Santa Monica Seafood's Roger O’Brien talks acquisitions

Published on
July 11, 2017

Late last week, Santa Monica Seafood’s Roger O’Brien, who has served as CEO of the Rancho Dominguez, California, U.S.A-based company since January 2015 and as its executive board advisor since 2005, was promoted to the additional title of company president. On Friday, 7 July, SeafoodSource spoke with O’Brien about his promotion and his vision for the company.

SeafoodSource: How long have you been with Santa Monica Seafood and what were the circumstances of your recent promotion?

O’Brien: I’ve been associated with Santa Monica Seafood for 12 years now, and even before I was formally employed as the CEO, I was operating as the de-facto CEO. When I started officially as CEO on 1 January, 2015, I already knew the company’s programs quite well, I had run board meetings, shareholder meetings, participated in all key management meetings, and I had engineered all of its acquisitions prior to that time. So stepping in as CEO was a little easier for me than someone stepping in from the outside.

When I first came onboard as CEO, the initial thought was that I would start as CEO and president, but both [Santa Monica Seafood Chairman of the Board] Anthony [Cigliano] and I decided that would be taking on too much at one time. We decided to split the roles, with Anthony taking on the operations side of business and all the administrative side reporting to me. 

In the last eight months, we just went through a “Good to Great” program, where we introduced lots of productivity efficiency changes and analytical processing improvements – the whole package. Coming out of that, we wanted to make sure the whole thing would be sustainable and that we would continue to have process improvements, which precipitated the title addition. 

The other factor was, through that, we decided needed one person speaking for the company and calling the shots. I’m the business and strategy person, while Anthony is the fish person. From a managerial perspective, we agreed it was best for me to take both positions. Anthony and I are both on the board of directors, and the move was a unanimous decision of the board. Anthony is not going away not retiring. He’ll still be very active in the business – he’s a workaholic like me – but it will allow me to have that one voice going forward. Long story short, this move was envisioned more than two years ago, but we’re just now putting it into practice.

SeafoodSource: What additional duties have you taken on with the role of president?

O’Brien: The biggest changes from what I’ve already been doing is that now all of our departments – operations, production, procurement, purchasing, quality control, food safety – those will now report to me. It’s about 625 employees total. 

In addition, I’m now in charge of putting together the company’s executive team. We recently hired a new senior vice president of sales and vice president of procurement, and we have a job offer out for someone to run our logistic department, which is the last open spot on our executive team. Once we have that person on board, the senior management team will be complete and fully in place.

SeafoodSource: Do you have plans to grow the business and how so?

O’Brien: We’re pushing organic growth as well as looking at expansion opportunities. Primarily, we want to both grow our core processing distribution business niche – we don’t want to veer off into new segments of the industry. Right now we cover southern and central California, as well as most of Arizona and Nevada, and we want to expand out of there. At the same time, there’s still a lot of space in our existing territory that we can grow into. Also, now that our financial position is much stronger, we can consider more acquisitions. I’m not going to indicate where we’re looking, or who we’re looking at, but those are all back on the table. 

SeafoodSource: Is Santa Monica Seafood looking to make any acquisitions in the near future?

O’Brien: It has now been about two years since we purchased American Fish, Chesapeake Fish, and LA Fish in July 2015. I can say those three entities have now all been fully integrated. All the holds on significant growth or expansion have been removed and I think we’re now at the point where everything is in place that we can consider further acquisitions. 

SeafoodSource: Are you actively involved in any negotiations regarding an acquisition? 

O’Brien: We are not in any advanced talks with anyone yet.

SeafoodSource: Do you have plans to expand the retail side of your business?

O’Brien: We’re pretty unique on the distribution side of seafood in that we also have two retail stores – seafood markets and cafes, both in southern California. We’ve had those two stores for quite a while and they do a tremendous volume and help both our top and bottom line. The retail stores are not part of our core business, and while we’re not looking to expand that business, we value those stores for the additional reason they are excellent source to help our brand in the community. I would say most Californians know us better for those stores than the fact we supply lots of high-end restaurants and grocers. And besides branding, if we need product – if one of our sales reps needs products quickly, or if one of our customers near those stores needs product quickly, they come in handy. They also give us good insight from a retail perspective of what’s selling and at what prices. That helps us with advice we give to our retail accounts.

SeafoodSource: What were some of the limits to the company’s expansion in previous years, besides the time it took to absorb your previous acquisitions?

O’Brien: We’ve done a lot of work on both our organizational structure and our infrastructure. We’ve put in USD 12 million (EUR 10.5 million) worth of investment into our nine facilities over the last three years. We’ve doubled the square footage of our main facility in Rancho Dominguez, adding another 60,000 square feet of space, and upgrading a lot of our equipment. We’ve also put a lot of money into upgrading the facilities we got with American Fish acquisition. 

We’ve also spent a lot of time on improving our organizational structure. We used to operate with a lot of tribal knowledge, and we’ve begun documenting it so we can incorporate it into our training systems. We’ve added several planning and analytical tools to monitor our progress so we better manage our progress. As part of that, we have gone through extensive training and set up a lot of performance metrics – key performance indicators – with all of our sales and management people throughout our entire company. 

On a side note, now that we’ve had some time with the systems, I’ve been happy to see that, for the most part, our analytics are positive. Our productivity has increased quite significantly and our sales and margins continue to trend very nicely. 

SeafoodSource: Where are you seeing the greatest innovation taking place in the seafood industry?

O’Brien: Both fresh fish and value-added products, that’s where new innovative activity is happening in our industry. However, the biggest innovation I see is on the packaging side, especially with skin-pack. That has definitely taken hold – everyone is trying to jump into it, though getting grocers to leave their butcher block-type displays and go over to skin-pack is not easy. Even with that and some of the other issues they’re facing, I see that conversion eventually happening regardless. 

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