Interview with Arran Stephens – By Dr. Catherine Carstairs
CC: From reading your book, Journey to the Luminous, I have a fair amount of background, so I’ll ask some specific questions.
I was really intrigued by the Golden Lotus and wanted to know more about where it was located, how many people were involved, whether everyone was on the same sort of spiritual journey that you were.
AS: Well, I started alone, but never really alone. There’s a higher power with us all. Let me quote a line from one of my mentors, the poet-saint, Sant Darshan Singh:
‘I started alone on the journey of love, filled with faith and zeal;
At every step travellers joined me, and soon we were a caravan.’
After returning to Canada in 1967 from a seven-month journey through India, there were only seven dollars in my pocket, but never a shortage of energy or zeal! With a couple of small loans from friends, I put together Vancouver’s first vegetarian whole-foods restaurant called the Golden Lotus on West 4th Ave. My background was in fine arts—painting and poetry—and knew nothing about running a restaurant. At the beginning it was mostly a solo show with part-time help from a gracious Indian lady who imparted delicious recipes, plus improvisations from Western cookbooks. We made great food, but there were times when no one showed up for dinner. Rather than be discouraged, my crew of two and I would sit in the spotless kitchen and meditate, using the simple, effective technique I learned from my spiritual mentor in India. Invariably, a big crowd would soon arrive, and we’d serve them. Many remarked on the consciousness-raising atmosphere and became steady customers. One evening, a reporter from the Georgia Straight dined at the financially strapped eatery, loved it and wrote a glowing review. The Golden Lotus was packed that night, and never slowed down.
Over the next couple of years, the Lotus grew and a small intentional community formed around it. Most of us lived in the apartments above the restaurant. The focus was on ethical and spiritual growth as well as following a healthy diet and lifestyle. Many of the young people drawn into this community came from the hippie/drug culture. However, at the Golden Lotus, drugs, alcohol and promiscuity were not allowed. If you worked, you were paid, plus given room and board. Discipline was strict but with strong undertones of love and support. Interestingly, several ‘conscious’ businesses sprouted out of the Golden Lotus. One was the great Banyen books, started by Kolin Lymworth who is still at the helm. Another was the Naam Café, started by a former cook.
On my second trip to India in 1969, I had an arranged marriage to Ratana—a wonderful, highly educated young woman. A few months after returning to Vancouver with my new bride, some of the more left-leaning employees wanted to turn the Lotus into a co-operative—everyone with an equal share and say, even if they did an unequal contribution to the work. This wasn’t for us, and so we sold the restaurant to the co-op for $2,500, and sincerely wished them well. I went on to open up Vancouver’s first large natural food supermarket —LifeStream in January 1971 at 4th & Burrard—and took on a partner. Ironically, the Lotus folded not long after.
Instead of pills, LifeStream’s focus was on fresh organic whole foods. Later on we carried a limited selection of natural supplements. LifeStream was the first occidental store in Vancouver to carry tofu and soymilk—which I’d pick up from Sunrise Market in Chinatown in my Volkswagon Van. We instituted a huge selection of bulk foods; pirated Otto Rothe’s organic fruits from the Okanagan past the marketing boards; imported organic fruits and veggies from California. LifeStream was the first to import and later to make granola and natural, non-preserved yoghurt in Canada. Within a year, LifeStream leased a big warehouse on 6th Avenue for wholesaling, began an alfalfa sprout operation and the following year, bought a whole-grain bakery in North Van to make granola, energy bars, vegetarian pastries, sprouted sliced and Essene breads for our growing clientele. In the front window of the big store in a sealed room was a 20” Meadows Stone mill grinding out tons of whole grain flours daily. Eventually the mill had to move, after fine dust leaked out to settle over everything in the store! In the back was Mother Nature’s Inn, a delightful little restaurant. Teachers brought classes of kids eager to see what the buzz was all about. Many of these kids would become future customers.
Believe it or not, supermarkets weren’t even carrying real whole wheat bread! Practically every prepared food on their shelves was highly refined and contained lard, artificial colours, preservatives and other questionable chemicals. Whole-wheat flour and brown rice were only available in a very few specialty stores. White flour, white rice and white sugar were all pervasive. We had to educate people that all these “whites” were denatured, unwholesome and fattening, and that fibre, wheat germ and other nutrients that modern milling stripped out of the grain were actually important in our diet. The concept of natural was alien to the typical grocery shopper. All of us in LifeStream became evangelists of natural! Every year, for several years, sales doubled and by 1981 LifeStream employed one hundred people, and sales topped $12,000,000. Some folks dubbed me “hippie capitalist”, but I was just a drug-free, long-haired lover of nature and peace who wanted to do something tangible for the world. LifeStream was the conduit, and our motto was, “Nourishing the Roots of Society”. The emerging natural and organic revolution was a counter-culture reaction—not just to the establishment and an unjust war —aren’t they all?—but to highly processed junk foods.
