Growing sunflower seed company plays ball with the big boysby Dan Gunderson, Minnesota Public Radio
Wahpeton, N.D. — After initial rejection and tough economic times, a North Dakota entrepreneur is realizing a major league dream.
Just 16 years after two large corporations rejected his idea for producing and selling premium sunflower seeds, Jay Schuler's Giants Sunflower is selling in 35 states and has been a success story in Wahpeton, N.D.
And he's thinking expansion.
"Our market share is over 60 percent in the tri-state area [Minnesota, South Dakota and North Dakota]," Schuler said. "If you go nationwide, we're only 7 percent or 8 percent, so we've got a lot of opportunity [for growth]."
The 58-year-old Schuler grew up in the sunflower business. His family has been breeding bigger sunflower seeds for three generations. Despite his background in plant breeding and genetics, he learned he didn't have the patience for developing new plant varieties. Instead, he put his energy into starting a company to develop and sell new sunflower varieties to farmers.
In 1995 he tried to convince two snack food companies -- DAVID Seeds and Fisher Nut Company -- to buy a larger confection sunflower seed his company developed. After they passed he decided to start his own premium sunflower seed company. He contracted with farmers who grow specific sunflower varieties. He chose the name Giants to represent the extra large sunflower seeds the company hoped consumers would buy.
But in 2004, he ran into trouble with Major League Baseball and the San Francisco Giants, which objected to the company's name.
He found an ally in his fight against MLB in North Dakota Sen. Byron Dorgan.
"[Major League Baseball] had more attorneys than we had employees. And they could have buried us," Schuler recounted. "So I reached out to Senator Dorgan. And he got right on the phone and called Bud Selig, the commissioner of baseball. He said, 'Bud this ain't right.' "
MLB backed off, and the two parties were even able to make amends as Giants became the official sunflower seeds of the Minnesota Twins.
It was the brainstorm of Schuler's oldest son, Jay.
"He says, 'Dad, I think we should become the official seed of the Twins.' I'm thinking, 'Yeah, right, college boy, have at it, See what you can do.' "
The college boy hammered out a deal with the Twins, and the company had a marketing grand slam. Giants added a second team in the Colorado Rockies.
Despite the economic downturn, the company is still seeing double digit annual growth. Schuler says annual sales now exceed $10 million, and he expects to top $30 million within five years. Giants Sunflower now has 60 percent of the sunflower seed market in Minnesota and the Dakotas. This rapid growth resulted in the construction of the Wahpeton facility in 2009; it is already operating at capacity.
The company will likely outgrow that factory by the end of the year. Schuler will need to decide where he wants to expand.
"Now if we were located in Denver, or if we were located in Nevada, we could take advantage of distributors in those areas. So, yeah, we have to make some decisions. We're pushing the pencil and figuring out the best way for us to grow.
Schuler when he first started the company, he planned to build a brand and then sell it to a big corporation. Now he says he's changed his mind. He's having too much fun competing with the giants of the snack world.
- Morning Edition, 04/01/2011, 7:25 a.m.