Learning the Hard Way

Cody-Kramer Imports was in need of a serious makeover when Reid Chase and Scott Semel, both 40, purchased the candy importer in 1994. At the time, the company was the sole importer of a very high-end candy from Switzerland, but the previous owners really didn't have any distribution. The company had a good product, but it wasn't even close to reaching all the customers it could.

To add another challenge, the previous owners had only a handshake agreement with the candy-makers in Switzerland-nothing was on paper. Furthermore, the candy-makers refused to ink an agreement with Chase and Semel. "They told us, 'We don't know you, and we're not going to trust you with a long-term contract. You need to prove yourselves first,'" remembers Chase.

corporation fails every three minutes.
SOURCE: Dun & Bradstreet

Even with no guarantee that they'd be allowed to sell their key product, Chase and Semel pressed forward. With nary a candy background between them, the pair started a crash course in all things candy-related and decided the real profits would be in exclusivity and expansion. If Cody-Kramer Imports could become the sole distributor of more than one candy product, Chase and Semel knew they'd see some serious turnaround.

They extended their line to include private-label mints and other candies. "We did things [the previous owner] never did," Chase says of the differences between the company's new and old ownership. In 2000, the pair had their biggest coup yet when they licensed the Snapple name and began distributing an exclusive line of Snapple candy.

Now that sales have grown from $600,000 under the old owner to about $40 million today, it's clear that Chase and Semel have not only turned Cody-Kramer Imports around-they've made it their own.

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This article was originally published in the November 2001 print edition of Entrepreneur with the headline: Fixer-Upper.

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