Berry Business Leadership — A Conversation With Garland Reiter Jr.

This copyrighted podcast is presented by the US Highbush Blueberry Council. The opinions and views shared by those of non-paid guests on the business of blueberries are those of our guests and do not represent the views, positions, or policies of the USHBC. Welcome to the business of blueberries, your source for what's happening across the blueberry industry. Here's your host, president of the US Highbush Blueberry Council, Casey Cronquist. Welcome back to another episode of the business of blueberries, the only podcast dedicated exclusively to the blueberry industry. Today, I'm welcoming Garland Ryder Jr., a first time guest to the show. He is the chief commercial officer for Driscoll's of the Americas and a fourth generation berry industry leader with a career spanning global markets from Baja Europe, the Middle East and Africa, playing a key role in expanding Driscoll's business of blueberries globally. Garland is known for driving innovation, sustainability, and strategic growth across the berry category. In his role, he oversees sales strategy, market expansion, customer development, and business solutions driving revenue growth across North and South America. Garland, thank you for joining me on the business of blueberries. Hey, Casey, how are we doing? Yeah, it's great to have you on the show. Thank you for joining me. I've been looking forward to having you on the show. I'm glad this has worked out. You've basically grown up in this space. For the audience who doesn't know you, have you talked a little bit about yourself, your background? Even for me, curious, was your vision to always be a part of this industry now being a fourth generation? Had you considered other career paths? Yeah, it's a good question and one actually I ask myself sometimes. If you look at my past 15 years within the enterprise, so when we say the enterprise, that would be on the growing side, working for a customer, and then more recently working for Driscoll's. I started my career formally within the enterprise and I went down and I was growing in Baja for about three years. My intention was to go down, learn how to grow for a year, learn Spanish, and then come back. That over time turned into three years because I learned that farming is really hard and you learn what not to do. It's about the smaller things and changing them from year to year. I really enjoyed my time in Mexico, somewhat speak Spanish. I've been losing it. Then I went up to LA and I worked for actually one of Driscoll's most longstanding customers, Valley Fruit & Produce, which is a privately held company. I worked for them for two years and I was doing some quality management and really starting to understand the dynamics of the wholesale market, which in the US is actually pretty fascinating. From there, I got married, moved to Europe and I worked in Europe for about five years. I absolutely loved it out there. The biggest takeaway I always share with people is Europe is very different than the US in terms of the market. Maybe not so much on the production side, but I got a look and feel of what we call product business management, led some supply and demand planning and then over time took over the strategic planning of our European business unit. From there, I took on and this was probably where our roads cross. I took on the blueberry roll. It was a new roll within Driscoll's. It's a roll that Gonzalo de Lozaldes has now, but really we recognized that blueberries were growing at a really rapid pace and it was challenging the ways that Driscoll's is organized. So I got to get in there and do a lot of fun stuff with the business. Then three years into that, I got the opportunity to come lead the commercial side of the Americas. I have very little to any commercial background, but I've been on a journey. Casey, to just summarize it, to really understand the value chain of the enterprise. If you think about it from the genetic side, to the nursery, to the production, to the supply chain, the operations, sales and marketing, I've had the opportunity as a family member to really explore and take the time to be hungry and fully understand all the different functions within the enterprise and how they complement one another. So that's my background and experience within Driscoll's. As relates to your second question, I'm a fit generation, actually technically fit generation. We reference more for generation because we're not totally sure some of the lineage of when the family started to farm, but Myles, Uncle Myles or Myles Ryder and my dad, they are kind of a vision for us and they never forced the next generation to get into the business. And I think it is really unique, especially in agriculture, where you generally see some of the patriarchs force the next generation into the business. And there's almost a sense of resentment and frustration with that. And so they've always challenged our next generation. Whatever you want to do, I hope it's something that you're passionate about and something that you love. And out of our next generation, there's four of us actively involved in the business out of the seven. My cousin, Bre and I both are actively involved in Driscoll's management. And the rest of them are on the production side of the business. One thing worth noting, Casey, I'm also a board member of Ryder Affiliated Companies. So I get to get the view and the perspective of the production side. And then