Cover Story: Flush With Green
Acquisitions Expand
Geographic Footprint,
Add Production and
Distribution Capabilities
Starting in March 2009, GMCR began acquiring companies as if they were email addresses. First came the purchase of the Seattle-based Tully's Coffee in March of last year, followed by Toronto-based Timothy's Coffees of the World in November 2009 and lastly California's Diedrich Coffee in May.
An integral part of GMCR's growth strategy, the acquisitions have served to add production and distribution facilities for GMCR nationwide. The company now counts distribution and manufacturing facilities in Waterbury, Lewiston and Essex, Vt.; Castroville, Calif.; Knoxville, Tenn.; Sumner, Wash.; and Toronto.
"As we look to expand our presence out of our Northeast home, this broader geographic footprint will enable us to be more efficient, producing and distributing varieties closer to customer demand," DuLong notes. Prior to its acquisitions, for example, if a GMCR customer on the West Coast wanted to purchase a Vermont blend K-cup, that product was manufactured in Vermont and trucked all the way to the West Coast. Bringing aboard the new production and distribution has helped establish a more efficient distribution system.
Part of GMCR's expansion strategy is a push into the wholesale market. In late April, GMCR launched GMCRWholesale.com, a website designed to serve customers of its Specialty Coffee business unit. The site details full-service coffee programs customized by channel to help wholesale customers increase sales and profits, drive customer visits and loyalty, and increase customer satisfaction.
In addition to its efforts to acquire more of the wholesale retail marketplace, GMCR has targeted the corporate office world as a vertical ripe for growth. Citing recent statistics that found 30 percent of coffee is consumed away from home, and that 10 percent of coffee is brewed in offices, GMCR's wholesale website was launched with the goal of targeting and capturing a bigger percentage of the small office marketplace.
"Of the 5.5 million estimated offices in the U.S., 80 percent of those have less than 20 people," DuLong says. "The B-to-B wholesale site was designed with tools for small office managers to better plan for and order coffee based on a number of variables – number of employees, number of visitors, among others."
Putting its Money Where its Mouth Is
At the core of GMCR's corporate culture is a commitment to social responsibility and environmental sustainability. The company prides itself on its social accomplishments, which include offsetting 100 percent of its direct greenhouse gas emissions, investing in Fair Trade Certified coffee and donating at least five percent of its pre-tax profits (last year that translated to $3.7 million) to social and environmental projects.
GMCR also encourages its employees to be active in the community with a paid-leave-for-community-service program, offering them up to 52 hours of paid time off per year to volunteer in their communities. GMCR sends employees to "source," which involves sending them to coffee farms around the world to observe grassroots production.
