Anita’s Organic Mill — Acquisition Success Story

Interview Spotlight

VW:

Tell us about your business. What’s Anita’s mission and history?

TG:

We are an organic food company who manufacturers whole grain flours. We also sprout grains, blend baking and pancake mixes and have a full line of organic certified gluten free flours and mixes for bakeries and bakers across the country. 

Organic is the primary focus for us. Supporting organic farming and having a direct connection with our farmers is a big part of our philosophy. We believe in organic food and the good it provides the environment and our bodies. It’s our mission to make sure our products are available to as many people as possible, so we can continue to support organic farming practices across Canada. Our customers can trust we are producing food with the highest level of integrity and quality. 

VW:

What kick-started your path to entrepreneurship and your journey to owning your own business?

TG:

Before becoming a business owner, I never thought of myself as an entrepreneur. Growing up, I didn't have plans to start my own business. I've always been interested in pursuing what I love—food and healthy eating included. Organic food has always been part of my diet. 

About 11 years ago now, I got involved with Anita’s. It was still a young company working out of a small space. The offices were in an old house, and the mill was in a standup aluminum building. The brand had been around for a while, and the product lineup and business concept was great—working with different whole grains, providing fresh organic flour, buying direct from organic farms and supporting the farmers. The more I got involved in the business, the more I fell in love with the industry.

The organic food industry is really unique because people are very intentional. Being in this industry takes a certain passion. If you're a baker working with organic flour, you're intentionally doing that. You're not just baking for the sake of baking; rather, you're choosing to work with better, more sustainable ingredients.

I found myself working with people that really care about what they do, which solidified my choice to jump into this industry and work with Anita's. The more I dove into it, the more I loved it. It sent me down the path of wanting more and giving me the idea that this is a company that I would really like to own.

VW:

How did you get started at Anita’s?

TG:

When I first met the original owner of Anita’s, I was in sales. I supplied the company with multi wall paper bags. I got to know the company over the course of a year, and it just so happened that the owner needed help with the business. He had other interests and wanted to relieve some of his responsibilities. I thought I was a good mutual fit to join the company as my values aligned with the company and owner.

When I joined the company, my new role came with the intention that it would eventually transition into an ownership position. That was very intriguing to me, so I shifted my career focus. Eventually, it evolved into a partnership, and it got to the point where I was handling everything in the business from finances, to sales and marketing, employees and growth.

VW:

What was the process of acquisition like for you? How did you assume full ownership of Anita’s? What have you learned about buying (or taking over) a business along the way?

TG:

My acquisition worked as a management buyout. I approached my partner with the idea to take over ownership and started negotiation over a period of time.

Negotiating the purchase was stressful, but I kept a pretty positive frame of mind and stayed as healthy as possible to make sure I stayed mentally sharp—knowing that it was going to be a long arduous process and that I needed to work through each step at a time. I had a good team with me, and I was really confident in my plan. I had full support, which included the banks that wanted to work with me.

Knowing your finances is a really important aspect. I ensured that was all in place even before negotiation conversations, just to make sure I wasn't scrambling if something came together. 

I’m always leaning on people that I trust and who have experience in the industry or experience with owning companies and buying companies. It’s always been extremely important to me to surround myself with people and good connections.

VW:

What was the process of acquisition like for you? How did you assume full ownership of Anita’s? Was it a challenge to obtain financing to take over the shares of the business? 

TG:

There's always lenders out there. It's just about how much you want to pay for the money. I ended up paying quite a bit initially, but I've since refinanced. At the time, I just wanted to get it done. I was most confident in the business because I knew it so well, and I was essentially investing in myself. I knew exactly what we could pay off accordingly and how we could support the business and its growing needs. 

Money is generally there, and I had good relationships with banks. Different banks provide different benefits to small businesses. I've learned a lot more about financing over time.

Your banker matters a lot. I've actually become friends with some bankers I've worked with because they can be so helpful. The bank matters and the banker matters. Obviously, interest rates matter, but putting yourself out there and making sure you know that aspect of your business is most important before taking over. 

VW:

Building relationships with other advisors, like lawyers and accountants, is important too. Can you speak to that?

TG:

I had a long negotiation period which led to becoming friends with my lawyer. Now, if we need a lawyer for the business, there is a lot of trust that has been developed. Both accountants and lawyers that align with you are necessary to know. 

I’ve found it’s really important to trust your gut instincts, so you can find advisors you really connect with.

VW:

What was the most challenging part of acquiring the business for you?

TG:

Releasing a business to a new owner is always difficult. I mean, I feel like the hardest part is always the negotiation. Working through the details of the contract and how the transition is going to happen...not just financial details, but all the operational details. For me, the negotiation period came with a lot of ups and downs. 

