Holly’s Oatmeal: Former Restaurant Owner Finds Her Product In High Demand

By Mara Lee The Hartford Courant

WWR Article Summary (tl;dr) Holly DiMauro shares the ups and downs of being a food entrepreneur. After packaging and selling the popular Oatmeal from her restaurant, the brand took off. "Holly's Oatmeal" can now be found online and at local Whole Foods stores. HollysOatmeal.com

The Hartford Courant

Holly DiMauro's dramatic career shift from medical technician to small restaurant owner was one she loved. But it was a single dish at the restaurant that launched yet another career change.

DiMauro opened a breakfast-lunch café in Canaan in 2003, before opening Holly's Cafe a year's later in Salisbury. There, she tried to follow a from-scratch philosophy attributing it to her Italian grandmothers

"Everyone cooked. Everything from scratch," DiMauro, now 60, said.

DiMauro also focused on serving healthier foods than the typical diner fare. No home fries. No white bread. "I would have people call me: 'We're coming in, start the oatmeal.'"

Served with warm milk and a drizzle of maple syrup, the oatmeal was made with soy milk, not water, and was more than just rolled oats.

DiMauro mixed rolled oats, quick oats, steel cut oats, rye/wheat groats, for varying textures. She added flax meal and chia meal. She'd also put a smooth hot cereal as part of the base.

By 2006, the oatmeal was popular enough to box and sell in mixes and in January 2007 she sold her restaurant to focus strictly on selling her new product, Holly's Oatmeal.

"The first year was not great," DiMauro said, with maybe $35,000 in revenue. But the second year, she reached $75,000, and by 2009, she was selling about $170,000 in oatmeal mixes.

Holly's Oatmeal was getting into specialty markets and health food stores, and she was getting discovered by online customers around the country as magazines interviewed her at food trade shows.

Then, in 2010, she was invited to go onto the QVC home shopping channel. The first year, she was on air twice. The next year, four times. After each appearance, DiMauro sold out of the oatmeal.

At that point, she was selling $300,000 worth of oatmeal. But the economics were different for the QVC sales. For most of her sales, she boxes the order as it comes in, mixing the ingredients by hand in a tumbler made from a plastic compost bin.

But QVC ordered at such volume that she had to borrow money to pay a contract warehouse to mix, box and ship the pallets of oatmeal. In 2012, she was able to borrow $100,000 through the state's Small Business Express program, which offers more generous terms than commercial banks.

At the contract warehouse, mixing is rougher, with a machine that includes blades. That made the oats break down more. She thinks that makes the end product less appealing. But it was necessary. For the more than 19,000 boxes QVC would order, "it would take me two months to do that by hand."

Paying the contractor cut her profit by two-thirds. But, she said, "I could sell $30,000 worth of oatmeal in five minutes.

Where else could I do that?"

DiMauro didn't go on QVC last year, because in 2014, her appearances in the fall and winter months were canceled, and they put her on air in April, May and June. Not great times for oatmeal sales. Nine pallets went unsold.

"I got mad," DiMauro said. "I didn't go back."

So her sales have been much lower the last two years, and she's gone from two full-time employees and two part-timers to two seasonal employees whose hours vary from full to part time depending on demand.

"It is very tough to be an entrepreneur in the food business, period," she said. "Grocery stores are very tough. They nickel and dime you."

Big Y wanted her to match Quaker oatmeal prices, which was impossible, she said. She includes specialty ingredients like amaranth, quinoa, organic apricots and walnuts baked in maple syrup.

But she's had a good relationship with specialty markets, like Highland Park. Glastonbury Highland Park general manager Tim Cummiskey said they stock seven varieties of Holly's Oatmeal, including gluten free varieties.

"It does well, particularly in the seasons that warrant a warm cereal," he said. "It's a great product, it's all natural, high in fiber, protein."

About 40 percent of her sales are direct to consumer, either online or over the phone, with an average order of $50. Some customers make a custom blend of fruits and nuts, paying as much as $9 a box. Most varieties cost $5 to $7, and at $7, Cranberry Almond is the top seller.

Cecelia Luna, of North Brunswick, NJ, discovered Holly's Oatmeal at a Whole Foods in Boston, and chose it for its high fiber and low sugar content.

"I'm always looking for quality products, nutritious things, trying to improve my diet, and the foods that I'm eating to maintain a healthy lifestyle," she said. "But it's also really tasty."

Luna found it at the Princeton Whole Foods when she got back from her business trip, but when they discontinued it, she started ordering Apricot Maple Nut and Cranberry Almond oatmeal mixes directly from DiMauro. She's been eating it for seven years.

DiMauro would like to sell the business to a big food corporation to get a retirement nest egg, but realizes she'd need to increase sales again to make herself an attractive acquisition. That would mean hiring brokers again to place her in stores, and going back on QVC.

"Everything costs money," she said.

While DiMauro has not found the business to be as big a money maker as she'd hoped, she said it is less demanding than running a restaurant, where she worked 10 to 12 hour days on her feet. Now, she works part-time in the summer.

"The restaurant was more fun, because I got to meet people all day long," she said. She still remembers a customer in Canaan that told her: "This is the best onion soup I ever had in my entire life."

"That's what I miss," she said.

Holly's Oatmeal is for sale at local Whole Foods, Highland Park markets, Roger's Orchard and LaBonne's markets. It's available online at HollysOatmeal.com

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