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contents First Quarter • Volume 2, No. 1
Packaging TRENDS, SUSTAINABILITY & INNOVATION
FROM THE ASSOCIATION 04
PRESIDENT’S MESSAGE Packaging Partners Bring Solutions
BY MIKE SUEVER
XECUTIVE VP E MESSAGE Packaging Can’t Be Taken for Granted
BY BRUCE W. KRUPKE
NDSA MESSAGE Name & Logo Change, Highlights BY MELISSA FRYER
WHAT YOU NEED TO KNOW 10
LEGISLATION State-by-State Watch
BY BRUCE W. KRUPKE
ECONOMIC OUTLOOK Higher Prices in 2019?
BY GARY LATTA
CONSUMER PACKAGING: TRENDS, SUSTAINABILITY & INNOVATION 18
Glass Is Back
Dairy Case Is Full of Container Choices
E-Commerce Is Knocking on Your Door
Ice Cream Finds a Place in E-Commerce
Häagen-Dazs Launches Stainless Steel Container
Packaging: The Silent Salesman
Sustainability: Product vs. Planet
Dairy Industry Committed to Smaller Carbon Footprint
Do Consumers Understand “Milk” Label?
WORKPLACE TOOLS OF THE TRADE 38
mployee Stock E Ownership Plans
427 S. MAIN ST, NORTH SYRACUSE, N.Y. 13212 315-452-MILK (6455)
BY DIANE STIRLING
SHA: Dairy Plant O “Quick Check”
BY STEVE VALENTINE
MEMBER INFORMATION 48
By Caroline K. Reff
By Caroline K. Reff
et the Most Out of G Your Membership BY ALEX WALSH
ember Profile: M Cabot Creamery Celebrates 100 Year
BY CAROLINE K. REFF
Cabot Sweeps Awards
Member & Industry News
Welcome New Members
yrne Dairy B Announces Expansion
NED Magazine | First Quarter 2019 • 1
contents First Quarter • Volume 2, No. 1
NORTHEAST DAIRY FOODS ASSOCIATION, INC. EXECUTIVE VICE PRESIDENT
Bruce W. Krupke
DIRECTOR OF MEMBERSHIP AND COMMUNICATIONS
Alex Walsh PRESIDENT
Mike Suever HP Hood, LLC
Daniel R. Lausch Lactalis America Groups, Inc. TREASURER
Michael P. Young Guida’s Dairy SECRETARY
Rick Sedotto Midland Farms
NORTHEAST DAIRY SUPPLIERS ASSOCIATION, INC. PRESIDENT
Ozzie Orsillo Evergreen Packaging Co.
ASSOCIATION UPDATES 58
2019 Coming Events
NDFA Retailer of the Year Award
Bill Elliott Northeast Great Dane
Melissa Fryer Alfa Laval Ryan Osterhout KCO Resource Management
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Rachel Barry, Melissa Fryer, Gary Latta, Kira Maddox, Diane Stirling, Mike Suever, Stephen Valentine, Alex Walsh PRODUCED BY
Northeast Dairy Media
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An official magazine of the Northeast Dairy Foods Association, Inc., a nonprofit organization. This publication carries authoritative notices and articles in regard to the activities and interests of the associations. In all other respects, neither the association nor the producer of the publication, Northeast Dairy Media, is responsible for the contents thereof or the opinions of the contributors. The entire contents are © 2019 by Northeast Dairy Media. Nothing may be reproduced in whole or in part without written permission of the publisher. The association and Northeast Dairy Media reserve the right to print portions or all of any correspondence mailed to the editors without liability on its part and no such correspondence will be returned. Visit Northeast Dairy Foods Association online at nedairyfoods.org for current information on association programs and services, or call the association at 315-452-MILK (6455). Questions and comments may also be sent to the association at email@example.com.
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Packaging Partners Help Bring Solutions to the Dairy Industry BY MIKE SUEVER, PRESIDENT, BOARD OF DIRECTORS, NORTHEAST DAIRY FOODS ASSOCIATION, INC.
aving worked in the dairy industry for quite some time, I’ve seen my share of trends come and go. Consumers always seem ready to try the latest and greatest in the food and beverage space. Yes, there are trends in dairy; we see them all the time. However, there is an added challenge in the dairy industry because, to most Americans, milk is a classic. They want it fresh and cold from the refrigerator. They expect it to taste a certain way and are very sensitive to any changes in flavor or colors that take away from that experience. In this issue of Northeast Dairy, we examine some of the aspects that go along with trends in packaging. Of course, we want to offer our customers and the American consumer something new, but the perishability, as well as the expectation of “farm fresh” products, has made this challenging. The dairy business is so heavily capitalized that it is difficult to make packaging changes and follow the trends that are appealing but not likely to be long lasting. There’s no denying that in dairy we are apt to be followers — and not even fast followers — because we are so capitally sensitive. Other fluid beverages, like soda for example, can change the shape or look of bottles quickly with little affect to the product inside. As long as that soda remains carbonated, consumers are happy and are eager to try something new. We just can’t do that with milk, as flavor and shelf life can easily be affected by a number of factors, including exposure to oxygen, light and bacteria. We are in the game, though. People are drinking less milk than ever before and have so many other beverages choices in front of them that we can’t afford to sit by and watch other consumer trends grab a bigger chunk of the market. It’s actually amazing to me to see how much time and effort has gone into sustainability issues in dairy packaging in just the past 10 years. Our engineers spend as much time on packaging these days as they do on ways to protect the product itself. It’s quite a reversal, but it’s one that customers — not the consumers, but our own customers — are demanding. 4 • Northeast Dairy Foods Association, Inc.
People are drinking less milk than ever before and have so many other beverages choices in front of them that we can’t afford to sit by and watch other consumer trends grab a bigger chunk of the market. — MIKE SUEVER
President, Board of Directors, Northeast Dairy Foods Association, Inc. Our customers understand that there needs to be a holistic approach to the packaging we use. We find that many of our customers are driven by a certain level of activism from their shareholders, who want a holistically sustainable process. While consumers may choose whether they buy milk in glass or plastic, we, as an industry, are looking at the larger picture — Where are the materials in our packaging sourced? How much energy goes into producing and transporting them? Do they protect and maintain the quality of our product? Are the materials we use recyclable, and, even if they are, have we made the consumer aware of that? In the end, milk may just be something that consumers don’t want to see as too trendy. Others have tried. In England, for example, the A2 Milk Company experimented with white
and amber-colored glass milk bottles in order to protect the product from the effects of light on taste and nutritional value. However, the perception was that the product looked too medicinal, and consumers simply wouldn’t buy it, so the company transitioned back to clear glass. Others have tried new flavors or colors in milk, and again, consumers just said no (with the exception of chocolate milk, which, in and of itself, is probably also a classic). And, while shelf stable or aseptic milk is hugely popular in Europe and growing rapidly in Asia, Americans just aren’t buying in. They can’t get used to the taste, and it is simply not a part of the American culture to purchase milk from a shelf, rather than from the refrigerated dairy case. There are opportunities though, and we continue to explore them. E-commerce has great potential, as people are finding it much more convenient to order their groceries, including dairy products, online and simply pick up or have them quickly delivered to their door. We’re excited about that, and we will continue to work with our customers to maximize our impact in this space. And sustainability concerns are not going away, as we straddle the line between producing and selling only the best tasting and most nutritious dairy products with a true commitment to doing what we can to be respectful of our planet. Many questions and options are in front of us, but at this point we, as an industry, have determined that it is much more logical to use fewer materials and resources up front rather than figure out how to re-use and recycle our packaging after consumption. Our packaging partners deserve kudos for working tirelessly with our industry to meet the demands of our members, our customers and consumers. It’s an uphill battle, as all of these groups continue to become savvier when it comes to sustainability. We know there is no “quick win,” but we are thankful for the research, know-how and ingenuity that our packaging partners bring to the table, as we all work together to find better and better solutions that keep milk and other dairy products in consumers’ shopping carts and out of the landfills.
NETWORK AND STAY IN TOUCH WITH THE ASSOCIATION!
The Membership Directory is a HUGE member beneﬁt! It allows members to quickly reference key contacts for all member companies. Need to check and make edits to your listing? Tell us! email@example.com
THE FIRST EVER
NORTHEAST DAIRY ASSOCIATION BUYERS GUIDE In Spring 2019, NE Dairy Media will publish the membership's ﬁrst premier Buyers Guide to showcase manufacturers and vendors by category. This will beneﬁt the Dairy Foods Association by breaking it down into industry-speciﬁc classiﬁcations to help with purchasing decisions.
MORE INFORMATION TO COME, STAY TUNED!
NED Magazine | First Quarter 2019 • 5
Packaging Can’t Be Taken for Granted BY BRUCE W. KRUPKE, EXECUTIVE VICE PRESIDENT, NORTHEAST DAIRY FOODS ASSOCIATION, INC.
ow often do you think about food packaging? packaging, I’m talking about the piece you hold when using it, When you go to the store for a food item, is not about the pretty graphics and messages catching your eye.) What are consumers looking for in packaging? Good your first consideration and reason for purchasing it the type of packaging it comes in? question. First, I have to believe the number one reason is I’m sure in some instances, you might consider ease of use. Does it fit the manly hand or the more feminine grip? Can the kids hold it? whether you need a full gallon The next consideration might or just a quart of your favorite be safety or security of that chocolate milk. But how about product. This is what we’d those impulse products that call tamper evident. We need may be on the shelf? What to be certain a product hasn’t makes you purchase them? been messed with before we Could it be the packaging the put it in our mouths. Twentyproduct comes in? five years ago, this wasn’t In our association, we have a big concern, believe it or about 35 companies involved not. That extra foil, pull tab directly in providing dairy or screw top ring wasn’t part and food packaging products. of the cost equation. Post 9/11 If you were to talk to these and incidents like the Tylenol companies, they’ll tell you tampering have changed the there are a number of reasons packaging we routinely use. packaging takes on the form Consumers are looking you see. First, you have to for the green in our packagrealize they are trying to get the consumer to buy more. ing, too. Is it environmentally They have carefully developed stable and renewable? I think and designed these packages this continues to be a big con— BRUCE W. KRUPKE to get your attention to buy. cern. I’m seeing laws being Executive Vice President, Northeast Dairy Foods Remember the day when milk introduced to eliminate plastic Association, Inc. ruled the dairy case in plastic shopping bags, but I wonder is gallons or the basic gable top this really necessary? There’s paper container? Not anymore! more to it than just plastic Just look at the packaging changes used for refrigerated dairy bags that end up in the waste stream. For example, it takes products alone. Today, we have more styles, sizes and types about seven trucks to transport paper grocery bags from the of packaging than you can count. For good reason, we have manufacturer to the store, while it only takes one truck to ship learned to give consumers the various options they want. (By the equivalent number of plastic bags — thus paper uses more the way, don’t confuse packaging with labeling. When I say fossil fuels to move from one place to another. That begs the
Remember the day when milk ruled the dairy case in plastic gallons or the basic gable top paper container? Not anymore! Just look at the packaging changes used for refrigerated dairy products alone. Today, we have more styles, sizes and types of packaging than you can count.
6 • Northeast Dairy Foods Association, Inc.
FrontDesk question of whether or not elimination of plastic bags really is a green idea. But you can bet the younger generations will continue to make a point of connecting the dots between packaging and our environment. And don’t get me started on the topic of packaging recycling. Legislation being introduced today includes raising the amounts of redeemable deposits on containers and increasing the types of packaging to be included in the net. Fortunately paper and plastic milk containers have not been mandated for deposits, but the day is coming in many states. Be honest, when was the last time you asked your customers what they want in packaging? I suspect most of you haven’t held a consumer focus group meeting about your packaging. If you have, congratulations, but I assume most of you leave it up to your packaging sales representative to make suggestions. And what about your retail and/or food service customers? Have you had the guts to ask them what they think about your packaging? If they have told you, have you acquiesced or did you forego making any changes? When I go to a fast food restaurant, I always ask for chocolate milk instead of soda. Much of the chocolate milk
sold in these fast food places are purchased from a faraway state in little plastic bottles. How environmentally friendly is shipping milk thousands of miles for me to enjoy with my sub or hamburger? Anyway, I think these locations are ripe for increased milk sales if displayed properly and given ample eye level exposure. The variations on food service type packaging is where it is at. If you go into a typical convenience store, just look at the number of SKUs and facings they have. How can milk and other dairy beverage products compete? Brands are using every conceivable type of package known to man. The competition is fierce for the sale, so if you want a quick lesson in packaging, stand in front of those beverage sections and just stare and take notes. Our dairy beverage industry has a lot of competition, and sales are in jeopardy. Take your packaging seriously. Compete in the marketplace, and fight for your sales. In this issue, we discuss and focus on packaging with some experts in the field. We get your thinking about form, function and sustainability. I hope you enjoy this focus. We’d love you to tell us about your experiences with packaging in a letter to the editor. Let’s hear from you!
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NED Magazine | First Quarter 2019 • 7
New Logo, Video and Scholarships Highlight Work of Association BY MELISSA FRYER, TREASURER, BOARD OF DIRECTORS, NORTHEAST DAIRY SUPPLIERS ASSOCIATION, INC.
he association has officially changed its name to the Northeast Dairy Suppliers Association, Inc. This change better reflects the composition of the association membership. While the name may have changed, our mission stays the same: dedication to the growth and advancement of the dairy food industry. With that, we have also adopted a new logo. The board reviewed several options for the new logo before deciding on a final design. I want to thank the board for the time and effort that went into narrowing the selections and ultimately approving the new symbol of the Northeast Dairy Suppliers Association. The 2019 fiscal year for the Northeast Dairy Suppliers Association, Inc., began January 1, and the association is in a strong and stable financial position, as we look forward to the year ahead. Once again, our 2019 budget includes $15,000 in scholarships reflecting our continued commitment to the future of our industry. Students enrolled in a dairy-related degree program or pursuing careers outside the industry have the opportunity to apply for our scholarships. Scholarship applications have been sent out, and we are excited for their return so we can review this year’s applicant pool. The association is proud to support students in their academic endeavors and assist them financially in reaching their goals. Please encourage your employees 8 • Northeast Dairy Foods Association, Inc.
or employees’ immediate family members enrolling in college for Fall 2019 to apply today! A lack of a qualified skilled labor force has become a critical issue and a consistent topic of discussion and concern throughout the dairy processing, manufacturing and distribution industries. The association has partnered with the Northeast Dairy Foods Association to produce a labor recruitment video for use on social media platforms, websites, YouTube and other venues. The purpose of the video is to introduce middle and high school students to the various careers available in the dairy foods industry. We have been working with the video producer to assist in developing a creative and effective message to draw in young people and engage them in our industry.
In addition, companies will be able to customize content within the video with their own messaging and information. This is an exciting collaboration between our two associations in an effort to help all members with labor issues they are experiencing. Be sure to mark your calendars with the dates for both of our events this year. The Dairy Industry Clambake and pig roast will be held on Wednesday, July 10, 2019, at a new location — The Spinning Wheel Restaurant and Clam Grove in No. Syracuse, New York. As we mentioned in our last issue, Hinerwadel’s unexpectedly ceased operations at the end of 2018, forcing the association to select a new venue. We are fortunate to have a found a new place that meets our needs, allowing members and guests to
NORTHEAST DAIRY MAGAZINE
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SECOND QUARTER • SUMMER 2018
continue enjoying this major dairy industry event. As you all know, the annual clambake is a terrific networking event, and we look forward to seeing familiar faces and those new to our industry. The clambake also provides members a fantastic opportunity to show appreciation to their customers by inviting them to enjoy the event. Like any organization, we are constantly seeking to increase revenue to fund our programs and events. We have been looking at new and innovative sponsorship opportunities for the annual Northeast Dairy Industry Clambake and Northeast Dairy Convention (see Page 58 for details). These opportunities will provide sponsors the ability to reach a broader potential customer base and increase revenue to the association. Please be on the lookout for information regarding the new sponsorship opportunities. The 2019 Northeast Dairy Convention will be held Sept. 11-13 at the Otesaga Resort in Cooperstown, New York. The convention is a great way to recognize employees for their hard work and provide them an opportunity to learn from industry experts and gain insight on market trends. It is also a wonderful event to bring your family to. The Otesaga is a beautiful resort, and Cooperstown, home to the Baseball Hall of Fame, is a village filled with culture, history, sports legacy, outdoor recreation and more. Between session speakers and networking with potential customers, members always find the convention a worthwhile event for themselves and their employees. On behalf of the Northeast Dairy Suppliers Association, Inc., I am looking forward to an exciting 2019. Please feel free to reach out to any board member with any questions or suggestions. We hope to see you at an upcoming event.