I'm also obviously working on the Driscoll side. Yeah. Yeah. I mean, for our audience who may not understand that kind of relationship between Ryder and Driscolls, how would you just, in a quick synopsis, describe that? Yeah, it's not the first time I've gotten the question, obviously. So you have Ryder Affiliated Companies, which is a, that only produces berries for Driscolls. And I think they produce now about 25% of Driscolls global production. But that has a separate management structure, separate board. The overlap there is ownership. So our family owns 100% of that entity. And then we own a majority stake in Driscolls. Driscolls, on the other hand, has their own management team, their own board, different ownership structure, and they're really focused on three core elements, genetics, supply chain, sales and marketing. Yeah, that's very good. You know, I think it's important to, you know, maybe for the audience to understand a little bit of the history of Driscolls in relationship to Ryder and the production focus to a marketing focus, because it wasn't always a marketing organization. So maybe just for our audience to understand that, you know, yes, Ryder production, but that dynamic of change at Driscolls and how that took place. Yeah, I think, you know, so, and co-ops are around the world. And so if you wanted to distill it down, Driscolls was essentially a co-op with a group of growers of five major families that were sharing assets of coolers and resources, and then would ship the food out to the market. And actually, so you'd have a Ryder case wouldn't create in the market. A Driscolls wouldn't create a porter wouldn't create. And then over time, I think there's this shift in thinking and philosophy of, you know, well, there's a relevance in a brand. And because actually Driscolls started the first ever private breeding program, and I know we're going to get into that, but in the 1940s, which focus on strawberries. And so I think this, you know, investment on the R&D side, they needed to see the benefit on the commercial side of the business. So it was in the 1970s, KC, where they transitioned the fruit all under one brand, which was Driscolls. And that was the wooden crates that we see today. And then the evolution from the paperboard crate with the plastic that you see like the Driscolls across the side, eventually to the clamshell. So Driscolls evolved pretty rapidly when they started to see the value. And I mentioned it early on the genetic side needing to get that reward in the marketplace on the consumer side. And so this evolution from the 1950s to the 1970s of investing in genetics, they're pretty progressive on supply chains. So the first trains into San Francisco from Pajaro Valley, they started doing air shots from San Francisco to Chicago, and realizing that distribution would be a bottleneck. So the supply chain element that I talked about earlier, and then this kind of brand thing, right? And so I think it was a pretty progressive approach for those times, which strawberries and blueberries are still pretty commoditized crops. And so that early understanding of the value of a brand and then the genetics tied to it, coupled for a pretty powerful combination early on in the early stages of the berry industry. Yeah. And talk to me about how you see it as commoditized. When you say that, become either commoditized or are commoditized, how are you defining that? Yeah. So I'm on the commercial side of the business, as I said, right? And Driscolls will sell about 35% of the berry patch in the US on an annualized basis. Below that, there are a lot of small players. And that's not to say that small players aren't significant. In the blueberry industry, I think I'm really excited to see some of these smaller players focusing on high quality, because I think they're bucking the trend of this notion that berries are somewhat commoditized. But if you get produce as a whole, Casey, I asked a lot of my friends and family and others, like, can you name some brands and produce as an example, right? And the lack of knowledge or reference of a brand in our space, I think is a fair representation that people just view it as a strawberry or a blueberry or a raspberry or a blackberry, right? What Driscolls does, though, on a daily basis, my principle part of my job is to try to share with our customers the importance of focusing on the consumer. The importance there and how you get that message to a consumer is by branding, right? And so sharing with them the value chain of we invest on the genetics, we invest on the supply chain, we invest on the brand, so that when the consumer, if we can earn that shelf space, to just have that moment where the consumer can pick that clamshell, they eat it. And you've said this on your podcast, my uncle says it as well, the job of the first clamshell is to sell the next clamshell. The power in that is to buck the trend of commoditization and to really elevate this category as a whole is absolutely critical. And so for us, I think we need to watch out that we don't get overly commoditized. And I think blueberry is actually a really good case study on where this industry is going to go one way or another. I think influencing and educating both growers and retailers of the importance of elevating the eating experience, the category as a whole. And the best way to do that is try to have a conversation with a consumer, whether it's marketing or then eating the food, having that experience