2001 Farmer Cooperatives Conference

October 30, 2001

Meeting the Needs of Our Food Customers

Blue Diamond Growers

• How to Better Meet Customer Needs– Adapt & Change– Reorganize

Reorganization Guiding Concepts

1. Market Driven

2. Structure into Business Units

3. Strengthen Key Customer Relationships

4. Business Planning Driving Day-To-Day

5. Empowered Work Force

What is a Business Unit?

Cross Functional Business Team Structured Around Market Segments Aligned with Production Cells Formulates Objectives & Strategies Accountable for Results

Business Unit BenefitsClearer FocusImproved LinkageStronger Customer RelationshipsMarket Segment ProfitabilityBetter Overall Business Performance

Business Units

Processed IngredientsCommodityAmericas IndustrialExport IndustrialConsumer Foods

• Confectioners

• Cereal/Baking Manufacturers

Processed Ingredient Customers

• Marzipan & Paste Manufacturers

• Traders and Speculators

• Importers/Processors

Commodity Customers

• Bakers/Bakery Companies

• Nut Roasters/Salters

• Repackers

• Inshell Buyers

• Ice Cream Manufacturers

Americas & Export Industrial Customers

• Grocery Stores & Supermarkets• Drug & Discount Stores• Wholesale/Club/Cash & Carry• Food Service

Consumer Foods Customers

Meeting Commodity Customer Needs

• Price Buyers

• Margins Minimal

• Buying Positions Speculative

• Excessive Supply & Uncertainty

Meeting Industrial Customer Needs

• Quality, Service & Price

• Brand Loyalty

Meeting Processed Ingredients Customer Needs

• Value Added Products

• High Degree of Intimacy

• Exacting Product Specifications

• Matching Infrastructure

• Mutually Drive Costs out of Processes

Meeting Consumer FoodsCustomer Needs

• Higher Margins Market Segments

• Growth Requires Closer Integration– Multiple product lines– Must deliver information plus products– Must tie technology together to lower costs– Proactive services

A Can a WeekThat’s All We Ask