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The McCain story: Canada's international food company.

The McCain Story: Canada's International Food Company

Global brand building has been a way of life at McCain Foods almost from the beginning. When frozen french fries were still very much in the realm of high-technology food processing back in the late 1950s, Canadian entrepreneurs Harrison and Wallace McCain were looking across the Atlantic for expansion opportunities. And expand they did!

Nurtured in the fertile potato fields of rural Florenceville, New Brunswick, today the multinational frozen food and beverage powerhouse employs more than 12,500 people in over 50 factories and offices stretching from Canada and the United States to Great Britain and Continental Europe, across the Pacific to Japan, Australia and New Zealand. Guided by a vision that the convenience, good taste and wholesomeness of the humble french fry would wax universal, the McCain star now shines over a constellation of value-added products that include entrees, dinners, pizzas, juices and desserts.

Now boasting some $2.7 billion (Canadian) in annual sales, rapid growth has been stimulated both by increased demand for the McCain Group's diversified product line and by a steadfast policy of strategic international acquisitions. The company is committed to doubling sales worldwide every five years. In 1985 it surpassed the $1 billion mark. Four years later, in fiscal '89, global receipts topped $2 billion. Today's volume is approaching a milestone of $3 billion.

During the past six years McCain has been especially busy re-employing capital. A new juice plant was opened in western Canada; three additional potato processing plants were purchased, as well as several juice factories and a major transportation firm in the United States; several new multi-million dollar potato plants were constructed, factories were expanded and a frozen meal facility was purchased in Australia; a large french fry factory was acquired in France, along with expansion of another frozen potato facility there; two Belgian frozen food plants and a juice facility were brought into the fold; in Holland a fresh potato trading company was acquired, in addition to frozen vegetable and potato plant operations in the Netherlands; a pizza products company and a cheese manufacturer were purchased in Britain; a vegetable processor was acquired in New Zealand.

Harrison McCain, the company's energetic 63-year-old chairman, says that it took more than brains and brawn to reach a level of success and profitability that would rank it favorably in the Forbes Index were the outfit not privately held. "It helped to be in the right place at the right time," he told Quick Frozen Foods International, "and to have the right people running things around the world."

Indeed, the McCain brothers have been masters at picking the right places in which to do business. Realizing that the nearby and familiar USA market was too tough to crack three decades ago, they saw better prospects in Europe, where a less crowded frozen food field was still in the early stages of development.

Interestingly, their first export sale was not french fries. Instead, it was a 50-ton shipment of frozen peas to Great Britain in 1959. That was the beginning of something big. Ten years later a processing plant costing $2.6 million was built in Scarborough, England. More came later, making McCain the leading supplier of frozen fries (or chips, as they are called in Britain) to the U.K. foodservice business.

From there it was on to Australia a year later, followed by the establishment of McCain Europa in the Netherlands. Organized by Dr. George E. McClure, vice president of corporate development, the company was well on the way to pan-European distribution of its product line, which was already expanding into other frozen product offerings besides potatoes. Factories were added in France, Spain and elsewhere to handle the growing demand.

And everywhere the Canadian company went, the McCain label was sure to be front and center. Brand building was paramount in all markets, despite advice from some consultants that a foreign-sounding name could impede sales goals.

"We went to Germany with our product in the early '70s and were told you can't sell it here with the name McCain on it," recalled McClure. "They said people can't pronounce or spell it. But I felt if you can sell radios called Blaupunkt in Canada, you can sell McCain in Germany."

Right on Target

That assessment proved to be right on the money. The brand's Pommes Frites sold zehr gut in Deutschland, while des produits de pommes de terre surgeles were declared tres bien in France. In whatever language or market - from Spanish to Japanese or Holland to Saudi Arabia - McCain has won its share of satisfied repeat customers. "Today people are interested in international things, so the McCain name is really an advantage," said McClure. "The company is perceived as global, and that's a good thing."

Canada's foremost international food company earns some 30% of its revenues from Continental Europe. Great Britain, Canada and the USA each account for about 20% of sales, with Australia, New Zealand and Japan contributing the other 10%.

The business is personally looked after by both Harrison and Wallace, the latter of whom serves as president. Each logs about 150 days on the road per year, with one usually at home while the other is abroad. To facilitate travel from remote Florenceville, a couple of small jets are at the ready on a private runway near their neighboring domiciles overlooking the picturesque St. John River.

It seems that the brothers have advanced the concept of "managing by walking around" a notch. They manage by flying around. And while their style of running the business is very much eyes-on, it is not necessarily hands-on anymore. Top-flight executives call the shots in individual markets. The U.K. operation has been headed up by Charles "Mac" McCarthy for over 30 years. In Europe it's Paul van der Wel at the helm. Michael McCain heads up USA operations from Chicago. Archie McLean is in charge of Canadian marketing activities. In Australia the managing director is John Clements, and in command of the Japan office is Carl R. Morris.

PHOTO : Carleton, P.E.I., Canada: McCain Foods newest potato processing operation was officially opened September 11, 1991
COPYRIGHT 1991 E.W. Williams Publications, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Title Annotation:McCain Foods Inc.; Special Section: Canada's International Frozen Food Company
Author:Saulnier, John M.
Publication:Quick Frozen Foods International
Article Type:Company Profile
Date:Oct 1, 1991
Previous Article:Juicing up a thirsty market that eats lots of pizza and fries.
Next Article:McCain has appetite for growth.

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