What Processors WantNeal Snoddy AVP and GM Cargill Value Added Meats Retail

Founded in 1865

William Wallace CargillGrain warehouse in Conover, Iowa

Cargill - History

Cargill – MarketsAn international provider of food, agriculture, and risk

management products and services.• Agriculture

– Cargill originates, processes and distributes grain, oilseeds and other commodities to makers of food and animal nutrition products. It also provides crop and livestock producers with farm services and products.

• Health – Cargill develops science-based, health promoting ingredients and ingredient systems for

makers of food, dietary and pharmaceutical products.• Risk management

– Cargill provides agricultural, food, financial and energy customers with risk management and financial solutions in world markets.

• Industrial– Cargill serves industrial users of salt, starch and steel products. It also develops and

markets sustainable products made from agricultural feedstocks.• Food

– The company collaborates with food manufacturers, food service companies and food retailers to provide food and beverage ingredients and meat and poultry products that help them serve their customers better.

Cargill – Strategic IntentStrategic Intent 2015

“A structured and collaborative relationship with key suppliers that focuses on innovation, continuous improvement, strategic goals, knowledge sharing, risks and rewards which ultimately has a positive impact on the bottom line of both companies.”

Trust is a key requirement of a successful relationship.

Cargill - The Company

• 76 Business Units Worldwide

• 160,000 employees in 67 countries with over 50% working in developing countries

• Approximately 1,000 warehouses in North America for cold, dry, and terminal storage

• Over 4,000 Warehouse/Terminal locations globally

Cargill Value Added Meats– Brands

Consumer Supported

Brands

Value Brands

Control Brands

Exclusive to Customer

(FOODSERVICE &BULK DELI ONLY)

COSTCO Canada

COSTCO United States SAM’S CLUB

Cargill Value Added Meats – Retail

• Virginia

– Dayton

– Timberville

– Mt. Crawford

• Missouri

– Springfield

– California

• Waco, Texas

• Springdale, Arkansas

• Nebraska City, Nebraska

• Albert Lea, Minnesota

Can the PRW Satisfy the Business Units Needs?

• Runs reports to show aging of product

• Produce listing of product needed to fill orders

• Temperature or temperatures of rooms

• Thawing

• Location(s)

• Innovativeness

• Paperwork, timeliness, accuracy

• Export

• Holiday Season flexibility

• Operating Hours

Service

• Turkeys are turkeys: we differentiate by service.– We are masters of the last minute.

• Is the facility ready, willing, and able to differentiate through service?

• Is the facility innovative?

• Take care of the customer, trust us

to take care of you.

Financials – Managing Risk

• Are they financially stable?– 3 years audited financial statements

• Is the specific location sustainable?– Example: time left on lease

PRW Rates

• Higher PRW rates does not always indicate better service– Meeting our key required services

is essential to move on in negotiations

– When multiple vendors provide the same service, price comes into play

• A long-term relationship is the key ingredient for Cargill.

Contract Negotiations

• A “2 way street”

• Increases are in contract (PPI Based)(producer price index includes power)

• Growth opportunity in contract

• Insurance

• Length of contract

• Master contract with separate rate sheets for multi-unit companies

• Asset Based

• Partnership with carrier

• Broker/Dispatcher on property

• Outside broker

If you accept transportation responsibility, a transportation failure is a PRW failure

Transportation

Insurance and More

• Replacement value on warehouse negligence

• Damage

• Loss

• Re-boxing

Transfer in Storage

• Key to partner relationship

• It’s about the freight

• 100,000,000 pounds in 2010– Half of our outside Turkey storage is TIS

Customer PRW

Cargill

• Partner understands requirements, product, and production

• Partner understands the value in Cargill’s Strategic Intent 2015– Customer is #1

– Be part of the solution

• Communication

• Satisfy the customer

Partnerships Now and in the Future

• TIS

• Communication

• Partner

We can be demanding, our commitment is to be the partner of choice

Summary

• Karen E. Smith-

• karen_e_smith@cargill.com952-742-1863

QUESTIONS ?

Contacts