Kentucky: Four Generations Strong and The Legacy of Brown Foodservice with Daniel Neeley, Chief Operating Officer of Brown Foodservice

Nick: 00:00:02

There are a million ways to make money in the food service industry. You just have to find one.

On the Titans of Food Service podcast, I interview real life movers and shakers in the food game who cut through all the noise to get to the top. My name is Nick Portillo and welcome to the Titans of Food Service podcast. Let's jump right into it. Welcome back to Titans of Food Service.

I'm your host, Nick Portillo, and this is season three where I'm traveling across America in 50 weeks, interviewing one titan of food service from every single state in the country. This week, I'm headed to the Bluegrass State, Kentucky, to talk with a true industry leader, Daniel Neely.

p family roots dating back to: 1942

As part of the fourth generation in the business, Daniel continues the legacy started by his great grandparents, George and Mary Jane Brown, who began supplying food to mining communities in the big sandy coal fields. What started as Sandy Valley Produce has since grown into a major food distribution company serving Appalachia and beyond.

All while keeping trust, transparency, and family values at the core of their business.

In today's episode, Daniel, he's going to share his journey at Brown Food Service, the challenges and rewards of leading a multi generational family business and how they continue to grow and innovate while staying true to their roots. But before I dive into my conversation with Daniel, I want to give a little background on Kentucky and the food service community within Kentucky.

I do this on every episode, so let's go ahead and take a look at Kentucky's food service industry. So it's known for its rich traditions.

So Kentucky is home to more than 8,500 restaurants and has a thriving hospitality scene that generates billions in revenue.

The state is famous for its bourbon culture, fried chicken legacy, and deep rooted Southern cuisine, which continues to attract food lovers from all over.

With a strong agricultural sector and farm to table movement, Kentucky is a hub for fresh, locally sourced ingredients that fuel its dynamic restaurant industry. Pretty cool. Okay, without further ado, let's go ahead and welcome Daniel. All right, Daniel, welcome to the Titans of Food Source podcast.

Man, I appreciate you hopping on here and talking with me.

Daniel: 00:02:16

Yeah, no, thank you for having me. Great. Great to be a part of it, of course.

Nick: 00:02:21

Of course. So tell me, you live in Kentucky?

Daniel: 00:02:25

Yeah, yeah, just in eastern Kentucky.

I like to say I'm Kentucky born, raised and educated because I grew up in eastern Kentucky, you know, all the way through high school and went to UK for Undergrad and grad, so. Bleeding blue through and through, for sure.

Nick: 00:02:41

I love it. Were you there in: 2012

Daniel: 00:02:46

No, I. I graduated just before then, but I was there during the Billy Gillespie years when we. A football school. Okay. So.

But yeah, there for the first year that the Cal was. Was on campus and, you know, John Wall and DeMarcus Cousins walking around on campus, you know, it was a.

It was a different feel on campus at that time, for sure. That's so cool. Yeah.

Nick: 00:03:12

Isn't it Kentucky, too, that had like a. A handful of running backs, like five. Like, I want to say within the last 10 years. Like, there was like a bunch of running backs all in, like.

Like within a couple years of one another. Maybe that was a different school. I can't remember.

Daniel: 00:03:26

Yeah, we. We had Benny Snell who was a big running back for us and set a couple school records. He went.

He was a backup at the Steelers for a few years and then the backup right now at the Bills. His name's escaping me, but yeah, he was. He was a heck of an asset for us.

And, you know, he put up a few touchdowns, I think, in the playoffs for the. For the Bills too, so. Nice. Nice.

Nick: 00:03:50

I've been to a couple Southern schools, have been to Ole Miss, I've been to lsu and I've gone to their tailgates and did the whole. The whole experience with a couple friends, and I've gone a few times. And how's the experience at Kentucky for. For game days?

Daniel: 00:04:06

It's really. Especially since over the last decade, since Stoops came in as coach. It's, you know, it completely changed.

Not just on the field performance, but in the tailgating as well. It's a lot more exciting. You know, it used to be that everybody get out, you know, and enjoy their beverages and chili in the morning.

