When just about everyone is losing money, which happens in every sector of agriculture at one time or another, it’s easy to lose
faith.
It’s a rare person who has the acumen and nerve to turn bad times into an opportunity.
Glenn Cooke is one such person. Twenty-two years ago, he was fresh out of high school and hoping to find work to keep him in his tiny hometown of St. George, N.B., on the Bay of Fundy.
Today, along with his brother, Michael, and father, Gifford, he runs the fifth-largest farmed salmon company in the world.
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The Cookes are obviously smart fellows, but Cooke Aquaculture would never have grown so big, so fast, if salmon farming was an easy business in which to make money.
“You look at the salmon business and there’s been a lot of failures and a lot of money lost,” says Glenn Cooke.
“We saw the need to grow, so as people wanted to leave the business, we’ve bought them. We’ve ended up buying a fair amount of bankrupt companies through the years and turning them around.”
The Cookes started with one marine cage and 5,000 fish with help from a government grant. Many Maritimers did the same and were good at raising fish, hatching smolts or processing.
But being good at production doesn’t guarantee profitability. The Cookes got plenty of chances to test their philosophy that “opportunities are often disguised as problems.”
Their first major acquisition was a bankrupt hatchery and their second, a processing plant in receivership.
Whenever they heard of a company in trouble or owners wanting to get out, they took a look.
Their relentless expansion took a quantum leap in the early part of this decade when salmon prices hit historical lows and their three largest rivals in Canada threw in the towel and sold to Cooke.
“For example, when we bought Heritage Salmon from Weston Foods, we found a report to the board of directors that said, ‘Salmon farming would no longer be profitable once the dollar hits 80 cents’,” recalls Cooke.
“Well, when we bought, the dollar was already 88 or 89 cents. But our attitude was that was just putting your head into the sand and giving up.”
Of course, the dollar has con-tinued to climb – the rise in 2007 alone reduced revenues by $30 million – and so the drive for more efficiency is endless.
Customers were asked to take larger packages, which saved on packaging costs and labour.
A newly purchased feed mill was made more efficient, raising annual production to 65,000 tonnes from 45,000 annually.
And the company’s fish behavioralist improved feed efficiency by six percent.
That last point deserves closer examination. Who even knew there were fish behavioralists, much less that they worked for fish farms?
Actually, Cooke knows of no other company that has one on staff. But in 2007, he definitely earned his keep. That little six percent gain in feed efficiency will save $5 million annually.
Hiring smart people is the foundation for the Cookes’ belief that every business can be run more efficiently.
Quitting was never an option.
“There’s no way I’m ever going to put my head between my knees and say, ‘that’s it, I’m done,’ ” says Cooke.
“I know there are lots of producers, like in hogs, that are in the doldrums now. But I’d say to them that if you can be creative in what you do and how you do it, any business can be successful.”
Cooke has signed a letter of intent to buy a Chilean company that, if finalized, will boost production to more than 90,000 tonnes, push annual sales beyond the $300 million mark, and move Cook Aquaculture into the No. 4 spot worldwide.
It is an astonishing success story, especially for an industry that has seen so many businesses go belly up.
But it’s also a lesson that even in hard times, opportunities await.
More information on Cooke Aquaculture is available online at www.cookeaqua.com.
Glenn Cheater is editor of the Canadian Farm Manager, the newsletter of the Canadian Farm Business Management Council. The newsletter as well as archived columns from this series can be found at www.farmcentre.com.
