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|Articles - December 2010|
|Wednesday, November 17, 2010|
Harry & David wasn’t planning to move to cage-free eggs in the company’s bakery products, but the idea certainly fit the corporate strategy “to make the most natural, wholesome product possible,” according to VP Pete Kratz.
So when the Humane Society of the United States came calling as part of their nationwide effort to eliminate the practice of confining egg-laying hens in small “battery” cages, the decision was simple.
Harry & David became the first major Oregon-based company to decide to exclusively use cage-free eggs, according to the Humane Society.
“There was no consumer pressure,” says Kratz. “It sort of fit right in to what we were looking at. We’ve reformulated over 82 products this fall to eliminate transfats.” Most of the products in Harry & David’s signature upscale fruit baskets and other high-end foods don’t have eggs in them, but the switch still will cost between $30,000 and $50,000 annually, about 25% to 30% more expensive than caged eggs. The company uses about 150,000 eggs per year.
The timing was good news for Willamette Egg Farms in Canby, which supplies Harry & David with its eggs. “We were already in the process of increasing our cage-free productions,” says VP Greg Satrum. The switch “was great for us because we need the sales for those eggs.”
Willamette Egg is the largest egg producer in the state. Its 1.2 million Oregon hens produce 1 million eggs a day. Satrum says about 3% of the birds will be cage-free in the next few months. Market demand didn’t drive the decision, but market projection did. After seeing growth in 2006-2007, “demand has not been strong for cage-free over the last few years with the economy,” he says.
Nationally, prices can swing from as low as 80 cents for a dozen conventional eggs to more than $4 a dozen for organic free-range eggs.
Cage-free eggs are more expensive than conventional eggs because it requires more feed, labor, medication and space to care for the hens. Cage-free doesn’t mean the hens roam free outside; only “free-range” designates that. Satrum says a modern conventional cage today is just under 4 square feet and holds eight hens and that the trend has been toward larger cages for many years. The cage that was widely used in the 1960s and 1970s, and still in use today, measures 12 inches by 20 inches.
Nationally, the demand for non-cage eggs has remained constant for the past four to five years, about 5% of U.S. consumption, according to Mitch Head, spokesman for the United Egg Producers. “We don’t see a dramatic increase in demand on the non-cage eggs,” he says, “95% [of consumers] are still voting with their wallets for caged eggs. Eggs that come from modern, clean cages are humane. Cage- free provides some benefits that modern cages don’t, and vice versa.”
Though it was an easy decision for a company like Harry & David, caged hens is a controversial debate. In the past several years, businesses such as Burger King, Starbucks and Denny’s have switched to cage-free eggs. In Oregon, seven private colleges have gone to cage-free eggs, along with two culinary schools and the corporate cafeterias at Nike and Adidas. Myriad restaurants and cafes around the state also exclusively use cage-free eggs. Burgerville, based in Vancouver, Wash., went cage-free several years ago. Whole Foods sells only cage-free eggs, and most all U.S. supermarkets now carry cage-free eggs, according to the Humane Society.
But McDonald’s earlier this year said the science was not there to support a change. In response to similar questions from the egg industry, the Coalition for Sustainable Egg Supply is doing a study led by Michigan State University and the University of California, Davis, to evaluate the various housing systems. Europe will ban the use of conventional cages in 2012.
The Humane Society is clear about its intent: extreme confinement is inhumane and they and other animal welfare groups want battery cages banned. The Humane Society has had some success in helping change how the nation’s 290 million egg-laying hens are kept. In California, extreme confinement will be banned by 2015; in Michigan, a hen must have at least one square foot of floor space beginning in 2019; and in Ohio farmers have agreed to bar new egg farms using battery cages.
“We are discussing whether to pursue battery cage legislation in Oregon,” says Kelly Peterson with the Oregon Humane Society. “I think voters and lawmakers would be amenable.”
Will consumers pay more for those eggs? “There’s the magic question,” says Satrum. “I don’t see production in the U.S. going away from cages any time soon.”
Tuesday, December 09, 2014
BY LINDA BAKER
On the eve of the Portland Ad Federation's Rosey Awards, Matt Anderson, CEO of Struck, talks about the transition from creative director to CEO, the Portland talent pool and whether data is the new black in the creative services sector.
Thursday, December 11, 2014
There’s a fascinating article in the December issue of the Harvard Business Review about a profound power shift taking place in business and society. It’s a long read, but the gist revolves around the tension between “old power” and “new power” as a driver of transformation. Here’s an excerpt:
The authors, Henry Timms and Jeremy Heimans, don’t necessarily favor one form of power over another but merely outline how power is transitioning, and how companies can take advantage of these changes to strengthen their positions in the marketplace.
Our Powerbook issue might be viewed as a case study in the new-power transition. This annual book of lists provides information on leading businesses, nonprofits and universities in the state. Most of the featured companies are entrenched power players now pursuing more flexible and less hierarchical approaches to doing business. Law firms, for example, are adopting new technologies and fee structures to make legal services more accessible and affordable.
This month we also take a look at a controversial new U.S. Securities and Exchange Commission rule requiring public companies to disclose the median pay of workers, as well as the ratio between CEO and median-worker pay.
Part of the 2010 Dodd-Frank financial reform law, the rule will compel public companies to be more open about employee compensation, with the assumption that greater transparency will improve corporate performance and, perhaps, help address one of the major challenges of our time: income inequality.
New power is not only about strategy and tactics, the Harvard Business Review authors say. “The ultimate questions are ethical. The big question is whether new power can genuinely serve the common good and confront society’s most intractable problems.”
That sounds like a call to arms. Or a New Year’s resolution. Old power or new, the goals are the same: to be a force for positive change in the world. Happy 2015!
Wednesday, October 22, 2014
We didn’t intend this issue to have an election season theme. But politics has a way of seeping into the cracks and fissures.
Wednesday, October 22, 2014
BY JOE ROJAS-BURKE & KIM MOORE
Oregon Business reports on the visa squeeze, the skills gap and foreign-born residents who are revitalizing rural Oregon.
Saturday, December 13, 2014
The president of LaPorte & Associates lets us in on his day-to-day life.
Sunday, December 07, 2014
BY LINDA BAKER
On Friday, Uber switched on an app — and with one push of the button torpedoed Portland’s famed public process.
Wednesday, October 22, 2014
BY KIM MOORE
Businesses spend billions of dollars each year trying to influence political decision makers by piling money into campaigns.
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Amy will practice in the firm's Business, Real Estate, and Tax practice groups.
While the Bend City Council ultimately upheld the approval which enables OSU-Cascades to move forward with the 10 acre site, it did also thoughtfully consider the nature of its code requirements, resident concerns and OSU-Cascade’s efforts and suggestions and crafted conditions of approval to address potential impacts of the site in the area.