The much-dreaded Y2K "disaster" turned out to be a real bust, and now some of the food storage and emergency preparedness outfits are going bust because sales have fallen dramatically.
Why this happened, no one seems to know. Perhaps the public grew cynical after the gloom-and-doom predictions turned out to be dead wrong. Maybe people stocked up so well that they're eating the stored foods they own. Or perhaps during prosperity, Americans don't think about disaster preparedness.
Whatever the reason, it has been a roller coaster ride for the companies that manufacture, package and sell food storage products.
Rod Meldrum, the CEO of Highland Country Gourmet Soup Co., Orem, said his business was steamrolling along for about two years doing custom canning of dehydrated foods for other companies that couldn't keep up with their own orders.
"The last two years have been pretty crazy," Meldrum said.
But when Y2K turned out to be a non-event, the orders from other companies slowed to a trickle and his own firm has been buoyed only because he previously carved out a niche for his gourmet soups in grocery and health food stores.
"We went from 24 employees to six," Meldrum said. "Our sales were just under $400,000 in December 1999 and went to $25,000 in January 2000."
At the height of the Y2K demand, his plant was running double shifts to can between 8,000 and 12,000 gallon-size cans of dried foodstuffs every day. His firm canned 116 different kinds of food products for other companies to sell, including everything from dehydrated Alfredo sauce to wheat to powdered milk. He even acquired another building to handle all the work.
But from January to June, the firm produced a total of only 10,000 to 15,000 cans.
Meldrum is not alone. Although he declines to name companies or individuals, he said there has been "a huge, huge drop" in the number of manufacturers, suppliers and retailers of emergency and food storage products. "Of the 10 companies we were supplying products to — major companies along the Wasatch Front — only three of them are still left. And of those three, two of them probably are not going to make it."
Meldrum kept High Country Gourmet Soup going by subleasing the second building, reducing the work force and refocusing the firm's attention on its own product line of gourmet soups.
"Luckily, we have our soups in about 3,000 grocery stores around the country, along with about 700 health food stores," Meldrum said. "Most of the canneries are out of business now and there's kind of a glut of canning equipment on the market right now. The ones still surviving are the ones that have other avenues of income streams."
Maple Leaf Co. in Ephraim is another company that has held on despite the plummet from Y2K sales.
Charles Stevens, one of four brothers who own other businesses and buildings, said they soon learned they had to do something with their food plant, so they turned it into a car care center.
During the peak demand for Y2K foodstuffs, their firm was buying bulk items and packaging them in smaller containers for short- and long-term storage.
The demand for food storage products has not gone away completely. Maple Leaf is seeing a "small incline" in sales each month — but not what it was during the Y2K madness.
"Food storage is here to stay," Stevens said. "In the food business, we're doing OK. We don't have the sales we had last year, but it will return to what it was a few years ago."
Stevens said he and his brothers have seen cycles in the food business before. "When prosperity is very high, people aren't thinking of nesting and preparing. When times are bad, the cycle goes up. We've created other businesses so when the economy goes up and food goes down, the other businesses go up."
It isn't just food dealers who got hit by the Y2K aftermath.
Peggy Layton of Manti is a home economist, author of five books on how to prepare stored foods and the owner of a mail order company, Cookin' With Home Storage. Since January, she has seen a dramatic drop in income.
"Last year was really big because of Y2K. I sold a ton of books last year because it was kind of a panic year," she said. "I was doing $1,000 a day just answering my telephone. Now business is way down."
Layton, who has traveled the country with preparedness expos to sell her books and teach classes on preparing dehydrated foods, is saddened to see so many of her business friends going under. "People did really well for a year, but now their businesses are bankrupt, or they have to liquidate their products and sell cheap or come up with other ideas."
One business had eight cases of her books but had to go into bankruptcy. "They told me if I would take the books and sign a paper release (for their debt), that would be better than waiting for the bankruptcy to take place and getting 17 cents on the dollar," she said.
"That was kind of a hard thing to take, but I didn't lose much compared to some of the other companies," Layton said.
She also is worried about the country overall in case some kind of disaster strikes. "If something happens and people need dehydrated food, it won't be available, at least not to the extent that it was. People in Utah could still find it, but everywhere else, it's kind of unavailable."
E-mail: lindat@desnews.com