Fresh-cut processor helps drive growth of avocado market

March 3, 2008

For the last 10 years, one company was at the top of the A.C. Nielsen retail sales charts, but few people knew its name. Although the packaging was unique, competitors had begun to imitate it, so a new, recognizable brand name was needed. So that company launched a naming contest in August 2007, and when the votes were tallied, the new name for the avocado processor was Wholly Guacamole. Since then, the company has started a vigorous brand marketing program to grow the avocado and guacamole market further.

It all began with Don Bowden 38 years ago. He owned a chain of Mexican restaurants in Texas, but was having trouble finding good guacamole. The problem, it turned out, was the quality of the avocadoes. Bowden started traveling to Mexico to find a source of good fruit, then started a small processing operation.

He tried every way imaginable to package his guacamole, including freezing, heat pasteurization and canning it with vegetable oil. Bowden wasn’t satisfied with the results because each of the processes changed the taste so that it no longer tasted fresh. He stumbled on a new process called high-pressure pasteurization (HPP), a process that uses regular water to create pressure as high as 85,000 pounds per square inch. HPP has a 5-log reduction on harmful organisms without changing the taste and using no chemicals.

“High pressure works without any of those additives and without heat. The avocado keeps its fresh, buttery flavor,” said Steve Parnell, president of Wholly Guacamole.
“It just tastes fresh. At the end of the line it has to taste fresh.”

An advantage to HPP is that once the product is in the package, it’s not touched again. The HPP process is done after packaging, reducing the chance that a contaminant will be introduced after pasteurization.

The technology was new and expensive, but Bowden invested in the early machines that could process only five to seven pounds at a time – which are now part of his “museum.” He needed more processing ability by the mid-1990’s, so he invested in a newer machine that could do 60 to 70 pound batches in 1997. At the time, it was the biggest HPP machine in the world.

“From that point on he continued to commission bigger and bigger machines to keep up with demand,” Parnell said.

Today, the company makes guacamole in batches of 300 pounds with the trademarked Fresherized HPP process. The company uses HPP on more than one million pounds of guacamole and avocadoes each week.

Guacamole, as the name would suggest, is the main product distributed by Wholly Guacamole. About half of the product goes to retail stores and the other half goes to foodservice customers, who typically get the processed avocadoes and then mix in their own “secret” ingredients for their fresh guacamole. Retail customers have a choice of five varieties of guacamole – Original, Pico de Gallo style, Guaca Salsa (guacamole and green salsa), Organic and Spicy, which is the best selling flavor right now. The guacamole is all natural, with about 94 percent of the product made of avocado

The same Fresherized process is used to produce the Simply Avo line, an eight-serving package of ready to eat avocado. Wholly Guacamole has made the value-added avocado product for some time in 14- to 16-ounce packages, but customers responded when it was put into the smaller 7-ounce pack. That introduced customers to fresh avocadoes at a lower price point, Parnell said.

“If people try our product, they’ll buy it,” he said.

To introduce the product to more customers, Wholly Guacamole launched a 100-calorie snack pack. Although avocadoes – and guacamole – are a natural, fresh product, the snack pack was a way to reach dieting customers. Many were surprised at the amount of product that was in a 100-calorie package, Parnell said.

For retail customers that want to make their own guacamole or use avocado slices, Wholly Guacamole is launching Simply Avo Halves, avocadoes that have been cored and cut in half. The fresh-cut avocadoes use the same Fresherized HPP system as the other products.

The company’s 11,000 retail and foodservice customers get weekly shipments and the product isn’t made until the order is received. After the avocadoes are processed, the product is shipped from the Mexican plant in the company-owned trucks. Once the products reach the United States, they’re put on contract trucks so the company has control over the distribution from the time it leaves the plant until the time it arrives at the customer’s store or restaurant. Splitting or sharing loads with other products could reduce cost, but Parnell said the quality of the product wouldn’t be as high.

