Spangler Candy Company: Ramping up for Another 100 Years!
by Melinda Kroll
Universal Advisor, 2007 Issue No. 2

Although most towns aren’t associated with a particular scent, Bryan, Ohio is a sweet exception. On any given day, the town could smell of grape, cherry, butterscotch, or any other flavor used to make Spangler Candy’s signature products, which include Dum Dum Pops®, Saf-T-Pops®, Spangler® Candy Canes, and Circus Peanuts. “People always comment on how great the town smells,” laughs Spangler Candy Company President and CEO Dean Spangler. “That’s not necessarily a good thing, because what they smell is the batch that got burned. I always tell people it’s the smell of money!”

Founded in 1906, Spangler Candy Company is a privately held U.S. confectionary manufacturer that employs approximately 400 people in Bryan and 190 people in a co-manufacturing facility in Juarez, Mexico. It was initially founded by Arthur G. Spangler, who specialized in manufacturing baking powder, baking soda, cornstarch, laundry starch, spices, and flavoring. After his brothers Ernest and Omar joined the business, it evolved into peanuts and, finally, the Spangler Cocoanut Ball — Spangler’s first candy brand.

One hundred years later, Spangler is the largest manufacturer of candy canes in the world, and the only candy-cane manufacturer in the United States. The company manufactures 8 million Dum Dum Pops®, more than 2.7 million candy canes, and more than 600,000 Saf-T-Pops each day! In addition, the company now employs a number of fourth-generation Spanglers (a feat that’s almost unprecedented). How has Spangler Candy continued to be so successful? Dean credits steady growth, staying true to Spangler’s basic beliefs, and recognizing what shareholder value really is.

Strong, Steady Growth

“As businessmen, we have a responsibility to make a profit and for our employees to understand what a profit is and why it’s important,” says Dean.”My generation of businessmen hasn’t done a good job of that. People don’t have labor problems; they have labor management problems — they often don’t do a good job of communicating with employees why they can only be successful together.”

Dean believes in leading by example. “My office is located here because people know that I’m here and I’m working — not off in some quiet office reading the Wall Street Journal,” he says. “Over the course of my career, I’ve had a number of management theories, which I’ve finally narrowed down to two. First, it’s management’s job to come up with the best right answer. American businesses are typically quick to identify an answer and move forward; instead, we reply, ‘OK — that’s one right answer; what are the others?’ We identify all of them so that we can select the best one.”

“Second,” Dean continues, “it’s important to recruit the best right people. This means ‘best’ in terms of competencies, education, and leadership ability, and ‘right’ in terms of fitting culturally with what you’re trying to accomplish. I want the best right answer with an emphasis on best and the best right people with an emphasis on right. That’s one way we’ve continued to be successful.”

This philosophy has served Spangler well, both in terms of making the decisions to achieve profitability and in terms of retaining staff. In fact, 28 percent of the company’s staff members have been with Spangler for 25 years or more! “I think our consistency and stability have become great assets in attracting the best right people,” says Dean. “A while back, a newspaper did an article on us with a headline that read, ‘The Turtle Wins Again.’ I’m really proud of being that turtle; if we can continue to be a good, solid turtle, by the time my son’s my age, this company will be in great shape.”

The Importance of a Belief System

Spangler’s philosophy is rooted in the beliefs of its founding generation: Arthur, Ernest, and Omar Spangler. They include:

• Be honest
• Be practical
• Be market-wise
• Be independent

“We’re absolutely committed to our beliefs and values,” says Dean. “We live them every day. That’s why we’ve been around 100 years — that anchor has been tremendous, and even when the seas have shifted, we’ve been able to pull it up, refocus, and put the anchor back down. This has worked even in the most tumultuous waters.

”Like when Spangler made the difficult decision to manufacture 50 percent of its candy canes in Juarez, Mexico in 2001. “Our government policies have made it nearly impossible for American sugar candy companies to compete for items that have high sugar and labor content, like candy canes,” says Dean. “Part of the problem is that sugar is price supported in the United States through a loan-guarantee program in the Farm Bill. That means Spangler pays an additional 10–16 cents per pound for sugar compared to competitors in Mexico or China; obviously, the labor rates in Mexico are less than in the United States as well. Every other manufacturer of candy canes has either disappeared or moved all of their production outside the United States. If we had left the candy cane business (and we could have — our return on investment would have been the same, maybe even better), we would’ve eliminated more than 150 jobs in Bryan. We simply couldn’t do that. It was against our basic beliefs.”

Shareholder Value Is Not a Number

Only one-third of family-owned businesses survive into the second generation: of that, only one in five makes it to the third. Spangler counts a handful of fourth-generation family members among its staff. How have they beaten the odds?

By recognizing what shareholder value really is. “Shareholder value is developed when the legacy is more important than a market share price at a given point in time,” says Dean. “Ownership is a responsibility — it’s a trust for one’s children and grandchildren. It’s not a number. If, 20 years from now, my son is as proud of what I did during my 30 years of ownership as I am of my dad and grandfather, our shareholder value will be just fine.”

How Sweet It Is: Fun Facts About Dum Dum Pops®

• Dum Dum Pops® come in 16+1 flavors: Blu Raspberry, Banana, Bubble Gum, Butterscotch, Cherry, Cherry Cola, Chocolate, Cotton Candy, Cream Soda, Grape, Pineapple-Coconut, Pink Lemonade, Root Beer, Sour Apple, Strawberry, Watermelon, and the Mystery Flavor™.
  
• What is the Mystery Flavor™? Any combination of two flavors. At Spangler, flavors go into the batch roller and Dum Dum forming machine one after another, so there’s a period of time when two flavors may be stuck together. They used to scrap these candies, until one day, someone suggested they wrap them and dub them the Mystery Flavor™.
  
• Dum Dum Pops® weigh 6 grams. At only 20 calories, they’re fat-free!
  
• According to a poll at www.dumdumpops.com, the most popular flavor of Dum Dum Pops® is Blu Raspberry, closely followed by Cream Soda, Watermelon, and Root Beer.
  
• You can buy 120-count boxes of your favorite Dum Dum Pop® flavors online. The most popular? The ever-controversial popcorn flavor! In fact, Spangler sells more single-flavor boxes of the popcorn variety than all other flavors combined!