Made in SGF: DFA brings global brands to life in Queen City

Hugging the railroad tracks in west central Springfield is a hulking dairy factory cranking out Starbucks’ Frappuccino, iced coffee and Doubleshot espresso drinks. The products then move to Springfield Underground before a logistics network powers the caffeinated beverages to craving consumers.

The Starbucks Corp. (Nasdaq: SBUX) drinks are just one example of many everyday products Dairy Farmers of America Inc. works to bring to market.

“You’d be hard pressed if you were to go down a grocery aisle and put products into your basket for there to be something that we didn’t touch,” said Edward Tilley, chief operating officer for DFA’s beverage and food division, who manages the cooperative’s Springfield operations from DFA’s Kansas City headquarters.

DFA, a cooperative of 14,000 members responsible for dairy product invention, production and marketing, has a strong presence in the southern part of the Show-Me State and Springfield in particular. With 2014 corporate revenues of $18 billion, operations include the 240,500-square-foot manufacturing plant at 800 W. Tampa St. and a 43,000-square-foot DFA Innovation Center at 3253 E. Chestnut Expressway. Another production facility in Cabool handles a portfolio of 40-50 brands.

The Queen City plant is one of four DFA facilities dedicated to creating Starbucks-branded cold coffee products for the North American Coffee Partnership. The Starbucks and PepsiCo Inc. joint venture brings the beverages to market through Pepsi’s international distribution channels.

DFA declined to disclose sales and production volumes for the Springfield plant, and Starbucks representatives declined to comment.

Outside of Starbucks, DFA and its subsidiaries have a hand in a wide range of products, from Borden cheeses to the coatings on Goldfish crackers and Breakstone’s butter. Other multiproduct lines are for Kemps, Guida’s Dairy and Dairy Maid.

Local connections
DFA’s local employee base includes 311 staff members, with roughly 150 of those working out of the West Tampa Street plant.

“It’s definitely the most significant allocation of resources for us from the standpoint of infrastructure, but also employees and talent,” Tilley said of the cooperative’s Springfield footprint.

Although the center city manufacturing building makes up the majority of DFA’s physical presence and requires the most number of workers in town, Tilley said the Innovation Center is one of the cooperative’s largest sources of research and development. Other DFA products, La Vaquita cheeses sold in the southwestern U.S. and California Gold milk primarily exported to China, begin their journeys in the Springfield labs.

“They’re all developed and formulated there in the innovation building,” Tilley said, adding DFA operates a similar facility in Minneapolis and partners with dairy research centers at U.S. universities.

DFA also works with the local branch of Edwardsville, Ill.-based logistics provider Buske Lines Inc. and Springfield warehousing company Pinnacle Services Corp. to store products at Springfield Underground.

Of Pinnacle Services’ 11 customers, owner Greg Faulconer said DFA represents roughly 30 percent of the company’s pallet space in 275,000 square feet of underground storage on Springfield’s east side. The manufacturer accounts for roughly 20 percent of shipping activity at Pinnacle’s 17 loading docks.

“They require us to maintain a certain control temperature on that product for a period of time, and then we’ll take samples to test the pH levels,” Faulconer said.

Pinnacle stores not only ingredients and packaging for DFA’s Springfield plant but also finished products and ingredients for brands coming out of Cabool. Pinnacle also performs ingredient sampling, incubation and testing of product shelf life.

At 71 degrees Fahrenheit and relative 43 percent humidity year-round through the use of dehumidifiers, Faulconer said the underground storage space is the ideal environment for preventing dairy powders from clumping.

“The limestone is a perfect insulator to control temperature, so you’re kind of getting the best of both worlds,” Faulconer said. “You’re getting dehumidified space that you would find in a refrigerated environment without the costs of refrigeration.”

Company expansion
In February, DFA announced plans to move its headquarters across state lines to Kansas City, Kan., but Tilley said the cooperative isn’t uprooting anything in Springfield. Rather, some expansion plans are in the works.

Among other local companies DFA partially or wholly owns – the cooperative has ownership in Hiland Dairy Food Co. LLC and a 50 percent equity position in DairiConcepts LP – is Chestnut Labs, which operates on the second floor of the Innovation Center.

Hiland’s presence on the supermarket shelves is ubiquitous, from milk, cheese, yogurt and butter to ice cream, juice, tea, dips and sour cream. DairiConcepts’ contributions are at the taste-bud level for Parmesan cheeses and Doritos flavors.

“We’re expanding and moving outside of that building with Chestnut Labs into a standalone building because we’ve continued to grow that business,” Tilley said, noting the relocation is planned for late 2015 or early 2016.

Additional hires are likely for research science positions.

Chestnut Labs performs food microbiology and chemistry services, and technicians examine consumer trends and concerns along with functionality of packaging and physical manufacturing. He said the number of products originating from DFA’s Springfield labs is in the thousands, including infant formulas and proteins for fitness drinks. Changes at the lab are then passed along through engineering and later implemented at 43 manufacturing facilities across the country.

“There’s a tremendous amount of effort that goes into not only developing a product you will actually consume, but also the delivered mechanism for that product,” Tilley said. “You hope, frankly, that it never ends, because typically the only reason it would is because the consumer stops purchasing that product.”