“Our freight would go down but our business wouldn’t be as successful,” he said. “Our only preservative is temperature.”

If a customer doesn’t make a weekly order, the sales staff will call and suggest smaller weekly orders instead of one big one. That will result in fresher product on the shelves.

Guacamole and avocado products are popular in the Southwest and the category is growing in the Northeast and Midwest. To get the products to new customers, Wholly Guacamole doesn’t enforce a minimum purchase requirement and will ship small orders to retail and foodservice customers.

“It’s just the right thing to do for customers to let them grow avocado sales,” said Jay Alley, vice president of sales and marketing for Wholly Guacamole.

Processing avocadoes is a labor-intensive process. The Wholly Guacamole plantemploys about 1,400 people. The plant is operating at about 50 percent capacity, so there’s room for growth up to a couple million pounds of avocadoes a week, Parnell said. The minimally-processed avocado are peeled, cut and scooped by hand, then the ingredients for the guacamole go through a minimal blending so they’re mixed but the batch isn’t smooth.

“We just want that chunkiness. We don’t want that creamy, processed look,” Parnell said.

Although there are machines that could do the work of many of the employees, processing the product by hand keeps it “natural” and not lets customers know they’re buying fresh avocadoes and guacamole.

“We could mechanize, make it creamy, use less people, but it’s just not the same product,” Parnell said.

What sets Wholly Guacamole apart from other guacamole manufacturers is the product is fresh, and year-round. Many guacamole manufacturers use acid-canning techniques, which extend shelf life beyond 60 days. The Wholly Guacamole products have a shelf life of 30 to 40 days for guacamole and 25 days for cut avocadoes.

“In fresh-cut that’s a long time, but in the old dip category it’s not that long,” Parnell said. “We keep our shelf life as short as possible so the flavor is at its best.”

The company is able to get a year-round supply because of the temperate climate in Mexico, where its source of avocadoes is grown. But because the avocado-growing region is so large, the fruit is grown in different climates, resulting in different flavor profiles. For a consistent taste in the Wholly Guacamole products, the company tests the oils

“What’s great about Mexico is it has a year-round crop. That’s paramount,” Parnell said. “The secret is the fact that we’re in the growing area with our own people and we’re in the growing area every day.”

Avocado production has continued to rise and it’s one of the only commodities to not see prices drop with increased acreage. That shows there is growing demand for the product, both in guacamole and in raw avocadoes, Parnell said. About one billion pounds of avocadoes are sold each year, with the biggest day for the fruit being Super Bowl weekend. Fifty million pounds of avocadoes are sold for that one day, enough to fill a football stadium end zone to end zone 19 feet deep, Alley said.

Part of the category growth has been the result of marketing programs by the avocado board and by individual companies, including Wholly Guacamole.

“It’s really increased the awareness of avocadoes and people are trying it,” Parnell said.
Consumers not only need to be aware of avocadoes, but how and when to use them. Wholly Guacamole rolled out the Guac Mobile in 2007, which traveled to football games and was in Pheonix for the Super Bowl. The Guac Mobile 60 feet long, truck and trailer included, that is used to educate and excite consumers on location. At one retail store that the Guac Mobile visited, between 50 and 60 cases of guacamole were sold, Alley said.

Wholly Guacamole is looking at ways to increase usage by focusing on the application of avocadoes. The company is looking at some cross-promotion with other fresh-cut products, such as carrots, because vegetables are a new and fresh way to use guacamole, Parnell said.

Wholly Guacamole, while in the Top 5 of the A.C. Nielsen refrigerated dip category, is poised to take over the No. 1 spot. Parnell said the company would take that spot in less than two years.

“I see our business growing organically at double-digit rates,” he said.

The company will continue to innovate, but stay true to its loyal customers and maintain its relationships with local stores, Parnell said.

“We want to stay in the forefront. We’re going to continue to innovate. It’s in our DNA and we’re not going to change that,” he said.

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