Promoting Change within the Produce Industry
Dexter’s Farm supplies schools and restaurant chains throughout the American southeast with fresh, locally grown produce. Although the Buford, Georgia based distributor has been in business for over 30 years, the company took a new direction – and achieved significant growth – since Denny Cahan and Lane Westfall took over in 2008.
The partners came into the industry as serial entrepreneurs with a background in healthcare software systems. “Being outsiders really helped us bring different viewpoints into this industry,” Mr. Cahan says. “For us, there really are no sacred cows when we look at the industry. That gives us an advantage.”
This outside perspective has been invaluable as Dexter’s Farm navigates a rapidly evolving industry to continue delivering what the market demands. After sharing the company’s achievements in the December 2013 issue of Business in Focus, Mr. Cahan and Mr. Westfall sat down with us again this month to report on the changes sweeping through today’s produce industry and how their company is overcoming the associated challenges.
The demand for fresh fruit and vegetables has “increased dramatically” in recent years. “We got lucky with that,” Mr. Cahan remembers. “We didn’t know that was going to happen when we got into the company.” Along with this general increase has come a specific demand for locally grown produce. “Locally grown is just a great opportunity for everybody,” Mr. Westfall points out. “It is a big win for the farmers; it is a big win for communities because it stimulates the economy.” The environment wins too, because the carbon footprint is reduced. “You are not driving a truck from California to Georgia to deliver a tomato when there is a tomato down the street.”
Farm to School programs have helped jump start demand for locally grown produce. Dexter’s Farm was well positioned when the initiative caught on, so the team got their foot in the door from the get go. “We were on the early side of that because of our customers,” Mr. Westfall recalls. “We [supplied] a couple of large school systems that were involved, so we had the good fortune of being there and being able to support them.”
In additional to supplying schools with fresh, local produce, Dexter’s Farm supports educational initiatives included in the Farm to School program. From demonstrating how food is delivered to arranging farm tours, the team helps kids understand where their food comes from and encourages an appreciation of natural, healthy foods. “A lot of kids today just don’t have the opportunity to see that,” Mr. Westfall points out. “They don’t know what cauliflower or broccoli is.”
Since the Farm to School program launched, Dexter’s Farm has expanded its locally grown efforts, supplying locally grown produce to many restaurants as well. Supplying locally grown produce is more complicated than one might assume, and the team has had to work hard to stay ahead of the curve. For instance, extra attention must be paid to food safety because small, local farms may not have a formal food safety plan in place like larger, national growers do. Most of these small farms are actually following the proper food safety procedures, Mr. Westfall adds, but they don’t have the systems in place to formally document that compliance. Dexter’s Farm has made it a priority to educate these farmers to help them maintain proper procedures. “We think that is good for us and good for our community to help connect those dots.”
The team believes that educating consumers is also key to the success of the locally grown movement. Many consumers, especially children, need some coaxing to step out of their comfort zone and try fruits and vegetables that don’t quite look like their grocery store counterparts. “If you are doing locally grown, we do great apples in October in Georgia, but those apples are not the absolutely perfect shape and size that you get in the grocery store,” Mr. Westfall explains. “Those come from millions and millions of apples that have been picked through [so] only the perfect ones end up there.”
By making the effort to educate farmers and consumers, Dexter’s Farm is helping the locally grown movement to expand, supporting farmers, communities, and the environment in the process. “Locally grown has been a good opportunity for us,” Mr. Cahan says. “Everybody is excited by it throughout the industry because it is good for everybody, but it just needs a little more maturation to pull together some of those details.”
Food safety is garnering an increasing amount of attention throughout the industry. These efforts were spearheaded by 2011’s Food Safety Modernization Act (FSMA), which tightened food safety requirements significantly. Although the act was signed into law four years ago, many of the new regulations are just now coming into effect and the impact is being felt throughout the industry. “A lot of companies are struggling to keep up,” shares Mr. Westfall.
New regulations cover numerous issues, including how raw produce is grown, harvested, packed and held; preventive plans that identify hazards and require substantial documentation; securing and monitoring the produce at all times; and ensuring sanitation during transportation. “All those things require a lot of work, quite a bit of knowledge, a good plan, and execution,” Mr. Westfall points out. Fortunately, Dexter’s Farm is prepared to handle it all. “One of the advantages of being outsiders is that we are good at change and we are good at identifying when change is needed. With food safety, we started making those changes many years ago so this doesn’t actually affect us. We are already there.”
The Global Food Safety Initiative (GFSI) has also boosted food safety efforts throughout the industry. As an industry driven initiative that provides leadership and guidance on food safety management systems, GFSI takes food safety a step further than traditional monitoring methods. “The proof in the pudding,” Mr. Westfall explains. “Instead of your food safety experts explaining what the company does, with GSI you have to prove that everybody knows [food safety procedure] and does it every day. They [GFSI auditors] come in for many days, they talk to many people – not just the people you put in a room with them – and they make sure that the training is effective.”
Dexter’s Farm is able to handle that level of critique, but many businesses simply aren’t prepared to deal with it. “There are going to be a lot of competitors out there who are really going to struggle with this,” Mr. Westfall predicts. “There is going to be a shake up as this thing goes through the industry.”
With so much change rippling through the industry, Dexter’s Farm feels a responsibility to help guide the industry toward success. The team is launching Produce University, a nonprofit dedicated to providing the tools and information that growers and buyers need. “Whenever there is change, you need to have education in order to make it successful and to smooth things out,” Mr. Cahan points out. “This isn’t about helping Dexter’s Farm, this is about seeing the need and helping the industry.”
One focus will be on teaching buyers how to get a fair deal. “If I am a school system, how do I hold the person who won my contract accountable?” Mr. Westfall asks. Produce University will arm these schools with information on index pricing, so that a buyer has access to “fair and accountable tracking.” The nonprofit will also help schools follow Federal Procurement Regulations. “Coming up with a bid, or an RFP (request for proposal), is very tough for them sometimes, especially coming up with one that holds vendors accountable,” Mr. Westfall explains. “Between their food safety, satisfying their customers, and getting good pricing, an amazing amount of work goes into a school cafeteria or a restaurant. [We want to] give them tools so they don’t have to reinvent the wheel and they can hold their vendors accountable – including us. We are okay with being held accountable. We aren’t afraid of that.”
Produce University will help farmers navigate the industry’s increasing – and sometimes bewildering – regulations, and help them gain a firm foothold in the locally grown market. “We have worked with farmers to help them understand how to supply to suppliers like us so they have a better opportunity to sell their product,” Mr. Westfall reports. “We are helping them connect the dots. We are teaching them how to meet these food safety requirements or how to come up with their gap plan. And it really is doable; it just seems overwhelming to a lot of folks.”
So far, Produce University has received “an unbelievable response” from farmers and growers eager to get a leg up in a rapidly evolving industry. The Dexter’s Farm team is excited to support the industry through education and to bring about change where change is needed. “Our team lives and breathes this every day,” Mr. Westfall explains. “Their heart and soul is in it.” As the new kids on the block, Mr. Westfall and Mr. Cahan are armed with new perspective and the enthusiasm needed to bring this positive change. “We are really excited about the opportunities.”