Goelitz, on a shoestring, bet the firm on gourmet Jelly Belly beans in 1976

The Herman Goelitz Candy Company of California, then run by fourth-generation candy maker Herman Goelitz Rowland Sr., was nearly sunk by the world sugar crisis of the 1970s. Consumption outstripped production from 1970 through 1974, and sugar that had averaged around ten cents a pound spiked above 65 cents in November 1974, devastating candy makers worldwide. Rowland borrowed money to buy sugar so his company could stay afloat. As he later told the Los Angeles Times: 'It was really a time of turmoil and we were on a shoestring — we had nothing to stand on.'

Instead of retreating to cheap bulk candy, the firm doubled down on product. It had pioneered a mini jelly bean with a flavored center in 1965, and in 1976 a candy distributor named David Klein pitched Rowland a gourmet version: exotic natural flavors like cream soda and watermelon, marketed at two dollars a pound — a then-outrageous price for a jelly bean. Goelitz developed the recipes, Klein named the candy Jelly Belly, and the family firm, in Rowland's words, 'poured everything it had into the product.'

The bet paid off through an improbable customer. Ronald Reagan, who had snacked on Goelitz beans since his governorship, became president in 1981, and the company shipped 7,000 pounds of red, white and blue Jelly Belly beans for his inauguration; the White House went on ordering about sixty cases a month. Sales skyrocketed. In the fall of 1980, before the boom was certain, Goelitz had also secured the future of the brand itself, agreeing to pay Klein and his partner $10,000 apiece per month for twenty years in exchange for the Jelly Belly trademark.

Jelly Belly became a national brand after Reagan's 1981 inauguration, which featured 7,000 pounds of beans; by 2011 the firm's gross revenue ran about $190 million.

The sugar crisis was existential: input prices rose more than sixfold and credit-dependent candy makers were failing worldwide.

Rowland chose premiumization over retreat — a two-dollar-a-pound bean built on natural flavors carried margin the bulk business could not.

Buying out Klein in 1980 gave the firm full ownership of the trademark, converting a borrowed idea into a durable family asset.

Reagan's publicly known jelly bean habit gave the shoestring firm a presidential endorsement no advertising budget could buy.

A near-broke family firm survives by narrowing, not by discounting: inventing a premium niche — and owning its trademark — carried margins the bulk candy business never could.

Herman Goelitz Candy and the Illinois-based Goelitz Confectionery merged in 2001 and renamed themselves Jelly Belly Candy Company — the first time in a century the family sold candy without the Goelitz name on it. Herman Rowland Sr. remained chairman of the combined firm, whose gross revenue was estimated at about $190 million in 2011. In November 2023 Ferrara Candy Company, part of the Ferrero Group, completed its acquisition of Jelly Belly, ending more than 150 years of Goelitz family ownership.