Read the previous issues of Northeast Dairy magazine online.
The C ha lle nges N ew R of & Driv ules , S afet er Sho y rtages
Real vs. Dairy Alternatives
A2 Milk On The Move
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USDA Revises 2018-19 Forecast
FDA To Enforce “Milk” Label?
Will EL D Rules Make ence?
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NED Magazine | First Quarter 2019 • 9
Association Keeping a Close Eye on States’ Legislative Activities BY BRUCE W. KRUPKE
n our last issue, I summarized bills that were introduced into state legislatures in 2018 that, if passed, could affect your businesses. The topics of these bills varied greatly, covering environmental restrictions, packaging and labeling mandates, nutrition and calorie exemptions and more. Fortunately, every two years, states throw out the bills not passed at year-end and have to start over again. This is usually in conjunction with their state election cycles. Except for New Jersey, all northeast states started from scratch the first of the year. This is good news; the bad news is legislators will usually reintroduce the bills from the old year under a newly assigned number. The longer the bill survives over the years, the better chance it has of passing. 10 • Northeast Dairy Foods Association, Inc.
As the 2019 legislative season begins, we take up where 2018 left off — only much faster. As we anticipated, with the blue wave taking over control of many Northeast state legislatures and executive offices, including the biggest, New York, we find ourselves playing heavy defense right out of the gate. The activity of bill introduction has been very brisk and troublesome for you, the dairy processor, manufacturer and distributor, but also for the dairy farm community. When you include the fact that in many states we have new governors or secretaries of agriculture, it makes our job much more challenging. Of course this is one of the primary reasons why you pay dues and support our association, so we can have your back and try to deflect as much onerous legislation as possible.
This year, states such as Maine, Vermont, New Hampshire and Connecticut, which are usually somewhat quiet on the legislative front, have given a loud roar. If you do business in any of these states, you need to know what is going on. With that in mind, I’ll review some bills introduced into a few states. CONNECTICUT Let’s start with Connecticut. Members of the Committee on Children have introduced a bill that would eliminate flavored milk from children’s meals in restaurants. House Bill 7006 states, “An act to prohibit restaurants from including soft drink beverages on children’s menus and in children’s meals,” but don’t you believe them. The way the bill is written disallows flavored milk. Specifically, the bill states “On and after January 1, 2020, no beverage listed or displayed on a children’s menu shall be a beverage other than water, sparkling water, flavored water with no added sweeteners, unflavored milk or a non-dairy milk alternative.” Yes, white milk can be offered, but chocolate milk should be allowed, as well. Kids are provided chocolate milk every day during school lunch periods. For the record, our association is opposing this bill. VERMONT Let’s move on to Vermont. Vermont has a milk commission made up of legislators from both the Senate and Assembly. Over the years, this commission has been very active supporting its dairy producer community. This year, Representative and Agriculture Committee Chairwoman Carolyn Partridge has introduced a bill in the Assembly that states, “This bill proposes to clarify the definition of ‘milk’ to mean the pure lacteal secretion of hooved animals.” In layman’s terms, a product can’t be labeled “milk” unless it comes from a hooved animal, so says the FDA. But there is a problem in that the FDA hasn’t enforced its own law. Our association supports what the law says; if we don’t like the law, then change it. Sometimes we run into this situation when a state tries to usurp or take over what is a federal regulation. This can be very confusing at the least and market distorting at the worst. Should Vermont actually pass this law, it could be cutting off its nose to spite its face. As long as the FDA turns a blind eye to beverage products using the
term “milk” when there may not be any in the product, these items are going to be marketed. Should Vermont outlaw these products, then you can bet those companies might stop selling them in the state to avoid breaking the law. In the end, this hurts processing and manufacturing opportunities and limits the sale of some products that might actually contain milk, meaning sales are lost. MAINE There is a lot of activity in Maine. It has a new governor, Janet Mills, and will soon have a newly appointed secretary of agriculture. Its legislature is now dominated by a Democrat party majority. There have been two bills introduced that we are weighing in on. You should know that Maine is not part of the Federal Order 1, and it has its own minimum pricing system. The Maine Milk Commission oversees the pricing program, which sets a minimum price dairy farmers receive, a minimum wholesale price and a retail price, as well. At times, dairy producers have excess milk production in Maine, and sometimes it is all not used. The state has introduced a bill, LD 292, which would allow for donations to be made to local food banks bypassing its minimum pricing system. Our association has no position on this pricing program, although if this bill is passed, it would bypass the system and not have payments made to dairy farmers for the donated milk. Many legislators in Maine have indicated they don’t want to pass a bill that could jeopardize the pricing system in any way. So, the nice idea of allowing donations to food banks by bypassing the pricing system won’t pass. Compromises will be needed, and our association has suggested putting a cap on the donation amounts per year to keep better control. A second bill in Maine that we are lobbying is called LD 102. This bill prohibits, beginning Jan. 1, 2020, a manufacturer from selling, offering for sale or distributing for sale in the state a single-use plastic beverage container unless the container is composed of at least 15 percent post-consumer recycled plastic. Beginning Jan. 1, 2022, this threshold for the percentage of post-consumer recycled plastic in single-use plastic beverage containers increases to 20 percent, and beginning Jan. 1, 2024, the threshold increases to 25 percent. (continued on next page) NED Magazine | First Quarter 2019 • 11
The bill also prohibits, beginning Jan. 1, 2020, a manufacturer from selling, offering for sale or distributing for sale in the state a single-use plastic beverage container with a plastic beverage cap, unless the cap is composed of the same plastic as the beverage container and/or is tethered to the container to prevent the separation from the container when removed, or includes an opening from which the beverage can be consumed while the cap remains screwed onto or otherwise affixed to the container. Our association is opposing this bill for many reasons, mainly due to quality, sanitation, safety and the ability to procure sufficient raw product to create the containers. NEW JERSEY New Jersey, like Maine, has a new governor, Phil Murphy, and an all Democrat party-controlled legislature. The state is a hotbed of activity. I’ll summarize for you some bill topics we are working on and our positions:
12 • Northeast Dairy Foods Association, Inc.
• Removing milk weight licensing mandates (Oppose) • Requiring the Department of Agriculture to provide for electronic submittal of milk dealer license applications (Support) • Permitting sale of raw milk under certain conditions and establishing a raw milk permit program (Oppose) • Authorizing use of retail coupons for purchase of milk by consumers (Support) • Recognizing the last week of June as Dairy Week (Support) NEW YORK Finally, let’s take a look at the Empire State, New York. Here are some of the bills we are lobbying, and the positions we are taking on each: • Requiring public schools to offer plant-based food options in food service (Oppose) • Requiring supermarkets to make surplus food available to qualifying charities (Oppose)
• Relating to the sale of certain foods in vending machines on school grounds or property (Oppose) • Mandating sugar-sweetened beverages to be labeled with a safety warning (Oppose) • Enacting the Farmworkers Fair Labor Practices Act (Oppose) • Mandating the labeling of food products from cloned animals (Oppose) Enacting provisions imposing a five-year moratorium on the planting and growing of genetically modified crops (Oppose) As you can imagine, each of these bill topics can be very intrusive to businesses and do not recognize good science. We are especially concerned about the bill that would force dairy farmers to abide by new labor laws and regulations. Dairy farms are not run like other businesses. They are controlled by Mother Nature. When crops need to be planted, workers don’t take days off. The same goes for when crops are to be harvested and when the land needs care. Forcing the unionization of farm workers and having farms comply with strict labor laws would be devastating for our agriculture community. WASHINGTON, D.C. We also monitor and lobby important issues to our dairy processing industry in Washington, D.C. We are supporting HR 832, which would allow low-fat and whole flavored milk to be served in our public schools. Currently only non-fat and 1 percent flavored milks are allowed to be served. The act has been introduced by Rep. Glenn Thompson (R-PA) and Agriculture Chairman Collin Peterson (D-MN) to recognize the importance of whole milk for growing children and teenagers. Most legislative sessions stop before the end of June, unless legislators are called back for a special session in the fall. Much of the work to be done on your behalf is condensed into about 120 days during the winter and early spring. We encourage you, our members, to get involved. Let your voice be heard in your state capital. You can easily view the 2019 Bill Introductions Report we’ve discussed in this article on our association’s website, www.nedairyfoods.org, in the Member’s Only section under Legislative Update. As a member, you will need a username and password to view this report. If you haven’t obtained your username yet, it is easy and will give you access to many other useful pieces of information. You can also request a copy of our lobbying activities and bill report by contacting our office. Bruce Krupke is the executive vice president, Northeast Dairy
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Foods Association, Inc. NED Magazine | First Quarter 2019 • 13
ECONOMIC OUTLOOK Will We Be Seeing Higher Dairy Farm and Market Prices in 2019?
BY GARY LATTA
ccording to most industry observers, milk prices should rise a moderate amount in 2019. Since early January, industry, academia and USDA economists have been issuing papers, seminars and podcasts with a common thread — U.S. farm milk pay prices should inch higher in 2019. The speed and degree of the estimated climb in this year’s milk prices vary by prognosticator. However, most agree that price rises will occur gradually in the first half of 2019, climb more rapidly during the second half and peak in the last quarter. A few analysts predict Class III milk prices to edge upward near $16 and possibly $17 by year’s end. Many political and agricultural events have been taking place recently here and abroad that could shape the U.S. situation and set the stage for higher farm milk prices.
PRICES DETERMINED BY MORE GLOBAL SUPPLY THAN DEMAND Lower farm milk prices over the last four years have been 14 • Northeast Dairy Foods Association, Inc.
partially attributed to large global supplies that exceeded demand. Last year was the most difficult for U.S. dairy producers as exports were dampened by retaliatory tariffs imposed by major customers of U.S. goods. Some trade mitigation efforts have been made by the president and agriculture secretary, but they are no substitute for lost markets. Political posturing between the U.S., China and Mexico in ongoing trade wars led to reduced sales of U.S. dairy products in these key growing markets. The U.S. Dairy Export Council estimates that shipments of cheese, powders, butterfat, whey and lactose exports to China alone were down about 47 percent from 2017. China shifted much of its dairy product imports from the U.S. to other major dairy producing countries like the European Union and New Zealand. Export sales to Mexico would have been better last year were it not for retaliatory tariffs. However, despite the ongoing trade dispute, cheese exports to Mexico remain brisk with the U.S. share of that country’s cheese market growing from 67 percent in 2016 to 75 percent in 2018. Currently, Mexico is
Economic Outlook by far the largest customer for U.S. dairy products, especially cheese. China — and possibly Japan — however, may be our greatest cheese export opportunities. If the trade dispute ended with China, the U.S. with be in a good position to expand export sales there. Japan is one of the top two largest cheese importers in the world and holds great opportunity for the U.S. if we play our cards right.
EXPORT OPPORTUNITIES EXIST WITH JAPAN The USDEC recently commissioned a study that reinforced the need to explore more export opportunities with Japan. The study revealed that Japan’s increasing love for cheese will lead to greater consumption and a need for imports. This study also came with some warnings that the U.S. must engineer a strong trade agreement with Japan or risk losing this lucrative market to the U.K., New Zealand and Australia. Australia and New Zealand already have a trade agreement with Japan called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, while the EU has its own called the Japan-EU Economic Partnership Agreement. With no agreement of our own with Japan, the U.S. stands to be at a considerable dis-
advantage for dairy exports to that lucrative growing market. The USDEC commissioned report from a Tokyo consulting group warned that as much as $5.4 billion in sales could be lost over a period of 21 years unless the U.S. acts. The recent news on this should serve as an incentive for the U.S. to get an agreement worked out with Japan soon. Currently, Japan is the fourth largest market for U.S. dairy exports but could become even more significant if developed.
PASS THE (U.S.) CHEESE, PLEASE Strong growth in both U.S. and world milk supplies have weighed heavily on market prices globally. Growth in milk supply has been fueled more from increases in output per cow and not from cow numbers. The abundance of milk supply exceeded demand in most major producing countries. This led to surpluses of dairy products placed in storage. The EU had been sitting on a mountain of skim milk powder called intervention stocks, while the U.S. had built up a mountain of surplus cheese. The abundance of fresh milk supplies and commodities in storage have served to keep market prices rather low for four years. Last year became even more challenging
NED Magazine | First Quarter 2019 • 15
Economic Outlook The USDA and many industry experts believe the worst may be behind us. Growth in global milk production is showing clear signs of slowing down, and many of the storage surpluses, which weighed heavily on the market, have been drawn down. for U.S. producers and marketers after the political wars and retaliatory tariffs were imposed by several of our major trading partners, including China, Canada and Mexico. However, the USDA and many industry experts believe the worst may be behind us. Growth in global milk production is showing clear signs of slowing down, and many of the storage surpluses, which weighed heavily on the market, have been drawn down. EU surplus intervention stocks have been sold off and are nearly empty at this time. EU milk production is expected is to be down 1-1.5 percent in 2019 due to weather impacts and other subtle factors. Australia is expected to be down in 2019 milk production from high temperatures, rising input costs and drought. New Zealand is the only top five milk-producing country displaying strong growth in milk production currently. Overall, the world dairy market has moved into much better balance. The fate of the United States-Mexico-Canada Agreement remains to be seen now that we have a politically split Congress. Mexico and Canada are believed to have few obstacles with respect to signing the agreement. For the U.S., this may be another story, as some believe the fate of the USMCA in Congress is in question. Fighting between parties, and even fighting within parties, could derail the legislation.
FARM BILL CHANGES HOW MILK PRICES ARE CALCULATED The new Farm Bill included a change to the way monthly Class I fluid milk prices in Federal Milk Marketing Orders are calculated. Once implemented, the new formula to compute the mover of Class I milk will be the simple average of the advanced Class III price and advanced Class IV price plus 74 cents. Currently, the Class I mover is the “higher of” the advanced Class III price or advanced Class IV price. The new formula should allow cooperatives, producers and processors better use of Class III and IV price risk management tools, such as futures contracts to hedge Class I price risk. The 16 • Northeast Dairy Foods Association, Inc.
International Dairy Foods Association and National Milk Producers Federation collaborated on developing the new formula. Many leaders in the industry believe the new Class I methodology will also help reduce some of the volatility that existed with the old Class I fluid calculation. The new formula should benefit the whole supply chain from farm to retailer. The implementation date could be delayed a month longer than previously expected due to the recent government shutdown, but it is expected to become effective between May and July 2019.
WHOLE MILK MAY BE BACK TO SCHOOL A few new positive moves for dairy have occurred in the nation’s capital that, if implemented, could be of benefit to the dairy industry. Piggy-backing on USDA Secretary Sonny Perdue’s efforts to bring back low-fat flavored milks in schools is H.R. 832, the Whole Milk for Healthy Kids Act. The act has been introduced by Rep. Glenn Thompson (R-PA) and Agriculture Committee Chairman Collin Peterson (D-MN) to recognize the importance of whole milk to growing children and teenager well-being. If enacted, these efforts could go a long way to stimulate fluid milk consumption in schools and at home, as children and teenagers get reintroduced to good tasting dairy beverages again. (On a humorous note, both Thompson and Perdue attributed whole milk to giving them their rather large robust physical size.) The USDA is now scrambling to get caught up with a number of its reports important to dairy industry analysts and observers. Many reports from across the entire agricultural sector simply were not getting done during the government shutdown. The U.S. Milk Production Report and the Livestock Dairy and Poultry Outlook have been delayed. Fortunately, the USDA was able to issue the World Agricultural Supply and Demand Estimates report on February 8. This report gives us some indication as to what the USDA is thinking 2019 will look like for cow numbers and milk prices. The USDA is also stepping
Economic Outlook up the pace to get the new Farm Bill in place, especially the vital dairy revenue protection and insurance mechanisms. U.S. dairy producers will have access to multiple risk protection programs that include dairy margin coverage, dairy revenue protection, livestock gross margin and futures contracts. The Dairy Margin Coverage Program is especially worth looking at, as the cost of decent coverage is not expensive.
