Berry People Expanding Footprint and Volume

Berry People, which is currently going through the final stages of being acquired by the ag tech company AgriFORCE Growing Systems Ltd., is also in the process of increasing its organic volume and production footprint by co-investing with grower partners, especially in Central Mexico.

The Hollister, California-based company was founded in 2017 by produce industry veteran Jerald Downs, and is a year-round supplier of all four berry categories—strawberries, blueberries, raspberries, and blackberries—offering a fairly equal supply of both organic and conventional fruit to the marketplace.

Downs, who is CEO/President, and who will remain in that position after the acquisition is finalized, spent the first five years of the firm’s existence building out its supply chain and developing its Berry People brand for year-round distribution. The company has been sourcing fruit from Mexico, Peru, California, and the Pacific Northwest. It quickly established a recognized global trade brand and scalable operations and has more than 200 retail and foodservice clients and more than 100 grower and exporter clients across the US, Canada, Mexico, and Peru.

Jerald Downs, CEO and President, Berry People

With the investment infusion from the AgriFORCE acquisition, Downs said the company is ready to enter the next phase of its growth, which is what he calls “backwards integration” into the grower end of the business. Berry People will not be growers themselves but will co-invest “particularly with 5-hectare growers helping them become 50-hectare growers,” utilizing sub-license genetics, especially in the blueberry, raspberry, and blackberry crops.

“As we move into farming partnerships with growers, we are anticipating a 40 percent per annum growth rate,” Down said, noting that there is substantial room for growth in the raspberry and blackberry categories.

Downs revealed that Berry People’s volume metrics are closely aligned with IRI retail scan data and consumer preferences. “About 35 percent of our volume is strawberries, with blueberries right behind that, followed by raspberries and then blackberries,” he said. “That is the right mix based on the market.”

“As we move into farming partnerships with growers, we are anticipating a 40 percent per annum growth rate,” Down said, noting that there is substantial room for growth in the raspberry and blackberry categories.

The advent of better genetics and newer varieties, however, has led Downs to believe sales of raspberries and blackberries will increase as a percentage of the overall berry category—and as that occurs, Berry People will adjust its volume mix.

Concerning the organic/conventional split, the company’s volume currently skews toward a greater percentage of organic production because Downs believes organic sales will continue to increase. He argues that with better genetics and growing practices, organic berry production can be on par with conventional production in terms of yields and unit costs. If that’s the case, expectations would be that organic sales will continue to rise. “It’s a better way to farm,” Downs said.

Long term, he said the company’s product mix will match the market dynamics.

Downs has been involved in the berry business for more than 20 years, and the idea of creating a four-berry, fully integrated company has been in his mind for many years. He began his produce career in the mid-1990s working as a teenager for Fred Meyer, an upscale chain in the Pacific Northwest. In the 1990s, he also worked as a bird dog for several brokers and shippers and worked for Tom Lange Company, as well.

The advent of better genetics and newer varieties, however, has led Downs to believe sales of raspberries and blackberries will increase as a percentage of the overall berry category.

After landing a position with Safeway’s East Coast division, Downs was eventually transferred to the retailer’s Watsonville, California desk, where strawberries became top of mind. Over the next 15 years, he worked for several companies, including launching his own business. He called that a “tough business experience," but it did give him an education in investment banking and running a company. Another notable industry stint was his time working for Earthbound Farms, which clearly tapped into his passion for organic produce.

In 2017, he was ready to go out on his own again and enlisted the aid of a couple of grower partners from Mexico. The prediction was to form a four-berry company in the berry sector, which he believed had great growth potential. That vision has come to fruition. The US berry market, including all four major varieties, was $9.65 billion in 2021, with a year-over-year growth rate of about 10 percent for each of the preceding three years. All indications are that the upward trend will continue.

When AgriFORCE and Berry people announced their letter of intent (LOI) for the acquisition, Mauro Pennella, President of AgriFORCE Brands, said, “We are very excited to announce the LOI with Berry People, which is a thriving business with promising growth opportunities. The AgriFORCE Brands division offers better and more nutritious food and plant-based products to today’s consumers, both in the form of better grains and pulses with UN(THINK), and now in terms of fresh and nutritious berries.”

At the time, Downs said: “We are thrilled to join AgriFORCE as we are mutually aligned on the company’s vision and strategy as well as AgriFORCE’s desire to build the Berry People brand alongside the company’s founders and industry-experienced management team. This assures us that we can be a reliable and rooted platform for our industry partners, other collaborators, and the broader communities that we serve.”

Berry People will be exhibiting at the 2023 Organic Produce Summit in Monterey, California, in mid-July in Booth #100.