Wolfe's Neck Farm Beef goes For Profit
This week's edition of MaineBiz magazine includes a feature about the Wolfe's Neck Farm brand of natural meats. Wolfe's Neck Farm, a not-for-profit located in Freeport, Maine, through it's Foundation for Agricultural Renewal has been selling it's naturally-grown meats for several years. The market for the product started out fairly small - farmer's markets and local restaurants and natural foods stores. Now WNF sells to large retailers (Hannaford and Whole Foods Markets) and high-end restaurants as well. With people becoming increasingly aware of what goes into their foods, and especially since the introduction of Mad Cow Disease to the US, demand for Wolfe's Neck's naturally grown beef (pasture fed, no hormones or antibiotics used, etc.) has rapidly increased. The operation, with revenues of $6.5 million last year and growing to an estimated $10-$16 million this year, has outgrown the scope of Wolfe's Neck Farm.
Now, with the support of the Portland-based philanthropic Libra Foundation, the WNF is spinning off the natural meats division to Pineland Farms Natural Meats Inc. Management will remain basically intact, and the new corporation will be housed at the Pineland Farms business center, located at the former Pineland mental health institution in New Gloucester, Maine. Because the Wolfe's Neck Farm label has become widely recognized it will continue to be used, though it may be complemented with the Pineland Farms Prime Beef label in the future.
I admit that I am usually skeptical about adding a "for profit" motive to a business model. When decisions are made solely with the bottom line in mind, bad things often happen to products and people. For now, however, it sounds like the current mission of FAR will be continued:
While Pineland Farms Natural Meats is in the midst of developing new business
strategies, (Erick) Jensen (founder of FAR) says its social purpose will remain the same: helping cattle farmers in Maine and beyond get the best value for their product, thereby
keeping farmland in production. “Now that we’re for-profit, we have the
resources to do that,” he says. Currently, the company has seven feedlots across
the state, with more than 4,000 head of cattle. Jensen would like to see the
number of feedlots increase by 30%-50% in the coming year.
My wife and I have made it a point to only purchase natural meats, and we have readily supported Wolfe's Neck Farm in our purchasing decisions. To the extent that this change makes natural meats more accessible and affordable, it can only be looked at as a positive. I will be optimistic that the company will be able to maintain its standards of quality as it continues to grow in the coming years.
posted by Joe @ 12:10 PM
5 Comments:
This is a great sign of the health of real food demand. I work in the non-profit sector and as counter-intuitive as it may sound, going "for profit" with a successful product can actually be more beneficial to the community as you then pay property taxes, corporate income tax etc. Its a model that the hugely successful mouse exporting wing of Bar Harbor's Jackson Lab would do well to copy, rather than hide behind their tax-exempt status.
Good points, Weasel. Jackson Lab really is a "for profit" institution hiding in NFP clothing.
So what's wrong with a big fat profit once in awhile?
I tend to like the "p" word - and I suspect that most people do: After all each of us as individuals and/or families are in fact our own "for profit" companies. A good year for any family is a year that income is greater than "outgo". We make decisions daily (whether to go to work, whether to sleep in, whether to rack up credit card debt, whether to shoot up heroin, etc. which affect or determine our ability to earn a profit (otherwise known as "support ourselves").
The expansion of Wolfe's Neck and it's recognition that it is a sustainable business that may generate revenue is terrific. So how much profit will they deserve if they succeed? I'd say that if they can generate a profit - it should go proudly to those who took the risk - both in terms of capital and time - and they should be rewarded.
The bonus here is that the Wolf's Neck folks appear to have good priorities. But so what if they didn't? They should be free to blow the money on whatever they wish - regardless of other peoples wishes.
Agreed; with the caveat that they pay their taxes and that we as consumers have the knowledge base to decide whether or not to contribute to their profits. Which is why I don't begrudge Wolf's Neck a penny (even if they go out and buy Lexuses) but wouldn't eat a product produced in a NC hog gulag (bad for pigs, bad for people) if you paid me.
There is nothing wrong with being “for profit”, per se. Many good things can happen when a company works for profit. In the case of Pineland Farms Natural Meats, this move will very likely result in more jobs (both at PFNM and with the meat producers) and preserve working farmland from development.
My skepticism in the “for profit” model is that it can (and usually does) result in a change of the organization’s mission. Instead of the desire to provide high quality natural meats to the market, the primary motive for the company can become earning the next incremental profit dollar. This is when bad things tend to happen. Management gets bonuses based on profitability targets, and they do funky things (like eliminate employees) to ensure they get their bonuses. Or the company can’t figure a way to cut costs while providing an all-natural product, so they start lobbying their Congressmen to change the definition of “All Natural” in order that they may use cheaper feed. Etc. etc.
I don’t begrudge a company making money (and, as Weasel suggests, paying its fair share of taxes). I don’t begrudge the owners being rewarded for their capital investments, either. That’s usually why people invest in the first place. If, however, the pursuit of profit results in the company changing its standards and providing a less-healthy product, or becoming a poor citizen in our society, then it’s to be lamented. I support Wolfe’s Neck Farm because I believe in the product and the mission. If those are compromised, then PFNM might fall into the category of companies that I would rather not do business with.
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