An owner will always be attached to their business, and you have to respect that. It’s not an easy process for anyone. Going into it with that understanding and having patience and a good team to get you through is crucial too. 

VW:

What do you feel are the immediate and long term benefits of acquiring an already established business as opposed to starting a business from the ground up?

TG:

Being in the food industry, specifically the retail food industry, I know that there’s a benefit to having a brand with a good reputation. A brand with a good reputation is a leg up because you don’t have to rehabilitate relationships or build rapport with customers or suppliers. I think it’s important to do the due diligence necessary to make sure that you're buying a company that's well respected and has good relationships within the company, not only with employees, but also suppliers and customers.

There’s a lot of work that goes into getting listings and making connections within the food industry, especially the grocery world. It's a long sales cycle, so there’s an equally long ramp up period. I think it can be an advantage to get into a company that's in its relatively early stages where some ideas and relationships have been developed. 

You end up spending money in different areas. Whereas with a startup, you might initially be spending it more on development as opposed to the efficiencies. 

We were able to focus on different things. The main thing was to bring the three different locations under one roof. We’ve recently added a bakery for the community, but it’s also more of a specialized aspect of our business. Being able to be open for several hours every single day providing finished products to people in our community—sourdough breads and pastries—it's also a good marketing piece. We centered our ideas around efficiencies and providing a better work environment for our employees as well.

VW:

As a new owner, how did you innovate and grow the business after acquisition? What are you currently doing to continue to expand your business? 

TG:

We are always focused on getting better, providing more education to our customers and dreaming up new products and exciting ways to use our flours. 

We continue to expand our brand reach within the grocery world, where we can be found across the country. We are building our relationships that we have within the industry, and we are trying to work with more artisan and commercial bakeries and manufacturing companies. 

We feel like, for the industry we're in, being able to sprout grains and convert those into flour is something that’s really innovative. We felt we had room to improve the technical side of baking so our on site bakery has helped fill that gap. Our bakers are able to give constant feedback to our millers and farmers, which enables us to provide the best possible ingredients for our customers. 

The bakery has been successful even through COVID, the community has really embraced it. We’re putting in a satellite location in another area in Chilliwack, just to give more people an opportunity to buy our goods. It’s an idea to hold a market, promote and provide more education to our customers—showing people how to bake at home using our flours.

VW:

What’s something you wish you would have known about acquiring, owning and running a business prior to acquisition? Is there something you wish you would have done differently?

TG:

For me it has generally come down to knowing that it’s important to have enough money in place. I knew the business really well, so I didn't have any initial concerns. I was fully confident that this was the right move for myself and my family. But, what I found out is that it’s easy to underestimate the amount of money it's going to take, especially taking an expansion into account. Having those resources in place and being able to access more money if needed is important. 

I would really encourage potential buyers to do the necessary due diligence and get to know as much of the business as you can before making the move, including the relationships within the business. This is to avoid coming into any disastrous relationships that are going to jeopardize the business.

VW:

Forbes journalist Sidney Evans expresses that “A defining moment is a point in your life when you're urged to make a pivotal decision, or when you experience something that fundamentally changes you. Not only do these moments define us, but they have a transformative effect on our perceptions and behavior.” When was this in your journey as an entrepreneur?business prior to acquisition? Is there something you wish you would have done differently?

TG:  

When I was trying to buy the business, there was a period where negotiation was dragging over the price and the terms.

That's always hard because the buyer and seller are coming from two different places. I was working through this time, speaking with people that I trust, who are in the industry and have been through things like this before. One day, I was explaining my situation to this gentleman. And after listening, he said, “just get it done, get it done.”

I actually needed to hear that. That was a huge shift for me. I remember it very specifically—about how my mind instantly shifted from thinking about negotiating to believing let's close this. Move it forward.

There needs to be a point where you decide it's time to get it done. There comes a time in the process where you have to have that mindset. When he said that, it really clicked for me. It put me in the mindset that I needed to be in to push forward and close the transaction. 

VW:

You’ve given great advice throughout this interview, but is there a last trinket of advice would you give your fellow entrepreneurs about buying a business?

TG: 

Just surround yourself with good people that you trust. There's generally someone that's been through what you're going through, or will go through. So, it's nice to have those people at your fingertips to provide advice and foresight when needed, and once you're in the business to support you and carry a like-minded approach.

To learn more about Anita’s Organic Mill, their products, stockists and recipes, visit their website here. Follow along with Anita’s Bread & Coffee daily posts on Instagram to gain insight on their welcoming community and delicious creations.