that they want to go back and get a bigger share of their wallet. So for us, it's the brand because we have a brand, but in others, it's relationships with retailers and having a conversation about new varieties, how to position in store. But I think it's super important for blueberries and something to be cognizant as this growth, which will come, doesn't cannibalize the opportunity that we see in the marketplace. Well, and that opportunity, as we see it, and I know you guys are looking at this same information, is that that definition of commoditization tends to come also when you've peaked, you've hit a production number that essentially the consumption or the demand curve can't absorb and things become increasingly commoditized, if you will. Casey, just on that though, I think it's a really important point. The best-in-class retailers that we see in the marketplace, blueberry sales are now exceeding strawberry sales. And if you extrapolate that out and you ask those retailers, what are you doing differently on your product offering than others? It's generally speaking, they're really focused on execution. So how are they merchandising? How are they positioning the product both digitally and in store? And then secondly, they are hyper focused on their supply. So they're really working with their suppliers. I only want the best of the best. And so anyone who's listening, go to the best-in-class retailers and there is a large spread of not only what quality of product is in store, but also the level of execution taking place in store. And I know your guys, mantra is blueberries to become the world's favorite fruit, if I'm not mistaken. Yep, you got it. It's happening and there could be an outcome here where blueberries are the single largest item in terms of produce sales in 10 years. Now, blueberries have a little bit of a head start or there's a benefit because there's a higher on shelf value. It's just more expensive to produce than a strawberry. So the units won't be higher than then blueberry units won't be higher than strawberries, but consumers are willing and wanting to pay more value for that fruit than any other product. I mean, it's super exciting. I think it's happening. But back to the commoditization piece, we need to make sure that we're having those conversations with retailers and with consumers educating them on the benefits and why this variety at this store is different than the other one. And so I do understand and recognize the challenges that retailers face where you have to go invest in this supply and the quality of supply while still being competitive on your price points, right? And that's why this premium segment of the business is growing because I think a lot of people are realizing you do need to create more value on the consumer side. But it's just to say it's not as easy as, okay, we need better supply and everything's going to be great and the genetics will change everything. The retailers need to take a leap of faith, right? And I'm seeing it, I think the whole industry seeing it, but the bottom of the barrel generally dictates the pricing conversations that are taking place. And so it's buoyed and actually weighs down a lot of the conversations that we have, right, broadly with customers. And that's really my reference on commoditization where if you have public genetics, whether you're in strawberries or blueberries, those tend to be the price points that start the negotiations. And then it can be a challenge to go get the price point you want and then have a competitive price with the consumer as well. Yeah. And I know you at Driscoll's, you've had what was certainly innovative at the time, the Swedish batch concept, seasonal limited supply. But this year was something different. It was the first year I'd seen Swedish batch show up at my Costco. And I thought, this is a good conversation to have because you're starting to see the elevation of the game become something that is more ubiquitous to the consumer in quantity. So I wanted to talk about that because I think that's what you were saying. It's like, man, we're raising the bar, people are getting excited about what's coming out there. And the Swedish batch seems like a good example of what you have been doing at Driscoll's to share and talk a little bit more about attempting to make that shift in a differentiated clamshell and seeing the response you're getting. Yeah. I mean, Driscoll's focus on the premium segment has, I think, really been around for about five years. We actually ironically started with Jumbo blueberries and then have transitioned to a more flavor-oriented focus. And we see it in the data that resoundingly consumers flavors the number one purchase driver. And so it was a solution, and I think Soren's talked about this, but it was a solution commercially to a variety that was not overly productive in Iran, meaning with the kilos we were producing and the cost, we couldn't sell at a conventional, what we call yellow label price. So our standard product offering. And so we really focused on, well, how if we're going to offer an elevated flavor experience, we have to have the right brand and the right packaging. So it needs to pop a little bit. And it's been a lot of fun. It's been definitely a journey for the organization. And the reality is we're seeing increasingly consumers are willing to pay for an enhancing experience. This applies not only to blueberries, but across the berry patch. So we're doing it all