CC: So who were the main customers? AS: Hippies, university students, the curious, old
folks looking for a cure, and all those who were into the culture of health—including faddists. With the advent of the counter-culture, back-tothe-land movement, revolutionary ideas lit the imagination. With fondness, I remember loading up my 1971 VW van with organic apple juice and making runs to select stores on Vancouver Island. The poor thing would hardly make it over the Malahat Drive. This was a peaceful revolution and it was cool. Many of the original hippie customers of that era have become grey haired, upscale professionals. Their children and friends also started thinking about what they ate; what started as grass-roots caught the media eye. Support came from doctors, scientists and nutritionists. Desiring a healthier lifestyle, a growing percentage began to reduce consumption of red meats and fatty foods; fibre and exercise became hip and medically recommended; soy foods became commonplace, and organic was suddenly not-so weird anymore.
By 2002, natural products sales in North America were over US $27 billion, with organic being the fastest growing segment at around US $12 billion. Think 20% growth per annum. What started as a dribble became a paradigm shift across the mainstream. A parallel shift was happening in Europe too. Thus, the loaf was leavened.
CC: So tell me more about whom you describe as the health faddists.
AS: A health faddist was someone very obsessed with bodily hygiene and eating—whether fasting, raw foods, Ehretism, enemas, fruit diets, macrobiotic diets, or narcissistic body-building—anything in the extreme. A fad becomes dangerous when people begin believing in a magic pill or a single food as a cure-all. Or, the illusion that the body is never going to get old. I’ve seen lots of fads come and go over the past forty years. One of the most dangerous fads has been the high protein, high fat, low carbohydrate diet. Complex carbs— as found in whole grains, are good and are not fattening. Simple carbs as in refined grains and white sugar are not good. Too much red meats, fat, fried foods and sweetened sodas, whether “diet” or “regular”, are not good for health. They lead to obesity and ill-health. I experimented with various diets, such as raw foods, and at the other extreme, the macrobiotic diet. Both have value, but both have imbalances. I once fasted on nothing but water for seven days and cleansed my body of old toxins. Faddists are people who are just super, super intense about their body. Moderation is best. I was interested in longevity and vitality. Was I a faddist? Dunno.
I’ve personally known many long-term vegetarians who have lived actively into their nineties— several who’ve lived up to 100 years and Raghuvacharya of Rishikesh who died at the age of 113 years. I interviewed him in 1967 when he was 111. My wife, our children, and grand-children have never eaten meat, and me since 1964, and we’re still kicking. Despite the purest diets, people do get sick and die. Along with diet, lifestyle and environmental factors, there’s the gene factor, and then there’s the karmic factor— the law of cause and effect. Many things which happen to us, despite all precautions, are karmic, or related to the unknown past; As you sow, that shall you also reap. Or, in Newtonian terms, “For every action there is an equal and opposite reaction.” More important than the length of our lives is how we have lived and what we accomplished—the life we give to our years. Have we helped anyone along the way? Have we served? If our choice is to wear out or rust out, let me wear out in service.
I occasionally take a supplement, but don’t think it’s healthy to consume handfuls of pills. Fresh whole foods, organically grown, have more flavour, enzymes and dense nutrient content. You’ll get more from your food, especially if you chew it well in a calm state, than you’ll ever get from a pill. Nothing can replace the richness and complexity of nutrients you’ll find in a varied diet of fresh organic whole foods.
CC: And who were the customers at Lifestream?
AS: Many of the Lotus customers migrated over to LifeStream, times ten. Just imagine — LifeStream was the only real Natural Food store in Vancouver at that time. Afterwards came the food co-ops and larger stores. And what’s particularly interesting is that most of the pioneers are long gone; bought out or flamed out. The pioneers are usually the first to catch the arrows! Tremendous consolidation has taken place in recent years within the industry, irrevocably changing its structure and ethos. In the early, heady days of this food revolution, we did it for the love and the idealism of changing the world, to make it a cleaner, safer, saner, healthier place. We did it to support ourselves and families through honest and meaningful work.
