The work may be hard, but these entrepreneurs reveal that success is sweet in the food business.

By Betsy Block

Think of the food industry as a pie—OK, as a very large pie. This year, Americans will wolf down hundreds of billions of dollars worth of food. Entrepreneurs hungry for a slice of the action might wonder how they, too, can break into this lucrative bread- and-butter (and juice and jam) field. The answer: Sniff out the hottest trends. Right now, some of the loudest buzz in the food industry is around organic foods; gourmet specialty foods, such as “homemade” jams and candies; ethnic foods; and, of course, restaurants, including both independents and franchises.

With 2005 projected sales of $476 billion in the restaurant industry alone, according to the National Restaurant Association, and growth rates running as high as 20 percent a year in the organic food industry, it’s no wonder so many entrepreneurs are jumping on the food- industry bandwagon. Case in point: There are more than 50,000 restaurant startups each year, according to Gary Worden, publisher and owner of Restaurant Startup and Growth magazine.

As impressive as these growth rates are, however, failure rates are also high. As Worden says, about 1 in 4 new restaurants fails within a year of opening. Still, with a populace that has a seemingly endless appetite for anything new and different, there’s definitely money to be made in food. Here, four successful entrepreneurs share the secrets of their successes (but, alas, not their secret recipes).

Kenneth Perry, owner
Perry’s Gourmet Services
Jamaica Plain, MA
Kenneth Perry has been slinging hash—and rice and beans, and macaroni and cheese—for nearly three decades. He started working in the food business during high school before taking his toque into the military. After his service ended, he worked for hotels and restaurants around Boston, and finally became head chef at City Fresh Foods, a company that provides freshly cooked, nutritious meals for schools, the elderly and community programs. After eight years at City Fresh, the 45-year-old entrepreneur was ready to venture out on his own. Three years ago, Perry heard about a subsidized commercial kitchen run by a nonprofit organization, Nuestra Culinary Ventures (see “A Helping Hand” on page 49), and he knew it would be the perfect opportunity to start his own catering company. (In Massachusetts, it is almost always illegal to prepare food for sale in a home kitchen.)

He chose his menu of Caribbean, Latin and Southern cuisine because, he says, “this is everyday living for most people” in the neighborhoods he serves; not to mention “it doesn’t cost a lot,” Perry adds. Some of his specialties include jerk chicken, fried catfish, fried chicken, collard greens and corn-bread stuffing. Now, a little more than two years after starting Perry’s Gourmet Services in Jamaica Plain, Massachusetts, he and his four employees are bringing in sales in the six figures.

Perry advises other would-be caterers to work for someone else first, both to learn the business and to make mistakes on someone else’s time—and dime. While working at City Fresh, he says, he learned how to order, how to deal with salespeople and purveyors, and how to get the best deals on the freshest ingredients. “When I left City Fresh,” he adds, “I took the catering business with me, so I had [my business] on a silver platter.”

One more thing: “Get legal advice,” Perry warns. He didn’t, and he ended up filling out the wrong incorporation paperwork. Fortunately, it all worked out just fine; he quit his job last fall and has devoted himself full time to his business ever since. Perry knows what he’s talking about when he says, “Don’t let fear hold you back.”

Kim Halmrast and Steve Weaver, managing partners
Seasons at Rose Creek
Fargo, ND
“Think twice before you get into this business,” says Kim Halmrast with a laugh. Talk to her for a few more minutes, though, and you can tell she’s just kidding. Well, half-kidding, anyway. Halmrast, 49, has been in the restaurant business for over 30 years, and she clearly loves the industry. So does executive chef Steve Weaver, 47, who, along with Halmrast, is co-managing partner of Seasons at Rose Creek, an upscale restaurant.

According to Weaver, you have to love the business if you’re going to do all the work required to keep a restaurant running: the ongoing effort to improve as a chef; the last-minute parties of 30; the banquets cancelled due to snow (“We are in North Dakota,” Weaver wryly points out); “the mothers of the bride,” whom Weaver laughingly calls one of the most difficult challenges; and most daunting of all, the competition from the more than 90 restaurants, mostly chains, that have opened in Fargo since Seasons was founded 12 years ago.

So how do they manage to stay viable? Nine years ago, they started cooking for off-site parties, says Halmrast. Now, catering accounts for about 40 percent of their $1 million in annual sales. They also have a banquet room, which, with its location right on a golf course and with the duo’s focus on detail, attracts clients looking for the right place for a special occasion. “It’s a ‘wow’ as you walk in the door,” says Halmrast proudly.

