Business

Starting out at 15, Ethan Holmes has built a thriving applesauce business

BY Preta Peace Namasaba June 24, 2024 4:33 PM EDT

The older generation has a wealth of knowledge and recipes for success to pass down to the young. Ethan Holmes benefitted and learned from the presence of older loved ones in his life. At 15, his godmother gave him the book “Reallionaire: Nine Steps to Becoming Rich from the Inside Out’ by Farrah Gray who made a million dollars at 14 years old from creating and selling his own product in Cleveland, Ohio. This inspired Holmes to start a business. With his grandfather’s applesauce recipe, he founded Holmes Mouthwatering, a manufacturer of all-natural applesauce sourced from locally grown apples, pears, and apple cider.

Over the past decade, the company has delivered over 250,000 units to consumers across the US. The product is available in retailers including Heinen’s, Whole Foods Market, Kroger, and Giant Eagle, among others.

Initially, Holmes devised the idea to develop a chocolate candy bar called NomNom. He tried to sell it in the school cafeteria but people were not interested and it was a failure. Holmes returned to the drawing board and realized that people needed something healthy – a high-quality product with a story. He came up with the idea for applesauce and approached his grandfather on how to make it. Unlike better-known brands of applesauce loaded with added sugar, Holmes planned on making a product that was made up of healthy, local, and all-natural ingredients.

“I just went to my grandfather and said, You make everything from scratch, show me how to make applesauce. And then we went to the kitchen. He showed me how to wash the fruit, boil it, and turn it into applesauce,” Holmes said about how he created his applesauce recipe.

He used the technique his grandfather taught him and experimented with his recipes for about six months to a year. Holmes eventually found an all-natural applesauce recipe he liked by adding cider, fresh pears, fresh apples, and cinnamon – on occasion. He spent about $1,500, mostly from his birthday and Christmas money to start the business.

In 2015, Holmes dropped out of Hiram College to launch Holmes Mouthwatering Applesauce. He invested his prize money from pitch competitions and business accelerators and got a commercial kitchen. A year later, his product was in retail locations throughout the midwest, including Heinens, Giant Eagle, Zagara’s, and Dave’s markets. Holmes continued expanding and soon had his family recipe on the shelves of Whole Foods, the Cleveland Metroparks Zoo, and smaller independent establishments.

However, the growth journey was not linear.

Holmes has faced a series of rejections in the beginning. Instead of being discouraged, he listened to the feedback, closed the gaps in business strategy, and sought out people who shared and or saw his vision for the business. He has grown his operations and distribution by leveraging his network, pitching his product at every opportunity, and listening to the advice of business mentors. Holmes has won several entrepreneur pitch competitions, earning approximately $800, 000 in capital to fuel business growth.

“We’re trying to be the Ben & Jerry’s of applesauce. Nobody has been able to shape up applesauce the way ice cream has been,” Holmes said about his aspirations for Holmes Mouthwatering.

In 2021, a Chilean contract manufacturer looking for strong emerging brands reached out to Holmes. He visited their plant, met the research and development department, and ate 50 different applesauce formulations with them. They eventually found the right recipe and Holmes returned to Cleveland with 500 samples to use for marketing and sales. In addition to shifting from a small, local production facility to a global contract manufacturer, he changed the company’s name simply to Holmes Mouthwatering.

Holmes Mouthwatering’s increased production capacity and updated packaging have seen its sales significantly increase. From averaging $50,000 to $60,000 a year, the company brought in about $200,000 in 2023. It is now on track to reach half a million in sales next year.

Holmes is inspiring the young generation to get an early start in business. He created the Holmes Entrepreneur Initiative which allows local students to learn about small business operations and earn a wage by working in the production and sale of Holmes Mouthwatering. They consequently gain the necessary skills to start their own business while earning a stipend with the company. Holmes also visits local elementary schools to teach the students about elevator pitches and the viability of entrepreneurship.

“I think that’s part of what I’m meant to do with my life. Money and success are great but it’s ultimately worth nothing if you can’t share with others. I really want to encourage more young people to go out and follow their dream,” Holmes said about the importance of inspiring the young generation.