Stonyfield Farm Founder and CE-Yo Gary Hirshberg Talks about Building a Responsible Business
Epcot Center might seem an odd place for the birth of an organic yogurt company — especially one based in frosty New Hampshire. But it was while in Epcot’s Land Pavilion, which was sponsored by Kraft, that Gary Hirshberg — who at the time ran a Cape Cod institute that researched organic farming — had the epiphany that changed the direction of his life. “It occurred to me that while 25,000 people might visit my institute every year, that same number was paying to go in there each day,” he said. “I said, ‘I’ve got to become Kraft.’ That was where, twenty-five years ago, Stonyfield was born.”
Hirshberg, the president, chairman and CE-Yo of Stonyfield Farms, told this story on April 9 at SOM in a talk sponsored by the Yale Center for Environmental Law and Policy and the Gordon Grand Fellowship. In his own way, he lived up to his vow: “Fourteen years to the day after visiting Epcot, Stonyfield passed Kraft in sales of yogurt. Now, we sell six times as much.”
Stonyfield’s ambition, Hirshberg told the audience, was to do good while doing well. As the business has grown, he’s become a leading advocate for a more sustainable form of business. He said that his dedication to the environment comes from his upbringing in New Hampshire, where his parents worked in shoemaking factories. The plant dumped its waste into the adjacent river, which used to turn different colors from the shoe dyes. As a child, Hirshberg found the sight pretty. “But when I was adolescent and the river caught on fire, I started to figure out that maybe things were amiss,” he said. “As a boy, I also used to summit Mount Washington, where you could see 60 miles to the Atlantic on a clear day. It’s something no one’s seen in 30 years, because it’s downwind from everything bad.”
The story of Stonyfield has already attained legendary status. Begun with seven cows, it’s grown into the world’s largest producer of organic yogurt. After a rough first several years, the company took off, boasting a compounded annual growth rate of 26.3%. Stonyfield has a tiny advertizing budget compared to its rivals, relying on word of mouth and messages. “I call it our handshake with the consumer,” he said. “The moment we stop improving what we’re doing, the handshake weakens. If I deliver, the consumer does my marketing for me.”
Stonyfield pledges to use only natural, organic ingredients, while conducting a business focused on doing as little harm to the environment as possible. This has created some challenges as the company has grown. But Hirshberg said that despite getting larger, Stonyfield has managed to actually decrease its carbon footprint in recent years, whether through tasking the logistics department to find ways to make the operation run in a more environmentally-friendly way or by building a waste treatment plant that pollutes less than traditional models and can harness excess methane to create power for the yogurt making.
All these things, Hirshberg said, makes Stonyfield more profitable. But ultimately, he said, his goal isn’t just to be successful as a businessman, but to help change the way we treat the earth. “We don’t respect the earth, we just see it for the taking,” he said. “The question I asked myself when I started was whether we could build a business that’s part of the solution to these problems, that’s the anti-Kraft. The answer has been unequivocally, Yes…No less than Wal-Mart, Kellogg’s, Kraft, and Nabisco are running into this space. They don’t want to be left out.”
Listen to or watch Gary Hirshberg discuss the rise of Stonyfield from a seven-cow farm to the world’s largest producer of organic yogurt.