They would go get slaughtered by another SEC school. But at least we make it competitive against most of them these days. Or, you know, we've had some pretty big wins too, so.

Nick: 00:04:35

Totally, man. I'm a big USC Trojans fan because they're right here in my backyard. And yeah, you know, growing up, they.

With Matt Leiner and Reggie Bush, you know, great team. Carson Palmer, I mean, we had some great teams, but ever since, you know, the last 15, 20 years, it's been pretty bleak.

But we're hoping that Lincoln Riley can. Can turn around at some point here. You know, he's going on year four, you know, out of Oklahoma, and we'll see.

You know, we're hopeful it's Such a great, it's such a marquee program and I think when that program is really strong, it's really good for, for college football.

Daniel: 00:05:08

Yeah, absolutely. Especially with how much the west coast schools have kind of migrated into other conferences at this point.

Nick: 00:05:14

Exactly, exactly. Man, I could talk sports forever. I love it. Unresports related I saw, is it kfc?

They're leaving Kentucky and I think they're coming my way to Irvine, which is right down the street for me. I think they're having a satellite office and maybe other states as well.

Daniel: 00:05:35

Yeah, yeah, that's Kentucky's in the name. And you know, they've got a museum in Corbin where the, where the first restaurant was started. But yeah, it's unfortunate.

You know, it's something that your large corporations sometimes do. You know, they want to be able to attract and maintain the best talent possible and sometimes it takes that to make it happen.

Nick: 00:06:01

In the city that they were based in, where they are. I'm sure they're one of the largest employers in that area.

Daniel: 00:06:07

Yeah, because I mean, it's not just the, the KFC brands, you know, PFS or Pizza Hut and Taco Bell also under the brand pretty much. They ran a lot of their corporate operations right there out of Louisville.

Louisville I'd say will be fine because there's some other large manufacturers there. Ge, Ford, have big manufacturing plants there. But yeah, it's a shame to lose a company like that out of the state.

Nick: 00:06:33

Yeah, for sure, for sure, man. Well, tell me, how did you get into the food business?

Daniel: 00:06:39

Well, I guess I was kind of born into it at Brown Food Service. I'm fourth generation.

My great grandfather started the business and then his sons were all involved in the business and then various family members of their children have been involved in the business business and are still involved in the business from a day to day perspective. But you know, I grew up around it, helped my mom deliver mail around the office when I was growing up and things like that.

But you know, when I went off to college, it was never really my plan to come back and work with the, with the business side.

Out of college I started my career off in retail at Dollar General Corporate down in Nashville, which was a great education, an absolute great education on how to run just business in general, but particularly, you know, sustainable and scalable business practices and what it takes from a process standpoint to be able to do that and a holistic view of managing, you know, not just a business but a large organization like that. I was very fortunate to work with their Continuous improvement department there from day one.

And we acted as internal consultants or project managers for the organization.

So got to touch a lot of the organization and, you know, learned a lot of good things that I could take on to other stops in my career that I've brought here.

Worked there for five years and then I wanted to get a bit back closer to family and so had an opportunity to work with a fan manufacturer in Lexington, Kentucky after that for about 18 months called Big Ass Fans. I'm sure if you've seen any of the products in the wild, you recognize the name.

Yeah, but worked a lot again in continuous improvement role there for sales and E commerce. Got exposed to a very unique culture at a company.

Everybody at that company, from CEO down to janitor, is encouraged to be an entrepreneur about their role in the company. And so a very unique culture that their, their founder had. And after about 18 months there, one, we had a death in our family.

And then that company was on the verge of sale to private equity. And you know, that's always an uneasy feeling as that goes through.

And so my family approached me about coming back to the business at that time, moved back to Appalachia and seven years ago, haven't looked back since. So, wow.

Nick: 00:09:01

I mean, what an incredible journey it's been, huh? And you know, I can definitely empathize what, what you said, you didn't necessarily think in the beginning you'd get into the family business.

When I was coming out of college, my dad wanted to start a brokerage business with me and I wanted to be a wealth management. In wealth management, I wanted to help people with their money problems and where to invest in things like that.

And that was something that excited me. And so I was interviewing with different large firms like Merrill lynch and Wells Fargo and places like that. And.

