Oat Haus now selling granola butter in Costco
From the Cleveland Business Journal.
Ali Bonar and her colleagues at Oat Haus used to buy the ingredients for their granola butters at Costco. Now, they are selling their products at Costco.
The food manufacturer debuted its cookie dough granola butter (yes, the butter is made from granola) in an extra-large 27-oz. jar at more than 100 Costco stores in Midwestern states, including Ohio, last week.
"Costco is pretty savage," Bonar told the Cleveland Business Journal. "It's very make-or-break. They'll test you for 12 weeks — they call it a 'rotation' — and especially the first few weeks are the most important. So if we do well in this Midwest region, then they'll start to expand us to other regions."
The Oat Haus entrepreneurs — comprising Bonar, her husband, Eric Katz, and Eric's childhood friend, Ari Schraer — doubled their output to make enough product for the Costco stores.
"We started running a night shift, and Ari started managing that," Bonar said.
"We still make everything from scratch," including toasting and grinding the granola used to make butters in several flavors, such as brownie batter, cinnamon roll and wild berry, she said. "We also fulfill ... all of our e-commerce online orders in-house."
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The brand was born in 2018 out of Bonar's nutrition study at the University of California at Berkley and her eating disorders. While recovering, she added nut butters to her diet but found them hard to digest, so she started experimenting with oats.
Bonar pitched the granola butters to Shark Tank investors in 2021, but her company didn't get an investment. Last year, Bonar received an Ernst & Young Entrepreneur of the Year award for the East Central region.
Why Oat Haus moved to Cleveland
Bonar, Katz and Schraer moved their California-born food company first to the Philadelphia area and then to Cleveland in 2023 in search of a facility where they could make their granola butters.
"There's just really not a lot of manufacturing facilities that are food-grade in the U.S.," Bonar said. "It's kind of finding a needle in a haystack, especially for exactly what we needed.
"We bake all of our granola from scratch, so we needed a lot of ventilation, and then we blend that up into our spreads," she said. "It's very high-powered blending machine, so ... we needed a lot of electrical power too."
Bonar and her colleagues chose Cleveland over places such as St. Louis, Missouri, and Fort Worth, Texas.
"We visited both of those and just didn't really enjoy the surrounding areas," Bonar said. "And then we came to Cleveland and the facility was perfect."
Oat Haus moved into 44,000 square feet of space formerly occupied by American Nut in September 2023.
"The company [that] was in here before us put about $2 million into this facility," she said. "So it's really state-of-the-art, just beautiful."
Bonar called the city itself "amazing. We're in our early thirties and just wanted a fresh, young-feeling city, and a lot of those facilities are kind of in the middle of nowhere. So, yeah, this was just a good blend of the two."
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