How Terry Ho’s Yum Yum Sauce Went From a Customer Mishap to Shelves at Walmart, Kroger, and Publix

Small business takeaway:

• Terry Ho’s Yum Yum Sauce shows how a restaurant favorite can become a national retail brand when customer demand reveals a bigger market. Three broader business lessons stand out: Loyal customers can function as authentic growth engines; control over production can protect quality and resilience as scale increases; and niche channels, from regional grocers to commissaries and schools, can create durable pathways to mainstream distribution.

Four years after Terry Ho opened a handful of hibachi fast-casual restaurants in his home state of Georgia, a customer mishap sparked a new family business, a sauce company, Terry Ho Products LLC, that now brings in over $25 million in revenue a year.

Ho’s customer wanted a 32-ounce cup of the Yum Yum Sauce he served in his restaurants, a concoction he invented years earlier in the kitchen of a fine-dining restaurant he once owned in Albany, Georgia. The woman dropped the cup, spilling sauce on the floor. For Ho, it was an aha moment: He needed to bottle the sauce.

“We had thought about it before,” he said, when other customers requested cups of the sauce to go or brought their own containers. “But this pushed me over [the] edge. I thought, ‘There’s got to be a better way to do this.’”

Over the last 19 years, Ho has grown his sauce business from one to multiple products, selling over 90 million bottles, while expanding his restaurant enterprise to 23 locations across Georgia and Alabama. Keys to his success have been word of mouth and loyal customers, quality ingredients, partnerships, and keeping his business in the family.

The $139.71 billion U.S. sauces and condiments market is estimated to reach $240.91 billion by 2036, driven by a demand for healthier condiment options and diverse culinary preferences, according to Future Market Insights.

Terry Ho started selling his Yum Yum Sauce in regional grocery chains before big-box stores like Walmart and Target agreed to a test

A first critical step Ho completed before launching his business was to work with a co-packer (specialized production facilities that make products for multiple brands) to streamline the recipe for Yum Yum Sauce across his restaurants. With the co-packer relationship in place, Ho started brainstorming a bottling plan the day after his customer spilled the sauce.

“I’m a fast-paced kind of guy,” he said. “I jumped on it.” His built-in audience of loyal restaurant customers formed a strong base for early sales of the sauce brand. “Our customers became our ambassadors,” he said.

Ho’s co-packer had a relationship with supermarket chain Piggly Wiggly and made a connection. Terry Ho’s Yum Yum Sauce went on Piggly Wiggly shelves during his first year in business. Success at Piggly Wiggly led to placement in 68 stores of the former Harvey’s grocery chain in Southwest Georgia. “And sales were good,” he said.

Supermarket chain Food Lion’s purchase of Harvey’s in 2020 expanded the sauce’s reach. Now, Terry Ho’s Yum Yum Sauce is sold in nearly 36,000 stores nationwide, from mom-and-pops to big-box stores, including Kroger, Target, and Walmart.

The Walmart relationship began with a test of some 200 stores in 2014 and grew after strong sales. Over the years, Ho has changed co-packers, but he’s consistently resisted advice to use cheaper sweetener ingredients, he said, preferring real sugar. “You just have to hold your ground sometimes,” he said. “I want quality.”

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Turning down private equity offers to keep the business family-owned and operated

Getting into big-box stores attracted private equity to the company. Ho thought hard about the partnership and purchase offers he received. But, in the end, “I want my future generation to carry on this project,” he said, so he chose not to entertain those offers.

To progress without that support, he knew he needed to control production and the packing of his products so he wasn’t dependent on third parties. Luckily, Ho had just completed construction of his own 15,000-square-foot manufacturing plant when the pandemic hit.

“That’s when our co-packer sent us an email saying we can’t produce your product now,” said Ho. “So we operated our own plant 24/7 to get our product out, and we actually grew tremendously during COVID.” Since then, a 100,000-square-foot facility he subsequently invested some $12 million in has replaced the smaller one. “There’s such a benefit to having your own factory,” he said. “You control your own quality and product and schedule.”

Ho’s son is the liaison between the sauce company and plant and owns one of the family’s hibachi restaurants. “And my grandson at 10 years old is already asking if he’ll one day work at a Yum Yum plant.” Ho continues to turn down offers from private equity.

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Two more niche revenue streams: selling Yum Yum Sauce in military commissaries and in schools, spreading the brand’s reach

Marketing by word of mouth over the years has fueled strong growth. “It’s the No. 1 marketing tool for me,” he said.

Customers organically posted authentic videos and pictures of themselves touting Yum Yum Sauce on social media. Only more recently, in the last year, has the brand upped its social media presence, especially on Instagram and TikTok, Ho said.

One TikTok video of a child unwrapping a gift, discovering it’s a bottle of Yum Yum Sauce, and then zooming in on his ecstatic look garnered some 1 million views.

Two more niche revenue streams have helped drive business too. Around 2014, it occurred to Ho that soldiers from the nearby Fort Benning base would often eat at his restaurants. He called the military base’s commissary and got his sauces on store shelves. Now, products are sold at commissaries on U.S. bases worldwide.

“It’s really helped my business,” said Ho, adding that he sells around 10,000 cases a year to bases.

Three years ago, the brand also ventured into schools, supplying districts across several Southern states with reduced-calorie Yum Yum sauce cups. “It’s a slow process, but we’re growing,” Ho said.

Planning to launch a new hibachi restaurant concept and more products in the coming year

With the sauce company’s success, Ho could choose to let his restaurants take a backseat. But instead, he’s moving full steam ahead with the sauce company and his dining locations. 

“I just love the restaurant business,” said Ho, who as a teen worked as a busboy and cook at the Chinese restaurant his father opened, House of China, in 1973 after emigrating from Taiwan. When his father died young, Ho at 28 helped his mother keep the restaurant going.

“I’m the only one in my generation to stay in the restaurant business, and I want to carry on the torch,” he said. Ho and the family are working on a new restaurant concept he calls “turbo-charged hibachi,” standardizing their restaurants’ look. Plans include converting one 20-year location to the new concept and then more if it’s successful. The converted location will feature current Terry Ho’s Yum Yum Sauce products plus a handful of other products that are in development for the new concept specifically. 

“We want to be the next Panda Express, that’s what we’re envisioning,” he said. New products made for the restaurants could then ultimately be brought to customers through grocery stores, Ho said.

For his sauce brand, Ho is working on another product to launch next year, in addition to the other varieties over the next few years, including Yum Yum Ranch and Spicy Yum Yum. Ho often tests new products with employees of the local bank he works with, setting up sauce tastings in the branch’s boardroom.

“Slow and steady growth like we’re enjoying right now is what I really care for,” he said. “We want to take care of our customers first. I’ve been taught that as a kid — take care of your customers and they become your ambassadors.”

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