Start Your Engines
June 1, 2006
Start Your Engines
Birchwood Foods is racing for national brand recognition through its NASCAR Burgers.
In 1936, Frank Vignieri borrowed $35 from his wife to start up his own business, buying dairy calves, slaughtering them and selling the veal to mom-and-pop grocery stores around Kenosha, Wis. That investment has grown into a $500-million-dollar company, with four plants in the United States and nationally distributed brands. Not a bad return on the original investment.
Dennis Vignieri, the grandson of the founder, is now the president and CEO of the company. Like his father and grandfather, he has made sure that the company is continually changing and adapting with the times, moving over the years from a vertically integrated processor to a ground beef specialist, with more changes on the way. Kenosha Beef started off slaughtering calves and then cattle, selling the beef in quarters or sub-primals. It then progressed into boxed beef in the late 1960s.
“My dad worked very diligently with boxed beef,” Vignieri says. “He was one of the pioneers of boxed beef. The [boxed beef] operation started in 1969 and a few years later, we had completely changed our operation and went totally into fabrication of boxed beef.”
That lasted until the 1990s, when the company’s supply of cattle quarters dwindled. When the boxed beef operation ceased to become profitable, Kenosha Beef moved into ground beef, where it has met with some of its greatest successes.
“I think one of the strengths of any privately held or family-held business is the ability to change and successfully manage that change from generation to generation,” says Dave Van Kampen, vice president sales/national accounts. “Dennis and his father before him [are] visionaries. They have the mindset for meeting today’s demands and the vision to understand what tomorrow is going to bring. It is not an easy balance, but they have developed an organization that takes care of today’s business and, at the same time, a continuous improvement culture focused on tomorrow’s solutions.”
The company is primarily a foodservice supplier of hamburger patties, taco meat, and other products. Some of its customers are among the largest QSRs in the country, as well as casual dining outlets and more. But its latest product development and marketing efforts have been to build its Birchwood Foods retail division.
Birchwood Foods’ frozen hamburger patties are predominantly known in the Southeast. Elsewhere, the brand name is not yet recognizable to consumers. So as it goes national, the company will strategically associate Birchwood Foods with more recognizable names in order to strengthen and improve recognition of the brand.
As a case in point, the company released four types of specialty hamburger patties last year. The beef patties are blended with various gourmet ingredients, including cheese, Vidalia onion, jalapenos and bacon. The restricted-melt cheese was developed through a project with Land O’ Lakes. That company’s logo is also on the Birchwood box.
“We have to bring in some credibility to the Birchwood brand as we start to expand on a national basis,” Van Kampen states. “We felt that if we had someone to hold hands with who has a very recognizable brand, like Land O’ Lakes, people would say, ‘Well, I don’t know Birchwood Foods, but I know Land O’ Lakes. I’m going to buy that product.”
The strategy to cross-merchandise brands to build its own reputation with consumers led Birchwood to its association with Checkers/Rally’s and NASCAR®. Van Kampen met with executives from Checkers/Rally’s to see if they had any interest in taking their burgers into the retail world. As it so happened, the company, which is the Official Drive-Thru of NASCAR, was looking to take that very step. Together with NASCAR, the two companies collaborated to release the Checkers Rally’s Official NASCAR Burger.
“NASCAR is obviously much more recognizable by the consumer, with 75 million fans out there, than what Birchwood is,” Van Kampen says. By utilizing the sport’s popularity, the company was able to further establish its brand as well. He credits Checkers/Rally’s as being an excellent partner, helping to lay out the groundwork with NASCAR. They have been a NASCAR sponsor for three years, and have restaurants at five race tracks.
While there are other frozen patties out there, the Officialy Licensed NASCAR Burgers have a few points of differentiation. The burgers are one-third pound in size instead of a quarter pound, and they are made to simulate a hand-made product. Most importantly, each box of patties comes with a shaker filled with Checkers/Rally’s burger proprietary seasoning. “This is what they use in their restaurants,” Van Kampen notes. “For fans that know Checkers/Rally’s and buy the burgers at the track, we say we’re delivering the track-side flavor to your backyard grill.”
Along with developing the burgers, the company also put together a complete pull-through marketing campaign to help retailers. In-store promotional materials, coupons, customizable radio spots, and the company’s custom wrapped NASCAR Burger semi trailer can be used for special promotional events. The trailer features speakers, lights, an awning, and is equipped with a grill, so consumers can try out the burger before they enter the store.
