Best known for its #1 US butter brand, Land O'Lakes looks to butter everyone's bread to boost its bottom line. One of the largest dairy co-ops in the nation, it's owned by 4,331 dairy farmer/members and some 900 member associations. It markets dairy-based consumer, food service, and food ingredient items. The co-op makes more than 300 dairy products from the 12 billion pounds of milk that members supply annually. Land O'Lakes produces animal feed through Land O'Lakes Purina Feed. The co-op also offers members seed and crop protection products, animal feed, and agricultural assistance. It operates dairy facilities in the US and does business in all 50 states and 60-plus countries.
Land O'Lakes' operations span three segments: Dairy Foods (the co-op's largest business segment accounting for about a third of total sales), Crop Inputs, and Animal Nutrition. The Crop Inputs business, Winfield Solutions, is the leading crop inputs wholesaler in the US; its operations include development, marketing, and sales of seed (alfalfa, corn, soybeans) for an array of crops, along with distributing a line of herbicides, pesticides, and other crop protection products. Land O'Lakes Purina Feed supplies livestock feed and animal milk replacers. Land O'Lakes sold its Layers (eggs) business conducted through MoArk in mid-2014.
Overall, Land O'Lakes generated 31% of its total revenue in 2015 from Dairy Foods sales, about 32% from Animal Nutrition, and 37% from Crop Inputs.
While Land O'Lakes' products are sold throughout the US and in 60 other countries, the company does not break out its foreign sales. Growth markets for the co-op's products include China, Mexico, and Southeast Asia. The company manages 24 agriculture and development projects in 17 countries.
Sales and Marketing
Boasting 3,532 direct producer-members and 799 member cooperatives, Land O'Lakes serves more than 300,000 agricultural producers. Its dairy products are used by many of the US' top food companies and manufacturers.
In 2015, the company generated net revenue of $13 billion.
Land O'Lakes' growth strategy is focused on developing and selling value-added, branded products to major customers and high-growth markets at home and overseas. To that end, the cooperative has pursued acquisitions, joint ventures, and alliances across its business segments. From 2012 through 2014, the cooperative spent $1 billion in growth initiatives, which it has funded from cost savings through strict margin management.
During 2014, for example, the cooperative pursued several growth initiatives including product innovation, facility improvements, new technologies, and extending the reach of its core brands to new customers. Also in 2014, it launched its international strategy and structure to move into new fast-growing economic regions such as Canada, Mexico, Africa, and China through partnerships and acquisitions. Setting up operations in China, Land O'Lakes worked to provide training and other services to Nestlé's Dairy Farming Institute, a dairy training center, in Shuangcheng.
Land O'Lakes isn't opposed to selling off under-performing lines of business to free up resources for growth initiatives. In mid-2014, for example, it sold its struggling Layers (egg) business (with operations in California and Missouri) to Opal Foods.
Mergers and Acquisitions
In 2016 the company acquired Ceres, bringing new advanced plant breeding and biotechnology to Land O'Lakes' forage segment's research and development pipeline.
In 2015 Land O'Lakes combined its WinField business with United Suppliers' crop protection and seed business. The resulting company, Winfield US, offers crop protection, seed, crop nutrients and decision ag tools and services.
That year, to boost its advertising effectiveness, the coop purchased marketing communications and strategic consultant FLM+, which specialized in the agribusiness and rural community sector.