Newcomers to organics such as Kellogg’s, General Mills, Heinz, Kraft, Mars and Nestle have entered because they see a growth market. Back in the seventies I predicted that the day would come when organic and natural foods would become mainstream. This was something too good and commonsensical to be contained within a tiny niche. It needed to be liberated and integrated into the main. Our company had to become strong, with a solid financial base, so as not to be wiped out by real competition when it inevitably came. I sensed the need to gain control of our production, and a race began, to build, brick by brick, a solid foundation that could withstand the storms. With grace and hard work, whatever base we have, continues. Nature’s Path now has some of the best manufacturing facilities in the world. Two state-of-the-art plants in Delta and Blaine, utilising over 200,000 sq. ft., run 24/7, employing a delightful team of 200 highly motivated professional men and women. Without exception, they are dedicated to the success of Nature’s Path (for the past six years in a row, Nature’s Path cereals have been the number one natural brand in the US and Canada, according to SPINS data). We say this with a measure of humility and thanks. Ratana and I have always been aware of a higher power over us. Of course that is over all of us, but we’ve felt a special protection and guidance from time to time.
CC: Why have you survived as a pioneer when others didn’t?
AS: Stubbornness? [they laugh]. A success is a failure that never gave up. Tenacious, and I would say wily. And thank God, this has been achieved without compromising ideals. The renowned author, scholar, humanitarian and spiritual teacher, Sant Kirpal Singh (1894-1974) in 1969 wrote me something very beautiful in a letter: “I wish that your restaurant should serve as a tavern of divine grace…” At one point I asked him, “The business is expanding so fast, and I’m wondering if we should try to limit its growth?” He looked at me as though I didn’t ‘get’ it, and said, “More opportunities for more people.” “I’m feeling the responsibility heavy on my shoulders,” I replied. “Then distribute your responsibilities!”
“Try not to become a man of success. Rather become a man of value” —Albert Einstein.
We’ve operated under the principle: Do the right thing and you’ll be taken care of. Treat your people well and be customer-driven. Serve them well.
CC: Who were the influential writers getting people on this path?
AS: Adelle Davis, Bernard Jensen, Frances Moore Lappe, Paavo Airola, Jethro Kloss, Frank Ford, Michio Kushi, Georges Oshawa, Edmond Bordeaux Szekely, Paul Hawken, Peter and Eileen Caddy of Findhorn, Kirpal Singh and many others. Alive Magazine was also influential. Thousands of other publications have come and gone, but Alive has endured. Like we have endured [laughs].
CC: When LifeStream was sold in 1981, did Nabob and then Kraft keep up all the same products that you had?
AS: No, they lost some major opportunities such as the LifeStream yoghurt line, the retail stores and the natural energy bar line (now see these categories). As the LifeStream partnership went into melt-down in 1981, despite its profitability, the only alternative was to sell. Three years after LifeStream was sold and my competition clause expired, I came out with sprouted Manna Bread out of the back of our Woodlands restaurant. We outgrew several spaces, and after developing a successful line of organic cereals, Ratana and I decided to gamble everything and design-built a new cereal factory in Delta, BC. We almost perished financially, being undercapitalised and inexperienced, but we pulled out of the hole and never looked back. LifeStream promptly tried to copy our cereal success, spending millions on TV advertising to launch their line, which they weren’t producing in-house. As such, they couldn’t compete and thus began the downward spiral. This experience reinforced my confidence in production workers, machinery, bricks and mortar. I was not a fan of the “virtual” company. When making your own products, it’s an opportunity to invest them with personal integrity, labour and creativity.
Nature’s Path started from nothing and paid its dues. Guess what? In 1995—fourteen years after selling LifeStream, Kraft approached me and asked if I would like to buy back the company. We dickered around for a while, and I said, “Under your management LifeStream is losing lots of money and the sales have plummeted. So here’s my offer.” My offer was dismissed. “It’s worth three times that. Goodbye.” As luck or destiny would have it, six months later, their lawyer called again, “We’re prepared to accept your offer.” “Well, you’ve lost this much more market equity since our last meeting, so my offer has just dropped.” We ended up picking up this building here, the brand, the factory and all the assets for the value of this real estate.
CC: And so are you continuing to sell LifeStream products now?
AS: At first we did, but Nature’s Path had captured the imagination of our customers. And so we rolled the two best LifeStream cereals into Nature’s Path and converted them from “natural” to 100% organic. LifeStream today is our waffle line, the second largest natural waffle line in America, but the fastest growing with 35% market share. Our biggest US competitor has about 49%, but we’re gaining. We believe in this game; when in business, you go out to succeed at it. Business is a war game, a chess-game, but all the same it is a game, and it’s better to have fun when playing. You don’t go out to hurt anybody, you go to benefit your company and all its’ stakeholders. The employees, farmers, suppliers, communities and customers are your stakeholders. So is the taxman. Make a better product than your competition, and if you can’t do that, why even bother?
