Organic Produce: Valley Growers Julie Clark Chris Doersen Julie Engle Josh Huston Kristin Stahl

Agenda Industry analysis Valley Growers overview Primary research results SWOT Goals and Objectives Implementation

Industry Analysis Organic  Government classifications No pesticides  Minimal use of off-farm inputs  Methods are used to minimize pollution from air, soil and water. Hydroponic Produce  Grown in controlled environment  No soil  less space required  1/10 the water and less fertilizer  Products Tomatoes, lettuce, cucumbers, herbs

Organic Fun Facts Reasons to Go Organic!  Organic products meet stringent standards  Organic production reduces health risks  Organic producers are leaders in innovative research  Organic food tastes great!

Company Overview Valley Growers  Located near Dayton, OH  Current production: Lettuce Tomatoes Herbs  “Soil-less, Controlled, Environment” Agriculture

Primary Research Groceries  Revenue: $3,200 per month  Volume: 180 cases per month  Generalizations Market-Specific Stores  e.g. – Trader Joe’s and Wild Oats  Promote quality  lower price sensitivity  Larger organic sections High volume stores  e.g. – Kroger  High sales = large account

Primary Research Restaurants  Revenue: $600 per month  Volume: 24 cases per month  Generalizations Localized stores  e.g. – Aladdin’s Eatery and Dragonfly Restaurant  Majority use Grade A product  Logistics concerns

Primary Research - Implications Groceries present greater opportunity  Require less resources  Greater gains from a single contract  Recognize ‘organic’ and ‘local’ Restaurants  Not concerned with ‘local’  Should not be discounted entirely!  Potential for growth in quality organic products  especially upscale establishments

SWOT – Valley Growers Strengths  Local  Consistent food year-round  Minimal waste and minimal prep-time Weaknesses  Lack of experience  No brand recognition  Restricted Logistics

SWOT – Valley Growers Opportunities  Demand for organic foods is growing Health trends  Increase brand awareness by joining co-ops and/or organizations Great Lakes Hydroponics Threats  Possibility of market saturation by larger competitors Retailers may choose larger experienced growers  Trend and demand may diminish in the future

Goals Determine pricing Develop Networks  Determine high opportunity clientele  Specialty organizations and coops Establish marketing plan

Implementation Contacting grocery stores  Focus on market-specific stores Higher-margin sales Easier to maintain longer relationships Promote quality! Provide samples Offer better price to penetrate market if necessary

Implementation Do not ignore the restaurants!  Great long-term potential despite: Requires more resources to create a relationship Lower usage volumes Many locations  added logistics capability

Objectives Create new relationships:  Groceries: 1 every 3-4 months Approximately $800 per week in revenue $40,000-$50,000 annual revenue per store  Restaurants: 1 every 2 months after first year Approximately $600 per month revenue $4,800 annual revenue per restaurant

Objectives Additional positive cash flows:

Other Considerations  High-volume stores Large accounts More price pressure Approach carefully and establish credibility  Show present accounts  Provide samples  Be flexible  Be prepared to meet delivery and other logistics demands  Monitor industry trends! Health and competitor trends

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