It’s been a big year for Earthbound Farm chief executive officer Charles Sweat, who’s overseen the creation of new divisions — for fresh fruit and frozen fruits and vegetables — at the organic grower-shipper.
The San Juan Bautista, Calif.-based company continues to enjoy double-digit sales growth annually. They’re not just about leafy greens. New organic products are continually in development — as are new markets.
Of those, Earthbound Farm has its sights set on the biggest — China.
In September, Sweat met with regulators in Beijing to push reconciliation of differences between Chinese and U.S. organic standards. He visited four Chinese cities, meeting potential customers and distributors and doing retail store checks.
“We’re working to become the first certified organic fruit and vegetable company to ship into the People’s Republic of China,” Sweat said. “I’m hopeful we’ll be approved by the first half of 2013.”
Earthbound Farm already does business in several Asian nations, primarily in salads, fresh vegetables and dried fruit. It plans to add frozen organic — a $15 million category for the company in 2013, if projections hold — and even beverages to that export mix.
“We’re looking to launch an organic fruit and vegetable beverage in the first quarter of 2013,” Sweat said. “It’s been in research and development for about 12 months.”
The company backs its increasing commitments with added acreage.
In 1998 — when Sweat joined Earthbound Farm as chief financial officer — the grower-shipper fielded about 2,500 crop acres. In 2013 it’ll be around 50,000, he said.
“We’re really focused on developing more organic healthy products for people across a broader food and beverage offering at prices that are reasonable,” Sweat said. “We have this view at Earthbound that we’d like to democratize organic so that it’s not such a high premium to enjoy it.”
The price premium on organic fruit over conventional is up to 40%, according to the company. It was about the same for packaged salads a decade or so ago, but now that’s down to roughly 10%.
“Our goal is to take organic production and scale it to be able to reduce the costs associated with smaller organic operations and be able to reach a broader swath of consumers,” Sweat said. “There has to be a major emphasis on increasing the organic land base. On the manufacturing side, it’s just applying new technology to packaging and other processes to be more efficient.”
Sweat, 51, was promoted to president in 2006 and chief executive officer in 2009. Before joining Earthbound, he was chief financial officer based in Atlanta for PetroSouth, an owner of convenience stores and gasoline distributorships.
Frank Padilla, vice president and general merchandising manager of produce and meat at Costco, said his company has a long history with Earthbound Farm owners Drew and Myra Goodman — and with Sweat.
“We helped them in their early years of getting established,” he said. “Now they’re really starting to venture out into longer product lines. We’re not in all of them, but we’re in many and helping to create some.”
Sweat proved essential to the company’s rebound from links to the 2006 E. coli outbreak in spinach, Padilla said.
“That clearly made up their mind to sell organic only,” he said. “Thanks to Charles’ firm direction, they went that way. They had the opportunity to sell both conventional and organic. What the founders needed was someone to take them to the major league, and that’s what he did.”
In 2011, Ernst & Young named Sweat Entrepreneur of the Year for Northern California in the food products category in honor of that history.
“Charlie is one of the most forward-thinking executives in the produce industry,” said Jeff Lyons, senior vice president for perishables at Costco. “We appreciate his listening and help in achieving greater sales. If he doesn’t think he has enough acreage to support our future growth, he’ll secure more growers to be sure he can handle our business. He isn’t just selling what he has.”
“Recognitions are much appreciated, but I had a lot of people helping me do it,” Sweat said. “Thanks to the founders of this company, we’ve had a successful run at achieving our mission.”