensures quality control.
"We test the temperatures of freezers in the store, and if it's not cold enough, we don't leave our ice cream," he said.
Blue Bell makes 250 different products, from Mooo Bars to plain-old vanilla. It has 17 ice cream flavors available year-round and another stock of about 30 that take turns in the rotation, depending on the market, season and customer demand.
It all started on a hot August day in 1907 when small-town farmers 70 miles northwest of Houston invested $2,200 to turn their milk into butter. They bought up other farmers' excess cream and established the Brenham Creamery Company.In 1911, they began making ice cream and delivering it to neighbors by horse and wagon, and in 1930, the company changed its name to Blue Bell Creameries after the native Texas bluebell wildflower. They kept making butter until 1958 when they began to focus fulltime on making "the best ice cream in the country."
The company is credited with devising the original "Cookies 'n Cream," but the most popular flavor, year after year, remains Homemade Vanilla, created in 1969, which, fans say, tastes remarkably like the hand-cranked ice cream folks used to make on the porch during long summer evenings.
Kruse’s grandfather, E.F. Kruse took over operations of the creamery in 1919, and his sons, Ed and Howard followed in leadership positions.
Paul Kruse bucked family tradition by majoring in accounting at Texas A&M before going on to law school at Baylor. He had a private law practice in Brenham for several years before being recruited by his father, after serving as board member, to general counsel, to his current role at the helm of the company. It was quite a negotiation.
"I told him to get someone else," Kruse recalled. "He said, 'Nope, I want you.' I said, 'Gimme a year.' He said, 'Nope. Now.' I said, 'Then get someone else.' He said, 'Okay, I'll wait.' "
What's remained the same from generation to generation is the love of ice cream, the focus on using fresh incredients and getting it to stores quickly, hence the company's other tagline "The milk we use is so fresh it was grass only yesterday."
"We know what works for us and we keep doing it," Kruse said. "My kids eat it every single night of the year, and I eat it every day."