BLUE MOUNDS, Wis. — The calendar may say July, but at Lactoprot USA, employees' minds are already on Christmas. That's what happens when you're a major supplier of shelf-stable processed cheese and other products for those ever-popular holiday gift packs.

Manufacturing of the company's cheeses, which are guaranteed for 10 months outside of refrigeration, is heaviest in the second and third quarters as gift packers get ready for the holidays, says Gerhard Simon, president, Lactoprot USA.

Simon calls the holiday gift business a "niche" market, but it's a market in which the company has carved a large niche for itself over the years.

The company has its predecessor company Stauffer Cheese, which it purchased in 1982, to thank for its long history in shelf-stable cheese.

"From a manufacturing side, we have some of the longest experience in shelf-stable process cheeses," Simon says.

But that's not all of what makes Lactoprot USA what it is today. Over the years, the company has been bought and merged and now encompasses what used to be three companies in the United States — John R. Donath, Austrian Food Center and Stauffer Cheese. These companies were the predecessors to Lactoprot USA which is now owned by Lactoprot International, a division of Artax, an Austrian firm. Lactoprot USA not only handles shelf-stable processed cheeses but also imported cheese and imported dairy ingredients.

Currently, the company's biggest business, though, is in the extended shelf-life business. Years of experience allow the company to offer a wide array of products, not only for gift packs but also for the growing snacking category. The company offers shelf-stable cups and foil-wrapped wedges, rounds, squares and rectangles. It also offers its products in clear multi-vac and Cryovac wrapping. Knowing that color is an important component to gift packs, the company can incorporate a variety of different colors in its packaging, Simon says.

Not all of the company's shelf-stable cheese goes into gift packs. Another style of product the company is particularly known for is its stick cheese. The stick cheese is manufactured and packaged in shelf-stable twin packs for private label. The company also supplies cheese to a number of nationally-recognized companies that pair the cheese with beef sticks before packaging. In addition, Lactoprot USA has the ability to stuff 6-pound sausage links with processed cheese. These links are then sold whole or cut into 8-ounce disks for sale in the deli. Single-serve packaging for cruise ships, restaurants and airlines also is available.

The processed cheeses come in a variety of flavors. Swiss and Cheddar are two mainstay varieties and added flavors include mushroom, tomato basil and pepper. New items are commonplace for the company and have included Feta with spinach and smoked Mozzarella with tomato.

"We're adding new flavors all of the time. The gift packing trade is always making changes in presentation," Simon says, noting that the company makes a number of smoked cheeses, in addition to Mozzarella, using natural smoke in smokehouses.

Dan Culligan, vice president, sales and marketing, says the company introduces on average eight to 10 new flavors a year. Not all of the flavors may be successful, he says, but a large number are readily accepted by customers.

"Our R&D department is very good about developing new flavor profiles that can have some significant market importance," Culligan says. "They're not just trendy; they do well in the market."

While the company does sell a small portion of its shelf-stable product under its own Glacier Ridge label, it doesn't assemble its own gift packs because it doesn't want to compete against its customers, Simon says. It does, however, offer a catalog with a full product line of items appropriate for gift basket development. In addition, the company manufactures dips and other related items, Culligan says.

The company isn't just versatile in the products it can provide for gift packs and snacking. It also is increasing its versatility in its cut-and-wrap operations and recently added a cubing operation for its imported cheese. Simon notes that the seasonal nature of the gift pack business means that the company can cross-utilize some of its equipment for imported products during certain times of the year.

Lactoprot USA brings in product primarily from the European Union, with imports such as Swiss, processed cheese and a full line of Danish cheeses including blue and Havarti. When not sold for industrial use or for private label, the Danish products are sold under the Royal Viking brand and the Austrian products are sold under the Mont Austria name.

Cheese imports tend to be bigger business for the company than dairy imports, especially in the currently lagging world protein market. Nevertheless, Simon expects that imports of dairy proteins from its sister company, Lactoprot Germany, will grow as new uses for the products are developed and as market prices shift again in the future.

The company is flexible, Simon adds. It has the size and scale necessary to service big gift pack companies but it still is able to provide small scale service. Catalog products are shipped within three days and as little as one case can be ordered.

"We provide good service no matter what the quantity," he says.

Lactoprot USA hasn't been particularly retail driven, focusing more on its co-packing and private label. Still, the company has had a good showing in different pockets of the country, particularly in the Northeast with its Royal Viking brand. The company is developing a broker network to increase it market presence, Culligan says.

The company also attends trade shows throughout the year to contact current and potential customers, both for gift packs and for retail. The company doesn't spend a great deal on brand development but instead focuses its market development efforts more on a grassroots level, Culligan says, such as tailor-making promotion programs for customers as necessary. The company also is working on launching a website, which will include the company's catalog.

Overall, Simon says the goal of the company is to strengthen and differentiate itself in its various markets.

The company will do this by continuing to focus on three areas, Culligan says: high quality products, fair prices and strong customer service.

"It's not rocket science," Culligan says. But it works.

Simon concurs.

"Many people can cut and wrap cheese and put it on a truck. What we've got going for us is our expertise in shelf-stable cheese and our level of customer service," he says.

CMN