And he said, hey, why don't we start this business together? And at the time, as I was going through these interviews, I was like, okay, I don't really want to be in the food business.

He had been in the food business his whole life, his whole career, excuse me, my whole life, and so jumped in and did it. And here we are now 10 years later, which is kind of crazy. But never thought that I'd be in this business.

And watching my dad my whole life growing up, I never even like food service. Wasn't really even as a thought, as a kid.

I think when you go to school you think like, I want to be a doctor, I'm a lawyer, I'm going to be a baseball player, you know, something like that. And being in the food business was not. Wasn't even on the top of the list. It wasn't even on the list. But really glad that I, that I got into.

Into this industry. It's been really spectacular. But good for you for jumping back into your, you know, into your family business.

And you said your great grandfather started the company.

Daniel: 00:10:23

Yeah, yeah, we. So he was a farmer here in eastern Kentucky. You know, the industries largely kind of fell apart, the coal industry in Appalachia.

But at that time, you know, across eastern Kentucky and West Virginia, you have these company coal camps kind of scattered all over the place so that the workers lived and, you know, in pretty close proximity to where they worked every day. And at that time, the coal companies were paying their employees in a combination of dollars and then company money, or scrip as they.

As they called around these parts. And so my grand, my great grandfather noticed that none of these company stores where they could spend the company money at.

You know, you could buy shovels or you could buy, you know, basic household goods, but they didn't have fresh produce and have fresh chicken and didn't have fresh eggs. And that's what he knew to do. So he'd load up his pickup truck, drive around the cold camps and deliver there.

And then in: 1942

He took out the loan and started up the business and got his three sons involved in the business, and they were involved in it for all of their lives. And our third generation, my cousin who's our president, he's been with the company 42 years.

You know, he's gone from candling eggs from a quality control perspective to mentoring myself and some of the other young folks that have come back into the business or, you know, really came home from, from other career stops before coming back here. And it's been a really good journey. Really, really good journey. So.

Nick: 00:12:08

Yeah, that's so cool.

You know, it's been interesting when in doing this podcast or even just meeting people in the industry in general, just in my day to day of, you know, those who work for companies that have been around for many, many decades, some over a hundred years, how they started, you know, it was like a simple idea that they wanted to help their local community. And for like, it's, it's like whatever they originally did, like, it just explodes into this big business or into this well established company.

And it's really fascinating to see that And I think it's super cool that what you guys have going on is, you know, you now have four generations in the business and I know you thought, you know, maybe there was a possibility of maybe private equity or having, you know, outside money coming in, but preserving that, that family owned or family, you know, kind of focus on the business. I think that's really cool of what you guys have done. What about for you, what is your specific role? What does your day to day look like?

Daniel: 00:13:04

So I'm, I'm chief operating officer of the company. I share an office with our CFO and general counsel.

And you know, regardless of title in any family owned company, but especially in food service, it's whatever's coming at you at the moment, you know, in terms of, you know, overarching things. A large part of my role has been helping to modernize our business over the last seven years.

You know, 25, 30 years ago, a lot of distributors, particularly independent distributors, were going through ERP implementations and you know, getting modernized in that way. And then for 20 years or so there wasn't a whole lot of movement from a technology perspective in the industry.

You know, one, we all deal with pretty razor thin margins because a lot of us are just moving boxes and keeping some of them cold at the end of the day. But you know, from an E Commerce perspective and otherwise there wasn't a whole lot of change.

But really since COVID a lot of new technology has erupted into the independent food distribution industry. You know, you've got folks on the E commerce side and sales rep tools like Pepper and Cut and Dry and Choco kind of moving the needle there.

There's a much wider selection from a routing optimization tool perspective.

And from inventory management, warehouse management, there's a slew of new solutions that have come out in the last five or six years that are, you know, trying to get make inroads in the industry and forcing a lot of the lumbering dinosaurs or I can't really think of another way to put it, the VRP companies that like to tell companies how they want to run their business and now there's more options on the table.

So it's been really interesting as that's happening and meeting those folks and figuring out how to integrate those into what we do each day so that it makes sense and helping to modernize not only our company, but what the industry is doing.

