`Stephen Mandia, Sovena USA - Olive Oil Times

Stephen Mandia, Sovena USA

Jun. 10, 2011
Lara Camozzo

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Just over 20 years ago, when the olive oil mar­ket was on the cusp of major growth in the United States, Steve Mandia was liv­ing in Imperia, Italy, while work­ing for the com­pany Oleificio Borelli Spa. After a few years of immer­sion in the Italian olive oil indus­try, Mandia rec­og­nized a need for change.

I under­stood that Italy was a very large importer, proces­sor, and pack­ager of olive oil, but a local pres­ence was needed in the mar­ket in order to suc­cess­fully dis­trib­ute to a world­wide cus­tomer base.” Mandia recalls the dif­fi­culty he had work­ing within the Italian olive oil busi­ness, I was work­ing for an exporter and was in charge of sell­ing to the U.S., Canada, and other English-speak­ing coun­tries. We had a dif­fi­cult time sell­ing to the ever-chang­ing cus­tomers in the U.S. because we didn’t have a pres­ence there and weren’t able to adapt to the needs of the local mar­ket.”

The United States cus­tomer is more about ser­vice than any­thing else,” says Mandia. They can’t wait for trans­porta­tion issues or the sup­ply of pack­ag­ing to become avail­able — you have to have the prod­uct when they want it at the qual­ity that they want.” Mandia real­ized that ser­vic­ing the cus­tomer at the local level was the key to suc­cess. By bring­ing the prod­uct directly from the source to the cus­tomer base, we’d be able to ser­vice the cus­tomer much bet­ter locally than abroad. I saw a great oppor­tu­nity for a com­pany in the United States.”

In 1991, Mandia founded East Coast Olive Oil Corporation. He saw the best oppor­tu­nity with major cus­tomers, as plenty of small importers were already buy­ing and sell­ing olive oil within their local mar­kets. It was the large man­u­fac­tur­ers of food prod­ucts in the U.S. that Mandia was after.

While we bought olive oil from Italy, we pri­mar­ily sourced from other coun­tries — Tunisia, Turkey, and Spain — as the Italians were doing. We started off sell­ing bulk and pri­vate label to the food­ser­vice indus­try,” sup­ply­ing com­pa­nies like Ragu Spaghetti Sauce and Pam Olive Oil Spray, that’s the kind of mar­ket we struc­tured our busi­ness around.”

At the incep­tion of East Coast Olive Oil, Mandia says the mar­ket in the U.S. was capped off at 50,000 met­ric tons. Today it has reached approx­i­mately 300,000 met­ric tons. The eth­nic con­sumer has always been con­sum­ing olive oil and will con­tinue to do so. The explo­sion of olive oil in the U.S. mar­ket was due to the non-eth­nic con­sumer com­ing to the real­iza­tion that there’s a health ben­e­fit to olive oil and the Mediterranean diet.”

East Coast Olive Oil pin­pointed its tar­get cus­tomer at just the right time. It was the late 80s, early 90s when the growth rate in the U.S. olive oil mar­ket really took off.” The tim­ing was every­thing. Obviously, I think we did a great job cap­tur­ing the mar­ket, but hav­ing a mar­ket grow­ing by dou­ble-digit per­cent­ages in any given year helped us suc­ceed.”

Over time, East Coast Olive Oil began expand­ing the com­pany. When we started, there were only a few of us run­ning the com­pany,” Mandia recalls. After sev­eral acqui­si­tions, East Coast Olive Oil had branched out from bulk and pri­vate label to branded prod­ucts. We were very aggres­sive in grow­ing our busi­ness. In 1995, when the com­pany was rather dor­mant, we bought Gem Oil, which gave us a brand and a very large cus­tomer base in the North East. We also acquired Puglia Brand, which was a sta­ple prod­uct in the metro New York and New Jersey area.”

In 2003, the com­pany acquired a New England based bou­tique com­pany called California Olive Oils that spe­cial­ized in extra vir­gin olive oil, fla­vored oils, and veg­etable oils. By pro­mot­ing their new brands and expand­ing their prod­uct line, East Coast Olive Oil gained a strong foothold in the mar­ket­place. We’ve been lucky to grow with some of these small com­pa­nies,” says Mandia who cred­its the finan­cial strength of his com­pany to these acqui­si­tions and to the con­sol­i­da­tion of facil­i­ties. We took down pack­ing facil­i­ties that we didn’t use and rolled this rev­enue into the com­pany with­out the over­head.”

There have also been chal­lenges along the way. The chal­lenge is always try­ing to sell a qual­ity prod­uct in a mar­ket that doesn’t always sell qual­ity prod­ucts.” Mandia says the company’s goal has always been to edu­cate the cus­tomer. Once they phys­i­cally know the dif­fer­ences in qual­ity and have a sense of secu­rity with what they’re buy­ing, if we’re able to ser­vice them well enough, I’ve found you can keep a cus­tomer for a long period of time.”

Of course, the chal­lenges in the begin­ning greatly dif­fer from the chal­lenges the com­pany expe­ri­ences today. In evolv­ing a small com­pany into a big­ger com­pany you have the chal­lenge of run­ning a day-to-day busi­ness — mak­ing sure you staff your com­pany with pro­fes­sional peo­ple, being able to ser­vice the cus­tomers in an ever-chang­ing envi­ron­ment (from sell­ing pri­mar­ily bulk to pro­duc­ing our own pri­vate label bot­tles) and con­tin­u­ously stay­ing ahead of the com­pe­ti­tion curve.”