CC: Have your other partners from LifeStream continued in the industry?
AS: No, I haven’t kept up with them over the last few years, but sincerely wish them well. Now, no partners except my wife. That’s enough [they laugh]. And our kids. It’s a family business.
CC: Right. So your kids have gotten involved?
AS: All four of our children are equally dear, educated, passionate and wonderful. Our oldest daughter did work in the company until she got married, and is busy raising a family in Illinois; our second daughter spent five years developing the export market from scratch to several million, but is on sabbatical in Italy with her daughter and husband. Our third daughter, Jyoti, works in Marketing and our son, Arjan, is a management trainee, and is planning to study business law. Too often in the past I said to our children, “I’m sorry I didn’t make it home for dinner, but we’re doing this to provide you kids with opportunities that your mother and I never had.” As parents, we regret the times we weren’t there for our kids, and hope they understand the nature of and reason for the sacrifices, and in general, our kids have. Not to say that I was a complete absentee father—we always made sure to put in good quality family time each week. They all helped us early on with our business and earned spending money. However, we are giving them an opportunity to earn into the business, but they won’t manage unless they’re capable and competent.
The extremely competent Nature’s Path employee team is also the beneficiary —competitive pay, benefits, incentive compensation, ‘get-fit’ and leadership programs. They too are a vital part of our larger family. We are beholden to our people. It takes a lot of good systems and energy to ensure that an organisation is running well.
My dad, Rupert was a pioneering organic berry farmer on Vancouver Island, in the 1950’s. While helping him spread kelp on the fields, he advised me, “Always leave the soil better than you found it.” We have a responsibility to leave this world a better place. Using an organic garden analogy, let us be good compost for the next generation – for a better, more environmentally sustainable and cleaner world than when we came into it.
Today, you can shop a wide variety of organically grown foods just about anywhere in North America. Organic farming grew from a few hundred acres back in the sixties to millions of acres worldwide. Today, in stores and restaurants across North America, you can find a much better array of wholesome foods compared to the ‘60’s and ‘70’s. That’s progress. That equates to millions of fewer pounds of agrochemicals polluting our planet and our plate; less rainforests being slashed and burned for beef for Big Macs.
CC: How do health food and natural health products connect to the back-to-the-land movement? Or did it, in the seventies?
AS: First of all, “health food” is a misnomer. Healthy foods, herbs, natural products and environmentalism combined, was the fundamental ethic from which the natural and organic food movement sprang. The original health food industry (distinct from the later natural food industry) provided an organised base with a distribution system. Why the term “health food” is a misnomer, is because most of the “health food” stores carried precious little in the way of food, and the same is true today.
The premise behind the natural food movement can be traced back to the Hippocratic Oath: Let food be your medicine and medicine be your food. And, You are what you eat; what you eat is directly transformed into your blood your brain, your bones, skin and organs. By supplying quality fuel for this body-temple-vehicle, you’ll naturally get more mileage out of it. But, give it poor fuel and it’s not going to perform nearly as well, nor travel so far. Eventually, everything wears out. [they laugh] But while you’re here, let’s make it a quality life. We can do that through quality foods, fresh air, vigorous exercise and other healthy lifestyle choices. Many have also found meditation to be a source of inner happiness and stress release—something I’ve done every morning for the past forty years. To remind me that “this body is more than the raiment, and life more than the meat.” For further balance, I dig and wander my large organic garden—and love giving away homegrown veggies to friends and family. Sorry, I digress.
CC: Not at all! What was the interaction between the older European health food stores and people like you who were starting up vegetarian restaurants, natural food stores and coops? Was there a learning process that was going on, or is it just two separate movements that were sort of moving along side by side?
AS: I’d say they were two separate, though parallel movements that sometimes converged. The older establishment rarely understood or recognised it for what it was. I’m speaking in generalities, with notable exceptions. Organic was the right thing at the right time at the right place! And, if I may say, a lot of being successful in life is being able to interpret the big “C” changes ahead of time or as they are coming down. And if you can’t recognise them, you need to change your prescription [laughs].
CC: What was your connection, if any, with the Canadian Health Food Association?
