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Wrapped up for Profit

Chaska, Minn. — St. Alban’s Bay beef tallow, millet and sunflower seed cakes may be for the birds. But the packages they are wrapped in are for the profits.

Bill Gleason and David Pichotta, owners of Wildlife Sciences in Chaska, anticipate that the trim, cost-saving packaging on their birdseed-suet cakes will beat the competition. This fall, the partners are scaling up production to bring their improved line of St. Alban’s Bay “Suet Plus” wild birdfeed to retail chains throughout the United States.

Six years in

The venture started six years ago as a side business for Gleason, 40, and Pichotta, 47. Both are Twin Cities commodity traders who deal primarily in ag byproducts — animal and vegetable fats, feather and bone meal, seeds, dairy whey and other ingredients for livestock feed, pet foods and industrial products. “With all the consolidation in agriculture, it’s been getting tougher for small, independent agents.” Mega-national companies “hire their own brokers. They don’t need us,” Pichotta says.

The pair began looking for ways to add value to the materials they traded, including beef tallow and seeds. Though at the time Gleason says he was only “moderately involved” in birdfeeding (he now has “feeders all over the yard”), he knew the market was growing rapidly.

The partners acquired equipment to make bird cakes at a Wisconsin contract packager. They used traditional methods for their suet cakes: mixing melted beef tallow and birdseed — “the consistency of ketchup with nuts” — and pumping it into plastic trays. A colorful label, laminated with a thin layer of foil so beef fat didn’t seep through, was heat-sealed on the clear blister-seal plastic tray — “similar to Matchbox Cars’ packaging,” Gleason says.

The cakes sold well in independent garden centers and specialty stores. “But if you look at the market, 75 percent of it is in the large box stores and home centers,” Gleason says. “You can own the independents and still not have much market share. … A couple years ago, we had to make a decision: do we want to bump this company up?”

Working in the margins

Pichotta and Gleason realized their products were too expensive for large retailers, which thrive on large volumes and thin margins. “We had more costs in the package — in cardboard and plastic — than in the ingredients. Everything else was minimized; we could only reduce on packaging.”

Although Gleason had some packaging knowledge as a former General Mills buyer, “I was not a packaging expert.” To investigate options, “we literally went to the grocery stores and grabbed anything that could hold a piece of suet.”

Wildlife Science’s banker told the entrepreneurs about AURI. “We sat down with Jack Johnson and Max Norris, looked at the various packages in front of us and told them what we thought could be marketable,” Gleason says. “They narrowed it down to a couple of choices” that would work technically.

“They were asking all the right questions, so we knew they had a good chance of success,” says Johnson, head of AURI’s coproducts lab in Waseca. AURI helped Wildlife Sciences source custom-designed equipment for its new packaging and move existing equipment from Wisconsin to Chaska where the company opened a processing plant a year ago.

Cake packs peel like candy bars

“We now use plastic roll film that replaces two (plastic) pieces and the cardboard. That reduces the cost by 20 percent,” Gleason says. The pair stumbled onto other useful attributes of the new packaging. The label can be printed directly on the plastic rather than on a foil card, so information can be printed on the top, bottom and sides of the package. “We can print birding tips on back, and if our products get knocked over or piled on top of each other, there is still printing in view. Our competitors can’t do that. We’re the only ones with this type of packaging.’’

From a handling perspective, “suet beef fat is messy. Consumers don’t like taking it out of the box; you get stuff in your fingernails or have to use gloves. With the roll film, these peel open like candy bars; there’s no mess. And there’s less waste — one wrapper to throw away.”

Pouring slippery suet cakes into plastic roll film was a challenge, however. The creamy product “is easier to put in a tray. The engineering was much more difficult than we thought.”

AURI chemist Rose Patzer helped formulate a firmer cake that could endure warm temperatures, and Johnson helped improve the packaging process.

In time for cool weather

The new-and-improved suet cakes, with an average retail price of one dollar each, are being introduced in retail chains, such as Hardware Hank, in time for prime bird-feeding weather. “It’s a seasonal business; people generally feed birds in colder weather when they need energy from the suet, or during migration times: fall and spring.”

St. Alban’s Bay birdseed cakes come in four varieties — peanut, sunflower, nut and berry, and wild bird blends — various mixtures of millet, cracked corn, sunflower seeds, peanuts and grain byproducts. All the tallow is from Minnesota and, except peanuts, the seeds and grain come from Minnesota and the Dakotas. “They are processing close to the commodities they’re using — buying at the right price and selling into a high value-added market,” Johnson says.

The company also sells green enamel cage feeders to hold the 4-inch square, 1-inch thick suet cakes. The original packaging still sells at independent retailers where the company has a loyal customer base. As production expands, “we may also private-label for some of the larger guys.” Nationally, Gleason says, there are only five or six major birdseed producers. The biggest, in Iowa, controls 50 percent of the market.

The side venture is becoming a full-fledged business enterprise. “Our company takes more of our time; we have less time for trading,” says Gleason, who is in charge of sales and administration. They still do some trading, says Pichotta, who handles purchasing and plant management. “It helps keep us in touch with the markets” — with prices and the availability of fats, seeds and nuts.

The entrepreneurs are tapping a national wild-birdseed market that exceeds $2 billion in annual sales. Spending on wildlife watching has surpassed hunting, they say. “As baby boomers get older, they want to watch the birds in the backyard,” Pichotta says. “It’s big; it’s growing.”

For more information on Wildlife Sciences products, visit