Pampered Chef's New CEO

(Crain's) - At the risk of sounding like a marketing cliché, Marla Gottschalk is not only an officer of the company she’s also a customer.

"I have all our Pampered Chef products," said Ms. Gottschalk, the former Kraft Foods Inc. executive who became chief executive officer of the kitchen products empire on May 1. "I believe in our mission of bringing families around the table and bringing out the chef in [everyone]. You need the right tools and a little inspiration to bring families and friends around the table."

Ms. Gottschalk, 45, joined Pampered Chef in 2003 as president and chief operating officer. Doris Christopher, who founded the company in her basement in 1980, has stepped aside as CEO but remains the company's chairman. Both report to Warren Buffett, who's Berkshire Hathaway bought Pampered Chef in 2002.

While Ms. Christopher is no longer overseeing the daily operations, she's still very much involved with the company.

"Doris and I still collaborate on a lot of things," said Ms. Gottschalk, who has a bachelor's degree from Indiana University and master's from Northwestern University. "We talk about strategy."

For instance, a casual conversation about a lack of Pampered Chef items at bridal showers both women attended spawned an on-line wedding registry.

Ms. Gottschalk said she isn't intimidated by taking over the job of someone who built Pampered Chef from 71 products and nearly $7,000 in annual sales to its current catalog of more than 300 products and hundreds of millions of dollars in sales. A privately held company, Pampered Chef does not release annual sales figures, but said it reached $500 million in 1998.

"I'm really focused on enhancing many things that Doris put into place," she said. "And I continue to look for opportunities to grow our market."

That growth will come from a combination of launching 60 new products this fall, reaching out to the growing Hispanic market, a test kitchen that created 400 new recipes this year, and, of course, working closely with the more than 60,000 independent contractors who sell Pampered Chef products.

Those consultants are the bread and butter for Pampered Chef, and their sales events, dubbed cooking shows, generate the bulk of the company's sales.

That’s not surprising to those in the direct sales industry.

There are roughly 1,500 direct-selling companies in the U.S., and collectively they racked up $29.7 billion in sales in 2004, the most recent figures available, according to the Direct Selling Association in Washington, D.C.

While the Internet may have been expected to hamper the direct sales industry as increasingly time-pressed individuals turn to the always open online shop over a personal sales pitch, direct sales have grown each year for 20 consecutive years, said Amy Robinson, spokeswoman for the DSA.

"The Internet has enhanced companies doing direct selling," Ms. Robinson said. "It is giving sales people worldwide access, not just access to people in their community."

Consumer product manufacturers are launching direct sales units - last year underwear maker Jockey International Inc. created Jockey Person to Person Inc. and in 2003, Crayola maker Binney & Smith launched Big Yellow Box.

Ms. Gottschalk has never worked in direct sales, but she has experience in the food industry. She joined Pampered Chef from Kraft Foods Inc. where she joined as a senior financial analyst 14 years ago and left as executive vice president and general manager of its Post Cereals division. Ms. Gottschalk has also worked at KPMG as an auditor.

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