Tens of thousands of small businesses from around the U.S. submitted videos to enter Intuit's Small Business Big Game contest. In the first stage of the competition, the number of competitors was reduced to 15,000, and out of these, 20 semifinalists were chosen. Locally Laid, a small pasture-raised egg company located near Duluth, Minn., was named one of the lucky 20 companies that are still in the running for the big prize, a professionally produced television advertisement airing during Super Bowl coverage.
Backyard flock becomes a business
Jason Amundsen started with a backyard flock of chickens as a hobby on the family's Duluth, Minn., area farm. He said that his local cooperative was bringing in eggs from more than 200 miles away, and this got him thinking about expanding the flock and turning keeping hens into a business. Jason's wife, Lucie, does marketing work off the farm, and together the couple hatched the narrative for the Locally Laid brand.
Locally Laid hens are kept on free-range pastures, which are rotated during the growing season. Feeders and waterers are out in the pasture with the hens, so the birds are outside during the day. The growing season is short in the Northern region, and the winters are harsh, so the hens are kept in cage-free houses during the cold weather months. Other points of differentiation for the Locally Laid brand are that birds are fed non-GMO corn and the eggs meet the government definition for local production; they are sold within 400 miles of where they are produced.
There are a number of possible points of differentiation for shell-egg producers to consider. Cage-free, organic, vegetarian-fed, free-range and even enriched cages all offer niche marketing opportunities. Amundsen was asked if any one aspect of Locally Laid was critical to the brand's success. He said, "We have the package. I think we have the winning formula. What is core to us, and no other company does it, is that we are unabashed environmental stewards and champions. We plant a tree with every delivery we make. Everything we do is geared towards sustainability, and this is what the customer wants. The other thing we have is an incredible ability to market our brand. We have marketing horsepower that no other egg company has."
Amundsen said demand for the company's eggs, which retail between $4.00 and $4.29 per dozen, is "astronomical." "The customers are speaking," he said. "They want a product where they know the animals are treated well. Where they know that it is a local product from a company that respects the earth and where the product tastes like something."
Scalable business model
Amundsen started with just a couple of thousand hens on his farm, but he expects to have approximately 20,000 hens in production on his and partner producers' farms by the end of 2013. Locally Laid eggs are currently distributed in the Twin Cities and the North Country of Minnesota. Amundsen is excited about the prospects for expanding to other markets with the help of more partners. "At least once a week I get a call from a farmer, a retailer or a distributor that wants to license our brand or contract produce for us," he said.
When asked about the "model" size for a pasture hen flock, Amundsen said, "It depends. There are four pieces to this, the producer, the packer, the distributor and the retailer, and all four legs of the stool have to come together. What keeps us going is that the customer wants this." He said he recently went to another state to explore business opportunities, and in two days he had 11 stores interested in Locally Laid eggs. "We have an enormous ability to differentiate ourselves, yet we have a business model that is highly replicable," Amundsen said.
Amundsen said that he was thrilled to have Locally Laid make it to the semifinals of the contest and that he and his wife feel like winners already. Four finalists will be named the week of November 4, and online voting for the grand-prize winner will begin on November 11. All four finalists will be given a professionally produced television ad for use in their promotions. Amundsen said that he might have to put a big screen TV in the hen house for the Lolas (all their hens are named "Lola") to enjoy their moment on the national stage if they win the grand prize.