There are two sides to this busi­ness,” says Mandia. One is the sourc­ing side, and the other is the sales side. We really sep­a­rated our­selves by first of all being here, and sec­ondly by the prod­ucts and the pack­ag­ing offer­ings that we sell.” Today the com­pany offers organic oils, mono-vari­etals, refined oils, and spe­cialty oils all in dif­fer­ent types of pack­ag­ing — from a 250 mL bot­tle to bulk oil and every­thing in between. We are a one-stop-shop,” says Mandia, we’ve really dom­i­nated in that mar­ket.”

Two decades or so later, much has changed. When Mandia started in the olive oil busi­ness most cus­tomers were local importers buy­ing a con­tainer at a time from a com­pany in Italy. Today, Mandia’s com­pany has grown from a few founders to one of the largest importers of olive oil in the United States.

We can offer the same val­ues for some­one who used to order a con­tainer at a time. Instead of buy­ing $20,000 worth of prod­uct, they can buy $5,000 on a weekly basis.” Mandia refers to this way of dis­tri­b­u­tion and logis­tics as the Walmart mode,” say­ing that peo­ple want quick returns on their prod­uct; they want it deliv­ered on a spe­cific day, not within a win­dow of 10 days to 2 weeks. That’s the secret to our suc­cess — being able to ser­vice that very defined need for dif­fer­ent cus­tomers.”

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But the biggest change that East Coast Olive Oil has seen over the years came in 2005 when Mandia decided to sell part of the com­pany to the Sovena Group, a Portuguese com­pany and one of the world’s largest olive oil pro­duc­ers. In 2007, East Coast Olive Oil was renamed Sovena USA. The busi­ness had grown tremen­dously,” explains Mandia. We were run­ning the busi­ness out of 3 dif­fer­ent facil­i­ties, and we needed an invest­ment in a new facil­ity. I was look­ing for an indus­trial part­ner to help the busi­ness grow.” Above all, Mandia was look­ing for a European part­ner because he believed this would help the com­pany not only in sourc­ing, prod­uct knowl­edge, and exper­tise, but also for the image of the com­pany.

Part of the deal for me was gain­ing more pro­fes­sion­als within the orga­ni­za­tion that offered a cer­tain level of exper­tise. It’s not easy to find an olive oil expert here in the U.S., we just don’t have an indus­try to pull from. Bringing some­one in who’s well versed in olive oil — like our direc­tor of qual­ity assur­ance of Sovena USA, Gabi Estevez, from Seville, Spain — is very help­ful; it helps edu­cate our cus­tomers.”

By join­ing forces with Sovena, Mandia feels he was able to bridge the gap between his com­pany and the mar­ket over­seas. When you grow an orga­ni­za­tion, you can’t grow it all by your­self. You need to imple­ment a man­age­ment team to help bring you to the next level. I think Sovena was the right choice for me,” says Mandia, adding Today, Sovena USA, which is located in Rome, New York, has the fore­most pack­ag­ing facil­ity in the U.S. by far.” Other Sovena facil­i­ties are located in Portugal, Spain, and Tunisia, which gives the cus­tomer a lot of choices, Whether they want to buy prod­uct packed directly in Spain, or be able to buy directly from our facil­ity, I think we can encom­pass anybody’s needs within our orga­ni­za­tion.”

Looking toward the future, Mandia sees great poten­tial for growth. If you look at the olive oil con­sump­tion here in the U.S. com­pared to other indus­tri­al­ized coun­tries, our con­sump­tion is still very low. I think that the IOC (International Olive Council) has rec­og­nized that and is will­ing to invest in pro­mot­ing extra vir­gin olive oil here in North America, which will help this next growth come in our indus­try.”

Mandia believes he’s taken his com­pany to the top when it comes to qual­ity, qual­ity con­trols, and pack­ag­ing abil­i­ties. Today Sovena is the sin­gle largest grower of olive trees for extra vir­gin olive oil in the world. Having that cra­dle to grave logis­tics — tak­ing an olive from an olive tree and putting it into a bot­tle and onto the shelf — will cer­tainly sep­a­rate us from the rest of the com­pe­ti­tion.”

Steve Mandia stud­ied Business at Bentley University just out­side of Boston, Massachusetts. During this time he also spent a semes­ter study­ing at Richmond College in London which he says gave him a chance to travel around Europe and become com­fort­able with the dif­fer­ent mon­e­tary exchanges and the feel­ing of liv­ing in a for­eign place. Looking back I’ve always said that was an edu­ca­tional expe­ri­ence that really opened my eyes to the world itself,” he says.

While Mandia con­sid­ers him­self a full-blown American” at this point, his roots trace back to Italy. His fam­ily has lost touch with their rel­a­tives in Italy. Nevertheless, Mandia and his tight-knit Italian fam­ily con­tinue to carry on cer­tain tra­di­tions. I grew up vis­it­ing my grandmother’s house every Sunday for break­fast which included olive oil — meat­balls fried in olive oil, fresh-made bread for dip­ping in olive oil — it was all about the olive oil back in the day,” says Mandia.

I remem­ber my grand­mother kept a big gal­lon can of olive oil under the sink, and my grand­fa­ther would always have a big plate of veg­eta­bles with olive oil, salt and pep­per.” Today, the mem­o­ries and the olive oil still flow in rich abun­dance as the Mandia fam­ily con­tin­ues their Sunday tra­di­tion. I’m 47 years old, and I still go every Sunday to my grandmother’s for the same feast. We have 4 gen­er­a­tions — my grand­mother, my father, uncles, myself and my broth­ers, and our kids — and we still enjoy that rou­tine.”

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