Chain of Goodness | Organic Valley


Welcome to Organic Valley. I’m delighted
to share a little bit about our cooperative with you today. We are a
farmer owned cooperative. We are also a marketing co-op, which means we market a
branded product. In combination, our farmers work towards that long-term
sustainable pay price that they are able to achieve by working in a cooperative
method to market their products and bring the best products to market. As a
marketing cooperative our role is to be the eyes and ears of the farmers. They’re
on their farms to making wonderful products every day and our job is to be
in the market making sure we know what consumers want, making sure we know what retailers want, and how do we think five years from now how are we going to
provide the best organic products in order to be able to have this co-op have
the same innovation and the same groundbreaking ideals that in 1988
started this whole crazy organic thing. Ray Haas is cultivating today. The day is June 8th, 1988. the pools Department does a variety of
things to ensure that we have the best farmers these services start with
transition and organic certification they include financial educational and
support through the certification process we also offer our farmers
resource assistance which includes on-call professional staff these staff
include nutritionists veterinarians and agronomist we also support our farmers
by doing on-farm education and training we have a seed program that connects
farmers to organic sources of feed another role that Poole’s has is working
as a liaison between the cooperative and the farmers this includes working with
the farmers on standards governance and as a conduit to the larger agricultural
industry all this work that we do ensures that we are delivering the
highest quality milk from the co-operative to the market there is a
rhythm to the production of Agriculture commodities and when they are harvested
and there’s a rhythm to when consumers want to consume cheese butter dairy and
those things don’t always line up together and so one of our big
challenges here is balancing having enough milk in the right season to meet
the demand for the consumers the first step in balancing is our demand planning
team coming up with a sales forecast they do that by looking at things like
seasonal buying new customers market trends and past history these
projections allows production planning to adjust the inventories in times of
short and long supply it also allows supply planning to say active base for
our farmers so we don’t oversupply the organic milk
when we have too much organic milk we have to sell it on the conventional
market we don’t like to do that so we make every effort that we can to use all
of milk organically whenever possible and we do that by manufacturing a mix of
products so we have packaged fluid milk we have butter
we have nonfat we have cheese’s all those are part of that diversity of
utilizing the milk all off throughout the year our philosophy with our regional milk
and our regional partners is to keep the milk as close to our processing plants
as possible and as close to our sales customers as possible that helps keep a
very low footprint as far as our food miles then keep our costs down so we
pick up milk 365 days a year 24 hours around the clock the various departments
that do this are the transportation department the hauling department and
the production department you can have truck breakdowns you can have plant
breakdowns they can take a phone call at any time and we need to reroute the milk
to keep it as fresh and clean as possible so we have 57 quality checks on
every load of milk that we pick up and the very first quality checks actually
start at the farm itself by our haulers when they pick up the mouth this is to
guarantee that we have the highest quality milk leaving our farms for our
customers and it’s received at the plant we pick back up on that battery of 57
tests so they do their tests to make sure that that milk is still in good
quality it’s good and cold as it’s coming into
the plant they receive that milk into the facility into storage tanks
essentially and then plants will take and process that rate into you know pull
it into skim and cream right off the farm after pasteurization we bottle the
milk or make the butter out of the cream and we can only have safest organic
products however we also look for the best organic ingredients are there the
alliance with our mission and values at organic Valley here so in developing
products in this manner we align with some very important beliefs that we have
as a cooperative and these beliefs include making products as organic as
possible making sure that we are purchasing our ingredients in a manner
that is treating farmers in a fair way we are always looking to make our
products from whole and unrefined ingredients wherever possible and we
want to make sure that we’re using the most delicious high quality ingredients
when developing products or even working with our existing products when you get great ingredients in great
packaging you then need a craftsman to pull this product together into product
that meets the customer in consumer needs we pride ourselves in our
alignment with great craftsman and grade and sensory and work with those plants
to produce the wholesome and delicious product that crop prides itself in once
it’s at the plant we together with Quality Assurance are managing the
production Quality Assurance is really looking at the quality product and
making sure that of those 57 checks that all of those parts are happening all the
way through the shelf life of the product production on the other hand is
really making sure that we’re utilizing the milk the way that we intend it to be
utilized once we get the production that’s done and we move that inventory
over to a warehouse then we’re really working with like the fill rates and
making sure that customers are getting what they want