four berries. But you can make a lot of analogies with grapes with citrus in all the major categories in fresh that are growing are actually the ones that are on the forefront of bridal innovation. And so with that, we're really excited about the prospect of Swedish batch. But I will say, Casey, there are some pitfalls that you can get into the more value you create there, the more inclined growers are to put more and more fruit into that. And so it can be somewhat of a vicious cycle where you create a really unique eating experience. You try to get it to expand the windows. It starts in one area. Now you have four or five or six different production areas doing it. You expand it to multiple varieties. And then the product quality can get diluted. And this is a principal role that Driscoll's plays in our value chain where we have growers on one side who are partners. We have more than 900 growers around the world. Driscoll's doesn't grow much, if any, fruit for ourselves. And then you have our customers. And at times I feel like we're the referee on what should be placed into that product on the Swedish batch side. And unfortunately, we find ourselves increasingly trying, we need to continuously elevate Swedish batch. Right now you see a lot of competition coming in with jumbos with premium plays on all the different berries. And so our idealistic outcome of Swedish batch is that every year it's getting better and better and better. And by that way, we're enhancing our yellow label, which is our core offer. And so in the future where we could see the best outcome for Driscoll's, it's that our yellow label, our standard product offering is actually a premium product compared to Resta Market. And then the Swedish batch offers a really unique eating experience. To Costco in particular, I think we are excited about the adoption of Swedish batch in a format like Costco that is generally very focused on minimizing SKUs. But if you see a Sam's Club or a Costco or these major, major retailers adopting this premium segment within their product offering, I think it definitely shows that there's a long runway for consumers willing and wanting to pay more for produce. Yeah. No, it was interesting to see that play out because as you're describing, it is this scenario of when the premium becomes the general offering and then you've got to have the premium premium. And I've talked to court about this too in terms of what's next because what goes in the clamshell that is that elevated experience, it becomes super premium, super, super premium. And it's what makes this really exciting. But I heard you say it's what makes it super challenging. Yeah. I think there is going to be a little bit of a reckoning in two to three years on the premium segment. And you've already seen it now, Casey. I know some retailers are amplifying their specs. So it's 20 mil plus. They're becoming far more discerning about what varieties get in, which ones don't. And I think my personal opinion, I think that's great because that means that the standard offer that are going to be offered to the consumer is going to be elevated because not all the, in our case, Rosita or Rami or Rana or in some of our competitors, Sequoia is not all the pop is making it in there. That means that a lot of those varieties are making it into the core offer. That's a way we're going to grow this category. If you look at the UK, they say about 15%, which has had a tiered offer for a long time now, about 15% of all sales in the UK are in this premium segment across all berries. And that's, I think, where the US will end up. That means 85% of the other sales. We need to focus on elevating that because if you just elevate the premium segment, I don't think we're going to grow the category very much. I want you to spend a little time there because you were saying something that I want to catch our audience up. Some will probably be familiar with what you're talking about, but I just want to put a fine point on the tiered offering. But when you say there's a tiered offering in Europe, maybe you could talk about what that looks like. And it's not just Europe that has this, but I think for those of us in the US who don't know tiered offerings like that, it would be important for you to kind of describe what that looks like and then how you're backing into this focus. So the UK and actually Europe as a whole has had a long history with berries, right? They call soft fruit. And so there's big history specifically on strawberries really in Spain. So they've been eating berries for centuries, specifically strawberries. And the UK, they consume a lot of strawberries and a lot of berries now. It's one of the highest indexing European countries in terms of total berry consumption. And so you have this rich history there in the UK. And then you combine that with predominantly, if not entirely, private label, right? And so a way that retailers had distinguished their product offering there in the UK is they offer tiers. Generally speaking, it's three tiers, which to me is a little confusing, but to three tiers, you have your super premium, your premium, and then your standard offer. And so over time, they've been building out on all the other berries, raspberries, blackberries, and blueberries, this tier offering to the marketplace. And so if you aggregate across the berry patch and you look at total consumption on that, it's called upper mid tier to top tier, about 15% of berry sales are sold in this