The Supply Side: Collin Street Bakery fruitcakes receive Walmart ‘golden ticket’

Thomas McNutt, 34, is a fourth-generation owner of the Collin Street Bakery in Corsicana, Texas. In the town of about 25,000, the bakery will ship around 1 million pounds of its nostalgic holiday DeLuxe Fruit Cake to more than 110 countries.

Most are sold via old-fashioned catalog orders, a growing online business, and more recently, a burgeoning retail business that will now include Walmart.

McNutt and his sales director Michael Fletcher, who is also the town mayor, recently met with Walmart baked goods merchants at the retailer’s Open Call held in Bentonville in late September. McNutt said walking away with a “golden ticket” was surreal for him.

“It is an unbelievable opportunity, and Walmart wants our fruit cakes in hundreds of stores in 2025. But given the holiday 2024 orders have already been made, it was too late for this seasonal item this year. However, they set us up as direct-to-store delivery, and we can take our cake displays to Walmart stores this holiday season and sell there. Our trucks are going to be busy,” McNutt said.

He said a second meeting is slated for October to discuss Walmart carrying the bakery’s cherry icebox cookies. He said the cookies are the top-selling item by count. McNutt said Walmart was interested in the baked cookies to sell to its bakery departments. Collin Street Bakery sells 30 different cookies made from scratch daily. The 127-year-old bakery makes more than 100 “from scratch recipes” of bread and baked confections that date back generations.

‘LEARNING OPPORTUNITY’
McNutt said Fletcher, who retired as manager of the local H-E-B store across the street from the main bakery location in downtown Corsicana, joined the bakery’s sales department a few years ago while also being the town’s mayor.

“This spring, Michael (Fletcher) asked me if I wanted him to sign up for Walmart’s Open Call through the Range Me app. Thinking probably nothing would come of it, I told him to go ahead and fill out the application. Then I found out Walmart had people going through those applications behind the scenes. I was pleasantly surprised to get my invite to Open Call,” McNutt said.

The plan was to attend and make it a learning opportunity, putting the best foot forward and seeing what happened.

“Wow, Walmart wanted a meeting with us. It was an amazing experience,” he said. “I was most impressed with Walmart’s emphasis on buying American-made products. The session with Daymond John of Shark Tank was a solid three hours of coaching. He took our questions and offered expertise with humility and honesty,” McNutt said.

McNutt said he is supposed to meet with Walmart in January to discuss the national order for holiday 2025.

RECENT GROWTH
About a decade ago, Collin Street Bakery expanded its footprint with retail sales located on major interstates across Texas: Lindale on I-20, Waco on I-35 and on I-45 across town from the original bakery located in downtown Corsicana. McNutt said the company employs 150 folks year round, with a few more for holiday sales.

McNutt said around 2016, there was an internal debate between his uncle and CEO Bob McNutt, himself, and others about whether the business should consider wholesale to other retailers as a way to get the fruit cakes into more physical locations.

“We are small and entrepreneurial-minded, willing to try new things, learning what works. We started a test-and-learn wholesale business with Brookshire’s Grocery based in Tyler, Texas, in 2017. My Uncle Bob went to college with one of the Brookshire owners, so that made for an easy introduction. We started small. Then, Albertsons’ southern division took a chance on us with a retail display in some stores in 2017 and 2018. We grew that business to add 40 more retailers like H-E-B, and by 2023, we had our DeLuxe Fruit Cake displays in 4,000 stores across 38 states,” McNutt said.

He said the bakery has the capacity to supply Walmart but just never thought it would happen. McNutt said the wholesale business is exciting and was the fastest-growing segment for the bakery’s $41 million business last year. That said, “direct to consumer” retail still provides the bulk of the company’s revenue.

McNutt said being in other retail locations is a way to reach a new audience. Given that DeLuxe Fruitcakes have been a holiday staple for many families over six generations, he said the retail displays get some interesting reactions.

“I have been in stores when shoppers walk past the display, they often do a double take and pause as if some family story comes to mind. It’s cool to see newer generations find our brand when we were not on their radar to start with,” McNutt said.

The holiday fruitcakes have an at least 90% sell-through rate at retail stores, he said.

INFLATION RESPONSE
As a family-owned bakery, McNutt said inflationary pressures have been harder to manage over the past few years. He said given the bakery is a huge buyer of eggs, flour, sugar, cocoa, nuts, fruit and other confectionery ingredients, it pays close attention to rising costs.

“We hate to raise prices, but when eggs went from $3.50 per pound to $15.80, we had to look for ways to cover that gap. We also put our DeLuxe Fruitcakes in a collectible tin that is made in the USA that also comes at additional costs, but it’s important for us to keep it American-made,” McNutt said.

He said the bakery continues to work to find efficiencies within its operation with more minimalistic packaging, and when prices were raised, the company also increased promotions and discounts to continue to drive sales. McNutt said its wholesale prices still allow him and the retailers to make money and support U.S. jobs.

Editor’s note: The Supply Side section of Talk Business & Politics focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by Talk Business & Politics and sponsored by Firebend.