Dairy farmers find markets for specialized products

As California dairy farms were being battered the last few years by rising costs, fluctuating prices and other financial difficulties, a number of farmers looked to new marketing avenues to help their businesses weather the storm.

For example, Noel Rosa of Rosa Brothers Milk Co. in Hanford studied different ways to sell directly to consumers and retail markets. Rosa, whose family has been in the dairy business for 60 years, looked into home deliveries but decided they weren't going to be a profitable business model for the company. Instead, he focused on selling his bottled milk to grocery stores.

"It wasn't easy. You have to learn not to take 'no' for an answer," he said.

During the past two years, he's been able to get his bottled milk into a number of independent retail stores as well as Vons and Save Mart supermarkets throughout the Central Valley.

Although some stores were reluctant to try the bottled milk, Rosa's big selling point was that his milk was something new for customers.

"With the milk, we told retailers that we weren't looking to displace the plastic milk jugs, but we wanted to provide a product for people who wanted quality milk with good flavor. We knew there would be a niche market for bottled milk," Rosa said.

Rosa milks 1,000 cows on his Kings County farm. He sells about 80 percent to 90 percent of the milk to his milk cooperative, with the rest of it being processed at his facility in Tulare. He chose Tulare, he said, because it's close to Highway 99, where he has easy access to retail stores throughout the Central Valley.

The Tulare location also has a store where customers can come in and see milk processed and ice cream being made through a large window. Customers appreciate the transparency of the milk processing, which Rosa said he considers key to gaining customers' trust. That's also why he offers weekly tours of his Hanford dairy facility.

"We did the market research and we found that people want to know where their food comes from. A lot of the larger plants won't even allow visitors. But we do farm tours every week. We get a lot of school kids and their parents, retirees and all kinds of people who are interested in what we do," Rosa said.

In Tulare County, Top O' the Morn Farms sells its products directly to consumers and retail stores. Ron Locke, who got into the dairy business about 10 years ago, said Top O' the Morn Farms is the only dairy operation in Tulare County where the milk gets produced completely on the farm. Most of the milk from his 2,000-cow herd is sold to his dairy cooperative, but about 2 percent to 4 percent goes to the company's on-farm milk bottling facility.

The company produces skim milk, reduced-fat milk, whole milk and flavored milks, including reduced-fat chocolate, strawberry, and peanut butter and chocolate. It also makes heavy cream, half-and-half and seasonal eggnog.

Top O' the Morn started out with two different home delivery routes in the Visalia and Tulare areas, and now operates six routes throughout the San Joaquin Valley.

Through the service, customers receive deliveries once a week. They place their empty milk bottles outside of their front doors, along with a cooler of ice, to receive fresh deliveries on a weekly basis. In addition to milk, Top O' the Morn also delivers local cheeses, honey, jams, nuts and eggs.

Third-generation dairy farmer Barbara Martin, co-owner of Dairy Goddess in Lemoore, runs a 1,000-cow dairy, which sells most of its bulk milk to California Dairies Inc. But Martin keeps about 1,000 gallons a week on the farm to produce her own gourmet fresh cheeses and non-homogenized milk. Her dairy also makes its own chocolate milk, using cocoa and sugar during the pasteurization process.

Martin said that when milk prices hit record lows in 2009, she knew that she and her family had to do something different.

Martin's cheeses, which are sold in 35 Whole Foods stores in Northern California, have been a huge hit, she said.

The gourmet, spreadable, artisan cheeses, which she makes herself, come in a variety of flavors, including spicy red pepper and garlic, Santa Maria seasoning with dill, ranch flavoring with real bacon, and an interesting mix of pistachio, cranberry and chocolate.

Another plus to marketing her own milk and cheeses, Martin said, is that all the product comes from one herd, which consumers also seem to like.

"People who buy my milk know that they're getting the milk from my cows," she said.

Martin's strategy of producing and selling her own dairy products seems to have come at the perfect time, due to the big "buy local" push.

When she went to "audition" for Whole Foods in front of the company's "food foragers," Martin said, the chain's dairy distributor was anxious to market as much of the cheese as possible. But Martin said her strategy was to start out slowly and introduce her products to consumers in small amounts.

"I wanted to sell the product to the stores slowly, because I didn't want anything sitting on the shelves too long and anything having to be thrown out because it wasn't selling fast enough," Martin said.

She said working with Whole Foods has been a good experience, noting that the markets give her special discounts on store demonstrations because she's a farmer, and also don't charge her for shelf space.

"In some stores, you have to pay $20,000; otherwise, they don't let you sell your product," Martin said.

She said she has also found success in selling directly to consumers at farmers markets, participating in 14 markets and selling milk in half-gallons.

(Lisa Lieberman is a reporter in Three Rivers. She may be contacted at lisal@thegrid.net.)