premium category. I think it's great, it offers consumers options and you can tell actually how educated they are. They'll know some of these varieties, they'll know some of the regions, they're offered both in the local season and in the counter season, right? But I think in the US, when you take those numbers and you look at what the opportunity is here, I think maybe we'll get around there. We see some of the more higher end retailers over indexing on 15% and then you have quite a bit of retailers not offering any of the premium. But anyways, that's the structure there in Europe. And it's something that we've been watching and it's relevant for our thinking here in the US. Yeah, absolutely. And at conversations with others, it's kind of like when does it arrive here? Do you ever see that tiered approach becoming more culturally the norm or do you see the continuation of the standard pack and the consumers have to be the educated party to try to differentiate based on? I think it absolutely will become structurally embedded within the US retail environment if the consistency in the eating quality is there. And I think that's a really big if because you have this kind of see-saw effect and we see it all the time where, oh my gosh, we're getting 2X the value in the marketplace. All of a sudden, every grower and every competitor wants to jump into that space, right? You overproduce, you created not an overly differentiated product and then that unique eating experience isn't there. And I'll give you an example recently with raspberries. We're constantly trying to elevate our sweetest batch offering. And when weather doesn't help, like here in Northern California and it's cloudy, it's overcast, we're not getting the bricks level, we're not getting the flavor profile, we got direct customer and consumer feedback that we simply weren't hitting those thresholds, right? But we were still getting those returns. And so we had to go back, tweak it, push more volume out of the system. And so it will only be there if the producers and marketers can recognize that it has to be a truly exceptional product. And I think also Casey, I hope we don't over complicate these things because I think there's so much opportunity to grow our base of the product that the blueberry offer specifically, that if we overindex our focus on the premium segment, I think it's actually going to dilute around the needs to just elevate our organic and our conventional offering. That's good. Yeah. No, I can appreciate that. And I think that's a great answer because I'm having a hard time imagining when the adoption of something, even for those retailers that you're working with who really want to limit their SKUs, it seems like it would still be a long way out before you see kind of that tiered traditional approach that you see in Europe come here. I think as we kind of wind down here, I want to kind of land on this new recently launched campaign that Driscoll's has that you could help us understand the one family, one earth. And that launch, what does that mean? And from your perspective, where is Driscoll's taking this? We've generally been focusing. Delight is a term that is core to what everything Driscoll's does. So our mission is to continually delight berry consumers through alignment with our berry growers and our customers. So we've been very focused on broadcasting that message to consumers. Increasingly, what we're seeing is a desire to get more transparency through the value chain, specifically on Gen Z and the younger generation. Driscoll's does a lot of activities, whether it's the communities, some of our water efforts, sustainability. We are putting serious resources against this and we're a privately held company. We're going to be a privately held company for a long time so we can invest in these types of initiatives. Traditionally, we have not broadcasted them. So we have not had a formal conversation with the public about some of these initiatives. But one family, one earth is our first stab at creating some campaigns about being more transparent about what Driscoll's is doing. And so it's kind of fun to see these initiatives, whether it's soccer field in here in Pajaro Valley, some of our focus on water and minimizing water usage. And so it's our first attempt to really create a narrative, a progressive narrative with our consumers about what Driscoll's is focused on. As you know, Casey, a lot of these campaigns take a ton of money and resources, not only to initiate these campaigns and have them keep going, but also craft that message, put it in content that's relatable and desirable by consumers, and then finally broadcasting that out to the consumers. So we think this is not only about the attributes of the fruit, but it's how we're getting that fruit produced. And we see that that for consumers is really, really important. So I'm excited to see how it evolves. I think you'll see more of this from Driscoll's, a beard stomp who works in Europe. He coined it kind of delight done right. So making sure that we're doing the right things in the communities and we're thinking about sustainability. So yeah, hopefully you'll see some more stuff out in the coming years that are help sharing some of these initiatives that Driscoll's has in place. Excellent. Well, this has been a great conversation. I really have enjoyed sitting down with you and just learning first more about your background, your passion for the deal, and the focus you have on the