Spotlight On: CMI

For 25 years CMI has exhibited commitment to its products, customers and long-term growth--and it has no plans to let up anytime soon.

Twenty-five years ago, CMI put all its apples in one cart—commitment. Founded on the notion to do what is best for the grower ownership and an obligation to customers to build the business, CMI has shown the industry that a little commitment can go a long way.

With three branded apples, a recently launched branded pear program and significant investments in technology, the company has forged new paths within its product categories and has helped lead the commodities into a new era. Celebrating its silver anniversary this year, CMI, based in Wenatchee, Wash., continues to prioritize the values that set it apart in the beginning: product and marketing innovation and a focus on quality. The focus on quality was evident from the start. Founded in 1989 by Glady Bellamy and Nick Buak, first representing Columbia Fruit Packers and McDougall and Sons, and adding Double Diamond and Highland Fruit shortly thereafter, CMI earned a reputation for high-quality fruit within a few years in the international community through its export business—which now includes more than 50 countries. “You have to start out with high-quality when shipping a product halfway around the world in a container; it will not get any better when it arrives in a warm climate four to six weeks later,” says Steve Lutz, vice president of marketing, adding that quality is the company’s number one value. Now, however, Lutz says 80% of the company’s fruit stays within the domestic market—which is large amount of fruit. Lutz estimates the company will pack in the neighborhood of 10 million packages of apples, pears and cherries, up from one-and-a-half cartons in the beginning. It is in the U.S. that CMI has made a number of names for itself. It has been a leader in the trend toward branded apple varieties, offering retailers a point of difference. Currently they offer three exclusive brands: Ambrosia, Kiku and Kanzi. These boutique products are slowly converting the apple category into a brand-driven segment, leaving many apple growers scrambling to keep up. The apple category is no walk in the orchard. It is one of the most complex and challenging categories, says Lutz. CMI owner/growers work with an international group that experiments with new varieties that might have potential in the market. “Our owners are constantly planting new varieties in test orchards to try and identify varieties that would bring something new to the market, and at the same time, apples that have the attributes that would make them commercially successful,” says Lutz, adding that the challenge in this case is time. “An experimental new apple is a five- or six-year process.” Innovation extends beyond the orchard. CMI prides itself on the recognition it receives for its marketing strategies, including packaging, display-ready shipping cartons and the graphics and visual elements it brings to retail. The marketing innovation piece of the puzzle has been a real foundation for the company, says Lutz. The face of CMI on the store shelves includes a range of brands. Most recently added are Queen Bee Honeycrisp, a Honeycrisp packaging program, and Sweet Gourmet Pears, the branding for its entire pear line, both introduced this year. The Hero snack apples marketing program was developed with kids in mind—and offers opportunities to co-brand with other commodities, like citrus. In the organic segment, Daisy Girl Organics has gained momentum over the past three years. The line came about after CMI identified that consumers prefer to shop for brands that they have confidence in. “Organics were going out into the marketplace as just that—organic apples. There is nothing special about that, so CMI created the Daisy Girl brand and it is the now the number one branded organic apple in the U.S.” says Lutz. “It’s a pretty good story; we took a generic item to the number one branded organic apple.” Now the company makes up about 15% of the total organic apple production for the state of Washington, Lutz adds. Forging the future Entering the organic market with such force demonstrates the company’s commitment to long-term growth, including its sustainability efforts. “Our owners’ commitment starts from having organic orchards; from there on, everything the growers do, from the orchard to the warehouse, is designed to increase sustainability and reduce costs, whether it is reduction of chemicals, changes in the lighting or recycling packaging. That is a commitment we make on behalf of our customers; there are a lot of retailers out there who are really committed to that,” he adds. CMI officials have always been of the mindset that a significant amount of reinvestment each and every year is necessary for long-term growth. New orchards, the right genetics and state-of-the-art facilities are a couple of the ways this is executed. For example, McDougall & Sons, is building a state-of-the-art 450,000-square-foot packing and shipping facility; and Columbia Fruit Packers, just put in a state-of-the-art cherry sorting line and packing operation. “You can imagine the investment that that requires,” says Lutz. “There is a tremendous amount of money being invested on behalf of the grower-owners at CMI to make sure that we are ready for the next generation of the apple, pear and cherry industry. “What you are seeing, and continue to see, is that CMI is putting tremendous effort toward having the absolute best product,” he adds. That goes for the up-and-coming branded apples, as well as the traditional names like Gala and Fujis. This investment extends to the community, as well. The company is very involved with the Washington Apple Education Foundation, which provides scholarships to growers’ and warehouse workers’ children to enhance educational opportunities. keep ‘em happy In the end, all the company’s efforts are about keeping the retailers and consumers happy. The company’s market approach is unique in that it has a fairly narrow core customer base for which CMI strives to be the top supplier, says Lutz. “We work really hard to make sure they are happy and that they get exactly what they want and need from us.” Commitment to the customer was part of Glady Bellamy’s legacy from the time he started the company, note officials. “Our commitment to customers comes from the thought that we have an obligation to always speak the truth and offer the best we can to our markets,” Lutz adds. “They may not always like the answer we offer, but they will always know we are giving them the absolute very best that we can and they can count on what we say.”