Then there’s Weaver’s determination to learn and grow as a chef, which he does through courses with the Ameri-can Culinary Federation. He admits he started out as a meat-and-potatoes man 12 years ago; now, he says, while it may still be meat, it’s no longer just beef, but also duck, quail and rack of lamb. And finally, the company sells Weaver’s homemade salad dressings at local grocery stores, which only account for about 2 percent of annual sales—if that—but make good marketing sense by getting the restaurant’s name out there.

Halmrast and Weaver stress that, in addition to diversifying your menu and services, the most critical key to success in the restaurant industry is good communication: between management and staff, between the front of the house and the chefs, and, of course, between the customer and the restaurant. “You need to have a pen and paper when you pick up the phone,” advises Halmrast. “That’s a must.”

Ronny Bell, owner and president
Pioneer Organics
Seattle and Portland, OR
Ronny Bell may not eat many hot dogs, but hot dogs, nonetheless, have changed his life. That’s because he spent his early years immersed in the culture of his grandfather’s company, kosher food giant Hebrew National. His childhood exposure to the food business resulted in dual passions for both food and entrepreneurship, so it’s not really surprising that he founded his own organic-food delivery business in Seattle. What is a little surprising, though, is that he did so when he was only 24.

Bell, now 32, learned about the benefits of organic farming when he read The Ecology of Commerce by noted environmentalist Paul Hawken. After graduating from the University of Wisconsin, he volunteered at a farm in Washington. “It became clear to me—after about five minutes of work—that I was not meant to be a farmer,” he laughs. Instead, he started selling the farmer’s “beautiful organic produce” to local restaurants and natural foods stores. He found the work much less backbreaking than farming—though not exactly profitable at first, since all the money he made went back to the farmer.

The profits started coming in 1997 when he took what he’d learned from the farmer and another wholesaler he worked with in New York to found Pioneer Organics, an organic-food home delivery service. Pioneer Organics creates eight different produce boxes a week, available for free delivery weekly or biweekly. The boxes come in different sizes and with different kinds of produce—mixed fruits and veggies, all fruit, even all juices. Customers specify what size box they want and then customize their orders by saying what they do and don’t want in their boxes.

At first, Pioneer Organics consisted only of Bell making deliveries from the back of his Subaru to all of six customers. But his company grew quickly, and what started as the seasonal dream of an inexperienced college graduate soon turned into a year-round business that now boasts annual sales of $3.5 million, a staff of 42 and a total customer base of 4,200 households. His greatest challenge, he says, has been overcoming his inexperience. “I always wished I worked for more people before I started my own business,” he admits. “I was naive.”

Still, his is a success story enviable by any standard or age: He turned his passion into profits while staying true to his most deeply cherished ideals. “What I did,” he says modestly, “was just follow my heart.”

Chip and Debbie Peterson, franchise owners
Cici’s Pizza
Throughout Missouri
How did a registered nurse and her husband, a jack-of-all-trades for Pepsico for nearly two decades, wind up as pizza moguls? By listening to their three kids.

When Chip and Debbie Peterson’s children were young, the family of five would drive from their hometown of Farmington, Missouri, to Houston to visit Debbie’s sister. Debbie remembers looking forward to the trip as a chance to try some new restaurants, but her kids had other ideas. “We want to eat every meal at Cici’s,” she remembers them insisting. Guess who got what they wanted? But Debbie didn’t mind, because the whole family liked Cici’s all-you-can-eat buffet of pizza, pasta, salad and desserts. Plus, Cici’s was clean and family-friendly. In fact, over time she came to look forward to those meals almost as much as her kids did, because while the young cousins ate pizza and entertained themselves, she and her sister could visit. “I said, ‘We need one of these [Cici’s near home] real bad,’” says Debbie.

But there was one problem: The company didn’t plan on opening any stores in Missouri. “I called Cici’s corporate headquarters once a year for seven years telling them I was interested in franchising,” Debbie recalls, until finally, four years ago, she got the answer she wanted.

They opened their first Cici’s in Farmington later that year. Since then, the Petersons have opened seven more Cici’s around the state, and they have three more slated to open by the end of next year. Debbie, 45, and Chip, 46, have made Cici’s their life. “Owning a business is a 24-hour part of your life,” warns Chip. For him, though, the upside is that he gets to work with his wife—something he clearly relishes. “[Debbie and I] are business associates and great friends and married partners—the only way to have an opportunity like this is to go out on your own.” And with annual sales of about $6.5 million and 240 employees, many of whom the Petersons consider a part of their extended family, they certainly have no regrets about leaving their old lives behind.

“I do hate to think of us trying to do this without a franchise behind us,” says Chip. With Cici’s just a phone call away, he says, “We don’t have to be chefs; we have to be entrepreneurs.” And that’s just the way he and Debbie like it.

Betsy Block is a freelance writer in Boston. Her work has appeared in The Boston Globe, Boston Magazine, Natural Health and Gourmet.