The Makeover Journeys: After the Storm

Editor's Note

As we began putting together this edition of Springfield Business Journal, the editorial team explored what it might mean to have a business makeover. And it's not by chance that this In Focus falls within the first issue of 2010, which follows a year that presented myriad challenges to businesses across the board. Our thinking was that business leaders might want some fresh perspectives to guide them in the new year, particularly if they face challenges beyond those presented by the economy.

What our contributing writers have discovered is that there's more than one way to define a business makeover.

Local companies are on pathways of change that range from rising out of a disaster to relocating, and as their stories are brought to light, it may be that they will inspire change in other companies that want to begin makeover journeys of their own.

When Vickie and Dave Kensinger began building Memory Lane Dairy nearly 33 years ago, they couldn't have imagined that Mother Nature would be the force that could make their business all but a memory.

On May 8, a tornado severely damaged their milk production plant and retail store, located 2.5 miles from the Kensingers' 399-acre farm on Highway 60 just outside Fordland.

"You don't ever think it can happen to you," said Vickie Kensinger.

The tornado knocked their 8,000-square-foot production plant loose from the foundation and cracked the walls.

Seven months later, the Kensingers, with sons Luke and Paul, are still rebuilding the dairy business they depend on for income.

"It's hard to think in terms of planning for a disaster," said Rayanna Anderson, director of the Small Business and Technology Development Center at Missouri State University. "No one every thinks it could happen to them."

From co-op to customers

More than three decades ago, the couple plunged into the milk business and began by selling their milk to the Arkansas Dairy Co-op. Selling to a co-op limits dairy operations to federally set milk prices, but working with the co-op provided the family with a living for several years, Vickie Kensinger said.

Eventually, the family decided to step their business up a notch, investing roughly $750,000 in a production building and equipment. The venture began producing milk in 2001, selling it in nostalgic glass bottles.

In 2001, they had enough customers to sell one day of milk produced directly, while the rest still went to the co-op. By the time the tornado hit in 2009, all of the dairy's milk - several varieties of Cream Line and homogenized milk - was being sold directly to a customer base of 20 local grocery stores and through the dairy's retail storefront.

After the storm halted production, the family went back to selling Memory Lane's milk to the co-op, though Kensinger said production fell drastically from the 208,000 gallons of milk being produced prior to the tornado.

"After the tornado, that fell to about 70,000 gallons," she said. She estimated that the family's income fell by two-thirds, though she declined to disclose revenues.

The money earned by the milk decreased, too. Wholesale milk prices dropped to an average of $9 per 100 pounds in Missouri, from $18.9 per pounds in June 2009, according to the U.S. Department of Agriculture.

A push for production

Rebuilding efforts are aided by the business interruption insurance the dairy had in place, though Kensinger wouldn't give an estimate on rebuilding costs. She said the family is still negotiating with their insurance company.

Between the insurance and the revenues from the co-op sales, Memory Lane has been able to remain fully staffed.

The rebuilding process has taken much longer than anticipated, Kensinger said, but the family tries to think positively. "We can worry and be sorry we're not where we were, but we have to keep looking up," she added.

Right now, they're hoping the production facility will be up and running by March.

Calvin Call, executive director of the Missouri Insurance Coalition, said the start of a new year is a perfect time for businesses to talk to their insurance agents and review policies. "Make sure the inflationary value of property is included," he said. "Most people don't keep up with value and replacement costs."

In addition to forming a plan to keep operating and purchasing equipment such as a generator, the SBTDC's Anderson recommends storing backup copies of all records off site and formulating a strategy for keeping in contact with customers if disaster strikes.[[In-content Ad]]