USDA PREDICTS HIGHER MILK PRICES LATER IN 2019, BUT OUTPUT PER IS COW TRENDING DOWN Along with many analysts, the USDA is forecasting higher milk prices in 2019. Most of the price increase is expected to take place during the second half of the year with the fourth quarter especially strong. The USDA lowered its 2018 milk production estimates based on data that was available through December. The USDA also lowered milk production estimates for 2019 based upon factors of reduced cow numbers and slower growth in production per cow. Annual milk production is expected to be up just over 1 percent in 2019. This logic is consistent with the belief that both cow numbers and output per cow will continue to trend down. The USDA raised its 2019 estimate for fat-based exports on the belief that strong demand for butter and butterfat products will continue. It raised its estimate skim-solids basis exports in 2019 in anticipation of strengthening demand for nonfat dry milk. Keep in mind that the USDA tweaks these figures every month and usually provides the logic attributed to the tweak. This is good monthly background for planning, whether you are a producer, processor or manufacturer. Looking ahead at 2019, the USDA lowered its cheese price forecast from the previous report but raised butter, nonfat dry milk and whey prices. The Class III price forecast for 2019 is given at a range of $14.70 to $15.40. The upper end of this estimated range represents a Class III increase of almost a dollar over 2018. The 2019 Class IV price is raised on higher butter and NDM prices to within a range of $15.55 to $16.35. This Class IV estimate is over a dollar from 2018. The 2019 all milk price forecast is raised to $16.90 to $17.60 per cwt.s. Gary Latta is a dairy product specialist consultant for the Northeast Dairy Foods Association, Inc. He has more than 30 years of experience in providing economic analysis, statistics and information to the dairy processing industry.
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Let us help you make a splash. Boost your bottom line and brand awareness within the industry. Contact us today to learn about the opportunities. Hannah Gray, Relationship Manager firstname.lastname@example.org 315-445-2347 Ext. 115 NED Magazine | First Quarter 2019 â€˘ 17
GLASS IS BACK
(But Did It Ever Leave?) BY CAROLINE K. REFF
18 â€¢ Northeast Dairy Foods Association, Inc.
PACKAGING TRENDS + SUSTAINABILITY
ny great chef will tell you that people eat first with their eyes — and the same might be said for dairy consumption. Today’s consumers like to see what they’re buying. It gives them the assurance that the product is fresh, made with simple ingredients and tastes great. That may be one of the reasons that the traditional glass milk bottle is taking up a bit more space in the dairy case lately. Glass is back (although it never completely disappeared), and there are a number of factors driving this trend, including nutritional value, recyclability and even nostalgia. According to the Food and Drug Administration, glass is the only packaging material that is considered completely safe for food products. A product made of substances found in nature, glass is impermeable, meaning it keeps the great taste of fresh milk in while keeping other flavors and odors out. In addition, glass does not release any chemicals into whatever food or beverage it holds, eliminating the concern that some plastics may contain things like BPA, which have been the subject of FDA warnings in the past. (Many manufactures, however, have heeded these warnings and do offer BPA-free plastic containers.) According to www.drinkmilkinglassbottles. com, “Glass is 100 percent recyclable and can be re-used an endless amount of times without losing its quality or impacting a product’s purity.” Many consumers are particular about what they buy in terms of environmental impact, so glass’ ability to be easily recycled is definitely a plus. Ronnybrook Farm Dairy in Duchess County, New York, re-introduced its milk in glass bottles 20 years ago. This multi-generational family dairy farm operates “by all practical measures organic, if not beyond” and doesn’t consider “organic” simply a marketing concept but instead stands by its practices as a testament to its values, good stewardship of the earth and a commitment to the health of its customers. Bottling its milk in glass remains a way to continue the values of the Osofsky family, while also remaining relevant and profitable. Located near New York City, Ronnybrook Farm Dairy began selling its glass-bottled milk at various farmers markets around the Big Apple. People liked the taste, as well as the purity and sustainability. Soon, gourmet food markets started carrying Ronnybrook products, too, and today the dairy
Glass is 100 percent recyclable and can be re-used an endless amount of times without losing its quality or impacting a product’s purity. — www.drinkmilkinglassbottles.com.
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has 50-100 stops in New York City and an additional 200-300 outside the metropolitan area. “We pride ourselves on selling in glass bottles,” said co-owner Richard Osofsky, whose company also sells butter, ice cream and yogurt. While glass bottles can increase prices, Osofsky said consumers don’t seem to mind. They are willing to pay for the plusses of glass-bottled milk, including a $2 deposit per bottle. In fact, Osofsky said the dairy typically gets only 60 percent of its bottles back, which increases profits. Syracuse, New York-based Byrne Dairy also gives its customers the option of glass bottles. “Over the past couple of years, it seems there has been a lot of talk about the resurgence of milk in glass bottles,” said Ryan Elliott, a representative of Byrne Dairy. “But milk in a glass bottle has been a staple of our company since its founding, and it continues to have a strong, vocal fan base.” At this time of year, customers are particularly interested in Byrne’s mint-flavored milk in glass bottles, timed to be on the shelves around St. Patrick’s Day. For many, it’s a springtime tradition, and being able to see the green milk through the glass bottle only adds to the excitement. “The reasons for the charm of glass bottles are varied,” Elliott explained, “and perhaps that’s why they have stood the test of time. For instance, we hear consumers say they prefer the taste of milk in a glass bottle; others enjoy making an environmentally-conscious decision, while others may be drawn to the product by feelings of nostalgia for a past time or the pure aesthetic.” Of course, there are some drawbacks. Glass if heavier to carry, and, of course, it is breakable. Some retailers don’t like the hassle of handling returnable bottles (often because consumers don’t take the time to wash them out properly). In addition, glass allows light oxidation, which can cause the breakdown of amino acids — something the body can’t produce on its own. In addition, light can degrade some of milk’s important nutrients like Vitamin A, Vitamin D and riboflavin. Still, whether it’s nostalgia, nutrition, sustainability or simply the taste of an ice-cold glass of milk straight from the bottle, there is clearly a significant population that likes to purchase milk in glass bottles and with that comes a market to do so. Caroline K. Reff is the editor of Northeast Dairy.
20 • Northeast Dairy Foods Association, Inc.
KEEP MILK UNDER 45! Traditional pasteurized milk in bottles, cartons or jugs must be kept under 45 degrees F to retain its freshness. Every hour that the temperature of milk is above that point subtracts one day off of the expiration date on the label. The ideal temperature for milk and most dairy storage is 34 to 38 degrees F, according to Cornell University’s Department of Food Sciences. If milk is kept at an optimum temperature in the refrigerator, it can even last two to seven days past its stamped expiration date.
PACKAGING TRENDS + SUSTAINABILITY
The Dairy Case Is Full of Container Choices
hile glass bottles are popular, there are plenty of other container options for milk and other dairy products — as well as the pros and cons that go along with each.
PLASTIC MILK JUGS
The plastic milk jug doesn’t seem to be going anywhere, despite some of the more trendy packaging surrounding it in the dairy case. Typically made from high-density polyethylene, more commonly known as No. 2 plastic, milk jugs remain a safe and convenient way to sell milk. Why? Plastic jugs are lighter, which reduces both production and shipping costs that aren’t passed on to consumers. They are lighter to carry, easy to reseal and there is less chance of breakage on the way home from the grocery store. Like glass bottles, plastic jugs are recyclable. However, according to the Environmental Protection Agency, only about one-third of plastic milk jugs actually get recycled by consumers. According to earth911.com, over 70 percent end up in landfills, where each can take up to 500 years to decompose. This is not the fault of the manufacturer, however, but the consumer, who makes the decision to toss the plastic into the garbage, rather than clean and recycle it, or municipalities that don’t recycle No. 2 plastic. In addition, those jugs that do get recycled cannot be made into new plastic milk jugs due to FDA guidelines that, in general, prohibit making food packaging from a recycled source. The use of recycled milk jugs, however, has helped to create a new business sector, which manufactures innumerable new products, including: • Children’s toys • Recycling bins • Shampoo bottles • Carpeting • Tubs for non-food products • Clothing • Picnic tables/lawn furniture • Fiberfill for jackets • Playground equipment and sleeping bags
GABLE TOP CARTONS
Another common choice for milk at the supermarket is the gable top milk carton, which commonly contains dairy products like milk, cream and half-and-half. This type of milk carton is made from paperboard coated with a low-density polyethylene to make it waterproof and airtight until opened. These cartons are only slightly heavier than plastic milk jugs; however, gable top cartons do use a lot of natural resources to manufacture, including water and fossil fuels. And they are not made from
recycled materials, as they are not as strong as paper products that come directly from a tree. Because ultraviolet light cannot penetrate these cartons, however, they do help retain certain vitamins said to be lost in glass containers. And they are easy to fold flat for recycling. The real downside to gable top cartons seems to be that many municipalities do not accept plastic-coated paperboard, which means these cartons may end up in a landfill.
Non-refrigerated milk? It’s out there, and it can be convenient, but it is a huge leap for most Americans who want the traditional flavor of an ice-cold glass of milk. This shelf-stable milk, sometimes called aseptic milk or UHT milk, uses ultra-high-temperature pasteurization to heat milk up to 280 degrees F for two to three seconds. In contrast, traditional milk is pasteurized by heating it to 161 degrees F for 15 seconds. Aseptic milk containers need to go through a careful sterilization process, as well, to ensure little to no bacteria is present in the product or the container. The downside to this process, however, is that many consumers complain of an “overcooked” taste, which is a product of the sterilization process. This product can stay on the shelf without refrigeration for up to six months. However, once it is opened, it requires refrigeration and typically lasts five to 15 days. Milk stored in the cupboard rather than in the refrigerator is a relatively new concept to the American consumer, but it’s a very common practice in Europe and Asia, where many people have very little refrigeration space in their homes. On the environmental front, other countries may be on to something. Shelf-stable milk means stores don’t use as much energy on refrigeration, thereby reducing the carbon footprint. The United Kingdom’s Department for Environmental Food and Rural Affairs set a goal that 90 percent of milk sold by 2020 not require refrigeration. There are nutritional concerns related to shelf-stable milk, too. A study by the University of Redding in the U.K. warns that pregnant and breastfeeding women should avoid aseptic milk as its manufacturing process reduces the amount of iodine, which is critical for brain development. However, most health experts agree that an otherwise balanced diet can help consumers meet daily requirements. Whether a glass bottle, a plastic jug or carton or a shelf-stable box, there are many ways to package milk and pros and cons that go with each. Consumers have varying priorities and preferences when it comes to how they like their milk. Thankfully, they also has varying options from which to choose. NED Magazine | First Quarter 2019 • 21
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E-Commerce Is Knocking on Your Door We live in a world where information can be found in an instant, messages can be sent in seconds and just about any item can be purchased with the click of a button. It’s no wonder that e-commerce has become a booming part of the way the food and beverage industry does business. E-commerce in the food and beverage arena is much more than just online shopping. It’s an experience where consumers can make a conscious choice about what they purchase, where their products come from, how their products are packaged, how quickly and carefully their order arrives, and, of course, how much they are willing to pay for it. Online meal kit subscriptions like Hello Fresh and Blue Apron continue to grow in popularity as busy consumers are demanding fresh and healthy ingredients but don’t always have the time — or desire — to go to the grocery store to get them. Economic forecasters predict that e-commerce in food and beverages will reach sales of between $15 and $30 billion by 2021. This is a huge opportunity for the industry, but it also comes with challenges that need to be figured out — and fast. According to The Digital Future of the Food and Beverage Industry by Sana Commerce, a B2B e-commerce and B2C e-commerce software company, the digitalization of how 22 • Northeast Dairy Foods Association, Inc.
Economic forecasters predict that e-commerce in food and beverages will reach sales of between $15 and $30 billion by 2021. This is a huge opportunity for the industry, but it also comes with challenges that need to be figured out — and fast. Americans purchase their food is not a trend; it’s becoming a way of life. Supermarkets are no longer investing only in physical locations but instead are seeking new and innovative ways to maximize e-commerce opportunities. Examples include Walmart’s “click and collect,” where groceries can be ordered online and brought right to your car at the nearest
PACKAGING TRENDS + SUSTAINABILITY retail location in only a few hours, or Amazon’s recently launched AmazonFresh, which delivers the groceries you select right to your door on the same day. Food and beverage retailers are realizing that they have to be where the customers are. And, today, most customers would rather be at home than elbowing their way through the grocery store aisles (although most say that even if they do shop for food online, they still regularly visit their local grocery store for other items). Of course, shipping food and beverages, which are often perishable, comes with a much greater degree of challenges than shipping a sweater or a new pair of shoes. According to Sana Commerce, quality, freshness and taste are vital to success in the food and beverage e-commerce space. Conveying the true look and taste of a product online can be particularly challenging. However, most initial impressions are based on how the food looks when it arrives. Are the leafy greens wilted? Did the pork chops spring a leak? Did the packet of rice spill open? Yes, consumers want convenience, and many are even willing to pay a premium for it, but what comes in that package had better be fresh, delicious and top-quality — or customers will simply turn to one of an increasing number of other online options.
According to Sana, the average buyer is doing more research before making a purchase and giving more thought to the potential consequences of their choices. People are reading labels, so that information had better be readily available. One of the main issues that holds consumers back from making online food and beverage purchases is trust. According to the Sana report, 55 percent of respondents were concerned that orders won’t be delivered when they are home, and 57 percent are concerned that they won’t get the products they ordered. This is one area where one bad apple can spoil the whole bunch and send consumers looking elsewhere. More and more Americans are turning to e-commerce to purchase food and beverages. For some, it’s convenience. For others, it’s an easy way to shop for diet-specific items like organic or gluten free. And still others are looking to indulge in premium products that can’t be found just anywhere but can easily be delivered to their doors. Like it or not, e-commerce is taking up a huge space in the food and beverage industry, and companies looking to profit from this opportunity not only need to get up to speed but keep up with the constant changes that contribute to this booming business. E-commerce is knocking on your door. So, the question is, “Will the dairy industry answer?”
ICE CREAM FINDS A PLACE IN E-COMMERCE SPACE The dairy industry has been slow to join the e-commerce space. It’s not a big surprise, as most dairy products are highly perishable and must be kept at specific temperatures for freshness, deliciousness and safety. It’s a challenge, to be sure. It’s happening though, and what might arguably be the toughest product to ship is making some of the biggest headway: ice cream. Jeni’s Splendid Ice Cream, based in Columbus, Ohio, is a great example of how a small storefront scoop shop is using e-commerce to expand its brand nationwide. Jeni Britton Bauer has always been ahead of her time, starting with making artisanal ice cream back in 2002, long before “artisanal” was trending. Flavors like Blackout Chocolate Cake, Middle West Whiskey and Pecan, and Gooey Butter Cake were always popular at the shop but have become wildly popular as Bauer has used e-commerce to bring that deliciousness to customers around the country. (continued on next page) NED Magazine | First Quarter 2019 • 23
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Packing ice cream for shipping is no easy task, so Jeni’s had to come up with packaging that would maintain its frozen product, including taste and quality, through shipping and delivery. The company went through thousands of hours of testing and experimentation, using trial and error, dozens of styles and sizes of coolers and all types of insulation and delivery services. Through that experience came an expertise that made the company a differentiator in the space that allowed a focus on delivering a great customer experience and even a frozen delivery guarantee. Jeni’s joined forces with a packaging company to take its standard corrugated box stuffed with plastic bags of dry ice to the next level, using dry ice packed inside an insulated cooler that gets colder than the inside of a freezer. This keeps the contents perfectly frozen until delivery, while also taking full advantage of marketing the brand through unique packaging and printing. “Finding the right solution was absolutely critical,” said CEO John Lowe. “Not only are we shipping a frozen product, but we’re shipping a frozen product made without stabilizers, and shipping to destinations with extreme temperatures. If you can’t keep your product frozen, then you’re not going to earn repeat customers — it’s as simple as that.” Today, Jeni’s customers receive their orders in a signature orange-colored, ventilated corrugated box with a lightweight Styrofoam cooler insert and an overwrap for dry ice packs. The packaging is designed to fit the pints of ice cream perfectly with elements that eliminate shifting during transport. Branding and marketing messages can be found on every available space, including the bright orange lid covers that are typically the first thing a customer sees inside the box. Best of all, the ice cream arrives fresh, frozen and delicious. Customers can’t get enough of Jeni’s Splendid Ice Cream — and they are willing to pay a premium for this in24 • Northeast Dairy Foods Association, Inc.
