A Philadelphia granola brand that grew 55% last year is looking to catapult to the next level with a goal of landing in major natural grocery stores and upping its direct-to-consumer sales.
Philadelphia-based OT Foods started co-packing for its three granola flavors – Cherry Almond Vanilla, Peanut Chocolate Chip, and Oatmeal Raisin – last month, greatly increasing its capacity. Prior to the move, the granola was produced and packed by hand at the Dorrance H. Hamilton Center for Culinary Enterprises in West Philadelphia.
With the Cherry Hill co-packer in place, the company’s founders are now looking to get on the shelves of organic and natural retailers like Whole Foods Market, Sprouts Farmers Market, and Mom’s Organic Market, while simultaneously increasing direct-to-consumer sales. Currently, direct-to-consumer sales make up about 20% of business, with the rest coming from grocery and retail. The company hopes to increase that to 30% or 40% of business over the course of the next year.
To grow that segment, OT Foods co-founder Sarah Coff is tackling marketing initiatives. She recently assumed a full-time role with the company this summer after having worked on the brand part-time, particularly in social media, previously.
Coff was tapped by John Marshall, who got the initial idea for OT Foods – the OT stands for "our table" – about a decade ago. A teacher by trade, after earning his degree at Tulane University, Marshall continued to work in education through Teach for America. During his two-year stint in New Orleans, and another year in public schools there, Marshall found himself turning to granola bars for quick and easy sustenance between classes.
Around the same time, as he dealt with some health issues, he began to reevaluate what he was eating, discovering that not all granola is healthy. Many, he found, are laden with added sugar.
He began to wonder if he could fill the void – and do some good, too.
A Bryn Mawr native, food insecurity wasn’t something Marshall had experienced first-hand but he was confronted with it regularly in New Orleans, where he’d see students, many of whom were on free or reduced-cost lunch programs, taking what food they could from the cafeteria to tide them over on weekends. From 2020 to 2022, the city had a poverty rate of 23.8%, according to U.S. Census Bureau data.
Seeing the lack of access, he knew he wanted to address it, something that’s been built into OT Foods by way of donations and volunteerism.
After holding various teaching roles, Marshall and his wife returned to Philadelphia where they both pursued master’s degrees in public health from Drexel University. It was while earning his master's that Marshall found himself harkening back to granola. He and his brother Peter, also a co-founder in the company, began toying with recipes in the summer of 2018 and formalized the business in 2019.
To address Marshall’s early concerns about sugar content, the recipes are largely naturally sweetened with raisins or dates. The flavors come in 6-ounce packages which sell for about $7.99 at a retailer or $8.99 online.
OT Foods' three granola flavors are relatively equal in popularity, with the Peanut Chocolate Chip having a slight edge at about 40% of market share, with the other two evenly split at about 30% each.
The granola is today sold in about 20 local retailers including the South Philly Food Co-op, Rowhouse Grocery, Salt & Vinegar, Riverwards Produce, Weavers Way Co-op and Mariposa Food Co-op, plus via local bulk delivery company The Rounds. In the suburbs, it’s available at Kimberton Whole Foods locations.
Building the brand has taken several years. In 2019, Marshall graduated from Drexel and took up a role at Health Union, a Philadelphia-based company that has online communities for those suffering from various diseases and health conditions. It was there that he met Coff, who started at the company at the same time.
For much of their time at Health Union, Coff didn’t know about OT Foods. “[I wanted] to prove not only to myself, but to my colleagues, that I was dedicated to Health Union and was there to show up and do a good job and that this other side project wasn't pulling my attention,” Marshall said.
While he may not have broadcast the endeavor, it was always in the back of his mind that if the brand gained momentum, it was where his focus would go. In 2022, OT Foods had gained enough steam that Marshall decided to take it on full-time.
Coff did the same this past June. With both now fully dedicated to the brand, Coff said it feels like "a really great new chapter” for the company.
“Now that we have the new co-packer, I feel like we can really scale the business,” she said.
While they recognize that being able to meet demand won’t inherently grow business, the co-founders are confident about approaching larger retailers now because they’ll be able to fulfill larger orders.
Their goal is to get in local outposts of large retailers like Whole Foods or Sprouts and then grow from there.
Addressing food insecurity remains part of the brand’s mission, and OT Foods donates food, funds and time to Philabundance.
As the Marshall brothers and Coff look to scale the brand, they are considering raising capital but don’t yet have concrete plans for a fundraising round. Thanks to relatively low startup costs, the business has been self-funded thus far and Marshall and Coff only recently began drawing salaries.
From 2021 to 2022, they grew business about 55% and expect to continue growing. “We’ve grown every year. I think now it’s like the real test because we kind of reached this place where we felt we had maxed out our ability to fulfill [orders],” Marshall said. “Now with the co-packer and Sarah on board and direct-to-consumer, definitely by this time next year, we’ll know if [the brand] has legs, and we’re confident it does.”