Nick: 00:15:00

It's interesting you saying in the last seven years really trying to modernize the business.

Is there any coincidence with COVID being four or five years ago and the speed of innovation and technology and kind of, you know, not just the food service industry, but a lot of industries moving towards more innovation, more tech. Do you, you know, do you think that's one of the reasons why you see that now in your business, maybe more than ever?

Daniel: 00:15:22

Oh, absolutely. And it's not just, you know, folks being able to doordash or ubereats things, you know, from, from restaurants. It's just everybody.

You know, whether you're a restaurant operator or somebody ordering, you know, a set of pencils off of Amazon, you expect to be able to do that with the, you know, the device that you have in your pocket and it be an easy, frictionless customer experience. And, you know, a lot of folks are listening to that.

A lot of, A lot of the tech companies that are coming in the industry are listening to that cry from both distributors and operators. And so it's been a real breath of fresh air, not only to see it, but as you said, the. Particularly the.

The pace of which is increased over the last five years, you know, and it would happen anyway. You know, much like a lot of things, as we've said since COVID just Covid has. Has sped things up.

Nick: 00:16:16

Going back to the beginning of our conversation, you were talking about your time at Dollar General and getting a lot of experience working with them.

Do you feel like some of those experiences and some of those learnings working for, you know, massive corporation like that has really helped and translated into what you're doing here today?

Daniel: 00:16:32

Oh, absolutely. You know, and every. The, the.

The team that I worked on was largely project managers or data analysts, and you kind of graduated into being a project manager. But you got to touch every part of the business.

You got to touch star operations, construction, marketing, merchandising, even tax and licensing with some of the stuff that I worked on there.

But everything involve leveraging technology in order to drive more efficiency, you know, more productivity in the business, make things happen quicker, make things happen with less mistakes. You know, how do you, how do you ensure that you can't get something wrong?

That's always the, the philosophy that we had as well as, okay, you're gonna be working with these different groups. You're always playing in someone else's sandbox.

So with that comes a certain degree of respect that you have to have for legacy and process and the way that. And how we got here to where we're at now. You know, I always start off a meeting that we have here with look, and I realize everybody's been.

Been working this way for A certain period of time, some things decades. But you know, I'm not calling anybody's baby ugly because everybody's baby's ugly.

So let's be on that same playing field and let's move forward with what's going, what's going to drive us, you know, what's going to progress is where we need to be at.

Nick: 00:17:53

the word change, in about. In: 2016

And kind of coming in and changing the culture and changing their systems, processes like it was. There was pains to it.

Do you feel that in your company, you know, being around since you said the 40s, you know, there's a certain way that's, that you've done business for a long time and it's been successful because it's been around for so long. You know, what was really the, the temperament around the company as you've started to make some of these changes as.

Daniel: 00:18:33

Far as internal, it's, it's one. Making sure that, you know, just because I'm a family member, you know, I realize I've got to earn some respect also.

So let, let's, let's, you know, one of the first projects that I worked on was, was getting us on a different food safety audit standard as a company and is one of our customers that was driving that, you know, one of our chain customers driving that need and being able to take the person that we put in place to, to run that program had been with the company, Lord have mercy, 35 years. But he was our food safety expert and he was also our warehouse manager. So he knew everything when it came to those things.

So one, getting him on board with, yes, we can do this, and this is how we're going to do it. And then as we move through that, you know, hand holding the people involved in that project so that they understand, okay, what are we doing?

Why are we doing it?

What is the result of why we're going to do it and building that bridge between current state and future state so that everybody understands why we're building the bridge and how we're building the bridge without getting into too much specifics and things like that, it's just making sure that people understand the path. And that was really successful in that.

But just in general from a modernization standpoint, making sure that we've got the right tools for the people, we get them trained, because that's one Thing that I think a lot of smaller independent companies take for granted is the training portion of that, because you don't have the resources.

At the end of the day, if you need to get people up to speed on outlook or another Office365 application, you need to get them up to speed on a new AR processing solution that we're implementing.

You have to get them trained and have them trust what they're looking at and how they're using it before you can really expect them to drive results with it.

