I became acquainted with Scott Nash and his offbeat Mom's Organic Market (sic) six years ago, when he had six stores, 350 employees and $50 million in annual sales.
He is now up to 16 stores, 1,000 employees and around $200 million in sales.
Nash has one trait that I admire: he takes nothing for granted. He acknowledges there were times when his life could have gone sideways. He appreciates his current station.
"Honest to God, had I not sort of luckily had these events happen where I was able to start my company, I think I'd be like a bum ... living in my mother's basement," he said. "I was never going to be a good employee and I sucked at school."
He recalled a particularly stressful period in 1995, when he lost his lease, closed his store for six months and put everything on his credit card.
"I remember having such stress and hot flashes during the middle of the night that I would just lie down on the marble tile in the kitchen to cool myself off," he said. "That was a real bad time."
The 51-year-old college dropout who once dreamed of becoming an omelet caterer is flush and able to kick back, enjoy his hard-earned wealth and leave the day-to-day to the staff.
Nash even opened a pinball-and-pizza shop (at least he didn't launch a record label) called VUK in downtown Bethesda, Maryland. "One of these passion-play things" that loses money, he said.
Why open a pizzeria in pizza-packed Bethesda (Dominoes, Papa John's, Pizza Tempo, Pi Pizzeria, Pizzeria Da Marco)?
"I have this great man cave at home, so I wanted to share my man cave with the public," he said. He also wanted to share his passion for pinball machines. "On this, I don't mind losing money as long as it's not unnecessary waste. And I don't intend to lose money forever. By this autumn, we'll turn a corner and make money.".
I trust him on the profit thing. He built MOM's (My Organic Market) from a tiny home delivery company that sold fruit and vegetables out of his mother's garage.
I visited Nash at his Rockville, Maryland, headquarters a couple of months ago with my colleague Jorge Ribas. We talked for a couple of hours in his office, down the hall from one of his stores. Nash's office is as funky as the counterculture family he hails from. After you get past the treadmill, there is a human skull, a signed poster from a Slayer heavy metal concert, an autographed basketball from the University of Maryland's 2002 National Championship, a piece of the old Cole Field House floor, some news clippings and a whiteboard.
Family of founders
He grew up in an unconventional family. His mother sent him to school with a lunch pail containing alfalfa sprouts buried between slices of whole wheat bread.
For all its granola instincts, the Nash family line has the entrepreneurship gene.
"I had a cousin on the West Coast, for example, who I've only met once as a kid, who started an organic corn chip company, which she sold for millions of dollars," he says.
"An entrepreneur is an entrepreneur, not from what they learn in school, but because of personality traits," he adds. "I've never liked authority. I have usually challenged conventional wisdom. And I've always thought I could do it better than my bosses.
"I remember being a teenager and knowing that I wanted my own retail store."
After working at an herb shop in Prince George's County, Maryland, he and a buddy started their own business in his mother's garage. Later on, he said, "I got a little warehouse in Beltsville. My first retail store was out here in Rockville."
Back then, the entire D.C. good-for-you grocery market was around $10 million a year. Now, he says, it's "probably getting close to $2 billion."
"Our customers initially were the early adopters. Really early. Like radical people who were into organic foods back then when there was no (local) Whole Foods," he says. "Now our customers are mainly mothers who share our progressive worldview."
The first two decades were a long drought. It took him nine years to hit $1 million in annual sales.
"We really didn't start making money until 2009," he said. "So it was rough for those first 22 years."
The big reality check came in midst of the 2008 financial crisis, when a looming bank loan forced Nash's hand. He calls it "the event that made us mature as business people."
"We really need to focus on metrics and the bottom line now after all these years," he told his team. "So we did that."
"I was always focused on revenue, and not enough on the bottom-line profits," he said during a second interview. "So I was forced to really focus on profits and rally the troops to make money."
He now sees MOM's as a cross between Whole Foods and Trader Joe's.
"We carry much more than Trader Joe's and less than Whole Foods. But we have strategy with our business that we believe is the reason people come and shop with us," he said. "And we make money by not wasting money. We pay very well here. We have a $12 minimum wage and lots of benefits. So we invest in people. And we realize that they are the most valuable asset to us."
Size matters
Like most companies in the low-margin supermarket business, MOM's makes its money on volume. To keep those profit margins alive, he searches for dirt-cheap leases and obsessively watches the overhead. The stores are clean and bright, but utilitarian. His brother helps build the store interiors with basic fixtures, finishes and furniture, which saves millions of dollars.
Nash is no doctrinaire proselytizer when it comes to organic food. He loves candy, and eats the occasional Berger cookie, a Baltimore-baked, chocolate-covered heart-stopper that is as Maryland as the soft-shell crab.
He sources his organic food from everywhere, including California, Mexico, Florida and Colorado.
As he puts it: "I'm glad (the local food movement) exists, but I think it's overrated, to a degree. I get it. Know your farmer and all that stuff. But you go to farmers markets and most of the stuff is not organic. So they're dumping chemicals on land nearby that goes right into the Chesapeake (Bay). In other words, organic is more important to me than if it's local. And if you can get local organic, that's great. We really get our produce from all over the country."
Top selling items?
Bananas.
Before we left, I asked Nash - as I do everyone - to tell me his biggest mistake.
"Probably holding onto stuff too long," he said. "I worked every day, except major holidays, from 1987 until 2003 or 2004. So it was a good 17 years or something where I only got major holidays off.
Also: "I remember at our Rockville store the first time I hired someone to do the produce. I tried to explain to her, you do this and this. I was really micromanaging. And she didn't want to hear it because she had produce experience. So she just went and did it. And I liked it. So I learned in that moment that people can do the job as well as me."
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