Sacramento charcoal product takes on grilling-giant Kingsford
By Jim Downing - jdowning sacbee.com
Published 12:00 am PDT Friday, July 4, 2008
Story appeared in BUSINESS section, Page D1
http://www.sacbee.com/103/story/1059997.html
This grilling season, Sacramento designer James Dudley is waiting to
see whether his latest invention will catch fire.
Raley's is already carrying the creation, thought up over margaritas
in Baja California.
He calls it the "Baja BBQ" =96 a flammable bucket made from recycled
newspaper and filled with two pounds of sustainably harvested mesquite
charcoal. One match sends the bucket up in flames, leaving the coals
hot and the griller's hands clean. No lighter fluid needed.
The Baja BBQ will be going up against industry giant Kingsford, but it
may be just right for the times. It's convenient, environmentally
friendly and should be buoyed by the growing popularity of mesquite,
the type of charcoal favored by many gourmet cooks.
But while the concept is simple, its execution was not. It took Dudley
three years and a $130,000 investment in design and marketing to get
it ready for store shelves.
"A lot of fires, a lot of hot dogs," Dudley said.
Raley's recently began stocking the Baja BBQ for $3.99, compared with
$3.88 for Kingsford's single-use bag of briquettes. Nugget Markets are
scheduled to begin carrying it later this year.
A presence in those two chains marks a strong launch that gives the
Baja BBQ some instant credibility with shoppers, said Dennis
Tootelian, a professor of marketing at California State University,
Sacramento.
Doug Higginbotham, general manager of Barbeques Galore in Folsom, said
the design sounds promising. "Lighter fluid is something people like
to get away from with charcoal," he said, and natural charcoals like
mesquite are gaining popularity.
Still, Tootelian said, carving a permanent niche in a $1 billion
annual charcoal business dominated by a single, very well-known brand
=96 Kingsford, which holds more than 70 percent of the market =96 will be
tough.
It's always difficult to get customers to try something new, Tootelian
said, and that's especially true when a launch isn't backed by a big
advertising budget.
And if the design does take off, Tootelian said, there's still the
prospect of being co-opted by the industry giant.
"If this starts to sell, how long would it take Kingsford to come out
with something functionally equivalent?" he said.
For Dudley, a four-day-a-week griller, today's Baja BBQ is the product
of an evolution that began, as the name suggests, on the beach in
Baja.
In the summer of 2005, Dudley arrived with family and friends at his
Baja vacation home to find the charcoal chimney, which ordinarily was
used to start cooking fires, badly corroded by the sea air. Over
drinks, the vacationers fa****oned a chimney from cardboard scraps.
"It worked perfectly," Dudley said.
Back at work in Sacramento, designing a similar chimney that could be
mass-produced became a front-burner project at Design Annex, Dudley's
three-employee, 13-year-old design firm on Folsom Boulevard.
Dudley grew up on the beach in San Clemente =96 he was a state surfing
champion in 1979 =96 and still makes leisure a priority while running
his business and raising a family. For an interview at his office this
week, he wore a Hawaiian ****rt, jeans and flip-flops. So the Baja BBQ
=96 "very much a beach product," he says =96 was a dream project.
But it would take three years to get both the design and the business
plan right.
The bucket design now on store shelves is the fourth generation of the
Baja BBQ, which in early prototypes resembled a heavy-duty paper lunch
sack. Today's version is made from recycled paper pulp using
essentially the same process that produces egg cartons.
Dudley's team started out with the idea that they'd be in charge of
all steps in the production process, rather than just handling design,
as Design Annex usually does.
"We wanted to be the charcoal kings," said Trent Smith, Dudley's
former marketing director, who is no longer with the company.
Dudley and Smith traveled to Hermosillo, Mexico, the hub of the North
American mesquite charcoal industry, and found a potential supplier.
Mesquite charcoal, along with the other "lump" charcoals made from a
variety of hardwoods, is the fastest-growing segment of the charcoal
business, according to data from the Hearth, Patio and Barbecue
Association. Retail sales grew 10 percent in 2007 and now account for
about 14 percent of the market. Lump charcoal looks like scraps of
wood rather than pillow-shaped briquettes. It's generally pure wood,
while most standard briquettes contain coal and binders like corn
starch as well as wood.
As Dudley and Smith developed the idea further, however, it became
clear that getting established as a newcomer in the charcoal world
would mean big changes in the way they did business =96 adding many new
employees and taking on large financial risks.
So Smith pitched the Baja BBQ to Robert Colbert, owner of Lazzari Fuel
Co., a 100-year-old San Francisco company already established as the
leading mesquite charcoal label in the western United States, selling
both to high-end restaurant customers and through supermarket chains.
Colbert hesitated at first =96 he gets a lot of calls from garage
inventors, he said.
Then Smith showed his prototype.
"Immediately, everybody in the office just loved it," Colbert said.
"It was a real 'ah-ha' moment."
Here was a way, Colbert thought, to make gourmet grilling convenient.
"It's the salad in the bag instead of the head of lettuce," he said.
"Grilling is always perceived as something that takes a long time.
This is a product that maybe will change that."
Dudley and Colbert worked out a joint venture arrangement, with the
Baja BBQ to be sold under the Lazzari brand. Last winter, Colbert's
company presented it to buyers at Raley's, who decided to give it a
spot on their shelves.
Dudley hopes to sell 50,000 of the Baja BBQs this year, and three
times as many in 2009. He splits roughly $1 with Lazzari on each sale.
Dudley said his initial marketing efforts will be low budget, relying
on word of mouth, media reviews and super- market demonstrations. The
demonstrations are especially im****tant, he thinks, because the Baja
BBQ looks like nothing else in the charcoal section of the grocery
store.
"When you first see it, it's not necessarily totally clear what it
is," he said.
Assuming business grows as planned, Dudley hopes to sell the Baja BBQ
to a larger cor****ation.
The most likely buyer?
By Dudley's reckoning, it's Clorox Co. =96 Kingsford's cor****ate parent.
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