![Farmer Bros [ticker: FARM] President and CEO John Moore has 30 years of coffee industry experience](https://www.twst.com/wp-content/uploads/2024/11/John-Moore2.jpg)
John Moore, President and CEO Farmer Bros [ticker: FARM]
“We are a coffee roaster.
We source coffees from all over the world.
We do our roasting in our Portland, Oregon, manufacturing facility.
We’ve been in the coffee business now for more than 100 years.
It was founded in 1912 and encompasses a few different brands, including Farmer Brothers, Boyd’s Coffee, Cain’s, West Coast Coffee and China Mist Tea.
We’re in the midst of what we refer to as a “brand pyramid strategy execution.”
So, we’ve got in our commercial and traditional tier, the Farmer Brothers brand of coffee products, as well as Cain’s. In the premium coffee tier, we have Boyd’s Coffee.
And then we’ll be launching a specialty coffee brand in this next few months and going into the remainder of the fiscal year.”
John Moore has been a coffee industry participant for many years.
“I’ve been in coffee now for about 30 years.
And I think if you go back to the 1980s, you would really see a very different consuming pattern when it comes to where consumers would go to get their coffee.
It was much more driven by the local café, diner or restaurant that was known for serving quality coffee, maybe a donut shop.
Whereas today, if you think about how coffee is available to consumers, it’s been democratized in such a way that you can go to a gas station now or a convenience store.
You can go to a grocery store and there may be an espresso bar inside of a grocery environment serving quality coffee.
You obviously see the coffee aisle in your grocery store.
And whereas it used to be a very small couple of shelves, now it can be an entire row of coffee offerings in a grocery environment.
And then, of course, you have the rise of the quick-service environments where coffee is served now through drive-thrus.
You have specialty chains like Starbucks and Dunkin’ and others.
And you really see the rising tide phenomena in coffee over the last 30 years.
So, you see, yes, the traditional bastions of coffee like the neighborhood diner and the restaurants and the cafes.
Many are still there, but it’s now augmented with these other channels to market and access points for consumers to really experience coffee on their terms and define how it is they want to enjoy their coffee experience.
And without fail, in today’s day and age, they’ll most likely be able to find, within their community or area, coffee in a way that meets them where they want to be.”
Coffee is a way of life for John Moore. His strategy is to nationalize the local Farmer Bros coffee brands.
“Farmer Brothers was the supplier to the cafes, the diners, the mom-and-pop operations where people were getting their coffee from the dawn of the last century all the way through the 1980s and up until today. So, you still find Farmer Brothers being served in all of these types of operations.
I would argue that in the last 10 years, Farmer Brothers has gone through some pretty significant change, and that we’ve really started developing beyond just the areas where these brands were known. Boyd’s Coffee, for example, being an Oregon-based brand initially and then kind of growing through the West Coast. In the last year, we’ve really made a concerted effort to take that to the entire country.
And that’s one of the things we were celebrating in our last shareholder’s call. Boyd’s is now, for us, for the first time in its history, going to be offered nationwide and really pushing that out to consumers where in the East Coast throughout the Midwest they may not have known the Boyd’s brand before. Going forward, they will really have access to that brand.
Similarly, Farmer Brothers, in that more traditional tier, had really been a West Coast-based brand. It grew out of California and then started to find its way East. But because the company grew through a series of acquisitions, these brands were somewhat limited to the areas from which they came.
Other brands that had been acquired over the years were more prevalent in the Northeast or in the Southeast. But again, in the last year, we’ve made a concerted effort to distill down these various different brand expressions into just a few core brands so that for the first time in our history, we’ll be able to leverage our scale and the size of our network more appropriately.
So, I think Farmer Bros (NASDAQ:FARM) has really grown and been dynamic as these trends have developed.
And now what’s exciting for us, for the first time in our history, we’re able to actually bring the brands that we have in a more curated format to the areas all over the country that may not have seen these brands before.”
Farmer Bros has an increasingly profitable future according to John Moore.
“I think investors should know that the company is a solid company right now.
You know, we’ve just reported about $341 million in net sales.
We went through a transformational transaction just over a year ago that really refocused the company in a very healthy way, refocused the balance sheet, put us in a healthy trajectory to get back into our core business again, which has been DSD — direct store delivery — where we manage the relationship.
Our white glove service that we provide to our customers around the country is appreciated.
We have distribution centers around the country, a branch network that is very strong, about 80 branches that are spread from coast to coast.
We have about 250 routes of representatives that are out as the face of the company, providing a service that involves everything from managing inventory, rotating stock, calibrating machines, cleaning machines, making sure that the customers’ coffee program is on solid footing and represents the company.
Essentially, we enable our customers to realize the value and the coffee value proposition we provide.
In doing that, we’re not just a full solutions provider on the product side, but also on the equipment and service side.
We have a technician network that spans the country.
We’re served in all 49 contiguous states, and we’re providing both the equipment, the maintenance of the equipment, and the entire coffee solution set, inclusive of a comprehensive allied goods portfolio that is perfectly synergistic with the coffee day part, offering everything from pancake mix to biscuit mix, gravy, syrups, a wide array of products that are all supportive of that coffee-driven day part and that coffee business.
I think right now, people are excited to see that we’ve had five consecutive quarters of positive trajectory in cash flow generated from our operations.
People are excited to see that our margin structures and gross margin percentages are getting stronger and stronger over consecutive quarters and we’re really focused on the blocking and tackling that is going to push this company forward into the next fiscal year.”
Get the complete picture about coffee company Farmer Bros [ticker:FARM] by reading the entire interview with President and CEO John Moore, exclusively in the Wall Street Transcript.
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