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Commonwealth Dairy expands ahead of schedule to keep up with demand for its yogurt

BRATTLEBORO—Commonwealth Dairy expected to add 50 jobs in its first five years.

Since starting operations in 2011, the fledgling yogurt company employs more than 80 full-time workers and additional temporary staff.

“We definitely blew that one [estimate] away,” said Benjamin Johnson, chief financial officer with Commonwealth.

He credits the company’s quick growth to market demand and, overall, a good sense of timing.

Commonwealth announced on Nov. 1 that it received $12.2 million in financing. According to Johnson, the funds are a combination of tax credits, a bank loan, and the company reinvesting its own capital.

The company will use the money to expand its processing facility, said Johnson. The addition will add about 24,000 square feet, representing a 60 percent increase to its physical footprint. The company also plans to add 34 more jobs.

“It will allow us to become a more efficient producer,” said Johnson.

Johnson said that the new construction, which began last month, will upgrade the facility on all levels.

One improvement will decrease the plant’s need for municipal water by altering how it handles a byproduct of yogurt production, whey.

Using reverse osmosis, Commonwealth will separate the whey from the water in milk. The whey will help feed local livestock, while the water will recycle back into the facility.

With Act 250 and building permits in hand, the construction process has kicked into full gear. Johnson said the completion date is April 2013, but that the company hopes for an earlier wrap.

Commonwealth formed in 2009. Massachusetts-based Johnson and his business partner, President Tom Moffitt, worked in retail before jumping to yogurt. According to Johnson, the men saw an opportunity to grow a yogurt business in New England.

Johnson and Moffitt decided to build a company “we could believe in.” To help with financial backing and expertise, they partnered with Bavarian-based yogurt company, Ehrmann.

According to its website, www.bavariangoodness.com, Ehrmann is a third-generation, family owned business. The company wanted to branch into the American market.

Americans consume about five times less yogurt than Europeans, said Johnson. The yogurt industry considers the U.S. an emerging market.

100 million pounds and counting

Johnson said the demand for Greek-style yogurt has climbed for 20 years and jumped in the past five years.

Commonwealth needs more local milk to meet demand, he said. The company will continue to work with local farmers and co-ops to source milk. Commonwealth works with two co-ops, Agri-Mark, headquartered in Lawrence, Mass, and Dairy Marketing Services, with offices in St. Albans.

According to Johnson, the facility processes 100 million pounds of milk a year.

“We believe that this growth will continue,” said Johnson.

Johnson said a community’s quality of life rises up or sinks down depending on the availability of “good, solid jobs.”

Finding qualified workers has proved challenging at times, he said. Not many people with the dairy experience Commonwealth needs live in southern Vermont.

“We invest a lot of money in our people, but we believe it’s well worth it,” said Johnson.

According to Johnson, the company has invested time, energy, and money into training new workers, even sending employees to Commonwealth’s partners in Germany for experience. It has also “cast a wide net” expanding employment searches nationally and internationally.

“[We have a] pretty talented and robust workforce,” he said. “We just have to continue to get them the needed training.”

Creating a workplace where people want to be, where they feel respected, and where they have opportunities for growth underscores Commonwealth’s employment philosophy, said Johnson.

Understanding dairy

When Johnson and Moffitt decided to launch their company, they expected to make “private label” yogurt for other entities and retailers. In addition to producing yogurt for Ehrmann, the company also produces yogurt under the label Green Mountain Creamery, greenmountaincreamery.org, available statewide.

“[Commonwealth] wanted to find a place where it felt the community understood us,” Johnson said.

The business partners scoured the Northeast for the right fit. When they reached Vermont in 2008, he said, they found a state with the desire to grow its dairy industry.

Vermont also understood the work behind value-added dairy products, he added.

Johnson believes food manufacturing suits Vermont’s economy and communities. Food production in general is rarely outsourced.

The state has continued to support Commonwealth as it has grown, said Johnson.

The new market tax program also figured into the company’s plans. The census drives where the program can operate. Brattleboro had an eligible tax zone, he said.

Johnson has heard of Vermont’s anti-business reputation. But he said he doesn’t agree with the “overarching statement.”

“We are insulated because people can understand at some level that we are supporting what they want to support,” added Johnson.

Dairy is a different kind of business, said Johnson. The company has interacted with every level of Vermont government, from the Brattleboro Selectboard to the state’s Congressional delegation, and he said he feels representatives remain open and available.

Credit also goes to Jeffery Lewis, executive director of the Brattleboro Development Credit Corp., said Johnson.

Johnson praised Lewis’ “vision” and skill for seeing through the cloudy haze surrounding large projects.

Lewis’ support is a big reason Commonwealth continues to grow, he said.

At the local level, Commonwealth has worked closely with Brattleboro’s Public Works Department and town officials. The manufacturing of yogurt impacts the town’s overall infrastructure such as the water and wastewater systems, he said.

“People in Vermont are very interested in their local environment, agriculture, and sustaining this way of life [like working farms],” he said.

Johnson added that a higher tax burden is part of doing business in Vermont, and Brattleboro specifically. Commonwealth addressed this issue early, he said, working with officials to offset the tax burden.

“It’s all about communication and, although the phrase is overused, being a decent corporate citizen,” Johnson said.

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Originally published in The Commons issue #178 (Wednesday, November 14, 2012).

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