Birchwood is also building two in-store sweepstakes around two famous NASCAR events. One summer event will fly a grand-prize winner out to the Brickyard® for a race. Additionally, the store where that person entered the contest will also receive a trip to the Brickyard, to be given to an employee of its choice. A second contest will be built around NASCAR’s last race of the year. The winner will receive a NASCAR party delivered to his or her house for 50 people. Among other prizes, Birchwood’s hauler will be there.
When it came to choosing a spokesperson for the NASCAR burger (as well as Birchwood’s other products), the company had an inside track with the signing of legendary NASCAR personality, Rusty Wallace. Tom Polansky, who is Rusty Wallace’s director of operations, used to manage Kenosha Beef’s transport company, Birchwood Transport Inc., and introduced Wallace to the Birchwood family. Wallace, who retired from racing last year, recently signed a long-term contract with ABC/ESPN, guaranteeing a high profile.
“We thought that he would be a good neutral person,” Van Kampen says. “There are good drivers that make terrible spokespeople, either because of some risk factor associated with their personal lives, or their inability to articulate our message. Rusty is a professional — he wouldn’t get a seven-year contract from ABC and ESPN if he wasn’t going to be a good spokesperson.”
The NASCAR burgers have been well accepted which is illustrated by the fact that they have gained distribution in several major markets. Furthermore, the relationship between Birchwood and its partners has been solidified. “We’re still going through the honeymoon period,” Van Kampen explains, “but we’re developing a great relationship that will allow us to leverage our individual assets in developing some very unique marketing and sales opportunities. We’re in a position now to be a lot more aggressive in putting these programs together. We’ve got the seeds planted, and we think next year is going to be a blowout year for the program.”
Now they're cooking
The retail hamburger patties aren’t the only new development at Birchwood. While strengthening the retail market is an important goal, the company also intends to look for new developments and revenue opportunities with its foodservice division as well, particularly in fully cooked products.
Of the company’s four plants, the ones in Columbus, Ohio, and Frankfort, Ind., produce fully cooked products. (The Kenosha and Norcross, Ga., plants are both raw manufacturing facilities). Sales opportunities have exceeded the Frankfort plant’s impingement cook line capacity, so the company’s board of directors recently approved a new fully cooked impingement line to be installed in the Columbus facility.
The line will be operational around the end of the year, Van Kampen says. When it is up and running, it will provide a substantial increase in capacity and add to the variety of products that will be produced at the Columbus facility. The Frankfort facility will maintain focus on two types of product lines. One will be crumbled pizza toppings, taco meat, sausage crumbles and similar products, made of beef, pork and poultry. The second will be fully cooked entrees, such as pot roast, salisbury steak and meat loaf. “That’s mostly on the foodservice side, although we are taking some of these products into retail as well, on the deli side,” Van Kampen notes.
To help develop products for both the retail and foodservice divisions, the company has opened a new state-of-the art product development facility named the Culinary Café. It is located at the company’s headquarters in Kenosha. The company also brought Chef Tim Keown on board as its director of research and development. Van Kampen notes that many QSRs and restaurants supplement their menu development teams with strategic vendor partners. Birchwood has developed the resources to enable them to offer these services to its customers.
The company can even do its own in-house product testing, thanks to its diverse workforce. One customer approached Birchwood to develop and test some breakfast concepts. The processor found employees among its workforce that matched the customer’s desired demographics and used them to test the new concepts. “It worked very, very well,” Van Kampen says. “This particular customer is trying to attract younger males. Our in-house panel preferred the same products as the test panel our customer paid thousands of dollars to commission.”
Van Kampen says the company will also consult with its customers on developing new products that have nothing to do with meat, such as advising one restaurant chain to develop a specialty coffee they can promote to customers. “We take a very holistic approach when we go in and visit with customers; we are interested in their total business. If their total business is not successful, we’re not successful,” Vignieri states in summing up their customer philosophy. NP
Kenosha Beef International/Birchwood Foods Division
Founded in 1936
Headquarters: Kenosha, Wis.
2005 sales: $505 million
Facilities: Headquarters/processing plant in Kenosha, with a second raw processing plant in Norcross, Ga., and fully cooked facilities in Columbus, Ohio, and Frankfort, Ind.
Brands: Birchwood Foods, Triple-T Burgers, and several types of frozen hamburger patties, including the new NASCAR Burgers.