A juggling act | Managing goods and people
REDCLIFF, Alta. — The new warehouse buzzes with activity. Forklifts toot their horns. Equipment chugs and whirrs. Bright lights illuminate new concrete. Conveyors transport brightly coloured vegetables to boxes and pallets.
And eyes follow Lyle Aleman.
Red Hat Co-operative Ltd. packages and ships fresh vegetables from its 40 active greenhouse operator members. It’s Aleman’s job, as general manager, to make it all work.
On this day he quickly steps a visitor through the 43,500 sq. foot expansion, one of many the operation has seen since its 1966 start on the edge of Redcliff.
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Now with almost 100,000 sq. feet of space, the facility is better able to handle and ship cucumbers, tomatoes, peppers and lettuce from southern Alberta growers to customers that include the big boys in retail food: Loblaws, Costco, Sobeys and Co-op.
Some of the 200 workers watch Aleman as he stops to assess the culling of English cucumbers or the packaging of bell peppers. It doesn’t appear that he misses much, as he stoops to pick up an errant tomato from the floor or speaks to a worker about conveyor speed.
“Our main market is Western Canada, so we are shipping to B.C., Alberta, Saskatchewan and Manitoba, but we do ship some into the U.S. and into Ontario and Quebec,” says Aleman as he steps from the path of a forklift.
A new cucumber packing line, purchased from Holland last fall, is a point of pride that warrants a pause in his pace.
The equipment has reduced handling and stress on employees with its ability to wrap, grade and pack the long English cucumbers, which are one of the co-op’s big sellers.
Cukes and tomatoes make up the bulk of production, but within those broad categories are long English, mini-cukes, beefsteak tomatoes, tomatoes on the vine, grape tomatoes, cocktail tomatoes, sweet bell peppers and sweet long peppers in addition to eggplant and butter lettuce.
Each product has its own special packaging, its own handling requirements and its own customer demands.
Small wonder Aleman walks fast.
“Our volume has doubled in the last 10 years,” he says.
Red Hat implemented efficiencies five years ago to delay the need for expansion and its related expense, but demand caught up.
“Last year we hit that wall. We knew we had to expand our facility. Right now we’re doing about five and a half million cases a year.”
Red Hat used to handle only three commodities, but now it has many, each requiring specialized equipment. For example, peppers used to be sold in bulk, but bagged peppers, including the “stop light” three-pack of different colours, are now more popular.
The Red Hat sticker goes on some produce, but some customers want it packaged with their own labels. The co-op complies, assembling all the boxes and employing traceability on every lot.
Aleman says the co-op has numerous advantages for growers, primarily in the way it handles sales, packaging and shipping, which allows them to concentrate on food production and quality.
“I think it’s always worked well,” says Red Hat president Albert Cramer, who grows cucumbers under 15 acres of glass near Medicine Hat.
“It’s been very good for the growers. We’re in a global market and the stores play with us and they play with big growers.”
Working through a co-operative gives growers more clout, he says.
Aleman elaborates.
“The benefits of the co-op right from the beginning is that all your growers can market under one brand and they can supply retail customers that are large, that are national in scale.”
He also points out the advantages of volume buying of fertilizer and other inputs, and the sharing of equipment costs, research and labour.
Aleman says despite recent improvements at Red Hat, it has been a challenging year for members because of lower commodity prices generated by overproduction in other countries and other parts of Canada.
Mexico, which used to provide seasonal field-grown product, is becoming a larger player, and expansion in British Columbia and the United States is also pressuring prices for Red Hat.
Then there’s retailers’ demand for new product, such as the mini-cukes that made their way into snack foods a few years ago.
“The retailers are looking to us for innovation, so they are looking for new products and new packaging that kind of sets them apart,” says Aleman.
“It kind of puts the pressure on us as marketers. The challenge is to predict the demand for the next year, so that’s our job. We evaluate the marketplace, we evaluate what we think is going to be the big mover next year.”
That, in turn, creates challenges for growers as they make planting decisions that may not bear “retail” fruit for months down the road.
Aleman says Red Hat receives some benefit from consumers’ growing demand for locally grown food, but it doesn’t have a great effect on the price that the co-op can demand.
His hope is that more Alberta greenhouse operators begin to run their operations year round rather than halting production in winter. That will provide a consistent flow of product, helping retain retail customers.
“Hopefully we can have our growers invest (in lighting technology) and be able to supply product year round for our consumers, that’s grown right here in Alberta.”
However, that will also mean Aleman will have to walk even faster.
