THORP, Wis. — In a business climate where people often think bigger is better, Chad Pawlak is a different type of businessman. His father worked in a small Wisconsin cheese plant that was eventually shuttered due to a flurry of industry consolidations, and it has been personally difficult to witness the financial squeeze many small dairymen and cheesemakers face. Still, Pawlak believes bigger isn’t necessarily better, particularly in Wisconsin, and that the family farm — and the family cheese plant — can be saved.

“Wisconsin cheese and dairying makes sense. And in Wisconsin, the smaller scale operations are realistic,” he says. “Our heritage is built on this.”

Pawlak now is marketing the state’s heritage and quality dairy products through Wisconsin Organics, a company focusing on organic dairy products produced solely in Wisconsin.

Wisconsin Organics has been a small company selling organic milk and cheese for a number of years, but it is taking a new direction now that Pawlak, who became president in 2003, and Bruce Ellis, who joined the company in 2004, are on board. The two say they plan to take their years of experience in marketing — including working for a food brokerage company that handled Fortune 500 firms — and make Wisconsin Organics a well-known brand throughout the country. They intend to capitalize on the strength of the image of Wisconsin and the quality that exists within the state to create an organic dairy product line that stands apart from the rest.

Part of creating that well-known brand has involved restructuring the business. The company’s high-temperature, short-time (HTST) pasteurized milk (as opposed to ultra-high temperature pasteurization which they say is cheaper but sacrifices flavor) remains an important aspect of the business. The company continues to operate a home delivery service in Chicago. However, the milk only will be available where it can be a fresh, local product so that product integrity can be maintained.

“We don’t see our growth necessarily in milk,” says Ellis. “We see it in specialty organic cheese products.”

The company currently offers Mild and Sharp Cheddar, Pepper Jack, Monterey Jack, Farmer’s, White Colby and its most recent introduction — Cotija. These are made by Wisconsin cheese manufacturers with whom Wisconsin Organics contracts. Eventually the goal is to make Wisconsin Organics a nationally-available dairy products brand that will provide a promising future for small dairies.

Pawlak and Ellis believe that the $1 million in annual business that Wisconsin Organics currently does could grow into $65 million over the course of the next five years; the goal for 2005 is $5 million in sales. And although they know they have a lot of work ahead of them, they already have made a number of changes and are seeing their efforts rewarded.

One change was at the beginning of the year. January 1 marked the date when Wisconsin Organics was purchased by OFM Inc. (also known as Organic Farm Marketing), of which Pawlak and Ellis are principals. As part of the acquisition, the company has introduced a new blue label featuring a cow and focusing on the benefits of organic food.

That label already will have a farther reach than it would have 12 months earlier. A year ago, Wisconsin Organics cheese was only available in about 25 stores in eastern Wisconsin. Recently, thanks to their new focus on marketing, the cheese’s availability has grown to more than 130 stores with distribution in three Midwestern states, Pawlak says. The company also has just established a presence in the Northeast and expects Wisconsin Organics cheese to be available in stores on the West Coast in the next month or two. In addition, over the past several months the company has gone from working with one distributor to working with seven, Ellis says.

Growing the distribution means that Wisconsin Organics can work with more dairy producer patrons and cheesemakers, adding to the economic stability of the state’s dairy industry, Pawlak says. Presently the company uses the milk of nine farmers, but expects that to about double in the next six months. In addition, three or four new cheese companies will soon be making cheese for the company along with the two with which Wisconsin Organics already contracts.

A key component of the company’s marketing plan isn’t just to offer cheeses that are simply “organic” by the technical USDA-definition of the word. Ellis and Pawlak want Wisconsin Organics products to be premium products with value-added characteristics in addition to being organic. They want the milk to be from smaller, pasture-based herds. Likewise, they want to handle cheese made by small cheesemakers who are experts in the business.

“We consider ourselves the premium brand of milk and cheese,” Pawlak says.

In order to create a premium product, the company plans to rely on the expertise of experienced, traditional-style cheesemakers who use things such as open vats and hand-pressed daisy wheels.

“We want to work with as many Master Cheesemakers (and other similarly-experienced cheesemakers) as we can. We want to have several more Master Cheesemakers as value-added partners and consultants,” Pawlak says. “We want to create a product and a brand based on the capacity of those cheesemakers.”

Already with the experience of these types of cheesemakers, Wisconsin Organics plans to introduce organic Feta, Blue and Butterkäse this year. Organic butter also is planned for 2005, and a blended goat’s milk/cow’s milk cheese is being explored.

Wisconsin doesn’t lack for quality, expertise or various certifications of dairies and factories, Pawlak notes. The critical marketing component now lies in taking that additional step and putting it all into a brand that the consumer can associate with on a regular basis, he says.

Ellis acknowledges that he and Pawlak’s goals for the company are high, but notes that when a company starts small, big percentage gains in sales are more readily attainable.

“It can be done,” Ellis says.

“Retailers are hungry for organic cheese and they want top of the line,” Ellis adds. “Wisconsin Organics is poising itself to be the dominant organic cheese supplier with premium products made by premium chesemakers with milk supplied by premium organic dairy farmers.”

The quick growth the company currently is experiencing and planning for isn’t without its challenges. Finding enough milk, for example, isn’t always easy, particularly in the short term with growth happening so quickly. However, Wisconsin Organics will only work with dairy farmers who are using organic practices that not only follow USDA’s organic rules to the letter but also the spirit of them, says Pawlak, who notes that in the West there some are large dairies that he believes stretch the limits of what organic means. Among the benefits to the producers Wisconsin Organics works with are a somewhat higher pay price and a company that is willing to work to meet their needs for various services. In addition, the company remains solely dedicated to Wisconsin.

Pawlak calls the current demand for product — and the immediate need to grow to meet that demand — both frustrating and exciting. And he knows there are many dairy farms out there that will prove to be the right fit for Wisconsin Organics. Five years from now, Pawlak hopes the company will be using the milk of 100 to 150 Wisconsin dairy farms.

“We support the family farm … we are never going to sacrifice quality just to get a customer,” Ellis adds.

CMN