Nick: 00:20:35

Yeah, absolutely. And what, what areas do you guys cover?

Daniel: 00:20:39

So we're, we're in seven states.

We cover basically all of Kentucky, all of West Virginia, southern Ohio and Indiana, west southwestern Virginia, and then parts of North Carolina and Tennessee as well.

Nick: 00:20:52

So you have a lot of the Appalachian area.

Daniel: 00:20:55

Yep, yep.

Nick: 00:20:56

I watched this documentary on YouTube and don't ask me the name of it because I can't remember, but it was great about, you know, kind of the. I didn't know much about Appalachia at all and kind of learning more about that. You know, it's, it's.

I think it extends from like Ohio all the way down to Louisiana. Right. It's a mountain range that, that these people live in. It's a coal mine. Coal mining community, for sure.

My, my have family that, that for many years ago, decades ago, they were in the coal mining business. They lived in Pennsylvania.

And I remember my grandma bought me this cool little like, figurine, a man dressed in a coal miner's outfit made out of coal, because I think it was like her father maybe, or maybe her great grandfather that worked in coal and how important that that resource and that industry is to that, you know, to those communities. For sure.

Daniel: 00:21:52

Oh, yeah, it's, it's, you know, one of the challenges and why there's not a whole lot of manufacturing our area is because you, you got to build that on flat land and there's not an overabundance of that. But, you know, the people in Appalachia are resilient.

You know, a lot of, you know, for example, one of the small towns that's been hit hard by flooding just, just this week in southeastern Kentucky.

Harlan, Kentucky used to have a hundred thousand people when, when the coal mining was booming in the 40s and 50s, and now it's a area with like 2,000 people. You know, it's, it's shrunk to that degree because there's not that much opportunity there.

But the people that, that have remained in Appalachia, you know, and Particularly as young folks are starting to come back and see the opportunities here. It's, it, it really shows the, not just the problem solving, but, you know, how do we figure out to make this work as a community?

Nick: 00:22:48

Yeah, absolutely. Absolutely. Um, I think it would definitely.

I mean, after watching that documentary, I think it's definitely a place I'd like to, to check out one day, you know, and to be able to go. Go see that.

And like I said, growing up on the other side of the country, I, I had heard of Appalachian State, I had heard of Appalachia, but like, I never, I had never thought of it, like, you know, of it being so big across so many different states and like, how big of a portion this is of the country, which is just, it's just crazy. And I, it's so funny that just growing up here, I had no clue.

Daniel: 00:23:20

Yeah, yeah. You know, same thing here. You know, my wife and I, we visited California a few times and it's.

You don't, you don't think about those kinds, especially the, the weather and the landscape, which is completely different than the way it is here. Unless you experience it, you don't really get exposure to it.

If you don't, if you don't seek out that kind of, that kind of exposure, then you don't get it. You don't have the perspective.

Nick: 00:23:46

So totally in your, within your business, who are, do you compete against? I would imagine, large national broadliners and other local independent distributors. You know, what does your competitive landscape look like?

Or maybe how many different competitors do you go against?

Daniel: 00:24:04

So in our area, we're fortunate that of the big, of the big distributors, US Foods is the only one that has a facility directly in our main geographic footprint. They have a facility just outside of Huntington, West Virginia.

So Cisco, US Foods, PFG, Gordon's Food Service, McLean, they all have shuttle domiciles that they use to service customers in our area mostly. And, you know, we utilize that to our advantage to a certain degree.

You know, we're sitting here, we're a local company and, you know, a lot of independent distributors use that local marketing pretty, pretty heavily. But as far as the big guys go, you know, those are our primary competitors.

But the advantage that we have really is the relationship driven and the way that we manage our relationships with our customers, you know, that's, that's our industry.

At the end of the day, you know, if you're not maintaining relationships with your key customers and you're not developing new relationships with key customers, then, you know, what are you doing so that's right.

Nick: 00:25:13

Food service, it's, you know, it is, it has a lot of that old school mentality. That old, you know, it is a relationship business. Yeah.

