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Dairy company Kemp launches new products to help boost sales
March 23, 2018

Dairy company Kemps has recently launched several new products in an effort to boost sales as farmers struggle with profits.

In the last eight weeks, it has unveiled new products such as its first yogurt smoothie without added sugar, its first real probiotic milk and its first high-protein, low-sugar frozen yogurt. It also launched a brand of premium, small-batch ice cream.

President and CEO Greg Kurr said that dairy farmers across the country are struggling with their balance sheets.

“We’re really motivated to help our farmers in tough times,” Kurr said to a room full of business community members on Wednesday at a luncheon in Plymouth hosted by the TwinWest Chamber of Commerce.

Rachel Kyllo, senior vice president of growth and innovation for Kemps, said there’s an oversupply of milk in the market and prices are too low. She said non-dairy milk alternatives such as almond milk or cashew milk have grown in popularity, which is partially driving the decrease in demand for milk. In fact, Kemps is now thinking of adding almond milk to its product portfolio.

Kyllo also said that consumption of cereal is down and that more mothers are encouraging their children to drink more water rather than other beverages like milk.

Kemps, which is based in St. Paul and employs 1,300 people, expects to do $850 million in sales this year while spending at least $5 million per year on product development and innovation, Kurr said.

The company is owned by Kansas City, Kan.-based Dairy Farmers of America, which is a national cooperative made up of 9,000 family farms. DFA itself is doing well, reporting this week net income of $127.4 million in 2017 on net sales $14.7 billion, up from $13.5 billion in 2016.

Aside from launching new products, Kemps spends about $3 million per year on consumer marketing such as radio, TV, billboards and social media, Kurr said. It also recently changed its tagline to “Good comes around” from “It’s the cows,” partially to reach more millennials, he said.

“This company you grew up with is changing so rapidly,” Kurr said.

 

Source: Biz Journals



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