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Spinelli's Sauce Co. cooks up King Soopers deal

Wednesday, June 17, 2015

BURL ROLETT, www.businessden.com 

Spinelli's Sauce Co., known for its pasta sauce, recently expanded into salad dressings. Photos by Burl Rolett.

Spinelli’s Sauce Co., known for its pasta sauce, recently expanded into salad dressings. Photos by Burl Rolett.

 
A local spaghetti sauce maker is pushing into the supermarket refrigerator section.

Spinelli’s Sauce Co., which sells pasta sauces in about 300 western grocery stores, is working a deal to put a line of salad dressings in 145 Rocky Mountain King Soopers and City Markets. It’s a big step up from the 15 or so specialty grocery stores where Spinelli’s dressings are currently for sale.

“We have a pretty proven growth pattern with the sauces, so you would think to just put money toward continuing to grow those,” Spinelli’s owner Chris Rogers said. “But Kroger asked us about the dressings – I guess they saw them in Whole Foods – and approached us. And I thought, why aren’t we pushing our dressings as well?”

Chris Rogers makes a pitch to potential investors.

Chris Rogers makes a pitch to potential investors.

Rogers said she hopes to have the dressings in King Soopers fridges by the end of the summer, about eight years after her sauce company first launched out of Spinelli’s Market in Park Hill. Rogers worked as a chef at Spinelli’s Market when it began bottling pasta sauces in 2007. She is now the majority owner of Spinelli’s Sauce Co., but does not own the market itself.

Spinelli’s began bottling three salad dressings a year ago, Rogers said. Since then, she’s put the brand’s Caesar, gorgonzola and balsamic flavors in 11 Whole Foods and two Marcyzk’s Fine Foods locations.

As Spinelli’s ramps up its dressing business to about 160 total stores, Rogers is looking for outside investment to help fuel the company’s growth. She recently pitched to 30 potential investors at a Denver Metro Small Business Development Center event, Trout Tank, looking for $150,000 in exchange for a stake in the company.

The sauce company got started at Spinelli's Market at 4621 E. 23rd Ave.

The sauce company got started at Spinelli’s Market at 4621 E. 23rd Ave.

It’s cash she plans to use for in-store demonstrations, product development and working capital.

“At this point, it’s just been me running the company, and I have some contract labor I hire for demos and things like that,” Rogers said. “So I’m kind of at capacity trying to maintain the everyday operations being in the stores we’re in.”

Spinelli’s Sauce Co. currently makes the dressings itself at a commercial kitchen.

A Littleton-based co-packer makes the pasta sauce, and Rogers said she’ll need to find a similar outfit to churn out enough dressings to stock 145 King Soopers stores.

Stocking stores with dressings is tougher than keeping pasta sauce on the shelves, Rogers said. Spinelli’s is still handling deliveries to stores itself. And because the dressings have to stay refrigerated, Rogers can’t expand to stores too far from the Denver area.

With the King Soopers deal, Spinelli’s will drop off its dressings at a distribution center, and the grocer will take them from there.

King Soopers currently sells Spinelli's sauce for about $6 or $7.

King Soopers currently sells Spinelli’s sauce for about $6 or $7.

Rogers estimated Spinelli’s would sell about 132,000 bottles of sauces and dressings in 2015. The company did about $335,000 in total revenue last year, Rogers said at last week’s SBDC pitch.

The company makes about 20 percent profit margins on dressings, she said, compared to about 15 percent on pasta sauces.

Right now the pasta sauce line includes Spinelli’s Classic Marinara, Creamy Tomato Vodka, Roasted Garlic Fra Diavolo and Puttanesca di Napoli sauces. Spinelli’s sauces are in more than 300 stores stretching from Wyoming to Texas and Kansas to Nevada.

In the coming years, Rogers said she hopes to double sales at the stores she stocks currently, open in new regions and begin selling the sauces and dressings to restaurants. A chef by trade, Rogers is also working on getting new recipes to market.

“I have a great alfredo and a really great pizza sauce and some new flavors of dressing,” Rogers said. “Again, I need to sort of be able to put my energy there to get those products out.”

Burl Rolett is a BusinessDen reporter who covers commercial real estate and the business of sports. He is a graduate of Washington and Lee University. Email him at burl@BusinessDen.com.

Original article from Business Den: www.businessden.com/2015/06/17/sauce-company-cooks-up-king-soopers-deal/ 

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