PACKAGING TRENDS + SUSTAINABILITY dulgence. The company’s website, Jenis.com, sells individual pints for $12 each or five pints for $58 — certainly much more than most consumers are used to paying at the grocery store. Smart marketing has also added product in collections for almost every occasion. The Build Your Own Party Collection, complete with ice cream and toppings, sells for $80, and the Newborn Baby Collection (a unique gift for new parents) of ice cream flavors sells for $50. There’s even a Pint Club for those who can’t get enough with four different flavors sent to customers quarterly. With the help of e-commerce, Jeni’s Splendid Ice Cream can be found in 35 scoop shops in the Midwest and South, grocery stores nationwide and through its website, making its unique and delicious ice cream flavors available to everyone all the time.
HÄAGEN-DAZS LAUNCHES HOME DELIVERY WITH STAINLESS STEEL, RETURNABLE CONTAINERS Nestle’s Häagen-Dazs brand recently announced a new service partnership called Loop with global-recycling organization TerraCycle that will provide a first-of-its-kind home delivery service to consumers. Loop will enable consumers to enjoy Häagen-Dazs and other household-favorite foods and personal care products in customized, durable packaging that is collected, cleaned, refilled and reused — all from the consumer’s front doorstep.
berry during the pilot of the program scheduled for the first half of 2019 in New York City. The design and transportation will keep the ice cream fresh and cold from the moment the containers are filled until they are delivered. The stainless steel container also ensures that, when opened, the ice cream melts more quickly at the top than at the bottom of the container. This allows people to enjoy the contents perfectly without the ice cream melting.
With the launch of Loop, Häagen-Dazs is debuting a reusable stainless steel, double-walled ice cream pint container, designed by Nestle’s global research and development group in Bakersfield, California, that elevates the consumer experience and keeps the ice cream at optimal conditions.
When the ice cream is consumed, the reusable containers will be picked up at the consumer’s door, washed and refilled for future use.
Consumers can select from non-dairy options like chocolate salted fudge, coconut caramel and mocha chocolate cookie or from traditional ice cream flavors like vanilla and straw-
The stainless-steel version of the container costs approximately the same as the traditional ice cream container. However, customers will pay a deposit, as well as shipping costs, through Loop starting at approximately $20. The company is banking on the fact that consumer awareness of the danger of plastic to the environment will make the extra cost more palatable.
NED Magazine | First Quarter 2019 • 25
PACKAGING TRENDS + SUSTAINABILITY
Convenience, Glass Containers and a Reason to Try Something New BY CAROLINE K. REFF
Donna Berry, a food scientist, editor, consultant and dairy blogger based in Chicago, makes it her business to keep tabs on the latest and greatest in dairy. Trends impact purchasing decisions, and lately it’s not just the products but the attributes of the packaging that have consumers asking for more.
Glass is a trend that is working for the dairy industry, according to Berry, as consumers seek out milk and other dairy products with recyclable packaging, the ability to see the products they are buying and even just because they’re eager to try something new. Glass bottles and containers are popular for a variety of reasons (see related article on Page 18), and fluid milk and cream are not the only items found in glass these days. Yogurt, in particular, is “booming” in small glass containers that not only attract consumers to their individually portioned sizes but also because some are marketed using words like “premium.” There is a downside to glass, particularly milk bottles, as some consumers are turned off by having to return the containers instead of simply tossing them into a recycling bin. This has led some companies to forego bottle deposits and actually put a “no need to return” message right on the label as part of their branding strategies.
Seeing the product has also made clear plastic containers popular, particularly in ice cream. “People want to see all the goodies inside the ice cream,” said Berry, referring to chunks of cookie dough, nuts, candy and more. Other dairy products, like shredded and snacking cheese in plastic cups, feta cheese 26 • Northeast Dairy Foods Association, Inc.
in square plastic containers, and gourmet and flavored butters packaged in plastic, are also popular.
Many dairy manufacturers are introducing squeezable tubes or bottles for products that can be positioned as a condiment rather than a spoonable item, according to Berry. Daisy Brand, for example, offers sour cream in a squeezable tube, perfect for individual portions on tacos, baked potatoes and more. Chobani’s Greek yogurt even comes in a squeezable container with a valve that automatically reseals itself for longer shelf life. Packaging varies from flexible plastic with designs similar to toothpaste tubes to free-standing plastic bottles comparable to some ketchup or shampoo containers.
According to Berry, shelf-stable products like milk and even nutritional supplements for children or older adults are starting to make a dent with American consumers, but the process has been slow. These aseptic containers, which undergo a stringent process to keep bacteria out of the product and the packaging, have been popular in Europe for quite some time and are becoming increasing popular in Asia, where consumers prefer smaller packaging and shelf-stable items due to limited kitchen storage space. American refrigerators, not to mention kitchens, are typically much larger than those found in other parts of the world. “The largest size milk container you’d find (in Europe) is probably a liter,” said Berry, noting that a gallon jug or milk is simply not practical for small spaces. Whether shelf-stable dairy will ever become commonplace in the U.S. remains to be seen, but American consumers often comment
PACKAGING TRENDS + SUSTAINABILITY that these aseptic products have an “overcooked” taste that just can’t be compared to an ice-cold glass of fresh milk.
E-commerce is popular in the majority of the food and beverage industry, but the dairy sector has been slow to enter this space, according to Berry. Most likely this is because it goes against the ability to provide fresh and local products, and the logistics of shipping highly perishable items like milk and ice cream are complicated. While there have been some inroads made in e-commerce with items like ice cream, in general consumers seem to be shying away from purchasing dairy products this way.
CONVENIENCE AND ON-THE-GO SNACKING
Consumers want convenience, and they are willing to pay a higher price for it. From the hurried parent feeding a child a healthy yogurt snack on the way to soccer practice to the business professional looking for a quick protein-filled snack when there’s no time for lunch, single-serve, on-the-go dairy
products are in high demand. The downside is that many of these items are created from plastic-milk bottles made of polyethylene terephthalate, plastic yogurt containers or tubes, individually portioned ice cream that comes with a built-in plastic spoon, and snackable-portioned packages of cheese and other proteins packaged in plastic and sealed with plastic film. This trend is driving a lot of waste, according to Berry, who noted that this is something that manufacturers should keep in mind. The fact is, busy consumers often have to choose between convenience and sustainability, and in many cases, convenience is winning.
Whether it’s squeezable sour cream or yogurt in glass containers, sometimes consumers aren’t thinking about sustainability or even convenience. Said Berry, “Some just want to try something new and different.” For more on the latest trends in dairy, visit A Daily Dose of Dairy at www.BerryonDairy.com. Caroline K. Reff is the editor of Northeast Dairy.
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NED Magazine | First Quarter 2019 • 27
The Silent Salesman (Editor’s Note: Competition in the dairy case is fierce these days, and many factors play a part in influencing a purchase. Packaging, however, cannot be overlooked. Shape, color, words, logos and a myriad of elements determine which of the dozens of yogurt brands, for example, are selected or which brand of cheese makes it into the grocery cart. Of course, long term, a great tasting dairy product will trump a glitzy package almost every time, but a consumer has to try it first. The following is a summary of why everything from what colors and fonts you choose to use on your package to how your product feels in the consumer’s hand make a major impact on purchasing decisions.) When you think of a really strong brand, there is a very good chance that an image of its packaging comes to mind. Think Coca-Cola, Absolut or M&Ms. When packages like these become visual icons and such an important part of the 28 • Northeast Dairy Foods Association, Inc.
brand’s overall DNA, how can we argue that packaging cannot be one of your brand’s most important investments? Not only will the packaging chosen by a strong brand have a longer shelf life than advertising or promotional programs, but more people in shopping mode will also see it. The package is the silent salesman that is on duty all the time in the home and in the store. The role of the package as the silent salesman is to make products more visible on the shelves to get the shopper’s attention. The average consumer is bombarded with thousands of messages each day. Consumers have more choices than ever due to media fragmentation and digitalization. It has become challenging to connect with your consumer through any one medium, making it that much more difficult to reach your level of media impression. It is no wonder that the mortality of newly launched products is high. Procter & Gamble is
PACKAGING TRENDS + SUSTAINABILITY widely cited for coining the phrase “first moment of truth” to describe the importance of when a shopper is standing in front of a package or brand in the aisle ready to make a purchase. Before shoppers can consume the brand, they have to choose it off of the shelf. The package makes the first important impression on the shopper in the store. Shoppers’ brains are looking for shape, color and fonts, as they will often decide whether they are going to buy your product based on the first impression. The package is also a key to creating a long-term relationship with the brand. Is there any other vehicle that shoppers and consumers interact with 24/7 than the packaging? From the time they notice your product on the shelf and purchase it, all the way through storage at home, to opening, handling and up to the point of disposal, you form a personal relationship with and an attachment to the brand through the package. Packaging is the one medium that really can result in a physical relationship with the shopper and consumer.
HOW TO GET THE SHOPPER’S ATTENTION: EVALUATING PACKAGING The package is both one of the most important in-store marketing components for a brand and also the only component over which the manufacturer has complete control. Hence, because you do not control the retail environment or your shoppers’ choices regarding the way your packaging is designed, your packaging should effectively tell shoppers what the product is, what it does and why to buy it. You can easily evaluate the power of your packaging by considering these six questions: 1. STOPPING POWER: Does the package stand out on the shelf and visually engage the shopper? 2. HOLDING POWER: Is the shopper drawn to engage with the product? Is the message relevant? 3. CLOSING POWER: Is the package persuasive enough to induce purchase? (continued on next page)
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NED Magazine | First Quarter 2019 • 29
PACKAGING TRENDS + SUSTAINABILITY
4. EQUITY BUILDING POWER: Is the package persuasive enough to induce repeated purchases? 5. SHOPPER FRIENDLINESS: Is the package easy to handle and take from the shelf or cart? Are the most important messages visible? 6. CONSUMER FRIENDLINESS: Is the package easy to handle at home? Is it easy to open and, for example, pour from?
FIVE WAYS PACKAGING CREATES ATTENTION 1. FOCUS ON PACKAGING AND DESIGN Packaging is one of the most important and yet often most undervalued elements of the marketing communications mix for a fast-moving consumer goods company. It needs to resonate with the consumers and deliver a great consumer experience. Packaging needs to protect the product and communicate all of the legal requirements, too. It has to meet logistics and retail standards so as to be accepted throughout the value chain, as well as being aware of its environmental responsibilities. Most importantly, it has to work for shoppers. It is on the shelf that packaging design has to communicate the most. If the product does not work on the shelf, is not visible to shoppers, does not attract them and does not give them the message they need, then it isnâ€™t working hard enough. Packaging is a remarkably efficient shopper communication tool, taking your message to every outlet where your product is available. Despite that, often when the in-store marketing mix is being defined, packaging as a communication tool is often forgotten. 2. MAKING SURE PACKAGING DESIGN WORKS FOR SHOPPERS It might sound obvious, but too often the packaging design process is led by marketing with input from the supply chain and legal departments. But packaging needs to do more than that, and it needs to work on the shelf in front of a shopper. So, it stands to reason that if there is a shopper expertise in the organization, it should be accessed during the packaging design process. The involvement of trade and shopper marketing is crucial to being successful. 30 â€˘ Northeast Dairy Foods Association, Inc.
3. IDENTIFYING YOUR TARGET SHOPPER Often the person consuming the product is also the shopper, but that is not always the case. If the shopper is not the consumer, does the packaging design also work for them? Different shoppers buy in different channels, and different channels deliver quite different shopping experiences. To a considerable extent, shopper understanding cannot be discerned by showing concepts to consumers in focus groups. If the shopper perspective has not been built into the packaging design process, it is likely that performance is not being optimized in terms of visibility or communication in the store. 4. CONSIDER THE IN-STORE ENVIRONMENT Even in more standardized outlets, there is a fair number of variations that might impact the way packaging should be developed. The width of the aisle may influence how close a shopper is to the shelf and the packaging. The amount of space dedicated to the category may influence the number of facings, which will completely change the way a shopper sees your product. Also, the competing products in the same space will greatly affect the visibility. Which packaging format is the competitor using? Which color coding is the competitor using? 5. TEST YOUR PACKAGING DESIGN WITH SHOPPERS Testing packaging designs for shoppers used to be a complicated, as well as expensive exercise. These days, virtual store technology and digital eye tracking are useful and cost-effective tools for packaging tests. Every shopper in every store will see the packaging design, hopefully for many years, and know that it makes it worth spending the time and effort on this from the beginning. Packaging design arguably is, or should be, part of the shopper marketing lexicon. At the very least, packaging development, including design, should be a collaborative effort involving both the consumer and shopper teams and not just the purchasing department. This information is published with permission from Ecolean, a company that develops and manufactures lightweight packaging and filling machines for the liquid food industry. This global company is headquartered in Helsingborg, Sweden, with a U.S. office in Plano, Texas.
PACKAGING TRENDS + SUSTAINABILITY
SUSTAINABILITY: Consumers Weigh in on Product vs. Planet Sustainability has certainly become a buzz word in almost every industry, as companies and their customers continue to pay close attention to what kind of carbon footprint a product or process leaves on the environment. The dairy industry is among this group, as it works to strike a balance between eco-friendly practices in packaging, products and processes with quality, safety, convenience and consumer demand. BillerudKorsnäs, a Swedish pulp and paper manufacturer working on solutions that “increase customers’ profitability while at the same time improving the overall environmental impact,” included a global consumer survey in its Annual and Stability Report 2017, that gives some important insight into what matters to consumers when it comes to product vs. planet. Consumers surveyed worldwide felt so strongly about sustainability that the majority stated this issue would make them consider choosing one brand over another based on responsible practices. The survey indicated that the majority of consumers also said they would pay more for products that are produced with sustainability in mind, whether that be use of renewable materials, the recyclability of packaging, the energy used in production or a host of other factors. This is especially true among Millennials, according to the APP Paper & Packaging Consumer Trends Report, which states that this demographic is willing to pay up to 30 percent more for products produced using sustainable practices. One thing that clearly came out of the BillerudKorsnäs
survey is that consumers everywhere are very concerned about plastic littering the oceans and filling up landfills at a drastic pace. The World Economic Forum recently reported that by 2025, the oceans will contain one ton of plastic for every three tons of fish! Clearly, all of this plastic is not coming from the dairy industry, but the issue certainly has dairy leaders taking notice and searching for answers. One of the challenges is that sustainability means different things to different people, and consumer perception is vital. In terms of packaging, results of the BillerudKorsnäs survey indicated that consumer understanding of sustainability can be defined as that which is: • Easily recyclable (22.6 percent) • Manufactured from recycled materials (16.2 percent) • Made from renewable materials (13.5 percent) • Manufactured from biodegradable and compostable materials (12.6 percent) • Helpful to reducing product waste (12.5 percent) • Able to be reused multiple times (11.9 percent) • Constructed with a minimal amount of materials (8.1 percent) While plastic is a staple of the dairy industry and a key component in the delivery of fresh, safe and convenient foods and beverages, sustainable practices are certain to remain top of mind both for consumers and dairy industry leaders. The question remains — Can there be a realistic balance? NED Magazine | First Quarter 2019 • 31
PACKAGING TRENDS + SUSTAINABILITY
Dairy Industry Is Committed to Leaving
Smaller Carbon Footprint U.S. consumers love their dairy, but there’s no disputing that the journey of dairy products from farm to table does have a negative impact on the planet. According to two study from the University of Arkansas, Greenhouse Gas Emissions of Fluid Milk in the U.S. and The Life Cycle and Energy Demand Assessment for Cheese and Whey Products, every gallon of milk results in the greenhouse gas equivalent of 17.6 pounds of carbon emissions, and cheese is approximately 0.7 percent. This footprint study surveyed hundreds of U.S. dairy farms, 50 dairy plants and also included transportation data. The good news is that the total carbon footprint from dairy is only 2 percent of the total U.S. greenhouse gas emissions, although the number is still significant. (The largest source in the U.S. is electricity, which produces 31 percent.) And, U.S. dairy cows generate the fewest greenhouse gas emissions per gallon of milk in the world, according to the U.S. Dairy Stewardship Commitment from the Innovation Center for U.S. Dairy. For the past decade, however, the U.S. dairy industry has been committed to voluntarily reducing its carbon footprint by 25 percent by 2020.
