First Choice Ingredients
N112 W19528 Mequon Road, Germantown
Industry: Specialty ingredient supplier
www.firstchoiceingredients.com
Jim Pekar started First Choice Ingredients in the basement of his home in 1994. More than 20 years later, the company makes dairy concentrates that go into some of the biggest brands in the world.
The growth has come from making products that go beyond commodity and building a team that draws on some of the top talent in the dairy industry.
“I was always interested in doing value-added. I was always interested in doing custom,” said Pekar, First Choice Ingredients president and chief executive officer, and a former defensive lineman for the Iowa Hawkeyes.
Before starting the company, Pekar was selling dairy substitutes. The product list fit on a single sheet of paper and while customers were asking for something different, his employer wasn’t interested in expanding its offerings, giving Pekar the motivation to set out on his own.
To produce concentrated dairy ingredients, First Choice follows a proprietary fermentation process. Raw products from Wisconsin, including cheese, butter, cream or milk, are combined with enzymes in large reaction vessels. These vessels are then monitored based on varying time and temperature requirements. The end result is an all-natural concentrate that can be delivered as a paste, liquid or powder up to 20 times as strong as the original raw ingredients.
The ability to customize those flavors is how First Choice is able to differentiate itself, working with customers to create the exact dairy flavor they are looking for. To date, the company has created nearly 25,000 different flavors.
First Choice’s products end up in foods sold in grocery stores, restaurants, food service and more, including brands like McDonald’s, Campbell’s Soup and Frito Lay.
“This industry is a lot bigger than everyone can see,” Pekar said.
The company now produces batches that can be as large as 40,000 pounds. When he was starting the business, Pekar would get excited for a 250-pound order.
With more than 40,000 square feet of space for production, getting a 250-pound order today can present a challenge for Pekar and his team to fit into production. At the same time, he’s determined to continue serving those customers.
“We may not make the best margin on it because there’s a lot of costs associated with making a smaller (purchase order) versus getting a larger one where you’re filling a vat and you’re supplying some of the bigger customers, but it’s back to the roots with us; we’re not going to leave those customers hanging,” he said.
To help support smaller customers and ease production in general, First Choice developed a frequently produced product list that includes items the company can have in stock.
“It’s hard to pick and choose who you do business with; you want to give everybody the opportunity and the chance to grow, as people did for us when we started out,” Pekar said.
After working out of his basement, Pekar moved the company to the atrium of a building on Howell Avenue. He signed a three-year lease but had to move after a year-and-a-half because the company outgrew the space. From there, it was on to Glendale for five years before First Choice finally landed in Germantown.
Most recently, the company purchased an 83,000-square-foot facility in Menomonee Falls that was used for a similar industry. The plan is to add 30 employees to staff the facility initially, and to have it filled in five to seven years.
To continue the 15 years of double-digit growth First Choice has experienced, Pekar will need to continue to find the right workforce. That includes the blue-collar talent to keep up with production demands and the best minds in the dairy industry to continue customizing flavors.
“There’s a lot we can do in the dairy industry,” Pekar said. “It’s a worldwide product.”