I always try to think like other industries, like the clothing industry, you know, growing up, like the only option is you go to the store, you try on the clothes and you buy what you like. Right now you can literally have a box that's delivered to your home that someone curated for you.

You can try on the different pieces and then, you know, keep and then send back the ones you don't like. You know, that's an option. Now it's, it's so funny. But in food service, it's still very much, hey, we show up to your back door.

You have a relationship with your driver. Right.

You have a relationship with your sales rep and you have a relationship with, with the people within the building and like, and that's just how you do business. And it's really fascinating. It's really cool that that relationship part of the industry is very much alive and preserved.

Daniel: 00:26:09

Yeah. And building on that, you know, you asked about other independent distributors and there are.

a member of a co op since the: 1960

bled up Premiere in the early: 2000

Large way that we communicate and interact with the other distributor is, you know, there's kind of a handshake agreement there that we don't directly compete with each other because there's plenty of business for us to take away from the big guys at the end of the day.

But using, utilizing the buying group, not just from, from a, you know, making sure that we get the most competitive pricing to be able to compete against the big guys, but just understanding what other best practices, buying or otherwise, are out there with other companies and getting exposure to being able to network with other distributors, be able to have those conversations and network with them. That's just as valuable as having the right products at the right price for customers too.

Nick: 00:27:30

We do the same thing on the broker side.

You know, we, we cover California, Nevada and Hawaii, but we're part of Sales one, which is a large broker group across the country, I think in Kentucky, it's, I don't know if you know, Mitch Shaheen and Beth Shaheen with Lakeland.

Daniel: 00:27:44

Yeah.

Nick: 00:27:45

And it, like you said, we share business practices, we don't purchase anything, you know, cause we're, we're just a sales agency.

But you know, I see it on the operator side and the distributor side when you're part of Unipro or you're part of like Sodexo Premier on the operator side, you know, you're only, you know, your operation may only be so big, but if we pull all of these other operations together, we, we make it our buying power much, much greater. You know, it kind of creates a community which is pretty cool.

Daniel: 00:28:13

Yeah.

Nick: 00:28:13

Looking into the future of your career, what is something you want to achieve that you haven't yet achieved?

Daniel: 00:28:20

So you know, starting my career off with such a gigantic company, you know, I don't, I'm not naive enough to think that, you know, you know, the small company here in Eastern Kentucky can grow to that degree. But you know, there are many models out there.

Whether you look at a Benny Keith or you look at a Chaney Brothers, you know, family ran companies that have been able to grow and thrive and become multi facilities distributors covering large geographic areas.

You know, by the time I retire I'd like to have you know, three or five facilities and be able to, you know, service customers across, wherever the geographics take us over that time.

But you know, continue to, to grow and thrive with our, with our family grand company here and some of the, the folks that we brought into the company, you know, just seeing things develop and blossom which you know, we've made tremendous inroads over the last six, seven years in doing that, but continue to invest in those and into our folks and being able to offer, you know, good careers for people in a community that's, in a community and in communities that have largely lost those with the evaporation of the coal industry. That's, that's the truly rewarding part of it.

Nick: 00:29:37

Amazing. Isn't it funny you thought at one point I didn't want to be in the family business, but here you are, man, you're hooked. You're in it.

Daniel: 00:29:44

Yeah, yeah. And it's the industry too, you know, totally.

One of the, one of the benefits that I had even at a large company like Dollar General is the people that I work directly for and with were salt of the earth people.

And this industry, it's very unique in how willing everyone, regardless, even if you're a competitor, how willing people are to share best practices and things that they're doing and that are helping to enhance their business. It really makes it unique and really makes it an enjoyable experience.

Whether you're networking at a conference or you're having dinner with another business owner locally, nobody is too big or too small to not be recognized and have something that somebody else can learn from.

Nick: 00:30:32

Totally well said. Well, Daniel, I just want to say thank you so much for. For taking time and coming on here and chatting with me.

Daniel: 00:30:39

Yeah, no problem. Anytime. I really appreciate getting to meet you and have a conversation.

Nick: 00:30:46

Yeah, we'd love to meet you in person one day.

Daniel: 00:30:48

Absolutely. Absolutely.