How much energy goes into a gallon of milk?
3.5% — Packaging 4.9% — Consumer 5.7% — Processing 6.5% — Retail 7.7% — Transportation + Distribution 20.3% — Feed Production 51.5% — Milk Production
32 • Northeast Dairy Foods Association, Inc.
PACKAGING TRENDS + SUSTAINABILITY
What resources are needed to make a wheel of cheese?
1.3% — P ackaging 1.9% — Raw Milk Transport 3.0% — Distribution 6.9% — Consumption 8.3% — Retail 10.7% — Manufacturing 22.4% — Feed Production 46.5% — Milk Production
How are other dairy products making an environmental impact?
13% — R etail + Consumption 19% — Processing + Distribution 68% — Feed + On-Farm
NED Magazine | Fourth Quarter 2018 • 33
CUT PROTECTION IS BRAND PROTECTION Weidenhammer Leads the Industry in Converting from Dangerous Metal Rings
ho doesn’t love an ice cream cone or hot fudge sundae? According to the International Dairy Foods Association, the average
American consumes more than 23 pounds of ice cream annually, and manufacturers produce approximately 1.5 billion gallons of ice cream and other frozen desserts each year. With so many delicious ﬂavors and options to choose from, consumers expect great taste and superior quality. They also expect their ice cream to be safe to eat. 34 • Northeast Dairy Foods Association, Inc.
In a manufacturing or scoop shop setting, bulk ice cream drums constructed with metal rings present a serious health hazard to employees and customers. The edges of those metal rings are surprisingly razor sharp; it’s all too common for an employee to cut a ﬁnger, hand or wrist while scooping the ice cream. And where do you think that blood goes? That’s right — and something should be done about it! While it’s unpleasant to think about, such accidents put consumers at risk for a host of blood or tissue borne illnesses (just
think about your HAACP and pathogen protocols). If you think it doesn’t happen or won’t happen at your creamery or dip shops, consider what a major ice cream manufacturer recently shared: “While it’s been said that cuts don’t happen, if you’re really paying attention, they occur quite a bit. What do employees do when that happens? They quickly put on a Band-aid, so no blood gets into the ice cream and hope people don’t see it.” Simply put: This is unacceptable, and Weidenhammer is on a mission for the industry to change that.
As a major supplier of packaging to the ice cream industry since 2007, Weidenhammer New Packaging, LLC, was established for the express purpose of addressing the fundamental packaging challenges facing ice cream manufacturers and scoop shops — the need for simplicity, safety and modern solutions. We have made a number of public statements illustrating the need for a safer way to package bulk ice cream and have been fortunate to work with the International Dairy Foods Association, the National Ice Cream Retailers Association, numerous dairies and creameries and even some of our competitors, in an effort to persuade others to get on board. The common theme of our discussions: One cut, one illness, one consumer’s negative experience is all it takes to destroy a business. Why take the risk when safe, alternative bulk containers exist? Here’s one for you. The Weidenhammer FoldDrum is a game changer, the first real innovation in bulk ice cream drums in nearly a century. The dynamic system consists of in-plant forming machinery with a 100 percent metal-free, fiber board drum. Available in a range of sizes from 1.5 to 5 gallon, the FoldDrum includes a paper bottom, smooth plastic top-ring for stability and a paper or plastic lid. The design also features a flat bottom that allows easy freezing during production and ensures the ice cream stays frozen in the dip cabinet. The bottom is heatsealed to the drum, which keeps drums leak-free (and no hot melt required!). Best of all, there are no metal parts and no danger of injury or the possibility of blood-borne contamination. The industry is taking notice. Since its introduction, the Weidenhammer FoldDrum has been well received — nearly 25 percent of the ice cream market has converted to the safer package. But that clearly shows that far too many people remain at risk from the dangers of the
“We always use our hands to hold the drum. Yes, we get cut often. It’s like a razor!” “It’s easy to get cut if you grab it wrong. If you get busy and don’t pay attention, you can get cut.” “Just the other day, I cut myself so badly that I had to stand over the sink for 20 minutes to get the bleeding to stop.” “The real issue is that the metal rings always tear up your fingers and nails as you handle them.” “We are usually cut from the bottom ring. During use, the bottoms push out and the metal opens up.” metal rings. We understand that change can be a challenge, but ask yourself this: What is the safety of your employees, customers and brand worth to you? In business, there are items beyond our control. Accepting the risks of continued use of metal-rings should not be one of them. We know we’re making strides, but we won’t be satisfied until metal rings and
the cut threat they pose are eliminated from ice cream packaging. Certainly, Weidenhammer has something to gain from this, but that’s not our end goal. Other packaging suppliers with scale and focus in the market have solutions, too, and we welcome them. Our main priority is safety, so we encourage you to spread the word and urge others in the industry to move away from what they know to be unsafe. After all, ice cream should be a delicious and satisfying treat, not a health hazard that could put your employees, consumers and brand at risk. For more information on our products or to learn more about how we can help you find the solutions to fit your needs, contact Weidenhammer New Packaging at email@example.com, visit our Facebook page: Weidenhammer Ice Cream Packaging, or call sales at 816-888-7023. About Weidenhammer New Packaging Founded in 2014 as a joint venture of the Weidenhammer family (Heidelberg, Germany) and Sonoco (NYSE: SON), Weidenhammer New Packaging is regarded as the leading innovator of metal-free, paperbased bulk ice cream packaging and related machinery. The company is the successor entity of the original Weidenhammer Packaging, which was formed in 1956. Weidenhammer New Packaging is a proud Gold Business Partner member of IDFA. NED Magazine | First Quarter 2019 • 35
PACKAGING TRENDS + SUSTAINABILITY
DO CONSUMERS UNDERSTAND WHAT “MILK” IS?
The Debate Over Labeling of Non-Dairy Alternatives Continues
ust because the label says “milk,” doesn’t make it milk. That’s the battle that continues to rage on in the dairy case as more and more non-dairy milk alternatives are nudging their way onto the shelves and confusing consumers. In August 2018, Dairy Management, Inc., completed a survey of adults that included exclusive dairy milk buyers, buyers of both diary milk and plantbased milk, as well as those who exclusively buy plant-based milk beverages to find out what their perception of “milk” is. Overall, the term “milk,” whether on a label or in product marketing efforts, shows a neutral to positive association with dairy milk. Exclusive milk drinkers think of health, taste, calcium content and strong bones, while some plant-based buyers tend to view dairy milk as unhealthy, inhumanely sourced or full of additives. While plant-based alternatives are made from almonds, soy, coconut and even peas, many consumers believe these products have the same nutritional value as milk — something dairy experts aggressively dispute. The DMI survey clearly shows that many consumers are not aware of the nutritional distinctions between dairy milk and plant-based alternatives. Those who buy plant-based alternatives perceive almond, soy and coconut milk as having the same or more vitamins, protein or other key nutrients as cow’s milk. Most said they buy dairy milk particularly for taste and 36 • Northeast Dairy Foods Association, Inc.
nutrition. Those who buy only plant-based alternatives or both typically associated these products with nutrition — some even more so than milk. In fact, when dairy milk buyers were asked if milk is “healthy,” 74 percent said yes, while only 26 percent of plant-alternative consumers said that cow’s milk is healthy. Of these consumers, seven in 10 view almond “milk” as having the same or more protein, vitamins and key nutrients as dairy milk. Exclusive plant-based buyers had even stronger views that extended to soy and coconut beverages. One of the interesting findings from the survey concerns the label that appears on the packaging. Results show that consumers have the expectation that products labeled “milk,” whether actually coming from a cow or not, are comparable on nutrition content. In fact, 73 percent of consumers surveyed believed that dairy alternatives labeled as almond “milk” have as much, if not more, protein than an equivalent serving of cow’s milk — when, in fact, cow’s milk has eight times the protein. Those who are plant-based alternative consumers feel more strongly than those who exclusively buy dairy milk. From the results of this survey, it seems that when the word “milk” is prominently displayed on the package, 53 percent said they believe it was labeled as such because the product had similar nutritional value to cow’s milk. The percentage was even higher — 68 percent — for those who only bought plant-based dairy alternatives.
PACKAGING TRENDS + SUSTAINABILITY In fact, 73 percent of consumers surveyed believed that dairy alternatives labeled as almond “milk” have as much, if not more, protein than an equivalent serving of cow’s milk — when, in fact, cow’s milk has eight times the protein.
Of those surveyed, most had a high level of association with dairy milk in its purest form. For example, 96 percent surveyed associated a gallon of cow’s milk in a plastic jug as cow’s milk. The same goes for organic whole dairy milk, often found in a carton. The split becomes more apparent as products move away from the traditional. Lactose-free beverages, kefir and others mixed with coffee products are not as closely associated with dairy by die-hard cow’s milk drinkers, while dairy-alternative buyers linked them more closely. As the debate continues, it is interesting to note that research suggests that while many consumers don’t feel the need to have items labeled “milk” as something that comes from a cow, 85 to 90 percent believe that if a label reads “orange juice” it should contain 100 percent juice from an orange. That, in many cases, is also false. The FDA has been slow to act on how a product labeled “milk” should be defined. Organizations like the National Milk Producers Federation and many others in the dairy industry continue to strongly urge the FDA to label milk as milk — from a cow — citing nutritional and transparency concerns. Stay tuned.
NED Magazine | First Quarter 2019 • 37
Employee Stock Ownership Goes Extra Mile, Furthers Company Success BY DIANE STIRLING
ack in 2001, Stewart’s Shops, a chain of convenience stores in Upstate New York and Vermont and member of the Northeast Dairy Foods Association, decided to make a move to truly engage its employees in the company’s growth and success. So the owners, the Dake family, decided to offer an ESOP — Employee Stock Ownership Plan — to all of its employees. While the Dake family still owns 63 percent and has plans to continue its involvement with the company, the employees own 37 percent. For nearly two decades, this “buy in” of sorts has helped the company and its employees reap the benefits in a number of ways. “We do it to give back to the partners — and all our employees are considered partners — and we feel giving them some ownership helps them care even more about what they do when they go to work each day,” said Pat Suprenant, an ESOP trustee for Stewart’s. “Over the past 17 years, we’ve seen our employees take greater ownership and pride in what they do, and we are certain the ESOP program plays a significant factor in this.” Chairman and CEO Bill Dake liked the idea of an ESOP since he began paying his milk drivers years ago based on a share of the profits. He quickly realized that employees with some “skin in the game” worked a little harder. Today, Stewart’s employees at every level — from cashier to top-level management — are eligible for the ESOP once they have worked 1,000 hours in a calendar year or 500 hours in a quarter. The company funds the program entirely, and employees are fully vested after six 38 • Northeast Dairy Foods Association, Inc.
years of employment. This has been a great means of retaining employees and a great recruitment tool, as well, according to Suprenant, who said that many applicants come to the company saying, “I hear you have a good retirement plan.” Stewart’s emphasizes the program to its existing employees at every turn. “We constantly talk about it — during employee reviews or when we bring in new people, it’s typically part of the conversation,” he said. “At every opportunity, we thank all of our employees and continue to remind them that they are the face of the company — and that we all need to keep hustling.” At the end of each year, Bill Dake and Stewart’s President Gary Dake send out a letter to employees telling them how the company faired over the past 12 months. “Over the past 20 years, we’ve had good, long-term steady growth, and that is going back to the employees,” said Suprenant. “In April, each person gets an ESOP statement, and in July and December employees receive a dividend.” Having ownership in the company and seeing profits pay off gives every employee incentive to do his or her best and go that extra mile to ensure Stewart’s success. “Employees see that every efficiency, every cost savings, everything they do to make the company more profitable comes back to them,” said Suprenant. “As the company grows, each person’s ESOP grows, and employees can see that every dollar counts.” While Stewart’s Shops created its ESOP as a form of an employee reward and retirement plan, other companies may make it a part of a succession gap or do so when a company
comes to a transitional crossroads. Restructuring as an ESOP can create a win-win-win solution for the company, as well as its stockholders and employees.
can create (boosting productivity, efficiency and revenues from instilling an owner mindset) along with its tax advantages are the cherries on top, advocates say.
PAYING IT FORWARD
A MORE PALATABLE CHOICE
Owners who aren’t turning the keys over to a next generation or selling to an outside buyer discover that ESOPs may let them “pay it forward” instead. The format can be the means to continue the company legacy, maintain its culture, secure the jobs of loyal employees and maximize profitability. Instilling an owner mindset among new employee owners, added to the available, built-in tax advantages, are strategies that let owners extract equity while customizing their exit strategies. Creating an ESOP can present a more palatable way for an owner to exit or retire, rather than liquidating the company or selling to a competitor or an industry conglomerate. Because employee ownership models a participatory culture, it may also help businesses meet some of today’s most pressing human resource challenges — employee recruitment, retention and engagement. The improved company performance that ESOPs
An ESOP can create an attractive transition vehicle, according to Loren Rodgers, executive director of the National Center for Employee Ownership. “The actual experience of people who sell to multinationals or private equity firms is that they are often not happy two to three years down the pike. They don’t like what happened to the company, the community that is affected by the sale and their employees and vendors,” he related. While selling a company outright may be thought to maximize its price tag, ESOPs can provide high value of a different sort. That depends on what is most important to the selling owner, said Patrick Mirza, director of communications for the ESOP Association. “Typically, when someone sells to an outside interest, they sell the entire company and walk away. When you sell to an ESOP, you can sell piecemeal. You can sell whatever percentage you want. You can spread the sale over time. You can NED Magazine | First Quarter 2019 • 39
HumanResources remain in your role for a time if you want. For someone who wants to get out gradually, there’s value in selling to an ESOP.” Owners consider many factors besides cash-in-hand, Mirza added. “If someone has built something over the course of time and they have an attachment to it, and especially if others have helped them build that entity, there is a strong incentive to keep that entity around, in particular where the company is an important source of employment in an area. Can you get a higher return one way or the other? That depends on what you value and what you get for the return,” he explained.
In practical terms, employee ownership generally results in a boost in business performance and improvements in
worker outcomes, according to research by Director Joseph R. Blasi, Ph.D., and Associate Director Douglas Kruse, Ph.D., of The Rutgers Institute for the Study of Employee Ownership and Profit Sharing. Their research has shown that those enhancements typically include a rise in productivity, a lowering of employee turnover, more stability for the company and more job security for workers. In a whitepaper developed for Third Way Next (“Having A Stake, Evidence and Implications for Broad-based Employee Stock Ownership and Profit Sharing”), written in concert with Richard B. Freeman, Kruse and Blasi describe those tangible benefits. Their studies using data from the U.S. government’s General Social Survey have shown results of:
AGE OF EXISTING U.S. ESOPS *
Federal legislation introduced in 1974 and enacted in 1976 created the opportunity to form ESOPs after its passage. Most current ESOPs were created before 1997. Those plans also contain the greatest number of participants.
