Stemilt is set to grow
Its plan is to change faster than the competition.
Stemilt Growers, Inc., Wenatchee—already one of the largest tree fruit growing, packing, and marketing operations in Washington State—is projecting phenomenal growth within the next few years.
Five years ago, the company was marketing 6 million boxes of tree fruits. Last season, its volume was up to 17 million. By 2011, it expects to be selling 30 million boxes of fresh produce annually, Stemilt partner Kyle Mathison reported during the International Dwarf Fruit Tree Association's conference in Tasmania.
Stemilt no longer restricts itself to marketing fruit grown in Washington. It owns the growing and packing operation Chinchiolo Stemilt California, based in Stockton, which enables it to sell cherries from California and then transition into the Washington cherry season, supplying the same customers.
Stemilt's goal is to keep its retail customers happy, and ultimately to provide the highest return to its growers, Mathison explained. "When you say 'We're out of something, go talk to someone else,' it's like handing the keys to the castle to someone else."
In 1999, Stemilt established an export company in Chile, called Exportadora Stemilt-Chile, to supply fruit to U.S. retailers in the off season. In 2005, it purchased land in Chile and planted cherries, with the aim of increasing off-season shipments.
Stemilt wants to leverage its brand recognition so that cherries from both hemispheres are recognized as a premium brand.
"The Stemilt brand is our promise to our retailers that these are quality cherries," Mathison said. "We've got to live up to that. We have to have consistency."
Mathison said Stemilt is not the only company with this strategy. The Turkish cherry producer Alara, which focuses on the European market, has linked up with producers in Argentina. "I can see that we're just on parallel courses," he said.
He noted that Argentina is better suited than Chile to serve Europe because the distance by sea is shorter.
Stemilt focuses on the U.S. market. It tried exporting cherries from Chile to Taiwan and Japan, but Mathison said the company could not find a way to add value because most of the retailers there were buying direct and their logistics were just as good as Stemilt's.
In the next few years, Stemilt will be focusing on being an industry leader in apples, pears, and cherries. To succeed, it will have to change faster than the competition, Mathison said.
"Today, the global economy is in a constant state of change," he said. "If you want to stay alive, you have to run like hell."
The company intends to be a leader in bringing new fruit varieties to market and has formed a new business called Stemilt Genetics. "We want to be a leader in the world in finding the best genetics we can, and take those to the market to fulfill our mission of providing a fantastic eating experience," Mathison explained.
It recently launched a business called Apple Sweets that produces fresh sliced apples with added flavors. It's an attempt to take market share from other snacks, such as potato chips, he said.
Stemilt also wants to be a leader in organic fruits and has a dedicated organic facility at Chelan Falls.
And, the company is trying to link growers to the customers, since people nowadays want to know who's growing the fruit, and it is exploring ways to reward growers for producing fruit with good dessert quality.
Mathison said Stemilt, a family-owned business, also differentiates itself from its competitors by the people involved. "Often we have three generations calling on customers to show we have a consistent plan and we're in it for the long run," he said.