Botticelli Foods is aiming to be a top five pasta-sauce brand in the US over the next few years to compete with the likes of Rao’s, now owned by The Campbell’s Company following a $2.7bn deal for Sovos Brands in 2023.
Family-run Botticelli, based in Hauppauge in New York, started out manufacturing extra virgin olive oil in 2002 and has expanded into pasta and pizza sauces of Italian origin. Ground coffee will soon form part of the portfolio, too, for a business that generated $100m in sales last year.
Go deeper with GlobalData
Italian sauces are now the company’s biggest revenue contributor, with a premium proposition and a made-in-Italy label using authentic ingredients.
The third generation of the founders, vice-president Joe Asaro spoke with Just Food’s Simon Harvey about Botticelli’s aspirations before the US tariff announcement.
He joined what he says was a “relatively small” business in 2020, when the advent of the Covid-19 pandemic and consequent lockdowns boosted at-home cooking and presented additional opportunities.
Simon Harvey (SH): How did the business progress from 2020?
Joe Asaro (JA): In 2020, we were in about 7,000-8,000 US stores and today we’re in almost 18,000, so we’ve rapidly scaled distribution. Everything is made in Italy, farmed in Italy, and we try to stay true to that message. We feel like nobody was really capturing that market.
That’s really what makes us unique, is that we’re an Italian-first brand.
SH: Can you explain the manufacturing and sourcing set-up?
JA: We manufacture everything in Sicily. We own some of our own farms in Sicily, which are 15 minutes from our facility in Catania and we also work with some farming cooperatives too.
All the ingredients in the jar come from Sicily or from mainland Italy, so everything’s made right at the source, and we import the finished goods to the US. The tomatoes we grow ourselves and for everything else like fresh herbs we use Italian suppliers.
We have warehouses on the East Coast, in New Jersey, Miami and California.
SH: How has the company made the transition from olive oil?
JA: It’s still a big piece of our business. I used to work at Greek yogurt manufacturer Chobani and I learned a lot from that team on how they built a brand and a category.
When I joined Botticelli in 2020, olive oil was probably like 85-90% of our business and pasta sauce was very small. But, once the pandemic hit, fast forward to today, pasta sauce is about 75% of our sales.
We’re still true to our core of being olive oil people, and we do our own manufacturing on the olive oil front as well. But pasta sauce has taken off as a rocket ship for our brand.
SH: What are the plans for coffee?
JA: Coffee is a new venture that we’re going into and we felt like it fitted really closely with our brand in Italian culture, cuisine and flavours. My family are avid espresso drinkers, we start our morning with a few espressos. We felt there was a lot of connectivity with what we’re doing with our brand.
Coffee is very competitive and we thought, ‘if we’re going to launch this coffee line, we want to be very thoughtful on how we add value to the category’.
We created this occasion-based line of a morning blend, which is a light roast that’s highly caffeinated, an all-day blend that’s moderate, not too much caffeine but not too low, and an evening blend that’s a low-caffeine option, that’s more of an indulgent, chocolatey type of flavour experience.
Number two, we went with USDA-certified organic coffee because we realised that’s a segment that not a lot of brands are playing in today, and there’s some really significant health benefits.
SH: Is Botticelli doing its own processing for coffee?
JA: We have a joint-venture partnership with a manufacturer in Naples and that’s where they’re producing our coffee.
We’re going to be testing in some select retailers over this next year. We’re hoping to get some learnings from how it performs and what the consumer is saying, and then understand how we want to expand that further.
We’re on Amazon already and we’re going into bricks and mortar probably within the next three months, hitting shelves across the US.
SH: If you are growing your own tomatoes for the pasta sauces what’s the position with olive oil?
JA: We have some of our own olive groves but we also work with a lot of the cooperatives around Europe, mostly in Italy and Spain. Our production facility for olive oils is in Gaeta, Italy.
SH: The business generated $100m in revenue last year, how has that progressed?
JA: When I joined the company in 2020 we were doing a little bit less than $20m a year.
SH: How does revenue break down across the other categories?
JA: Olive oil generates 20% of our sales, and then another 5% comes from the speciality items we also do like balsamic vinegars, roasted peppers and bruschetta.
SH: What are you targeting this year?
JA: The goal is to reach $120m. Our biggest business is in the US. We’ve also started exporting internationally to Canada, Mexico, Brazil, Argentina and Peru, and now we’re working to expand to Japan. We just started expanding internationally last year so the US is currently about 95-96% of revenue.
SH: What are Botticelli’s longer-term goals?
JA: We don’t want to expand too fast into different categories, so our number one priority right now is expanding the pasta sauce business and household penetration.
We’re the number seven best-selling brand in the US for pasta sauce and we’re really focused on, within the next three to five years, on becoming a top five brand across the country.
We’re very focused on, within the categories we play, whether it’s pasta sauce, olive oil or even coffee, on looking at unique opportunities that are consumer centric. It’s coming out with very thoughtful innovation to keep focused on the categories that we’re in.
SH: Is Rao’s one of your main competitors?
JA: We definitely compete within the premium space and they’re definitely the biggest player. It’s figuring out how we get more people into the premium segment and how we can upgrade those consumers to try products like Botticelli to get them into a higher dollar ring of sales and more quality too.
If you go to a restaurant, you could easily spend $20-30 on a plate of pasta and you could get that for half the price and the same quality at home with that Italian experience in our sauces.
SH: How do you get consumers to spend those extra dollars on a sauce in the current environment?
JA: We invest a lot of our advertising dollars towards television commercials and social media through recipe creation. And getting the experience with the Italian culture, as well as a clean ingredient product.
We’ve just revamped our labels, putting interactive QR codes on all of our packaging with recipes that will change every two to three months.
SH: The food industry has recently gone through a period when inflation-led pricing supported revenue and is now battling with shoring up volumes. What’s your answer?
JA: We’ve been very fortunate since we own a lot of aspects of the supply chain so we have not been as impacted as other brands that use strictly co-packers, for instance.
SH: Who has backed the business?
JA: We have bootstrapped it 100% ourselves. We take a lot of pride in that. For the first 11 years of being in business, we focused on olive oil and we were very methodical and stayed regional. We didn’t spread the brand across the country from day one, we focused on a core market, really grew it and did it in a very successful way to be able to make the investments that we’re making now as a company.