PLAN EFFECTIVE YEAR (YEAR CREATED)
NUMBER OF PLANS
% OF PLANS
1998 – 2007
NUMBERS OF S CORPS VS. C CORPS
NCEO shows a majority of ESOPs are C Corporations, which are partially employee owned vs. S Corporations, which are 100 percent employee owned.
S CORPORATIONS VS. C CORPORATIONS IN THE U.S.* PLANS
EMPLOYER SECURITIES (MILLIONS)
TOTAL PLAN ASSETS (MILLIONS)
*Information source; www.NCEO.org
40 • Northeast Dairy Foods Association, Inc.
HumanResources • Increased worker pay • Improved workplace performance and company productivity (because the environment incentivizes higher effort, cooperation, information sharing and innovation) • Protected jobs (through stabilizing employment and promoting company survival) • More harmonious workplaces (based on the ESOP culture of business reporting and employee involvement, thus greater corporate transparency and increased worker engagement in operations, job functions and decision-making). The earlier research by Kruse and Blasi of 1,100 companies between 1988 and 1994 quantified productivity increases specifically. They detailed performance-level differences of those firms after they became ESOPs, as opposed to their pre-ESOP performance levels, as follows: • 2.4 percent annual sales growth • 2.3 percent annual employment growth • 2.3 percent annual growth in sales per employee • 4.4 percent average increase in employee productivity. Kruse noted that while the averaged results take into account that some companies do well as ESOPs and others do not, the ESOP environment itself is conducive to success. “We do find
that employee ownership tends to work better in companies with certain cultures, where for employees there is high performance work, participation in decisions, lots of information sharing and good job security, as well as a good family feeling. Sometimes employee ownership can build that up, too, but that is the best environment for it,” he said. The NCEO’s statistics add further data on how the ESOP environment is a boon to company productivity, while also generating additional wealth for employees, stockholders, the company and the communities where the businesses are located. Its economic development of employee ownership report shows the following figures: • ESOP companies are 25 percent more likely to stay in business • Employees in ESOPs have 2.5 times greater retirement accounts • Employees at ESOPs receive 5 to 12 percent more in wages • Productivity improves by 4 to 5 percent on average at companies in the year the ESOP is adopted • Over a 10-year period, ESOP companies have 25 percent higher job growth than comparable companies without (continued on next page) an ESOP
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A Prou d Pa rt ner of t h e Nort h e as t Da ir y A s s oc ia t ion NED Magazine | First Quarter 2019 • 41
HumanResources • ESOP companies see average yearly post-ESOP improve ment in return on assets of + 2.7 percent • Employee owners were four times less likely to be laid off during the recent recession.
GOOD FOR THE ECONOMY, TOO
Not only is employee ownership linked to generally better company performance for the firms who adopt the format, the advantages of converting to an employee-ownership structure can be valuable to an area’s economy, particularly in stabilizing employment, wages and economic activity, according to Kruse. For instance, research data show that companies who become ESOPs tend to have fewer layoffs in recessions and greater company stability overall. “We’re not entirely sure why, but it looks like if you’re trying to create an ownership culture, you don’t want to lay people off,” the economist added. “The idea there is community stability, to make sure the companies continue, and there’s isn’t disruption to peoples’ lives from shutting down or shifting resources elsewhere. For the retiring owner, there’s a financial incentive, but there’s also the idea of leaving a legacy and keeping the community stable. Those are some really important incentives,” Kruse adds. J. Michael Keeling, president of the ESOP Association and the Employee Ownership Foundation, echoes the belief that ESOPs are good for the U.S. economy. While there certainly is no guarantee in the free enterprise system that every ESOP company is going to succeed, he said that, in general, the macro data which shows ESOPs providing significant performance “is overwhelming.” Keeling cites studies showing that most well-managed employee-owned companies where average-pay employees have a voice, and where they are respected within the structure also make more profits, have more sales, last longer, are more productive and create more wealth for workers than non-employee-owned companies do. “Most ESOPs are formed by the existing shareholders in companies that are secure and that have a nice track record; they’re not sick puppies, so you look at that factor, too,” he explained.
There are distinct tax advantages to forming an ESOP. When an owner sells the company to an ESOP and providing certain requirements (called a 1042 rollover) are met, paying capital gains taxes can be avoided for a number of years, said Mirza. “That has to be factored into the value the owner gets for the company. It’s a key element; it’s a huge factor,” he added. The NCEO lists these as significant tax advantages ESOPs can enjoy: 42 • Northeast Dairy Foods Association, Inc.
Contributions of stock are tax-deductible, providing companies a current cash flow advantage by issuing new shares or treasury shares to the ESOP. A company can contribute cash on a discretionary basis yearto-year and take a tax deduction for it, whether the contribution is used to buy shares from current owners or to build up a cash reserve in the ESOP for future use. Sellers in a C corporation can get a tax deferral. In C corporations, once the ESOP owns 30 percent of all the shares in the company, the seller can reinvest the proceeds of the sale in other securities and defer any tax on the gain. In S corporations, the percentage of ownership held by the ESOP is not subject to income tax at the federal level (and usually the state level as well). That means, for instance, that there is no income tax on 30 percent of the profits of an S corporation with an ESOP holding 30 percent of the stock, and no income tax at all on the profits of an S corporation wholly owned by its ESOP. (Note: the ESOP still must get a pro-rata share of any distributions the company makes to owners.) Dividends are tax-deductible. Reasonable dividends used to repay an ESOP loan, passed through to employees or reinvested by employees in company stock are tax-deductible. Employees pay no tax on the contributions to the ESOP, only the distribution of their accounts. Employees can roll over their distributions in an IRA or other retirement plan or pay current tax on the distribution, with any gains accumulated over time taxed as capital gains. The income tax portion of the distributions, however, is subject to a 10 percent penalty if made before normal retirement age. (For a full explanation of the tax advantages ESOPs can offer, see the ESOP Association’s website at: www.esopassociation. org/, search “Tax Advantages.”)
FOOD FOR THOUGHT FOR OWNERS
“At its very simplest, an ESOP is a retirement plan,” Mirza said. “You can have just the retirement plan with an ESOP and stop there. But, you can offer extra elements that companies are trying to get people to do. You don’t have to, but you can. There’s only one requirement — once a year you have to get an evaluation of the stock, and you have to tell employees what that stock value is. Companies who take this step find that they end up spending a lot of time telling employees how the business runs, how things work. That naturally leads to other things, including employees cutting costs and seeing how these things fit in.” Rodgers notes that while there is “major money invested in advertising now to convince owners that the best way to transition out of their business ownership is to sell to a third
HumanResources party,” anyone thinking of converting to an ESOP should take time to research their options and allow sufficient time for a transition to take place if they are thinking of the ESOP route. It’s wise for owners to carefully consider all available options before taking any action as an exit strategy, Keeling said, adding that owners should examine first whether there are family members to pass the company to, and second if an interested group of trusted senior managers exists as a potential buyer. “There are financial issues and psychological issues to satisfy,” he noted, and both sides of the coin deserve thorough consideration. “You clearly have to understand the tax consequences. ESOPs do have a set of special tax incentives and attributes that could perhaps be very attractive. Now to turn to the psychological. You have to ask whether your legacy, your contribution to your community and to the business community you’re in, and to the employees that made the company, is the ESOP going to satisfy those kinds of desires more than anything else you could do?” Kruse agreed. “As people retire, they don’t want to just sell to an outside investor who may end up shutting the company down or shifting its resources elsewhere. A lot of retiring owners want to leave a legacy and see the people they’ve worked with continue to be employed with the company.” Keeling added one point that owners who are considering selling to a private equity or a merger/acquisition interest, or letting a competitor buy them out should be aware of: the history and motivations of potential buyers. “Over the years, I’ve observed that such options often lead to the layoff of employees, particularly those in the back-office operations. The acquiring company already has people doing those jobs. When you’re looking to acquire, you’re looking to get the profit line as high as possible. Generally the biggest place to increase profit is to get the compensation line lowered.” Keeling urged owners to keep in mind “what you and your partner or family feel comfortable with” as an outcome. “Chances are high that you’ll be involved in the same community in your retirement. Most people have connections, and they’ll be thinking about the repercussions, so think those through.”
TAKE TIME FOR RESEARCH, DUE DILIGENCE
It’s also important to shop for quality service providers and to conduct due diligence to be sure those selected will properly guide the company’s transition, NCEO’s Rodgers said. In general, ESOP transitions “work out very well for the average ESOP company. But, it can go wrong. So, it’s good to take the time and put in the care to be sure to do it right,” he advises. As a source of information and a conduit to other ESOPs and
The National Center for Employee Ownership’s website presents some interesting data about the numbers of employee-owned companies in the United States, where they are located and the number of employees participating in the plans at those companies. There are
ESOPs in the United States *
Those companies’ total assets equal nearly
$1.3 TRILLION* (Source: www.neco.org)
owners, the NCEO is willing to connect owners with service firms as well as companies that have had satisfying experiences becoming ESOPs, Rodgers offers. He suggests other key steps for those considering becoming an ESOP: First (and especially if there is more than one owner), search your heart to see what’s important as an outcome. Think about what you want to look back on and what kind of outcome you want. Also, take sufficient time for the process — six months at minimum. An even longer timeline provides more time for an orderly transition and the advantage of “being ready for the human side,” Rodgers said. That timeframe lets you “announce this to the workforce in a way that sets things up for success. It pays to be really thoughtful, not just about the transaction, but how to portray the transaction to the workforce initially.” Owners should prepare for varied employee reactions — from thinking they’ll get rich quick, to being scared that the founder is leaving altogether, to the belief that the company is going right out of business. (continued on next page) NED Magazine | First Quarter 2019 • 43
HumanResources Despite good planning and plenty of time, converting ownership to the employees can come with some unexpected results, Rodgers said. “The biggest surprise some companies face is there are two distinct phases in the life of an ESOP,” that of before and after, he explained. “Most of the surprises that face people are not inherent. They usually are the result of focusing too much on the transaction and not enough on the longer term.”
THERE ARE CONS, TOO
Some companies participating with an ESOP say that it has created a tremendous amount of stability and positive peer pressure at all levels of the company. In other words, if someone isn’t doing his or her job and needs to pick it up a bit, then other employees will let that be known because they feel that value in ownership.
THE POTENTIAL FOR BROADENED WEALTH
While transitioning owners are certainly looking out for their own interests and for the future of their organization, the path to becoming an ESOP is one that can benefit more than just those with immediate connections to the new ESOP, according to Kruse. Those who advocate for employee ownership -- like Stewart’s Shops — or as it is sometimes referenced, shared capitalism, feel that the concept is good for the U.S. economy and for any system of democracy, he said. “There really is a lot of positive potential in employee ownership, and a lot of people don’t realize that. The economy hasn’t given enough consideration to employees having direct stakes in the companies and in the success of the companies,” he adds. The broad distribution of ownership is something that the founding fathers were keen on, and an idea with deep roots in American tradition, Kruse noted. He said that, as an economist, he is, “concerned about the growing inequality in our country of wealth and income, and this can be FINANCING THE a good way to distribute the economic rewards of our system more broadly.” That premise is detailed in the book that he, Blasi and Freeman published in 2014, “The Citizen’s Share: Putting Ownership Back into Democracy.” “The [Founders] thought it was very important for democracy, and I think there’s a lot to that. It’s hard to have a functioning democracy if just a tiny bit of the people own everything. So, employee ownership VERTICALLY INTEGRATED AG BUSINESSES can be part of a broadened ownership policy PROCESSING AND MARKETING EQUIPMENT • VALUE-ADDED AG BUSINESSES from a political perspective,” said Kruse. DAIRY SERVICE AND INPUT BUSINESSES • PARTNER WITH OTHER CAPITAL PROVIDERS
As positive an option as employee ownership appears to be, some cons exist, according to Kruse. They include the format being subject to “the free-rider problem,” where “rewards from individual effort are shared with other workers and the direct incentive to work hard may be weak.” Also a consideration is the fact that, “the effectiveness of employee ownership may depend on a complicated combination of supportive policies, such as employee involvement, job security and training.” A third reason for some doubt is that employees, “can be exposed to excessive financial risk, especially when employee ownership is a large share of a worker’s wealth, and when it substitutes for other pay and benefits,” Kruse added.
Diane Stirling is a career journalist, editor and public relations practitioner. She served 800-562-2235 | FARMCREDITEAST.COM
as GAWDA Media editor in chief from Fall 2015 through Summer 2018. She can be reached at firstname.lastname@example.org.
44 • Northeast Dairy Foods Association, Inc.
WHY THEY CAN BE WIN-WIN-WIN
What Is an ESOP? Employee stock ownership plans, or ESOPs, are a way to sell a business that benefits the company, employees, and the selling business owners. Business owners sell some or all of their shares to an ESOP trust, which owns those shares on behalf of employees.
The Benefits of Selling to an ESOP
ESOPs can be funded in many ways, but usually the transaction involves a loan. The company can take out a loan and then reloan the funds to the ESOP trust. The company makes contributions to the trust, which the trust uses to repay the loan. Sometimes the person selling the shares provides the loan. Almost all ESOPs are completely company-funded. Employees pay nothing.
An ESOP can use pretax future corporate earnings to buy shares from an owner. Sellers can defer taxation on the gain depending on the type of corporation. The business will also receive numerous tax benefits depending on the type of corporation. Sell the business at once or gradually in installments. Sellers can define their role in the company moving forward.
Protects jobs. Provides employees with a significant retirement benefit. Protects the integrity of the business by assuring that it will not be dismantled.
As the loan is repaid, shares become available to allocate to employee accounts. The allocations must be made on a non-discriminatory basis, like payscale or a more level formula. With limited exceptions, all employees participate in the plan.
The company administers the plan in accordance with federal laws and regulations that govern issues such as contribution and allocation limits, vesting, benefit distributions, diversification, and more.
ESOP companies often have ownership cultures that encourage employees to “think and act like owners.” Research shows such companies are more productive, faster growing, more profitable, have less turnover, and generate more wealth.
The National Center for Employee Ownership • web: www.nceo.org and www.esopinfo.org • email: email@example.com
NED Magazine | First Quarter 2019 • 45
OSHA UPDATES OSHA Safety Program “Quick Check” in a Dairy Processing Plant BY STEPHEN VALENTINE, CIH
he Occupational Safety and Health Administration standards for general industry (29 CFR 1910) are applicable at all dairy processing plants. To meet these OSHA standards, plants are required to develop many written safety programs and procedures to protect employees and conduct safety training for all affected employees to educate them on these rules. The intent of this article is to provide managers with safety responsibilities in dairy processing plants with a “quick check” of their applicability and general compliance with OSHA-required safety programs. Note: The article is not intended to be a comprehensive list of OSHA-required programs (and compliance requirements) but a list of programs (and their general requirements) common to many dairy processing plants. Use this list to evaluate where your plant stands: 1. FALL PROTECTION PROGRAM (29 CFR 1910.28-30) when employees are working at elevated heights (e.g., bucket lift, roof access, etc.) over 4 feet. Written program, hazard assessment, safety procedures and employee training Note: A written program is not required but is recommended. 46 • Northeast Dairy Foods Association, Inc.
2. EMERGENCY ACTION/FIRE PREVENTION PROGRAM (29 CFR 1910.38-39) to address emergencies associated with fires, medical, chemical releases, inclement weather, workplace violence, etc. Written program, hazard assessment, emergency response, safety procedures and employee training 3. HEARING CONSERVATION PROGRAM (29 CFR 1910.95) when employee noise exposure exceeds the OSHA action level (85 dBA) for an eight-hour time weighted average. Written program, personal noise monitoring, audiometric testing, safety procedures and employee training 4. RADIATION (IONIZING/ NON-IONIZING) PROGRAM (29 CFR 1910.97 and 1096) when X-rays and/or lasers (class 3B or class 4) are used at the facility. Written program, state-dependent registration, radiation safety officer, exposure monitoring, safety procedures and employee training 5. PROCESS SAFETY MANAGEMENT (29 CFR 1910.119) for plants using over 10,000 lbs. of anhydrous ammonia for refrigeration.
