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EO Products expands sales, retail vision

Originally published Jan. 21, 2015.

SAN RAFAEL — Small World Trading Co., better known as EO Products, is enjoying the sweet smell of success for its Marin County-made natural and organic personal-care products, capping a year of strong revenue growth and taking its emerging retail efforts to a high-profile level with a new face-to-face venue in downtown San Francisco.

Company revenues rose 47.5 percent to $20.8 million last year, from $14.1 million in 2013. Also last year, EO returned to the Inc. 5000 national list of fast-growing companies for a fourth time — 2010, 2011, 2012 and 2014 — sporting 67 percent revenue growth over three years. The workforce grew to 45 last year from around 35 for a decade and then to 68 now, with a second production shift.

'Growth was never our M.O. — growth for growth's sake,' said Susan Griffin-Black, co-founder and co-CEO.

The EO core brand got a boost from placement in Austin-based Whole Foods Market, which had about 60 stores had the time, and brand sales grew as the grocery chain expanded. Whole Foods now operates 406 stores in the U.S., Canada and the United Kingdom.

The opening of an EO Exchange store along with The Market food-and-fraternity center in the former Western Furniture Exchange and Merchandise Mart at 1355 Market St. on Jan. 21 takes the company back to its roots in multiple ways. Founders and co-CEOs Brad Black and Susan Griffin-Black launched EO from their Potrero Hill garage in 1995, and the rapid growth of the 3-year-old Everyone by EO mass-market brand has allowed the company to focus on even more premium ingredients in the original EO line while being able to expand sales to value-conscious shoppers.

'We were able to take off the bells and whistles and have a product that can compete with mainstream consumer packaged goods,' Ms. Griffin-Black said.

Yet the Everyone brand still has meticulously sourced ingredients of the EO brand, such as natural and plant-based materials and mixtures of the 90-plus pure essential oils the company uses.

So the roughly 400-square-foot San Francisco store within a store and its interactive environment is expected to help with not only product development but also expansion to foreign markets in a more eco-friendly way, according to Ms. Griffin-Black. The company opened a similarly sized store — the first EO Exchange — in late 2012 in Mill Valley.

'The reason we did retail was to see if we could make the refill bar concept work,' she said. 'It could be a disruptor in the personal care products industry internationally because it reduces plastic consumption.'

The stores have a 'refill bar' — decorative taps for dispensing popular items — that allows visitors to buy replenishment of their empty EO bottles, in line with the founders' Earth-sensitive ethos for the company. Sustainability is a big deal for EO Products. It aims for using as much recycled content in its bottles and dispensers as possible and has worked to eschew plastic 'blister packs' around its products via paperboard cases made by fellow Marin-based manufacturer PulpWorks.

'We have not had much interest in exporting,' Ms. Griffin-Black said, noting the natural resources consumed in moving bottled, packaged products across oceans. Having retail locations in far-flung locations, where shoppers can buy refills better fits EO's ethos. 'This allows us a way to do it in a sensible, ecological way.'

Opening stores within other stores also offers EO Exchange expansion flexibility and lessens real estate headaches, she said.

The Everyone brand launched with just six selections, and now the options top 50. Items from the line also are available in Safeway and Kroger's grocery stores, expanding test placements in Target department stores, and at Bed Bath & Beyond and The Vitamin Store locations.

The brand launched just before the company made a big jump in its production capacity and sophistication, expanding in 2012 to a 40,000-square-foot former Industrial Light & Magic special-effects studio in San Rafael. EO Products had been considering relocation of the plant to less-expensive locales in the East Bay.

And scaling up for a mass-market brand has brought its own challenges. A few months ago, Whole Foods featured the Everyone brand in an key aisle 'end cap' promotion, and sales for it doubled, according to Ms. Griffin-Black. Though the surge was only for a few months, the need for a second shift became clear. And the company invested in higher-production equipment, such as one that can fill three bottles at once.

Beyond production capacity, EO Products could be in the market for more warehousing capacity, according to Michael Cronin, chief operations officer.

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