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Wizard’s Cauldron Conjures International Markets
By Jill Lee
Take several committed organic farmers, add one passionate entrepreneur and a savvy processor. sprinkle in a bit of export expertise and wait for magic to happen.
John Troy is an easy-going man, with a ready smile for
everyone, except those who would compromise his standards. 
"When someone tries to cut corners, I tell them I’m taking my business elsewhere, and, if necessary, paying double to do it. That usually gets my point across," he said.
Troy rarely needs to resort to tough talk, however. The organic farmers and food processors who supply ingredients for his hot sauces and salad dressings generally share his commitment to high-quality, eco-friendly food.
Troy started out in the organic food business in 1986 with a candy bar. Today, his company, Wizard’s Cauldron, Ltd., located in Cedar Grove, North Carolina, produces several kinds of sauces and dressings.
He also sells a steak sauce, which is not eligible to be called "organic" yet, but will be as soon as Troy finds a few more organic suppliers. The steak sauce has the right ingredients to be labeled "natural," but to earn the description "organic," 95 percent of the ingredients have to certified organically grown. The standard is set by the private company that evaluates Troy’s products. There are numerous organic certification entities in the United States, and most adhere to the 95 percent organic content requirement.
Why is it hard to find organic ingredients? The answer lies in the challenges that organic farmers face. They must raise their crops without the agricultural chemicals, transgenic seeds or conventional tilling practices that many mainstream growers use. The objective is to farm in a manner that is kinder to the environment.
While these input restrictions cost money, consumers in the United States and overseas are increasingly willing to pay the price.
An Exporting Odyssey
Troy’s commitment to quality did cause him some problems in exporting at first. That is, until he met Emily Felt, a marketing expert with the North Carolina Department of Agriculture, who helped him find the right match.
"John had given it a try in Japan three years ago with his own brand of a natural salad dressing. But he soon learned that marketing his brand, ‘Simply Delicious,’ was very difficult because he was not able to explain the organic and natural attributes of the product using his labels," Felt said.
"It was ridiculous for me to get my own brand going in Japan," said Troy, in retrospect.
Felt, an international trade specialist, came up with a compromise that would work for Troy. She encouraged Troy to market his private label services to Japanese retailers and distributors who were looking for specialty organic dressings.
"These private label companies have a customer base and know the market," said Troy. "All they lack is a processing plant and great recipes–that’s something I can provide in abundance."
Troy is already an accomplished producer of domestic private-label dressings. Wizard’s Cauldron can boast of clients such as Whole Foods, a natural foods supermarket chain with branches from Texas to Maryland. The plant also makes salad dressings for Albert’s Organics, which are sold under the brand name Mellie’s. The company also makes sauces for a company in California, Edwards & Sons Trading Company. Thanks to Felt’s initial efforts, Troy may soon have more than one overseas customer in Japan. He’s also received inquires from Planet Organic, a natural and organic foods chain in the United Kingdom, and other private label customers in Europe are knocking on his door.
Organic Foods in Japan
Felt says that Troy is a great match for his Japanese clients. Not only is his quality top-notch, but he can deliver a service that is still rare in Japan–certified organic food processing. In some cases, it is more economical for Japanese companies to buy organic products ready-made from the United States than to produce them domestically.
But with the recent economic volatility in Asia, and the added costs of shipping, why are consumers willing to spend extra money on U.S. organic foods?
"Outside the United States, there have been some pretty serious food safety problems such as E. coli: 0157 in Japan and bovine spongiform encephalopathy in Britain," said Felt. "In both countries, there is a perception that organic foods are safer."
The care with which U.S. organic foods are handled and checked carries a lot of weight with overseas consumers.
Making the Most of MAP
Troy is not the only food producer benefiting from the marketing wizardry of experts like Felt who work for state departments of agriculture.
For the last two years, she has been part of an innovative state marketing group formed to maximize the power of FAS’ Market Access Program, or MAP.
MAP provides money for generic promotions of U.S. agricultural products, including organic foods and products made with these ingredients. MAP is also used to help small companies and cooperatives and may also be used to promote brand-name as well as generic products.
In 1998, Tim Larsen, of the Colorado Department of Agriculture, hit upon a novel idea: If the different regions of the United States were to pool their MAP dollars for organic food promotion, they could offer more and better services to U.S. exporters.
Felt, along with colleagues from Massachusetts, Washington and Minnesota, bought into the plan. The collaboration is a winner, she reports.
"This year we pooled our MAP resources and took a group of 35 organic exporters to Bio Fach again, one of the world’s biggest natural and organic product trade shows," said Felt. "We spent about $40,000 in MAP promotional funds and exporters reported nearly $10 million in sales."
Felt said sharing MAP resources and promoting "organic products from the USA" made sense. Buyers don’t generally identify where in the United States an organic product comes from, she said. They care about quality, price and supply.
The Producers’ Points of View
Why do Troy’s suppliers take the extra time to farm and process organically? Their perspectives differ, even though they give similar reasons.
Neal Norman, President of Kauai Organic Farms, Inc., provides Troy with his organically grown ginger. His farm, one of Hawaii’s largest, is certified organic by Quality Assurance International, the same group that certifies Troy.
"We feel we are cleaning up the Earth one acre at a time, and we offer a tempting and exotic line of products while we do it," said Norman. "Nothing else is quite like Hawaiian ginger. The soil here gives it a distinctive flavor."
Norman’s ginger is processed into pulp by Vegetable Juicers of Chicago, Ill. President Peter Garvy supports the organic philosophy, but also sees the industry in terms of the bottom line.
"John was one person who came to us about organic processing. Then we got an order for organic vegetable juice with a volume we couldn’t ignore," he said. "It was from a west coast distributor whose client was in Japan. That sale, for us, made conversion to organic processing a wise investment."
Like Troy and Norman’s businesses, Vegetable Juicers must be certified by an independent body before it can process organic foods. Good organic companies can differ, however, on who does their certification but still remain partners. Garvy’s choice for certifying, for example, is Oregon Tilth.
Garvy said that he sees a future where more mainstream companies will become aware that organic food production makes good business sense. He sees the market fueling the organic revolution.
"It costs less money than you might think to have organic and traditional processing in one plant," he said. "You do have to pay a fee to the inspector and you do have to budget for segregating your organic products, but if the commitment is there you can make it work."
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The author is a public affairs specialist with the FAS Information Division, USDA, Washington, D.C. Tel.: (202) 720-7939; Fax: (202) 720-1727; e-mail: leejill@fas.usda.gov
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