Bulking upBulking up

Caroline Perkins

Derek Barbagallo is the chief executive and chief financial officer of Colony Foods in Lawrence, Mass. Despite the recession, he has invested in infrastructure and staff to prepare for post-recession growth. A third-generation company executive, Barbagallo has a business theory that guides his leadership: “Don’t live in the past, and learn from your mistakes.”


Joseph Mario Barbagallo founded the company 55 years ago as a jobber working out of his garage. Three brothers, Joe, Mike and Paul, followed in their father’s footsteps and ran separate businesses until they combined forces and moved into the warehouse where Colony is located now. Other family members in the business include Joe’s son, Joseph, and Paul’s son, Paul.


Growth is a key word for Barbagallo. When he joined the family business in 1992, revenue was $2.5 million. It recently topped out at $37.5 million. All this is the result of a strategic customer focus, he said. Colony bills itself as a company that is “small enough to care but big enough to make a difference.” Barbagallo said Colony concentrates on ways to add gross profit dollars to customers’ bottom lines, particularly in light of the recent recession.


The Colony distribution center has new freezers and coolers so operations can run more efficiently, and there is plenty of room for growth. Barbagallo is in the process of building a strong mid-level management team. In the last 18 months the company hired a sales manager and six new sales people. 


How do you help your customers protect their bottom lines?


One thing we do is to help them with new products — either to add to their menus or to help manage costs in the kitchen. Most distributors have a food show once or twice a year, but we have a 52-week food show. We send new items and fresh ideas every week to every customer.


How are they delivered?


Our drivers deliver the samples. Drivers are in the operations even more frequently than our sales reps. We let them try the items at home so they are familiar with them and can either answer questions or comment on them to the customers. We also give them a brief training session. Plus, the featured manufacturers provide funds for a driver incentive program. They can win things like gas cards.


What are some examples of the products you sampled recently?


We’ve featured olive oils, veal, smallwares, butter, ketchup, spices and sauces, among other things.


Do you have an example of a customer that has taken on one of these new products successfully?


We became an authorized distributor for a coffee-machine company. Many customers took advantage of this idea to garner additional business and help drive dessert sales after their meal. Just by adding coffee to their menu and selling 10 cups a day, they realized an additional $2,000 total gross profit dollar contribution to the bottom line. Not bad for a $100 investment. Plus, they can offer the freshest cup around, as every cup is served within seconds after being brewed.


On your website you have photos of “Big Dave” and a great video of “Chef Bruno” demonstrating a pizza-packaging item. How do they fit into your sales team?


Big Dave is who I call the Brad Pitt of the pizza world. Dave Ostrander is a consultant who has helped thousands of pizza operators and has partnered with us to help our customers. Chef Bruno is another example of how we help our customers differentiate themselves. The product he’s [demonstrating] is an item that helps our customers deliver pizza as close to “out of the oven” [as possible], even though it has been in a box for 20 to 30 minutes. 


Any other family members planning to join the company? How about your twin 13-year-old daughters?


As of now I am not sure who wants to come aboard. But I will have any future members go to work in the world after college before joining the family business. I also will encourage any fourth-generation person who may think they want to join the family business to work at a pizzeria for the summer or some part-time foodservice job to get to know and understand the industry and how it works. 


As far as my daughters go, I hope they learn from my mistakes and learn to delegate, manage, listen and surround themselves with good people. And, yes, I would love to experience the joy of working with my daughters in the family business someday.