How A Restaurant Supply Website Created A Billionaire Family
Fred and Gene Clark have devoured a fifth of the $18 billion industry by following the Amazon playbook. Now they’ve cooked up a plan for greater growth.
Read the full story on Forbes: https://www.forbes.com/sites/jeremybogaisky/2024/02/22/how-this-billionaire-family-built-a-restaurant-supply-fortune-in-amish-country/?sh=1d78ed7e7970
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Read the full story on Forbes: https://www.forbes.com/sites/jeremybogaisky/2024/02/22/how-this-billionaire-family-built-a-restaurant-supply-fortune-in-amish-country/?sh=1d78ed7e7970
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LifestyleTranscript
00:00 Here's your Forbes Daily Briefing for Saturday, February 24th.
00:05 Today on Forbes, how a restaurant supply website with a quirky name created a billionaire family.
00:13 On a snowy January morning in Lancaster, Pennsylvania, a flat screen monitor in a former Mennonite
00:19 elementary school displays the vital signs of Websterant Store, spelled like restaurant
00:24 but with web at the beginning.
00:27 Websterant Store sells everything a restaurant might need, from $25,000 walk-in freezers
00:33 to 15-cent takeout containers.
00:36 Business is booming.
00:37 By 9 a.m., Websterant Store, the internet storefront of Clark Associates, a 53-year-old
00:43 family-owned firm, has already rung up $800,000 in sales.
00:48 It bagged $8.6 million the day prior.
00:52 In a former classroom nearby, which still has a chalkboard on the wall, employees run
00:56 demand projections to ensure Clark's warehouses remain well-stocked with 35-pound buckets
01:01 of peanut butter, boot-shaped beer mugs, and the rest of the 420,000 products the website
01:07 offers.
01:08 It's a struggle to keep up.
01:11 Clark Associates' sales have ballooned from $80 million in 2009 to $4 billion today, an
01:17 eye-popping growth rate of 32 percent a year.
01:21 Over the same period, employee headcount has gone from 350 to 7,000, hence buying the elementary
01:27 school.
01:28 Clark's CEO, Gene Clark, says, "We were desperate for space."
01:33 Clark, who is 39 years old, took the helm in 2020 from his father, Fred, a blunt-talking
01:41 65-year-old former electrician and self-taught businessman with a penchant for bucking conventional
01:46 wisdom.
01:47 In particular, everyone thought restaurant equipment was too complicated to sell effectively
01:52 online.
01:53 A standard two-door refrigerator, for instance, can be configured 150 ways, depending on if
01:58 you run a busy seafood joint or a sleepy neighborhood cafe.
02:02 Fred disagreed, and it paid off handsomely.
02:06 Before Websterant's store launched in 2004, Clark Associates was one of hundreds of regional
02:11 distributors of restaurant equipment and supplies.
02:14 It also built commercial kitchens and operated a small chain of brick-and-mortar stores.
02:20 Websterant's store, which accounted for more than 80 percent of the company's revenue last
02:23 year, has transformed it into the industry's behemoth.
02:27 Clark Associates has taken roughly 20 percent of a U.S. market worth at least $18 billion,
02:33 mostly by marrying its digital storefront with a warehouse network and a so-called "pick
02:37 and pack" system that enables it to make deliveries nationwide within one or two days.
02:43 By 2022, Clark's revenues were roughly a billion dollars ahead of its closest competitor, Trimark
02:49 USA, according to a ranking in the trade publication Food Service Equipment and Supplies.
02:55 The Clarks say they've done it without a penny of outside capital, funding expansion by reinvesting
03:00 profits with a modest $275 million in bank debt now.
03:05 Like any distribution business, profits haven't been fat.
03:09 Associates estimate them to be under 20 percent gross, especially given its reliance on e-commerce
03:14 compared to the value-added design services that make up a greater portion of competitors'
03:18 business.
03:19 But it has been enough to turn the Clarks into a billionaire family.
03:23 Gene and Fred own most of Clark Associates, which, conservatively, is worth some $1.2
03:28 billion.
03:29 Three other executives hold small stakes.
03:32 Fred, sitting in the bright white-tiled break room at headquarters a quarter-mile down the
03:37 road from the Nerve Center in the elementary school, says, quote, "This was never a master
03:42 plan."
03:43 The all-important Webster-Ontz store, for instance, began life as a summer project for
03:48 Gene, a college student at the time, who snapped pictures of a few hundred products while home
03:53 on break.
03:56 For full coverage, check out Jeremy Bogaski's piece on Forbes.com.
04:02 This is Kieran Meadows from Forbes.
04:04 Thanks for tuning in.
04:05 [MUSIC PLAYING]