Gary Hirshberg, CEO of Stonyfield Farm, spoke Tuesday at a “Brown Bag Lunch” held by the Entrepreneurship Club, the Food and Agriculture Management (FARM) Club and the Sustainable Business Club. Hirshberg expanded on his company’s business strategy and vision in sustainability.
“Business was always about something or somebody losing,” Hirshberg said.
Hirshberg said his ambition to create an enterprise that didn’t destroy the earth drove Stonyfield Farm’s growth from a small organic farming school to its current $360 million in annual sales.
Stonyfield tracks and reduces its carbon footprint, employs organic farming and uses alternative advertising to create a yogurt company with what Hirshberg calls, “win-win-win capitalism.”
“Organics really is the solution to much of what ails our nation and our planet’s food supply,” Hirshberg said. “We’re not going to solve the climate crisis by slowing down net carbon output; we have to start trapping carbon molecules in soils.”
Stonyfield developed the “Mission Action Program” to manage their footprint beyond just carbon emissions to include facility energy, waste to incinerator and plastic and water usage. Since 2006, the Mission Action Program has saved Stonyfield $18.2 million, according to Hirshberg.
Through humble beginnings, including an “adopt a cow” marketing campaign and word of mouth advertising, Stonyfield found its way onto the shelves of stores such as Whole Foods that have more of a “tolerance for novelty,” Hirshberg said.
Stonyfield now ranks third in the United States’ yogurt market shares, just beyond Dannon and Yoplait.
Forgoing most traditional advertising, Hirshberg explained that Stonyfield began using packaging to convey its story and values. Millions of the company’s lids display environmental messages and causes they have aligned with to promote education and advocacy. Social media and blogger outreach have also become effective advertising for the company.
Hirshberg spoke specifically about two aspects of the food industry he believes are in need of closer scrutiny: genetically modified foods and government subsidies.
He said developing countries with high population pressure and limited resources cannot invest in genetically modified foods to expand their nation’s food base because the promise of genetically modified foods in increasing yields has not yet been proven.
Hirshberg also added that subsidies have to end in the United States because they make organic food unaffordable.
At an individual company level, Hirshberg advocated closing this price margin by increasing production. Increased consumer demand allows Stonyfield to increase volume, which increases efficiency and lowers the price.
Hirshberg acknowledged that some people believe organic food is a niche with little prospect of increasing consumer demand. But market data seems counter this.
“The organic market has grown at 20 percent annually, even through the recession,” he said.
“The ultimate way we should buy is local and organic,” Hirshberg said.
However, he cautioned that people should not cite reduced carbon footprint as a reason to choose local foods over organic consumption. Transportation of finished goods accounts for six to seven percent of total carbon footprint, whereas the method by which they’re grown accounts for 40 to 50 percent.
“I know I could bring organic dried milk from New Zealand to New Hampshire for a lesser carbon footprint than bringing milk from New York,” Hirshberg said. “Food miles is not the issue; the issue is what kind of toxicity do you want to eliminate in the biosphere.”
Kellee Patterson, a first year MBA student at the Graduate School of Business, thought the talk appealed to “people who are interested in sustainability as a strategy while still wanting to remain relevant in the marketplace.”