Scott Mandell '01 and Bert Cohen '02

Nothing to sneeze at
When it comes to niche marketing, these Kellogg School alums are saying a mouthful

by Chad Schlegel

For nearly seven million Americans who suffer from food allergies, finding a tasty and safe store-bought snack can be tough.

Realizing the need for allergen-free packaged foods that don't skimp on flavor, Scott Mandell '01 and Bert Cohen '02 (pictured, l to r) launched Enjoy Life Foods, a Chicago-based bakery dedicated to improving the lives of its customers one treat at a time.

Mandell and Cohen hatched the idea for Enjoy Life Foods in 2000, as Kellogg School students. In Prof. Art Frigo's Entrepreneurship and New Venture Formulation class, they formulated a business plan they would ultimately pitch to a mock panel of venture capitalists.

Cohen, whose mother is on a restricted diet because of multiple sclerosis, suggested producing a line of products that would be free of common allergens like gluten, wheat, nuts and dairy.

While researching the assignment, Mandell and Cohen realized there was a tremendous opportunity. According to the National Institutes of Health, at least 30 million Americans suffer from some sort of food intolerance, and an estimated one in 133 suffer from celiac disease, an autoimmune condition triggered by the intake of gluten, the protein found in wheat, rye, barley and possibly oats.

"It made too much sense not to move forward with it," says Mandell.

In March of 2001, Mandell left his job at American National Bank to redevelop the business plan, buy equipment, assemble an advisory board and hire employees to develop recipes for a variety of products, including cookies, bagels and snack bars.

Originally the plan was to outsource production, but realizing the importance of keeping their products away from contaminants like gluten and nuts, they decided to construct their own facility.

Enjoy Life Foods moved into a bakery/warehouse on Chicago's West Side in March 2002. Mandell and Cohen hired a marketing director, a director of operations and plant workers, and shipped their first products in November. Cohen, who also worked at American National Bank, resigned from that situation and joined Mandell full time. Today, the company employs 20 people.

Mandell says four main attributes separate Enjoy Life Food from the competition: taste, nutrition, quality and purity. All the products are produced in a dedicated contaminant-free facility, are vegetarian and certified kosher, and are free of the eight common allergens responsible for 90 percent of food allergies.

"If something doesn't taste good and doesn't meet our quality control standards, we don't want our brand behind it," says Mandell.

Their customer base is people with celiac disease, but the products also have gained a following among people on restricted diets prescribed to treat autism, attention deficit disorder, diabetes and multiple sclerosis.

As president, Mandell oversees all facets of the business, primarily focusing on sales and marketing. As CFO, Cohen manages the finances and operations.

Originally, Mandell peddled Enjoy Life Foods products himself around the Midwest. Today the goods are available in the Midwest, on the East Coast and throughout Canada, at natural food groceries including Whole Foods.

Cohen says one of the company's biggest challenges is keeping production costs down, given that the firm's ingredient costs are two to three times those of non-natural manufacturers.

"People are willing to pay a premium, but it's limited --- they can bake for themselves," says Cohen.

Mandell and Cohen expect demand to grow over the next few years as more doctors start to understand and diagnose food allergies. They plan to answer that demand with many new products, possibly including a line of frozen food.

"We're growing quickly, but in a methodical way," says Mandell.

While they thoroughly enjoy the hands-on, entrepreneurial nature of running a business, Mandell and Cohen derive the most satisfaction from knowing that their products improve the lives of customers.

"On a daily basis we get letters from moms with kids who never got to eat this stuff before," says Mandell. "That kind of feedback gives us a big shot of adrenaline."