AS: I went to a few CHFA meetings in the early seventies, but found little understanding of the new paradigm shift to organic foods. The CHFA is quite different today, for the most part more enlightened and professional, although there are still some characters that spice it up. It was about four years ago that the CHFA began to recognise that growth coming from the organic sector, and if it were not embraced, it would likely go off and form its own association. Under the leadership of President Donna Herringer, the CHFA bent over backwards to be inclusive of the organic stakeholders, thus making the entire industry more united. Since then, the CHFA has done more than any other organisation in Canada in making consumers aware of the threat of bio-engineered food and the risks this technology holds for our food chain and the ecology of the planet. Where others have paid lip service, the CHFA ponied up resources, including organising consumer petitions in an attempt to influence policy in Ottawa.
CC: What was your experience with government regulation during the seventies?
AS: Consumer and Corporate Affairs Canada always seemed to be meddling in what we could or couldn’t have, regarding fortification of foods and freedom to seek alternative therapies. One example of a silly regulation recognised only wheat bran as a source of fibre, but not oat bran, rice bran or corn bran. Scientifically researched and supported organic food claims and marketing messages were OK in the USA, but not in Canada. You could state that oat bran was helpful in lowering cholesterol in the US, but not here. This challenge was particularly acute for distributors, as it became a nightmare to handle all the label regulations and red tape. In 1980 or ’81, legislation had been passed that would have effectively barred thousands of imported products. Health Action Network (HANS)—a consumer health advocacy group, led the charge. Consumers were mad as hornets and demanded their health freedoms back. There was a huge rally in downtown Vancouver which obstructed traffic for many blocks, and I was happy to march with them. Picture us walking into the Minister of Consumer Affairs office, cameras rolling, carrying a big coffin between us, filled with 100,000 petitions from outraged citizens, demanding their right to have access to health products! This is what happened.
CC: You mentioned that you were on CBC television and radio with a conflict. Can you tell me more about that particular situation, or, when it was?
AS: In the past 3 years, I’ve been involved in the struggle to ban genetically modified—I like to use the term “manipulated”—organisms (GMOs) from our food supply—thanks to a collusion of government / grocery industry / bio-tech / Monsanto interests. GMO’s are now the biggest threat to the planet’s Eco-system and our safe food supply. Since GMO crops—corn, soy and canola—were introduced less than twenty years ago by Monsanto and their ilk, more than 125 million acres are now planted worldwide. Canada, US and Brazil are the main producers, but 35 countries have effectively banned them for good reason. More than 70% of products on supermarket shelves now contain GMO ingredients, all without the consumer’s consent or knowledge. In poll after poll, Canadians (& Americans) have overwhelmingly stated that if they knew GMOs were in their food, they would choose non-GMO. We’ve lobbied for a ban or at the very least, compulsory GMO labelling, so consumers can make their own informed choices. However, the powers that be have stubbornly refused to budge. I’ve been part of a delegation—including John Fagan, PhD, an anti-GMO geneticist—to Ottawa, met with Cabinet ministers, pleading the case, but other than Charles Caccia, MP, an illuminating presentation by Fagan largely fell on deaf ears. Shortly thereafter, Nature’s Path was targeted because we stated on our packaging, “Made Without Genetically Engineered Ingredients”. There was a demand that we delete this perfectly true statement, or our products would be removed from all major grocery stores in Canada. This led to a dynamic interview on CBC’s As It Happens with Mary Lou Findlay, and it was picked up by press around the world. The press and public came to our side. I do not believe in meek acquiescence to wrong.
By the way, Canada is a major exporter of organic grains and products with export sales over a billion dollars. This leads to the subject of genetically engineered wheat: if the Canadian government allows Monsanto to plant and market their patented GE wheat, they’ll put at risk all Canadian food exports. Canada has already lost a $487 million dollar a year canola export because it backed GMO canola—which the rest of the world didn’t want. Are we crazy to consider bioengineering wheat and destroying several billion dollars per year exports? And yet Agriculture Canada has already given Monsanto permission to conduct GMO wheat trials on secret plots in this, our beautiful country. There are no walls high enough to keep out GMO pollen and seeds. GMOs are spreading into organic as well as conventional farms causing mutations in traditional crops and weeds. There are documented cases of GMOs moving laterally causing genetic mutations in the guts of bees. How long before GMOs jump to animals and humans? This is why GMOs have been dubbed ‘Frankenfoods’. A broad-based coalition of consumers, scientists, ecologists and the organic industry want this madness to stop. Class action lawsuits by damaged farmers have already begun.
CC: What would you say has been the interaction of the CHFA with the consumer rights movements?
AS: The anti-GMO fight brought them together. CHFA, Greenpeace, Organic Trade Association, Council of Concerned Canadians, and other nonprofit consumer groups have worked together to try and defeat the GMO threat. It’s been a very good relationship because consumer groups are the ones that carry these issues to the streets, and up to the doors, and in your face. It’s inspiring to see young people prepared to walk their talk and risk reprisal – as they have in protecting the last old-growth forests of BC.