Written program, process hazard
analysis, compliance reviews, safety procedures and employee training Reciprocal EPA requirement for Risk Management Planning 6. CHEMICAL EMERGENCY RESPONSE HAZWOPER PROGRAM (29 CFR 1910.120) for plants responding in-house to chemical spills or releases. Written program, medical surveillance, safety procedures and employee training 7. PERSONAL PROTECTIVE EQUIPMENT (29 CFR 1910.132) for all plants. Written PPE Hazard Assessment and employee training 8. RESPIRATORY PROTECTION PROGRAM (29 CFR 1910.134) for plants using respirators (above voluntary dust mask use) for employee exposure control. Written program, respiratory protection program administrator, air monitoring, medical surveillance and fit testing, safety procedures, respirator use inspections and employee training 9. CONFINED SPACE PROGRAM (29 CFR 1910.146) for plants where employees conduct confined space entry. Written program, confined space inventory/labeling, entry permit/permit
system, safety procedures, emergency provisions and employee training 10. LOCKOUT/TAGOUT PROGRAM (29 CFR 1910.147) for plants conducting service and maintenance of machinery and equipment. Written program, general and equipment-specific lockout/tagout procedures, authorized employee reviews and employee training 11. CHROMIUM VI PROGRAM (29 CFR 1910.1026) for plants that conduct stainless steel welding and exceed the OSHA action level (2.5 ug/m3) for hexavalent chromium exposure. Written program, air monitoring, medical surveillance, safety procedures and employee training 12. BLOODBORNE PATHOGENS PROGRAM (29 CFR 1910.1030) for plants with medical services and/or first aid/CPR/ AED trained personnel anticipated to provide medical services. Written program, Hepatitis B vaccine (offering)/medical surveillance, safety procedures and employee training 13. HAZARD COMMUNICATION PROGRAM (29 CFR 1910.1200) for all plants. Written program, chemical inventory, Safety Data Sheets (SDS), safety procedures and employee training 14. LABORATORY CHEMICAL HYGIENE PLAN (29 CFR 1910.1450) for plants with labs conducting research and development (not quality control). Written program, chemical hygiene plan officer, Safety Data Sheets (SDS) safety procedures and employee training Each of these OSHA programs must
be written and typically should get reviewed and updated on an annual basis or with changes that affect the program. Plants may want to create additional safety programs for topics that do not require a written program but where a written program will better define the safety procedures/rules and employee training. For example, fork trucks, lifts, cranes and hoists, electrical safety, machine guarding, welding, ergonomics, etc. Use the “quick check” as appropriate to review your plant’s applicability and status to these OSHA requirements. The OSHA standard reference (29 CFR
1910) for each of the topics is listed in parenthesis next to the topic if additional information is required. Stephen Valentine, CIH, is the director of environmental health and safety with Partners Environmental Consulting (formerly Greystone) in Syracuse, New York. He is a consultant to Northeast Dairy Foods Association, Inc., members and can be contacted at svalentine@ partnersenv.com or 315-263-3183.
t Agri-Mark, we are continually investing in the Northeast Dairy industry because this is our home. We have finished the $21 million investment in a new dryer at our butter/powder/condensing plant in West Springfield, Mass., shown above, for the 950 dairy farm families that own the co-operative. This project boosts the plant’s capacity by roughly 33% and will allow us to better serve our customers. Please contact us at 978-552-5500 for more information on how we can serve you! NED Magazine | First Quarter 2019 • 47
Get the Most Out of Your Membership With Cost-Saving Services for Members
BY ALEX WALSH
here are many reasons to join an association, whether it be for the networking opportunities to increase sales or business, receiving updates, news and information on the dairy industry, or knowing that someone is there to represent you and your interests in the halls of government. Our goal as an association is to assist you to operate your business more efficiently and more profitably, and the Northeast Dairy Foods Association, Inc., has four endorsed member services that are designed to take the burden off of you and your employees, while also saving time and money. All four of the following endorsed service providers are members of the Northeast Dairy Suppliers Association, Inc.
AXA ADVISORS: 401(k) AND RETIREMENT PLANNING The most recent endorsed service is for 401(k) investment and retirement planning through AXA Advisors. The Retirement Gateway Group Variable Annuity for 401(k) plans is one that’s easy to administer and offers your employees a simple, affordable way to save for retirement, as it was built to meet the needs of our association’s members. If you do not yet offer a retirement plan, AXA Advisors can construct one that meets your business needs and goals. If you currently have a retirement plan for employees, it can be benchmarked to the association’s plan through AXA, and you can compare it against your current plan. This group plan has no up-front administrative fees to start up the program, no per-participant fees and no annual fees, which can save you thousands of dollars. AXA Advisors will also review your plan to ensure you are meeting your fiduciary responsibilities and educate all of your participants on the process and the plan. An important factor to consider if your company does not have a retirement program in place is using this as a tool to attract and retain employees. We have met and spoken with many members who repeatedly say that labor is one of the top concerns they face. Offering a retirement program for your 48 • Northeast Dairy Foods Association, Inc.
current and future employees will not only help attract new workers but also help you retain your current employees before they leave for another job that offers more benefits — taking with them their knowledge and experience.
BROWN & BROWN EMPIRE STATE: INSURANCE COVERAGE There are many risks in business in today’s climate, and companies need to protect themselves with the proper insurance coverage should something happen. Brown & Brown Empire State has been endorsed to provide members with the lines of insurance that protect you, your assets and your employees. From workers compensation and property liability to cyber security and product recalls, Brown & Brown can develop the coverage you need at the lowest possible cost. Slips, trips and falls happen every day, but tomorrow your company could be the victim of a cyber-attack or product recall. If you do not have the proper coverage in place, an injury or catastrophic event could cost your company thousands of dollars, if not more. The specialists at Brown & Brown can review your current coverage and needs to save your company if an event were to happen.
PARTNERS ENVIRONMENTAL CONSULTING: ENVIRONMENTAL, HEALTH AND SAFETY PRACTICES Have you recently reviewed your environmental, health and safety practices? Partners Environmental Consulting is the endorsed consulting service providing its expertise in these areas to the dairy industry. For environmental services, Greystone provides environmental compliance, property transaction and site restoration services. It also provides safety compliance programs, including OSHA training, industrial hygiene, process safety management and construction safety programs. These programs are available to help management and employees be smarter and safer at work and limit your company’s risks.
Member Information ENERGY PARTNER CONSULTANTS: ENERGY COST ASSESSMENT AND SAVINGS EXPERTISE Everyone knows the commercials for Motel 6 in which Tom Bodett says, “We’ll leave the light on.” Well in this case, don’t — unless you really enjoy paying your energy provider more than you have to. Your company may be wasting energy, which means you are wasting money. Energy Partner Consultants can help you immediately lower your energy supply costs. EPC’s experienced and professional staff can conduct an energy-reduction assessment to determine if your business qualifies for a variety of credits and incentives being offered by local utilities and state and regional regulatory agencies. EPC is a full-service, national energy-consulting group that specializes in understanding specific energy markets and applying this knowledge to help our partners positively change their energy consumption practices and lower their energy overhead costs.
The company’s method is to thoroughly analyze our clients’ needs and requirements, educate, counsel and help you make valued decisions that will promote your economic viability, as well as the best interests of our ever-changing societal energy concerns. Combining these dual objectives is not only possible at this time in history but also strategically and fiscally advantageous. These services have received the endorsement of the board of directors due to their capabilities, specialty services and commitment to members of the association with the ability to work with any member, no matter the size or location. In order to participate, a company must be a member of the Northeast Dairy Foods Association, Inc. You can reach out to a representative at any of the association’s endorsed service providers for more information. They are here to help you be a leaner business, increase profits and provide for your employees. Alex Walsh is the director of membership and communications for the NDFA.
AXA Financial 401(k) Retirement Planning
Brown & Brown Empire State All Lines of insurance
Partners Environmental Consulting
Energy Partners Consultants
Anthony Stevens (315) 425-6307 Anthony.Stevens@axa-advisors.com
Steve Valentine (315) 263-3183 firstname.lastname@example.org
Stephen Messina (315) 474-3374 x420 email@example.com
Wendy Martin (518) 331-4627 firstname.lastname@example.org
NED Magazine | First Quarter 2019 • 49
Cabot Creamery Celebrates 100 Years of Working Together BY CAROLINE K. REFF
n 1919, 94 Vermont farmers formed a co-operative with a total investment of $3,700 to pool excess milk and other resources in order to expand into new markets. By forming a co-op, farmers were able to work together in a way they had never been able to do on their own, delivering to Boston by horse and buggy and to New York by barge. Clearly, much has changed over the past 100 years, but the commitment of farmers working together for the benefit of all has stood the test of time as Cabot Creamery Co-operative celebrates 100 years in 2019. In the beginning, the co-operative based out of Cabot, Vermont, used its 50 • Northeast Dairy Foods Association, Inc.
excess milk to make butter under the Rosedale brand, but by the 1930s it purchased cheesemaking equipment and changed its focus to cheddar and cottage cheese. (The Rosedale brand was phased out in the 1980s and replaced by Cabot-branded products.) A century later, Cabot Creamery is going strong with a successful 800-member farm family co-operative and the reputation for producing “The World’s Best Cheddar.” “At its core, the mission of our coop has not changed since the day it was founded,” said CEO Ed Townley. “Our job as employees of the farmers has always been to find a profitable home
for their milk. That mission and purpose has been in place since day one. As we hit this milestone, we remain focused on ensuring the next generation of family farms are able to continue farming, and 900 employees are engaged in making sure the farmers’ products remain the best.” In 1989, Cabot really put its stamp on the cheesemaking industry when it took first place in the cheddar category at the U.S. Championship Cheese Contest in Wisconsin. This was the beginning of years of awards at national and international competitions for “The World’s Best Cheddar.” Since then, Cabot has won every major award for taste.
In 1992, Cabot merged with the 1,800 farm-family Agri-Mark Cooperative, Inc., and reincorporated as Cabot Creamery Co-operative, Inc. Today, Cabot Creamery spans three New England states and part of New York with its headquarters firmly planted where it all began — in Vermont. Today, the co-operative manages four plants in three states with over 1,000 employees, and, in addition to its award-winning cheddar, produces light cheddars, flavored cheddars, Greek-style yogurt, cottage cheese and sour cream, which is distributed in every U.S. state and 22 countries. As it always has operated, profits are returned to the farm families who own the co-op, allowing these farmers to remain in operation.
In 2007, Cabot began marketing its cheese internationally, and in 2008 Wine Spectator listed Cabot cloth-bound cheddar as one of the “100 great cheeses of the world,” further solidifying its tag line as “The World’s Best Cheddar.” While Cabot is proud of the many awards it has received over the years, it still maintains the reason for it all: “a powerful love for what we do.” “As a group of farmers, we are much stronger together than we ever could be apart,” said Neal Rea, chairman of the board of directors and a New York dairy farmer. “When the idea to form a co-op in tiny Cabot, Vermont, was hatched 100 years ago, it’s hard to believe the founding farms could ever have imagined the Cabot brand would go on to become
and represent to farmers and consumers alike. We are proud to be in business a century later and appreciate that the millions we have invested in Vermont plants and equipment are the keys to our farms’ future.” Co-operative members agree. “When you’re a dairy farmer, you know how important it is to have a strong herd,” said Jenni Tilton-Flood of Flood Brothers Farm in Clinton, Maine. “As a co-op member and a Cabot Creamery Cooperative Farmer owner, the importance of the strength of our ‘herd’ is undeniable, as is the benefit of being able to depend and draw upon our Cabot community. Our co-operative gives us options, opportunities, resources, community and comfort, which enables and emboldens NED Magazine | First Quarter 2019 • 51
us to be better farmers, business owners and community members.”
GIVING BACK AND LOOKING FORWARD Cabot is pleased to also give back to its community in appreciation for the strong partnerships that have helped to make the company a success. The company collaborates with more than 4,000 nonprofits working to build a better community — very much a reflection of the mission of its member farmers. Cabot has contributed to activities that support agriculture and assist in recruiting and retaining high-quality professionals to the dairy industry’s workforce, worked toward solutions to prevent homelessness, advanced the marketing skills of college students, advised in the creation of sustainable, innovative business practices and created the first of its kind end-of-life care for humans certificate in partnership with the UVM College of Medicine. 52 • Northeast Dairy Foods Association, Inc.
“(One of) the most powerful tools we have to ensure the future success of our dairy farm (is) engaging in our community,” said Denise Barstow of Barstow’s Longview Farm in Hadley, Massachusetts. “We are offering farm tours that give people the tools they need to be more educated consumers. Helping people realize that dairy farmers do more for their land, ecosystems and communities than ‘just’ produce wholesome, clean, nutritious food. … Providing meaningful and memorable experiences on our farm creates advocates for Barstow’s Longview Farm, Cabot Creamery Co-operative and the larger dairy community.” In addition, the company continues to aspire to make it products even better through efforts that measure and manage the impact of dairy agriculture, whether on the farms’ end or on the facilities side. Cabot strives to better understand the U.S. dairies’ environmental footprint, the life cycle
assessments of milk and cheese and the carbon footprint of cheese. From cheese to community, Cabot is proud of the collaborative efforts that have been in place for 100 years, particularly in the face of a changing world where keeping a family farm running can be a struggle. Today, the business continues to produce “The World’s Best Cheddar,” as well as support its individual farm membership and the customers they serve. Sustainability is a concern at every turn, and Cabot has made strides to keep its impact low through efforts that save water, conserve resources and increase productivity. Technology that allows 50 percent of the water used at its Cabot plant to be upcycled from milk and the first solar-powered waste compactor at its Cabot, Vermont, facility are just two examples of how Cabot is “tackling the issue of conservation head-on using context-based sustainability to make sure we only take our fair share.”
CABOT SWEEPS AWARDS AT WORLD CHAMPIONSHIP Cabot has been winning awards for years, but 2018 was particularly successful as the co-operative took home eight ribbons during the World Championship Cheese Contest in Madison, Wisconsin.
“We are so proud of these results,” said Cabot Creamery CEO Ed Townley. “Not just for Cabot, but for the whole state of Vermont. Vermont cheesemakers won 15 ribbons this year. It speaks to just how hard dairy farmers work and how focused cheesemakers are on turning that milk into award-winning dairy products. These awards validate the work of our farmers and employees.” The 2018 World Championship Cheese Contest saw a record 3,401 entries from 32 states and 26 countries. Over the last 20 years, Cabot has taken home 27 ribbons, including 18 “Best in Class” awards, 10 of which were for the co-operatives’ delicious cheddar. “It’s a real thrill to see the variety of Cabot products that have won awards over the years. From our longest-aged cheddar cheese to our youngest cheese, we are consistently recognized,” said Townley. “This really speaks to the care and quality that go into all our cheese and dairy products. It is an impressive feat to have such a large range of products win these prestigious awards year after year.”
