Brookshire Grocery’s dairy manufacturing unit reaches out to the national market.




Goldenbrook Farms. Food Club. Valu Time. Full Circle.

These brands might not have national recognition, but they’re mainstays for consumers in Texas, Louisiana, Arkansas and Mississippi who shop at supermarkets owned by Tyler, Texas-based Brookshire Grocery Co., owner of BGC Manufacturing, the processor that makes the products carrying these labels.

A large part of that manufacturing division is dairy, generating more than $75 million in milk and dairy sales last year (out of a total of $88 million) for an extensive line of milk, ice cream and cultured products totaling some 237 SKUs (BGC Manufacturing was known as SouthWest Foods until 2007).

But despite BGC’s largely regional scope, the company is no stranger to the national scene. A captive dairy with an innovative streak, BGC grabbed the low-carb bull by the horns when it developed LeCarb, the first national reduced-carbohydrate frozen dessert, in 2001. The brand, which eventually included a dairy drink and YoCarb yogurt, was later sold to HP Hood.

Now, BGC is again staying on trend by targeting the national scene with Supreme Blend, a frozen dessert that contains 20% low-fat yogurt. With 4% butterfat and 80 calories per serving, the probiotic Supreme Blend is all natural and calcium enriched.

“You could eat a whole pint of this and still be better off than if you ate a bag of chips,” Jim Pitner, BGC’s vice president of manufacturing, says of the product that’s expected to be rolled out at organic and natural food retailers nationwide in early 2009.

“It has the texture and mouthfeel of ice cream,” says Hugo Fraga, ice cream plant director. Supreme Blend will be offered in vanilla, chocolate and strawberry varieties.

So with success in product development on a national scale, along with peer recognition for its tried-and-true offerings, things look good for BGC Manufacturing.

Pitner explains that several changes in the past year have impacted the relationship between BGC and its parent, including a new accounting and buying system, and a new category management system. “With these changes, we changed our relationship with Brookshire by guaranteeing an everyday low price,” he says. “They are redoubling their efforts to market manufactured products.”

Manufacturing evolution

After more than six decades in business, Brookshire Grocery Co. became a manufacturer in 1990 by purchasing a dairy plant on Fuller Avenue in Tyler. Built in 1927 by the Kidd family, the plant became Cabell’s Dairy in the 1950s, then part of the Southland Corp., parent company of the 7-Eleven convenience store chain.

The milk plant was sold along with 21 other Southland dairies before being individually purchased by Brookshire in 1990. The company added a blow-molding operation in 1991, started bottling orange juice in 1993 and then began bottling water in 1994 with a dedicated filler. The water operation eventually grew to require its own plant, built at the site of the BGC corporate offices and distribution center in Tyler.

BGC’s milk plant manufactures fluid milk, buttermilk, premium and low-fat chocolate milk, chocolate drink, orange juice and Red Diamond-branded lemonade (the tea is bottled at the water plant). BGC also co-packs for major processors and bottles several other private label milk products for retail customers. It was the first milk plant in Texas to be organic certified for milk and juice, and runs a private label organic milk in three gallon SKUs and three half-gallon SKUs. It also packs private label organic orange juice for Topco and Federated. The company also sells tote products to several Class 2 food processors in the area.

BGC reports organic private label lines of milk and orange juice have seen huge growth in the past few years since their launch in April 2005. Growth has topped 35% in the past three-plus years.

In May 1996, BGC began construction on its ice cream plant on the outskirts of Tyler, with production beginning less than a year later. A cultured plant began operations at the site in 2004.

A testament to BGC’s manufacturing excellence is a steady stream of awards from industry peers for its facilities and their respective products. Most recently, BGC won first place in the open yogurt category with its peach yogurt and third place in the blueberry yogurt category at the World Dairy Expo Dairy Product Championship Contest last fall.

“This competition gives our manufacturing group a chance to compete with the best dairy manufacturers in the United States and Canada, and our awards prove we can beat the best,” Pitner says. “Obviously, we’re very pleased and congratulate our entire team on this high honor.”

Community-minded

Such recognition is part of the management philosophy that fosters a sense of ownership among its 220 manufacturing employees – known as partners – at BGC. “Ownership is the key,” Fraga says. “Any time we accomplish something as a group, we tell the newspapers. Our people are very proud of what they do.”

Management encourages a spirit of accomplishment among its non-union work force with its Top Gun plant awards program (see Plant Close-up), whose honorees are treated to a celebratory meal prepared by their supervisors, Fraga explains.

Further, directors and managers attend monthly P&L meetings ready to single out a partner that has made significant contributions to the company’s success during that period, Pitner notes.