CC: What do you think the importance of alternative medicine has been to all of this?
AS: People must have the fundamental freedom to have access to herbs, alternative medicines and treatments that they want and need. If Canadians are deprived, they will go right across the border and spend their money there. Having Phil Waddington—a naturopathic physician – representing the interests of natural products and therapies in Ottawa, the recent natural products legislation worked out in concert with CHFA and other industry leaders—is a fine thing. They’ve made a lot of progress. I’m sure the relationship with Ottawa and the industry will never be perfect, but we do see that most, but not all, safe, alternative remedies and treatments, natural health products, most herbs, organic foods, organic cotton, natural soaps, and books are now widely available. There’s more science behind the claims than in yesteryear, and industry members are better trained, thanks to proactive leadership and extensive training materials made available from the CHFA. It’s all part of a circle. I might currently represent the organic sector, while others might represent herbs and supplements. It’s all very complimentary. There has been a tendency of certain individuals wanting to keep organic foods confined to “health food stores”. But that’s a sure way to marginalise and minimalise the mission of the organic movement.
CC: How do you think the industry has changed from the seventies and through the eighties and nineties?
AS: We saw a proliferation of large natural food stores from the seventies to the eighties. In the nineties, the stronger bought up the weaker, resulting in two major chains: Whole Foods Markets and Wild Oats / Capers Markets in the United States and Canada. We’re continuing to seen further consolidation at retail, wholesale, brokerage and manufacturing. That doesn’t mean independents aren’t doing well. There’ll always be a place for good independents. Just as the grocery industry consolidated in the 50’s and 60’s, the natural products industry is undergoing the same. It’s all part of the maturation process applied to market dynamics.
CC: Has anything been lost? AS: When an independent is sold to a large multi
billion dollar conglomerate, often the soul is gutted out of the seller. There’s a culture crisis. And the acquirer, of course, just gets bigger and bigger. Although competitors have been largely gobbled up to become three or four gigantic corporations; ironically, this has sometimes been to the benefit of the remaining independent operators, because the acquirers often lose the original focus. As one of those independents, Nature’s Path must maintain a laser-sharp focus. It’s not that we haven’t faced challenges and competition getting to where we are now, but for the future we have to remain flexible and adaptive. While remaining true to our original vision and grassroots, we simply cannot restrict the benefit of health and sustainability to only a fringe. As business and the industry grow, everything just gets more complicated, but that’s why we have to have a simple clear vision and mission.
One of our audacious goals as a company, is to become a trusted name in every home. We’ve received at least fifty offers to sell out—offers that would make your head spin, but upon serious reflection, my wife and I asked ourselves how such an obscene amount of money would benefit our lives and our children? Would it add to their character? Would it be of benefit toour Team? I don’t think so. We earn enough from Nature’s Path for our needs and for various charities that we support. By selling, we’d lose control over the course of this dynamic vehicle of beneficial change. If the acquirer says, “this plant is redundant, we’ll shut it down,” there go a couple hundred jobs. “We have another factory in the Eastern United States that needs to be more fully utilised.” Bang! Shut that down: pain and dislocation. We’re aware of our responsibilities.
CC: Do you think there are differences in how the industries developed in Canada and the United States?
AS: At the retail level there is a big difference. In the United States there are two remaining professionally run companies in natural foods distribution: UNFI and Nature’s Best; the rest have been gobbled up. There’s no retailer in the world quite equal to the Whole Foods Markets organisation. It’s ranked by Fortune 500 as one of the top one hundred companies to work for, with sales over three billion US. They’ve got 146 stores and 100 more in the works. Whole Foods is opening a 35,000-sq. ft. store in West Vancouver, with one already in Toronto. Wild Oats markets is a distant second, with sales just under US$1 billion. Wild Oats bought out Capers in BC, and they operate three stores here. Capers consistently demonstrates excellent corporate social responsibility. Despite the success and publicity of WFM and WO, there are many hundreds of viable independent large natural food stores in the US who proudly serve their communities.
Canadian natural retail evolved more timidly, as compared to our southern neighbour. However, there are at least forty well-run large Canadian natural food stores operated independently, all of which are doing extremely well. An independent can beat a large impersonal supermarket with knowledge-equity, variety and service any day of the week. Well-trained and motivated natural food store staff assist customers in a personal way that others cannot. Then it’s up to them to retain those customers. How? By employing cheerful, well-trained, informed staff, by keeping their stores immaculate and bright, shelves well stocked, beautifully merchandised displays, and by implementing category management. To compete, specials they regularly receive from manufacturers and wholesalers need to be passed on to the customers—and not pocketed. This is how to create a buzz, a “wow factor” at retail. These are some of the customer magnets. And done right, customers come back again, and again. Many friends upgraded their stores, opening up more locations and reaped the rewards, while others sang the blues.