future. And I think that's going to be a lot of the takeaways probably from our audience is just the ambition behind what's to come. And we certainly resonate with that here at USHBC. We look at a lot of the same consumer information that we give to you industry. They can see this opportunity that's still ahead for the category. And so it's great to have you on the show. I also want to acknowledge, it's great to have the support of Driscoll's as part of the memorandum of understanding that NABC has that ultimately comes over to the USHBC for that added marketing push, if you will, that's needed out there. And we're continuing to do that on behalf of everyone. And that does go a long way. It's helped us that retail conversation we're having that I'm able to share is because we have this additional resource that got us into the retail space to be having those conversations and participating in those kinds of campaigns. So I wanted to acknowledge your leadership on that as well. So thank you very much. As is the tradition of this show, Garland, you may already be aware of what's coming, but I do need to ask and clearly you've been around a lot of varieties and at the forefront of some of the ones that have made a name for themselves. But it's always important to ask, what is Garland's favorite variety? I'll answer that question if you want to answer that question. How about that, Casey? Maybe offline, I would like to hear your honest response, but you have to be very diplomatic. I on the other hand, do not. So I think it's actually, I wanted to mention this question in two ways. One, I'll answer the variety side. Secondly, effectively, when we talk about varieties, we're talking about B2B, right? And I think that is critical. I mean, that buy-in on that B2B side is what will enable the growth of this category. But if you think about it from a consumer lens, because I thought about this question coming into this, and I was like, I wonder how many consumers I could ask this question to who could actually give me a viable response. And so I would answer it on the first side is say, what brand would consumers recognize that do a really good job? Because I really think that's what we need to strive towards as an industry. And there are a lot of people doing it, and I'm super excited about it. We invite the competition as Driscolls because this category has a lot of runway, and we're excited about building it. But I would just say, I think like Family Tree Farms would be a great example of a company that's pioneering flavor and texture and thinking about really the consumer, Renier does a great job, got to put in Driscolls in there as well. But I think that's my honest answer from the consumer lens is I think we need to look outside just our industry at times and think about really the end users. But the real answer to your question is there's five varieties. All I did for three years was blueberries. And it was pretty fun because I got to meet with a lot of our competitors, look at a lot of breeding programs. So my first one Eureka Sunrise is just an incredible piece of fruit. The combination of texture and the balance of that flavor and that piece of fruit is really quite exceptional. The second one is Byfall Creek, I think Crunch, which is probably out in some stores now. That is a phenomenal piece of fruit, and I have to give them quite a bit of credit. The other three, so we have Rosita and Raimi. Those are Driscolls varieties that do feature in the sweetest batch, very different profiles of fruit and can be produced in some areas and not in others. And then the last one would be Arana for Driscolls. But what I'm most proud about, Casey, is that very few people will probably know those varieties because we don't go out and we don't promote Driscolls varieties. We are there to promote the brand and whether it's the yellow label or the sweetest batch. And so we don't go out and promote the varieties. We're there to try to promote the brand, which for the consumers, the most critical way to it all. But five varieties, I'm not sure if that's cheating, but that's my honest opinion. That's cheating. That's cheating. But it's hard. And I've said this to other guests who are facing similar challenges and identifying one over the other. It's like picking your kids. And this is what's kind of fun about it is like, what mood are you in? Even in my fridge, if I have the right varieties in my fridge, I know enough now that I'm going to pull this one because it's the afternoon and I'm looking for a little pop versus where I'm at in the morning. And so not everybody, of course, appreciates that. But man, I resonate with some of those choices. Garland, thank you for jumping on the show with me today. It's been a pleasure. We're going to have to have you back. There's a lot more that's going to take place in the years to come. But I appreciate hearing your thoughts on that and having this time with you. So thank you. My pleasure, Casey. Excited to see the trajectory that blueberries are on. I think this is going to be, I think the next four to five years for this industry are going to be really important ones. So I always joke around. And Driscoll's, I'm not supposed to have a favorite berry, but blueberries is pretty high up there. So I appreciate you saying that. Well, that's it for episode 218. Thanks so much for listening. We'll be back next week with more innovation, collaboration, family, and hard work right here on the business of blueberries.