At Chobani, the Turkish King of Greek Yogurt

Chobani CEO Ulukaya in upstate New York. (Photograph by Brian Finke for Bloomberg Businessweek)
Hamdi Ulukaya sits in a restaurant in upstate New York, waggling a rolled-up slice of pizza, making bombastic pronouncements about yogurt. As the founder and chief executive of Chobani, the brand of Greek yogurt that has stormed the stainless steel refrigerators of coconut water drinkers and ancient grain eaters, he has some standing in the matter, although he?s actually Turkish.
The yogurt that most Americans ate for decades was a travesty, in his view: too thin, too sweet, too fake. "So horrible," he says in his Turkish accent, his eyes bright against a lean face. "Terrible." As he sees it, we were all snookered by big food companies that cared little for our taste buds or health. Greek yogurt's high protein content makes it more filling, and it contains little or no fat. His doesn't have preservatives, either. "There is no reason for us to put preservatives in the food," Ulukaya says. "I would say to the big guys, "Watch out. You'd better change your ways. The consumer knows now, and the consumer will punish you if you don't do the right thing." 

He has kind words for one competitor, albeit briefly. Fage, the Athens-based company that first brought Greek yogurt to the U.S. 15 years ago, "makes great yogurt," he says. But when I start writing that down, he almost jumps out of his chair. "No, no, no," he says, "Fage does not make great yogurt." Then he laughs. He can afford to pass out compliments. Chobani has made Ulukaya a billionaire, according to Bloomberg data. Five years ago Chobani had almost no revenue. This year, the company will sell more than $1 billion worth of yogurt, says Ulukaya, who's the sole owner. Once a niche business, Greek yogurt now accounts for 36 percent of the $6.5 billion in total U.S. yogurt sales, according to investment firm AllianceBernstein (AB). Upstate New York, with its 28 plants owned by Chobani, Fage, Yoplait maker General Mills (GIS), and others, has become something like the Silicon Valley of yogurt.

Near the restaurant, trucks rumble by, headed to a Chobani plant 5 miles away in the hills of South Edmeston. Most days, more than 150 come at all hours to deliver milk or haul away fresh yogurt. The plant’s 1,300 employees work around the clock to produce more than a million cases of yogurt a week—the equivalent of 12 million 6-ounce containers of Chobani plain, strawberry, blueberry, peach, pomegranate, passion fruit, blood orange, and a dozen other flavors.

Ulukaya, 40, lives with German shepherds named Panja and Cedric in a modest house near South Edmeston. He says he’s building a man cave with a pool table and big-screen TV. On a recent day he puts on a white smock and blue hairnet and saunters through his factory like a kid on a playground full of pals. Workers offer hugs and handshakes while calling out, “Hamdi,” and “Boss.” He snatches a Chobani six-pack from a pallet destined for a Costco store. “This is for people who wanted to buy too many cups to carry,” he says. “It’s for heavy users, or actually now”—he smiles—“average users.”

For all of his cheerful swagger, there are no sinecures atop the dynamic yogurt market. Dannon, Yoplait, and smaller rivals are churning out their own Greek products. Ulukaya’s payroll has almost doubled in the past year, and he has built plants in Idaho and Australia, offices in Manhattan and Amsterdam, and a retail store in New York City’s SoHo. His ex-wife is suing him for $1 billion, saying she helped fund Chobani and is entitled to at least 33 percent of the shares. (Ulukaya says the suit is meritless.)

Sitting in his small office, surrounded by photos of dairy farms, Ulukaya says he worries most that he or his employees could forget how they succeeded in the first place. “We focus on the one cup of yogurt,” he says. “We stayed close to the plant. We are very good food manufacturers—that’s who we are. We are makers.” He gathered key staffers a while back to emphasize this point. He told them that if they detected unwelcome changes in him, they had his permission to punch him in the face. “I was serious,” he says.
Ulukaya grew up milking sheep at his family’s dairy in eastern Turkey. He ate the thick, tangy yogurt of his homeland day and night. “My mother used to make the most amazing yogurt,” he says. He and his five brothers fought over who would get the scrim of cream on the surface.
Last modified onSaturday, 06 May 2017 10:07