Dan Myers, chief executive officer of Carolina Foods, Pineville, NC, describes the sweet goods manufacturer as the “90-year-old company you’ve never heard of.” Quietly and steadily growing since it was founded in 1934, Carolina Foods was acquired by Falfurrias Capital Partners in 2021. With the support of private equity, the baking company is ready to go to the next level and with a little more fanfare than in the past. 

In May, Carolina Foods celebrated its new facility and 90 years of being in business with a grand opening event that included representatives from Falfurrias, county government, members of the press and, of course, the company’s employees. The 428,000-square-foot bakery is state-of-the-art, designed to deliver products with the longest shelf life and the highest, most consistent quality. 

“We are attracting customers, so we have designed this facility to be able to handle the flexibility of their needs and requests,” Myers said. 

With a next-level bakery, this company is ready to take the next step on the road to success. 

Vernon Scarborough started Carolina Foods in 1934, making sandwiches and baked goods in the South End neighborhood of Charlotte, NC. After World War II, Scarborough expanded the product portfolio to include yeast-raised donuts and pies. With a focus on quality and customer service, Carolina Foods’ sweet goods business became so successful that the company dropped its sandwich business in 1992 to focus solely on sweet goods. Reformulation for a longer shelf life allowed the company to also expand into new channels. Its Duchess brand can now be found in grocery, convenience, value, foodservice and club channels. Carolina Foods also produces private label items and co-manufactures for select customers.

“With a fresh product, speed to market is critical,” Myers said. “A longer shelf life with the same quality at the end of that shelf life opened up new markets for Carolina Foods. The sweet goods market really exploded after that, and we were able to be a leader in that space.” 

In 2021, the Scarborough family sold Carolina Foods to private equity firm Falfurrias Capital Partners. Vernon Scarborough’s son Paul Scarborough was CEO at the time of Falfurrias Capital Partners’ acquisition. He noted that the sale to private equity would allow Carolina Foods to achieve significant growth. 

“This partnership will give us the financial resources and management expertise to take Carolina Foods to another level,” he said at the time of the acquisition. “The company’s 110,000-square-foot facility in South End was operating at capacity, which was holding back growth. It was clear a significant capital investment would be needed in order for the company to grow.”

With the Scarborough family as minority owners in the business, Myers was brought in as CEO. The first order of business was formalizing Carolina Foods’ vision, strategy and mission. The vision: to be one of the most respected companies in the industry and community while enriching the lives of team members and stakeholders. 

“The history of Carolina Foods is quality and service to customers,” Myers explained. “We added new thoughts to that with this guiding document to take us into the future. We needed a culture that was suited to rapid growth.”

According to Myers, everything Carolina Foods does should contribute to one of four pillars of its vision: becoming a more valued partner with key customers, keeping products and people safe, pursuing opportunities for excellence, and innovating quality products. Stating this vision so explicitly allows the leadership team to quickly evaluate opportunities, ideas and processes that are consistent with their vision. 

The road map to achieving this vision is based on teamwork, integrity, respect and data, Myers said. The leadership team has worked diligently to ensure that everyone who works at Carolina Foods is well-informed of the vision, goals and how each person contributes. This imparts a culture of ownership and accountability within the company. 

“Ownership and accountability only work when backed up by facts,” Myers said. “Everyone knows what good looks like. We share a lot of information with our team, so they stay engaged; the more they know, the more engaged and invested they are.”

This is where the data comes into play. KPIs to ensure that Carolina Foods is achieving its vision are directly tied to metrics that the company tracks. Stuart Smith, vice president of operations, noted the company tracks quality and downtime hourly, and all of that information is communicated down to the production floor level. 

“We distill that information down to ‘How do I as a team member impact our goals?’ ” he said. 

This degree of communication and transparency with every level of the team has infused the culture of Carolina Foods with ownership and accountability. 

It also has helped the company dial into quality and freshness like never before and has laid the groundwork for the biggest investment yet, a state-of-the-art greenfield facility that has taken quality control to a new level.

This article is an excerpt from the July 2024 issue of Baking & Snack. To read the entire feature on Carolina Foods, click here.