and our goal there of course is to always fill the customer when they want
it and what quantities they need on time the organic valley sales team was in a
unique position because while we’re given a portfolio of products we really
have to go beyond just selling products we’re selling a story that begins on the
farm with the quality of the goods that we’re producing and then we go to the
retailers to tell that story and to create a partnership with the retailer
together so what we’re looking for is partners in the industry who can
understand that story because when you’re selling products are almost twice
the price they really have to understand your
value proposition the organic valley sales team is unique in that we’re not
only selling up branded products we sell private-label we sell ingredients we
sell bulk tankers so we take a strategy that leverages the strengths that we
have in all of those areas to create a relationship with the customers and to a
broaden the areas that we sell our products as the orders come in our customer
service department takes those orders and enters them into our enterprise
resource planning system from there our transportation management services
department builds those orders into efficient routes that meet our customer
service requirements over the years we recognized and we were shipping a lot of
partial trucks to our customers and we realized that a lot of our fellow
natural food companies were doing the same thing so we formed a subsidiary
called organic logistics to not only help other natural food companies get
their products to market but also help organic valley be more efficient so by
combining the orders of organic valley with our third-party logistics customers
we can fill those trucks will oftentimes going very long journeys reducing the
overall cost for everybody involved as well as the environmental impact by
consuming less fuel at the hub of the organic valley distribution network is
the state of their facility the cash and distribution center as you can see
behind me there’s two wind turbines that power up the facility weekly hundreds of
trucks will come in to the distribution center and ship up once the product
actually goes into facility half of the product goes onto our automated search
and retrieval system the system is similar to a hybrid vehicle while the
machine is moving back and forth the braking system is capturing electricity
and returning it back into the system the other 50% of the product is going to
be selected by a DC operator who will take it case by case build a pallet that
pallet will then be taken by forklift driver put onto a truck loaded and it’ll
be dispersed amongst thousands of stores across the United States you everything that we’ve talked about so
far leads up to what we call in marketing the moment of truth and so
it’s when the consumer is at that point of purchase they’re making a decision
about what they’re gonna buy and it’s about the right product in the right
place at the right time and so again it was the selection of the product the
product quality the packaging the communication that goes into it
and so partnering with our retail partners and distributors to make sure
that we’ve got the shelves stocked that we’re in the right neighborhoods so that
when the consumer goes in to make that selection
they’re gonna find OB on the shelf and that they’re going to reach forward and
ideally make the choice the second part of it is a little bit more of what the
brand and the mission messaging team does and that is to develop a story
that’s true and authentic and tugs at the heartstrings of our consumers so
that they’ve got a connection of their values with our values our values around
care for the environment about being good stewards about animal welfare about
responsibility for small family farms and community development and these are
areas that we connect with consumer in a way the very few other brands are able
to do and that’s what really makes this special so while we’ve chosen to follow the
dairy supply chain in this video it’s really important to realize that crop
cooperative in its mission to serve family farmers has a diversity of pools
and programs we have a produce pool we have a meet pooling program we have a
feed pool and program and we have an egg farmer pool on program so all those same
pools have the same complexity diversity of farmers and farm sizes the same
craftsmanship throughout the whole product the same system of checks and
balances and making sure we’re producing the highest quality products possible so you know to get everything done we’ve
got a lot of people that are outward facing but there’s lots of folks behind
the scenes as well that are really integral to us and our success I’m
talking about groups like our information resources or human relations
department our accounting department what we call employee services here our
administrative staff we have a great sustainability staff that’s working on
all kinds of projects behind the scenes both with the business and our farmers
we also have government affairs and a legal department that’s taking care of
all those kinds of details for us but we also have the member of fair side of
things and ensuring that the governance of the coop runs smoothly that our board
of directors is supported and that our farmers have opportunities to
participate in their coop we spent our time talking about what
makes up a successful marketing co-op and in conclusion we think about all
these employees working in partnership with the farmers and that’s what really
makes us strong we help the farmers by using our talents and creating a product
that is good and healthy and nutritious to take to the marketplace but without
the farmer creating that premium milk eggs meat and other products and guiding
the business we wouldn’t exist and those two groups working together if that’s
happening in meaningful ways the coop will continue to be successful now and
into the future you

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