Tulkoff sets a new course

Emigres' grandson expanding the business

May 02, 2008|By Allison Connolly | Allison Connolly,SUN REPORTER

Philip Tulkoff spent most of his career in engineering and computers. The food manufacturing business started by his Russian immigrant grandparents nearly 80 years ago had only been his high school summer job.

So no one was more surprised than Tulkoff, 47, when he was asked three years ago to take over as chief executive of Baltimore-based Tulkoff Food Products Inc., best known for its horseradish and related products.

"It totally came out of the blue," Tulkoff said. "I really had to learn everything."

But the fresh eye he brought to the company is now taking it in a new direction. Tulkoff Food recently completed a new headquarters and manufacturing plant in Baltimore, and it is developing additional distribution channels. The company, which has a retail presence in the Mid-Atlantic states, hopes to sell its brand in supermarkets nationwide.

Family-owned Tulkoff Food is unusual in that it has remained a small but stable Maryland manufacturer that managed to keep its 100-person work force largely within city limits. It manufactures 1.5 million cases of product per year and 12 million pounds of horseradish for customers such as Sysco Corp. and U.S. Foodservice Inc. as well as Mars and Safeway stores. It also has a California manufacturing plant.

The company's horseradish operation currently dominates the food service arena, providing products to many of the nation's largest restaurant distributors as well as private-label production. And Tulkoff sees promise in new products such as flavored butter, which he acknowledges is revolutionary compared with the company's decades-old staples of horseradish, garlic and ginger.

Like other manufacturers, Tulkoff said his company must evolve with the market, technology and corporate culture to survive.

"We need to change or die," Tulkoff said.

For decades the business was run the same way, Tulkoff said, from the top down. Nothing could be bought or sold without approval from the head office. There was no such thing as a staff meeting when he came on board, he said.

So Tulkoff hired consultants and brought on new midlevel managers. He adopted lean management practices that streamlined production and improved margins. He invested in training for all employees. And he held more meetings.

"I think it's a more open environment now," he said.

While he declined to disclose annual sales or revenue data, Tulkoff said the company posted its best annual sales ever for the fiscal year that ended June 30. He said each employee received a bonus as thanks.

Tulkoff also is investing profits back into the company, with employee financial incentives for attendance and food safety training, and for purchase of new equipment.

"Some of the equipment was older than I am," he said, walking through the plant recently wearing a Tulkoff polo T-shirt and a white hairnet.

The company moved in March to a new 80,000-square-foot building in Holabird Industrial Park that offers more room than its former space inside an old Canton brewery on South Conkling Street - an area being redeveloped into apartments, offices and commercial space. The company has remained in the city since Tulkoff's grandparents first began grinding horseradish and bottling it in East Baltimore along "Corned Beef Row" on Lombard Street during the 1930s.

City and state economic development officials said they offered routine assistance to help the company expand and move in Baltimore. Baltimore Development Corp. said it provided a low-interest, $500,000 loan to the company so it could purchase equipment for the new plant. The city also sold 5.9 acres of land in the industrial park to Tulkoff Food for $490,400. Maryland Economic Development Corp. said it assisted the company in securing $6 million worth of private bonds to help build its headquarters.

The new plant will allow the company to be more efficient and manufacture additional product with the same number of employees, Tulkoff said. There also is a test kitchen for creating new products, the company's first.

Tulkoff recruited Mark Natale, who spent more than 25 years in the food business, most of them at Columbia-based U.S. Foodservice, as vice president of sales and marketing. Immediately, Natale said he noticed the company had a lot of untapped potential. Tulkoff Food had limited distribution to grocers, clubs such as Costco and BJ's and restaurant chains.

"Every time I walk into a grocery store and see a competitor [on the shelf] I come back and yell at Mark and say, 'Why aren't we there?'" Tulkoff said.

Among those competitors is Hempstead, N.Y.-based Gold Pure Food Products Co. Gold's, also founded almost 80 years ago and family run, claims the top spot as the retail leader for horseradish sales. Both companies are part of the Horseradish Information Council, a trade group. In the horseradish industry, companies like Tulkoff and Gold have strong brands that are wedged between a few mom-and-pops and corporate giants like Heinz.

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