Stuart Benton, president and CEO of Bradford Soap International Inc., has been through a couple sales processes at different scales. Mac systems, which was New England's largest security integration company, was sold to Siemens in 2008, and Bradford Soap was sold to private equity in 2023.
Benton said at the Boston Smart Business Dealmakers Conference, that when he joined Bradford, the goal was to sell.
"It was very clear," he says. A family-owned business; same family had owned it since the mid-1960s. The company itself was approaching 150 years old. If you walked in the facility, we're a manufacturer. We called ourselves a manufacturer. And we called ourselves a contract manufacturer. So, what type of value did that company have?"
Through the years, they changed the language to say the company was no longer a contract manufacturer, but rather an innovator, marketing company that sells solid personal care. While there was some internal pushback at the idea, which to some seemed like discounting, Benton saw a competitive advantage.
"To an outside value creator, we were never going to have multiples of 13 or 20, or 15, or anything like that," Benton says. "We're talking about multiples somewhere between five and a half, seven and a half. So, we're always going to play down. How could we deliver value? The first thing is we pivoted on the way that people would see us. No. 2, we started changing what we sold."
When he started with the company, a large part of its business was selling commodity soap and hotel soap. So, through the course of the years, they flipped that.
"We took our specialty soap, which we own the formulas. We developed a formulation, we own the formulation, and we manufacture that formulation for the brand builders and the channel builders all over the world," he says. "You know the names. You probably see them every day you walked down the shelf — you're never going to see a Bradford bar of soap. So, December 2022, we sold maybe 1 percent to the commodity market, we sold 0 percent into the hotel, and we sold 80 percent of the soap products as specialty bar soap with high margins."
They also worked to create a story of sustainability in their supply chain that they could tell their customers. For instance, they sourced their palm oil from a family plantation in Central America. That meant they could tell their customers about how the family they're sourcing from provides schooling to children in Guatemala, and providing dental and medical care to their communities. They did the same thing with shea butter, buying from women in Ghana, which helps them pay for education and medical for their children.
"When we started to sell, and we highlighted (that) we own the formulas, we have relationships with our customers that approach 50 years in some instances, that we didn't have customer churn — we never lost a customer — we are a leading sustainability player in the marketplace, in the industry, in the world, that all created value," he says.