2018 WORLD CHAMPIONSHIP CHEESE CONTEST RIBBONS:
•1 •1 •1 •2 •2 •3 •3 •3
Place: Cabot Mild Cheddar Cheese
Place: Cabot Medium Cheddar Cheese
Place: Cabot Monterey Jack Cheese
Place: Extra Sharp Cheddar
Place: Greek Yogurt
Place: Colby Jack
Place: Natural Cheddar Slices
Place: Salted Butter
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855-357-4110 www.acesanitary.com NED Magazine | First Quarter 2019 • 53
Member & Industry News Byrne Dairy Stores are joining Team Green, a fundraising effort prompted by the recent announcement that former NFL player Tim Green is living with ALS. Customers have the opportunity to purchase a pin for $1 or $5 with all proceeds from the campaign going to Tackle ALS, a nonprofit that promotes ALS research. “We are going to try to collect as much money as we can for the cause and support of Green and the ALS community,” said Mark Byrne, CEO of Byrne Dairy Stores. Those who would like to donate to Team Green and learn more about ALS can visit TackleALS. com. Chobani, LLC, maker of Greek yogurt, announced the launch of the company’s first-ever plant-based recipe, Non-Dairy Chobani, to give people looking for non-dairy products a delicious option that’s packed with probiotics, less sugar than other non-dairy brands and only natural ingredients. In January, the company rolled out nine new non-dairy Chobani cultured organic coconut products in flavors like blueberry, strawberry and vanilla chai that are available nation54 • Northeast Dairy Foods Association, Inc.
wide at grocery and retail stores. NonDairy Chobani's name and packaging also represents the company’s advocacy for transparency as it pertains to better aligning food standards of identity. As an independent food company, Chobani is taking a leadership role in advocating for transparency in dairy and for clear distinctions between milk-based foods, such as yogurts, and other options like the Non-Dairy Chobani cultured organic coconut purees. Chobani believes consumers are more empowered when food companies accurately describe foods and the nutritional benefits they offer. Chr. Hansen produces 30,000 strains of bacteria cultures that are used as ingredients in food products like wine, meats, yogurt, cheeses and other dairy products. The cultures are stored in two 12,000-square-foot freezers in Wisconsin that remain at -67 F at all times. Wearing special suits for warmth and boots with 2-inch soles, employees spend their work day in an environment colder than most winter days in the Arctic! Workers can only remain inside for a maximum of two hours before taking a mandatory
20-minute break from the extreme temperatures. Chr. Hansen bacteria are in half of the world’s yogurts and cheeses. There’s a new cheese brand on the market that’s made from the “highest quality” milk that goes from the farm to the nearby creamery in just hours, producing a wide variety of cheeses from local, responsibly sourced products and environmentally friendly farming methods. Founded by eight farms located near Pavilion, New York, Craigs Creamery makes cheeses that range from mozzarella to muenster and are available in several major retailers throughout New England and the Mid-Atlantic states. Craigs Creamery is committed to innovation that reduces its carbon footprint, including a bio-digester that powers the creamery and helps work toward a goal of becoming a zero-waste operation. In late 2018, Evergreen Packaging Equipment named Ramki Pothepalli as its new manager of technical field services. Based in Iowa, Pothepalli has full responsibility for leading the field service operations, customer training and
Member News the technical support team. He has been employed at Evergreen since 1999. In addition, Khalid Ikram was named the new manager of development engineering, leading the team on all current and future machine developments out of the Cedar Rapids location. Ikram has been with the compaRamki Pothepalli ny since 2005. F i n a l l y, To m Crimmins was named manager of controls and automation. He will lead the team on the current conKhalid Ikram trols platforms, as well as pursue innovation and standardization of all machine controls. Crimmins has been with Tom Crimmins Evergreen since 1998. Great Lakes Cheese announced plans to expand existing manufacturing operations and build a new corporate headquarters in Geauga County, Ohio. The expansion, scheduled to start this spring, will include an additional 290,000 square feet of manufacturing and warehouse space. Construction of the corporate headquarters is scheduled to begin this summer. The company anticipates the hire of 400 additional employees in 2019. Privately-owned HP Hood, one of the largest and oldest branded dairy operators
in the U.S., is growing its presence in the plant-based beverage category with Planet Oat Oatmilk. According to Hood, the new full-bodied milk alternative is naturally sweet, boasts the nutritional benefits of oats and can be enjoyed by the glass, in cereal, in coffee and in cooking. While being free from dairy, gluten, GMOs, lactose, nuts and soy, Hood believes its oatmilk is “not as much an alternative as another beverage option” and that milk users will find it appealing, as an 8 oz. serving is an excellent source of calcium and vitamins A and D. The beverage comes in four varieties: original, vanilla, extra creamy and dark chocolate.
Embracing change was a common theme at the inaugural Agricultural Summit held at SUNY Morrisville. The college is taking another step forward in training agricultural leaders, announcing pursuit of its first Master of Science, an online program, in agribusiness during the summit. “Don’t just tolerate change or learn to live with it, but actually embrace change,” said Richard Ball, commissioner of the New York State Department of Agriculture and Markets, in his remarks at the summit. “It might be a new piece of equipment. It might be a new way of doing business. It might be a different customer. Think outside the box. Unless you change something, you will end up in a different place.” Over 80 students,
faculty and staff attended the event, which “shed a bright light on the future of agriculture.” Perry’s Ice Cream raised $3,625 and a collection of toys, DVDs, clothing and water bottles last December when its employees donated toward the company’s fourth quarter charity, Casey’s Place, operated by the Elmcrest Children’s Center. Casey’s Place provides short-term respite services for Central New York children and youth with developmental disabilities and/or complex medical conditions. The nonprofit in Syracuse, New York, provides a break for caregivers, while providing a safe, nurturing environment to assist children in developing socialization skills, peer relationships and independent living skills. In March, Tremcar, Inc. celebrated the delivery of its 20,000th tanker. To celebrate this momentous occasion, the company opened the doors of its head factory in Quebec on March 15 to customers and friends for tours and a celebration. The company delivered its 20,000th tank-trailer to Transwood, a transportation company located in Omaha, Nebraska. Tremcar is looking forward to expansion in 2019. In 2018, it delivered more than 959 tank trailers and 217 truck mounts for a total of 1,176 tanks, roughly the same number as in 2017. This is a significant increase over 2015 and 2016. In addition, Tremcar USA is expanding its Strasburg, Ohio, facility by developing an extra 10,000-squarefeet of manufacturing and tank servicing surface, which will be composed of eight bays, increasing parts sale and repair capacity by 33 percent and increasing manufacturing surface area by 33 percent, as well. The expansion will also include the addition of 20 jobs. NED Magazine | First Quarter 2019 • 55
he following new members recently joined the Northeast Dairy Suppliers Association, Inc. For more information about the benefits and services available to the members in both the Northeast Dairy Suppliers Association, Inc., and the Northeast Dairy Foods Association, Inc., contact Alex Walsh, director of membership and communications, at 315-452-MILK (6455) or email@example.com.
BERKLEY AGRIBUSINESS 11201 Douglas Ave. Urbandale, Iowa 50021 315-473-3638 www.berkleyag.com Chris Coleman, underwriting manager firstname.lastname@example.org Curt Leigh, underwriting email@example.com Zach Shrader, risk control firstname.lastname@example.org
GILROY, KERNAN & GILROY 210 Clinton Road New Hartford, N.Y. 13413 315-768-8600 email@example.com Larry Gilroy, president David Wallace, strategic business advisor DavidW@glegrisk.com Michael Giacobbe, vice president MikeG@glegrisk.com
WOW LOGISTICS 1450 McMahon Dr. Neenah, WI 54956 (920) 687-5497 www.wowlogistics.com Josh Gitter, director of sales, commodity purchase firstname.lastname@example.org Whether it’s warehousing, transportation management, commodity purchasing, builtto-suit or contract operations, WOW Logistics
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Kernan & Gilroy identify and help manage risks that best address your goals, as well as implement action plans and monitoring that help you take charge of your health-related expenses. The benefits will result in healthier employees and healthier balance sheets, too. 56 • Northeast Dairy Foods Association, Inc.
Byrne Dairy Announces $24 Million Ultra Dairy Expansion
n Dec. 20, 2018, New York State Gov. Andrew Cuomo announced the groundbreaking of a $24 million Byrne Dairy Ultra Dairy plant expansion — the first phase of the company’s $125 million plan to expand and create nearly 250 jobs in Central New York. The initial phase will create 30 new jobs and include a 42,000-square-foot expansion that will allow the plant to increase its packaging capability, as well as add additional processing capacity and storage space. Over the course of the three phases supported by a $15 million state investment, the company is planning several additional projects at its other production and warehouse facilities. “Dairy is a major part of our agricultural industry, and the expansion of operations at Byrne Dairy will help to further grow this critical sector of our economy,” said Cuomo. “Byrne Dairy is a fourth-generation, family-owned New York business, and its expansion will create jobs, spur economic development and help Central New York continue to rise.” In addition to the 30 new jobs, the Ultra Dairy expansion will result in the retention of almost 200 jobs at the Dewitt, New York, plant. The facility uses an ultra-high-temperature pasteurization process to extend shelf life for up to 150 days. Ultra Dairy processes conventional and organic milk, creams and other dairy products, as well as a variety of nondairy products. The expansion will allow the company to substantially increase output by adding processing capacity and increasing efficiencies in downstream equipment. In addition to the Ultra Dairy expansion, Byrne Dairy has proposed several additional projects at its other production and warehouse facilities. The projects are being supported by a $7.5 million CNY Rising Upstate Revitalization Initiative
Grant and another $7.5 million through the Excelsior Tax Credit Program in exchange for the job creation commitments. Additional projects include a further expansion of the Ultra Dairy facility in Cortlandville, New York, and an expansion of its warehouse capabilities in Syracuse and Dewitt, which will result in the creation of 248 new jobs. “We’re excited to begin the next chapter of Ultra Dairy’s growth,” said Carl Byrne, president and CEO of Byrne Dairy. “Our ability to expand to meet the growing demands of our customers is critical to the success of not only Byrne Dairy, but also family farms throughout Central New York. Under Governor Cuomo’s leadership, Empire State Development has been a strategic partner in ensuring Byrne Dairy’s continued growth.” “This expansion is excellent news for our dairy producers, who are facing many challenges in today’s marketplace, and for Byrne Dairy, an excellent long-standing New York state processor,” said NYS Agriculture Commissioner Richard A. Ball. “Through its participation in the New York State Grown & Certified program, Byrne Dairy is assisting the state’s efforts to promote local dairy that is produced with a focus on food safety and environmental sustainability. We thank Governor Cuomo and Empire State Development for investing in agriculture, which is helping to boost the industry at a time when it needs it most.” Originally founded in 1933, Byrne Dairy currently operates four production facilities in Central New York. In addition to the extended shelf life facility, the company operates a fresh milk plant, an ice cream plant and a yogurt/ cultured products facility. The company also has wholesale distribution centers throughout New York and Massachusetts, as well as operates a chain of over 60 convenience stores throughout Upstate New York. NED Magazine | First Quarter 2019 • 57
Members: What’s Coming Up in 2019? Summer’s coming, so it’s time to mark your calendars for this year’s members’ only events.
JULY 10, 2019: ANNUAL DAIRY INDUSTRY GOLF TOURNAMENT JULY 10, 2019: ANNUAL DAIRY CUSTOMER APPRECIATION CLAMBAKE AND PIG ROAST SEPT. 11 - SEPT. 13, 2019: NORTHEAST DAIRY CONVENTION
Watch your email, our website and the next edition of Northeast Dairy magazine for more information, or call our office at 315-452-MILK (6455).
NDFA Establishes Retailer of the Year Award NOMINATIONS WILL BE ACCEPTED BEGINNING IN APRIL
he Northeast Dairy Foods Association, Inc., announces its inaugural Retailer of the Year Award, which will be presented at the 2019 Northeast Dairy Convention, Sept. 11-13, 2019, at the Otesaga Resort in Cooperstown, New York. The concept of the award is to establish recognition at the convention to a retailer doing business in the states of New York, New Jersey, Connecticut, Massachusetts, Vermont, Rhode Island, Maine or New Hampshire. This award will 1) publicly recognize efforts of a retail company for its roles, contributions, efforts and participation with established nomination criteria at the annual convention and 2) create a heightened awareness of the associations within the dairy processing, food processing and dairy supplier/vendor industries.
58 • Northeast Dairy Foods Association, Inc.
Members of the Northeast Dairy Foods Association will be mailed nomination forms for the Retailer of the Year award on Monday, April 1, 2019. Completed forms must be returned to the NDFA by Wednesday, May 15, 2019, and the recipient will be chosen and contacted by Monday, June 3, 2019. Retailers will be judged based on how well they meet the following criteria: • Efforts to sell, promote, merchandise, increase dairy sales and bring attention to the dairy sections in their operations. • Interaction with a dairy product supplier • Efforts to support their community • Efforts to support their local environment • Efforts to recognize the agriculture industry in their region
• Activity with local charities • Longevity, loyalty within their industry For more information, contact the Northeast Dairy Foods Association, Inc., at 315-452-MILK (6455).
Have a College Student? Check Out Our Scholarship Opportunities
he Northeast Dairy Suppliers Association, Inc., is proud to announce the eighth year of offering scholarship opportunities to our members and their college-bound children for the 2019-2020 academic year. Again this year, we are offering $15,000 in scholarships, including: • Five $2,000 scholarships for students enrolled full time in a dairy science, food science or agriculture-related major • Five $1,000 scholarships for students enrolled full time (a minimum of 12 credit hours in a semester) in any major, even those not related to the dairy industry You or any immediate family member of a current Northeast Dairy Suppliers Association member are eligible to apply for one of these scholarships. (Please note: Your NDSA member-
ship dues must be paid in full before any applications from your company will be considered.) Student memberships to the NDSA are available for only $25 per year. Please see our website our call our office at 315-452-MILK (6455) for more information or an application. Students who have previously received a scholarship award are still eligible to apply. Scholarship applications must be postmarked by Monday, June 3, 2019. We are eager to distribute these scholarship funds to future leaders of the dairy industry and those pursuing other careers. It’s just one way we can give back and promote education and the future of our industry.
Apply today at www.neastda.org! NED Magazine | First Quarter 2019 • 59
ADVERTISERS INDEX Ace Sanitary............................................................53 Afgritech, LLC.........................................................29 Agri-Mark Cooperative- Cabot Cheese..................47 Brown & Brown Empire State.................................41 Evergreen Packaging..............................................13 GeoSaf....................................................................37 Herbein & Company, Inc..........................................7 Nelson-Jameson, Inc................................................9 PTI/Waldner North America...................................27 Schenck Process LLC..............................................15 Tremcar USA Inc.....................................................41 Tri Tank Corp..........................................................29 Weidenhammer New Packaging................BC, 34-35 WestRock.............................................................. IFC
GIVE US SOMETHING TO CHEW ON. Are you introducing an interesting product? Have you instituted cutting-edge processes? Are you welcoming a new hire? Is your business expanding, moving or changing? Do you have other news to share? Northeast Dairy magazine is always looking for Member and Industry News. Email your information, news releases and/or captioned photographs to us at email@example.com.
Source: PPAI 2017 Consumer Study
60 â€˘ Northeast Dairy Foods Association, Inc.
BeneďŹ ts of Association Membership EXECUTIVE DIRECTOR AND INDUSTRY CONSULTANT SUPPORT
Legislative Representation Through Executive Lobbying and Networking Safety and Environmental Information Economic Analysis and Forecasting Continuing Education and Certification Opportunities Industry Spokesperson Emergency Preparedness
PROFESSIONAL COST-SAVING PROGRAMS Dedicated Industry-Specialized Insurance Programs Employe Benefits, Including 401(k) Retirement Program Energy Supply and Consulting Services
NETWORKING AND MEETING EVENTS Annual Northeast Dairy Convention Contact Booth at the Annual Convention Annual Dairy Industry Clambake Hospitality and Sponsorship Opportunities Industry Plant Tours Annual Charity Golf Outing Fundraiser
COMMUNICATIONS AND PUBLIC RELATIONS Quarterly copy of Northeast Dairy Magazine Direct Customer Advertising Opportunities Industry Scholarship Program Membership Directory with Key Contacts in the Dairy Industry Digital Buyers Guide (launching in 2019)
ADVOCACY An association represents your interests before your government leaders, industry and business community. If your business/industry faces major threats or needs support, our association is right there on the front line fighting for you.
NETWORKING Association events, meetings and member directories make networking a reality for you and your peers. This is the one advantage many view as the most important reason to join!
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Northeast Dairy Magazine | Q1 2019