It’s human nature to complain about competition. Such is life. You evolve, or stagnate and die. You catch the wave, or you sit on your board. The times they are a-changin’. Just today, we learned that the largest US organic milk company, Horizon Dairy has sold out to Dean Foods, America’s largest conventional milk company, and two months ago, Dean Foods bought out Silk Soy / White Wave, the largest soymilk brand. The Heinz/Hain conglomerate recently snapped up Yves Veggie Cuisine of BC. One company after the other is being bought and concentrated into fewer and fewer hands. It’s causing dislocation. We may not like it, but that’s the way it is. Right now I can only think of four significant organic companies that remain independent.
CC: What are the other independent companies?
AS: Some that come to mind are: Amy’s Kitchen frozen vegetarian entrees; Lundberg Family Farms—major organic rice producers and marketers; Traditional Medicinals —organic herbal teas and Eden Foods. Eden’s president, Michael Potter and I were founding members of Organic Merchants—the first north American trade association in 1971. At one time that list of independent list would have been fifty to sixty. The survivors made it through thirty years of meteoric growth. Maybe that’s a wonder!
CC: How do you connect with the recent surge of home delivery organic boxes?
AS: I hope they’ll be delivering our organic cereals along with their fresh veggies!
CC: The company I use does.
AS: Oh that’s good! There are so many ways to run a business. We applaud home delivery. At the other end of the spectrum are big box retailers like Costco and Wal-Mart. These giants may cherry-pick four or five top organic sellers, put them in a jumbo box and blow them out. The variety and service won’t be there, but the exposure will be. The Club stores are as mainstream as you can get, and the exposure to a few good items will stimulate consumers to seek additional products and services at natural food stores.
CC: So you don’t have the concern that if it’s not being sold in a health food store then you don’t have the informational context and something’s being lost?
AS: Service, information and variety are the key advantages a good natural food store will always have over traditional supermarkets. Better natural food markets are becoming more like supermarkets, and the better grocery stores are becoming more like natural food stores! Watch this trend. There is a crossover happening—a blurring— especially with the success of Whole Foods, Wild Oats / Capers, Choices and the like. The supermarkets are envious of their growing success, and some will copy their model. Again, let us consider the home-grown success of the five store chain— Choices Markets, which grew out of the old Super Valu model.
CC: What made you decide to exit retailing and restaurants, to production?
AS: By nature, I’m an introvert. And as a retailer and restaurateur, I was forced to become more of an extrovert. Sometimes I felt like a carnival hawker, catching a customer’s eye and ear, up-selling. It wasn’t my nature, but something that had to be done to get the business going, and I was good at it. I/we enjoyed running veg restaurants and two large natural food supermarkets, and did so for many years. But I asked, “Why not do something like Coca-Cola?” Coke took sugared, flavoured carbonated water, mastered the magic of marketing and created a global brand. Now I thought to myself, “why can’t you take something that’s really good and wholesome that doesn’t rot your teeth, doesn’t cause hyperactivity, obesity and all the health problems associated with the soft-drink industry—and make a success of it? Even if I disregard their product, I’ll learn from them, because they’re the best at what they do. That’s exactly what we set out to accomplish, moving from the microcosm of retailing and niche marketing towards the creation of wholesome products, then macro-marketing them, and being amongst the best in the world at it.
I recommend reading From Good to Great: Why Some Companies Make the Leap, by Jim Collins. From him I learned that companies should have an audacious goal of being either number one or number two in any category they enter, and get the right people on the bus and the wrong people off. That’s a simplistic summation and there’s a lot more to his book. Anyway, with our talented team and my lovely wife, I set our company’s sights on becoming nothing less than number one in organic breakfast cereal. Well that’s a position we’ve held for the last six years in a row. We’re in the cross-hairs of some big competitors— including Kellogg’s with their Kashi, and General Mills with their Cascadian Farms. Why? Because their core business is flat and they’ve seen the growth potential in organics. Threat equals opportunity. “When the tide rises, all boats rise with it.” Their inevitable spending will only bring more customers to the organic food side. Their raison d’être, however, is quite different from Nature’s Path and our founding vision. One is born of opportunism, and the other is born of vision and commitment. If they don’t realise big gains fast, they’ll be out in a flash, but we’ll still be there.