“Every month a manager talks about one employee and why they’re being recognized, and we give them a $100 gift card to our stores,” he says. “They’re proud that we’re talking about what they do.” Beyond that, supervisors maintain an open-door policy to all employees to voice their concerns and share ideas about their daily business. “I try to make myself available to everyone in manufacturing,” Pitner says.

The company even owns a lakeside recreation area near Tyler with a fishing pier, camping area and a vacation cottage available for rental. All of these factors have contributed to Brookshire’s being voted the one of the best companies to work for in Texas for three years running by Texas Monthly magazine.

Not surprisingly, BGC enjoys low turnover. “This is one of the very few places where employees know their job well enough to not have someone standing over your shoulder micromanaging,” says Mark Morris, environmental health and safety coordinator.

BGC supports folks outside the company as well. “We support local charities very strongly, including a food bank and a big golf tournament fund-raiser,” Pitner says, noting the company also has sent truckloads of water and supplies to sites of natural disasters. “We’re very community-minded people.”

Brookshire’s also is spearheading “Let’s Go Green Together,” a company-wide effort to conserve resources, Fraga explains. For example, the company has introduced new lighting technologies at its facilities, including fluorescent bulbs and automatic shut-offs. Manufacturing facilities use some of the latest cooling technology to reduce refrigerant charges and CO2 leakage. These efforts have delivered a company-wide reduction in energy use of 16% since 2000, following a $100 million investment in new energy technologies over this same period.

The company’s transportation and logistics groups are experimenting with super-single truck tires – individual wide tires that take the place of two, with less rolling resistance – to conserve fuel.

This green program extends into the community as well, supporting recycling efforts at the retail level.

Staying competitive

So in a region where BGC’s private brands compete with the likes of Dean Foods, National Dairy Holdings and Blue Bell, among others, the company more than holds its own. Meanwhile, Pitner notes, it grapples with the same challenges as the larger players: falling per capita consumption of fluid milk, downsizing by consumers on purchases, an aging federal order system and a rising trend of producer-processors.

But BGC also sees an advantage to being an independent processor surrounded by very large competitors. “We can move faster in some situations,” Pitner says. Meanwhile, the company aims to leverage the nutritional value of its dairy products compared to the per-serving price, versus alternative products on the market.

“Our company has been strong for a number of years,” Pitner says, “but our ability to stay strong will depend on continuing to be competitive and being able to see the next major change coming down the pipe.”

History

The Brookshire Grocery Co. dates back to 1928, when Wood T. Brookshire opened a small store on the downtown square in Tyler, Texas.

Brookshire founded the company with strong convictions in a “people first” operating philosophy. He recognized the grocery business as his calling - a way for him to serve his fellow men by providing fair-priced products of the highest quality for consumers and a partner-style work environment for employees.

As the company grew, with stores popping up across East Texas, Brookshire’s opened its first warehouse in 1953. Through the years, the company continued to experience healthy growth, building new stores in new markets and branching into even more territories by acquiring stores from other operators.

Today, Brookshire Grocery Co. has more than 150 supermarkets operating in Texas, Louisiana, Arkansas and Mississippi under four distinct banners: Brookshire’s Food Stores, full-service supermarkets featuring everything from specialty departments to carryout service; Super 1 Foods Stores, upscale warehouse-style stores with lower operating costs passed on to consumers; Olé Foods, with a heavy emphasis on meeting the demands of Hispanic consumers; and ALPS (Always Low Price Store), a prototype discount-store format.

Employing about 12,000 people, the strongly Christian-based company also operates three distribution facilities - two in Tyler and one in Monroe, La. - with more than 2 million total square feet and a fleet of tractor-trailer rigs. BGC’s manufacturing facilities include bakery, dairy, ice cream, yogurt, fresh-cut, ice and water/drink plants, all in the Tyler area.

“Our mission,” says Rick Rayford, president and chief executive officer, “is to provide people with the food and services they want, the convenience they need and the experience they love.”

SOURCE: www.brookshires.com

BGC Family of Products

BGC Manufacturing produces an extensive line of dairy food products under several brands sold in Brookshire’s supermarkets.

Leading the pack is Food Club, which includes various fluid milk products, along with orange juice, yogurt, sour cream and dips. An organic line of milk and orange juice is sold under the Full Circle label.

The Valu Time brand features gallon bottles of milk and drinks including lemonade and fruit punch.

Goldenbrook Farms encompasses a wide variety of premium and light ice cream, as well as sherbet, in half gallons and pints. Premium flavors include Homemade Vanilla, Turtles ‘n Cream and Lemon Ice Box; among lighter flavors are no-sugar-added, reduced fat chocolate and vanilla. Sherbet flavors include orange, cherry limeade and watermelon.