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Persistence Wears Down Resistance

Saturday, January 6, 2018
filed under: Utilization/Trade

By Liz Morrison

       Tom Smude remembers a bit of advice he received early in his career: “Persistence wears down resistance.” That counsel guides him now as he works 90-hour weeks to build a new food brand.
     “It takes a lot of work to bring a food product to market,” says Michael Sparby, AURI senior project strategist — and, of course, there’s no guarantee of success. However, “Tom is determined and relentless.”
       “My wife would say crazy!” Smude jokes.
       Seven years ago, Tom and his wife, Jenni, central Minnesota cattle farmers, started Minnesota’s first cold-press sunflower oil manufacturing company. It all started with droughts in 2007 and 2008, which hammered crop yields and forced the Smudes to buy expensive cattle feed. So they looked for an alternative crop to diversify risk on their sandy soils.
       Sunflower requires much less water than corn or soybeans. In 2010, they set up a cold press on their farm near Pierz, Minn., to crush their first sunflower harvest for livestock feed and oil.
       Initially, the Smudes viewed sunflower meal as their primary product. It’s a nutritious feedstuff, comparable to soybean meal in protein and energy content. The oil was a secondary commodity, which they planned to sell in bulk for biofuel production.
       But when oil prices plunged, they quickly changed direction. With help from AURI, they set up a bottling plant and started selling food-grade sunflower oil in retail outlets.
       Beginning with farmers’ markets and a handful of local stores, they widened distribution to major chain grocery stores, restaurants, and movie theaters across the Midwest. They also supply bulk sunflower oil to Barrett Petfood Innovations, a rapidly growing premium pet food manufacturer in Brainerd, Minn. “We expect to grow along with them,” Tom says.
       Tom and Jenni “have done a tremendous job of marketing their oil and moving it into a variety of products,” says Al Doering, AURI co-products scientist. Doering provided nutritional analysis of the leftover sunflower seed meal and hulls, which helps the Smudes boost their crushing plant efficiency. The Smude’s Brand line now includes six varieties of flavored sunflower oil, such as garlic-pepper and tomato-basil; eight kinds of scented massage oils; and sunflower-oil soap and lotion.
Many Challenges
     Tom and Jenni, busy entrepreneurs, also operate Midwest Sales and Construction, which builds grain bins and distributes grain-handling equipment in three states, as well as a gravel business and a trucking company. Their combined ventures employ 14 people and generate annual gross revenues in the millions, Tom says.
       What’s the hardest part about being an entrepreneur?
        “No sleep!” says Tom, 43. In the start-up phase, “There’s not enough cash to hire all the people you need to help, so you have to do everything yourself.” Tom still handles all the sunflower oil sales and marketing.
       Later, he says, the challenge shifts to managing growth. For example, “We had to turn down a half-a-million-dollar contract for sunflower oil because we don’t yet have enough supply.”
       In 2017, Smude’s Brand will have pressed 3.0 million lbs of sunflower oil from 1,500 acres of sunflower — up from just 60 acres the first year. The company contracts with local farmers to grow sunflower.  Next up for the Smudes is an expansion of their 3,000-square-foot, on-farm oilseed crushing plant.
       About a year ago, Tom and Jenni, who have two kids, considered pulling the plug on the sunflower oil venture — long hours and low returns were taking a toll.  “But “I’m very determined,” Tom says. And lots of folks “encouraged us to keep going. It’s rewarding to connect with people and hear how much they enjoy our products.”
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