As we approached our fifties, Ratana and I told each other that it’s time to work smarter than harder. I hope our real kids don’t mind the analogy, but when we develop a new product from an idea, a desire, it’s like they are little babies; you bring them forth into creation, nurture them, make sure they pass through infancy to puberty. And you finally give them freedom to be on their own, and hope that one day they graduate with honours. If a product fails, of course you feel really badly about it. But you do your best to provide all necessary factors to ensure a healthy life in the marketplace, once out of the chute. You don’t cut the connection even when they grow up. It’s very creative and filial. Before business, my background was in fine arts—painting and poetry. My M.BA is from the “School of Hard Knocks”. I can’t think of anything more creative than Nature’s Path, and it’s a lot of fun, most of the time. The dynamic organisation of people, the latest technology and production engineering, the excitement of a new concept, moving it into the marketplace and the creation of employment is satisfying. Behind each organic product is a chain supporting sustainable farming; in front, a human being enjoying it’s flavour and that then becoming a part of their well being. It’s a microcosm of the cycle of life.
CC: Did LifeStream stay as a store all the way along until you sold it in 1981 or did it become largely manufacturing too?
AS: LifeStream’s revenues were approximately one-third retail from two large stores and the balance from manufacturing and distribution. The new owners shut down the stores.
CC: After you sold LifeStream you had a non-competition clause preventing you going back into manufacturing for two years, and then in the meantime you operated a vegetarian restaurant?
AS: My wife and I developed Woodlands Natural Foods Restaurants—four locations and a central commissary.
CC: And Woodlands still operates?
AS: No. In 1992, while experiencing significant growing pains in the brand new Nature’s Path’s cereal plant in Delta, the company almost went broke, thanks to under-capitalisation, rapid expansion, conflict, weak leadership and lack of organisational structure. Ratana was doing an outstanding job profitably managing Woodlands. She had learned the essence of the Japanese proverb: “Grow a small garden well.” She sacrificed that to help me out at Nature’s Path. Night and day, side by side, we toiled through overwhelming challenges at the new plant, resolving crisis after crisis. I can never repay her for her support.
By 1995, Nature’s Path was doing so well, that we decided to sell Woodlands. Sadly, Woodlands closed last year (2002). In any business, everything boils down to good management and good PR with your customers and staff. Ratana brought that personableness, charm and heart into Nature’s Path. She’s also very bottom-line oriented. She can make a nickel scream!
CC: But she came out of a food family, right?
AS: Her family was in the confectionery business in India. But she’s probably more security conscious than most. When she was a girl, the family business and mansion fell under the auctioneer’s hammer. She was determined never to let that happen again.
CC: This has been really, really useful. I really appreciate your time.
AS: Oh! You’re most welcome. It’s a different perspective than what you might get from a traditional “health fooder”. Although “natural” was the banner word in the ‘60’s and ‘70’s, that word became bastardised more than ten years ago as companies slapped “natural” on every gawdawful product under the sun. I became a board member on the Organic Trade Association, and after many years struggling to come up with a code of ethics and a set of parameters and rules, we finally achieved the USDA Organic Rule. Now, a broad-based coalition, of which I’m a small part, is doing the same in Canada. In the United States, for misusing the term organic, not strictly following the rules and guidelines, you can go to jail, or be heavily fined. In Canada, abusers might get a slap on the wrist. Canada doesn’t need a voluntary set of guidelines; what it does need are compulsory organic rules, with teeth, like in the USA. This will winnow out any fraudulent opportunists, forcing everyone to play on a level field, and will give Canada the credibility it needs on the world stage.
Nature’s Path has strictly adhered to the highest organic standards, even before any formalised rules existed—and has been third-party certified organic since 1990 —becoming the first Canadian organic food processor to receive this certification, and the second in North America. Many others have recently sought organic certification, now compelled to do so by the USDA Organic Rule if they wish to market organic products anywhere in America.
CC: So, where do you go from here?
AS: Our goal is to nurture people, nature and spirit; to make Nature’s Path a trusted name in every household, while leaving the smallest possible environmental footprint. And when we leave this stage, we’ll have contributed what we could in making this world a little better than we found it.
Dr. Catherine Carstairs is writing a book on the history of natural health products in Canada. If you have been a long-time consumer of healthy foods, or have been involved in the industry, and would be interested in being interviewed in connection with this project, please contact her at: 604-822-5409, or firstname.lastname@example.org
Nature’s Path was listed by MacLean’s Magazine—August 2003—as one of Canada’s “Top 100 Employers”, out of 51,000 Canadian companies.