Putting people first powers Ciranda’s success
The food industry is in Doug Audette’s blood.
A year and half ago, Audette signed on as CEO assuming the helm at Ciranda, a leading North American provider of certified organic, non-GMO and fair-trade ingredients based in Hudson, WI.
His resume includes more than 30 years of general management, sales, marketing and operational experience primarily in the food industry sector.
Audette joined a company that has experienced consistent growth commensurate with its role as a leader in the organic food industry.
Ciranda won the St. Croix Economic Development Corporation’s 2023 Business of the Year award in February.
The company specializes in gluten-free flours and starches; syrups and sweeteners; cocoas and chocolates; coconut products; liquid and powdered lecithins; and vegetable oils.
Ciranda was formed in 1994 by Brazilian-born entrepreneur Hans Friese and his wife Joan dedicated to the premise that organic food and farming was better for the planet and for the people inhabiting the planet.
They initially focused on navigating the ambiguous regulations in the U.S. governing organic at that time to export North American farmed ingredients to more receptive markets abroad.
But by 2000 the demand for organic products in the United States was gaining momentum. The potential convinced the couple to capitalize on their connections with foreign suppliers and reorganize their business model from exporting North American raised ingredients to importing organic, non-GMO and fair-trade ingredients produced by farmers in markets from South America to Asia to feed the awakening consumer market in America.
“Organic is still the primary focus of our business, non-GMO, fair trade, we still carry that vision forward. We believe that these certified ingredients really are important to the future of a healthy planet and healthy people,” Audette said.
Products are branded Ciranda. Suppliers bag and box ingredients in Ciranda labeled containers then ship them to one of six warehouses located strategically around the U.S. Ciranda draws from those inventories to fulfill business to business orders for many of the largest food companies in the U.S.
“We are the connectors. We import 100 percent of what we sell. We work with suppliers around the world and help connect them to customers here in North America,” Audette said.
Although the business is agriculturally based, Ciranda’s expertise is really transactional, securing and then moving commodities from suppliers located all-around the world to customers in the U.S. Technology including AI allows the company to be more predictive about where the market is moving so it can deliver the right inventory at the right location at the right time to keep prices competitive while still servicing customers dependably.
“We try to forecast what customers are going to need and match that up so that we’re not carrying too much inventory and have that wasted capital,” Audette said.
Organic and fair trade are key.
From the inception of Ciranda, Friese and his wife embraced a visionary mission to share their success to lift up the global communities they partnered with. They believed that organic and fair-trade practices could impact the developing countries in enduring and positive ways.
Ciranda has understood and championed the value of organic certification from the beginning. Commodities certified as organic translate into a better standard of living for farmers and local processors who manufacture the ingredients into importable forms.
Conventional Coconut is a popular commodity in high demand worldwide. Growing it is a labor-intensive process and traditionally farmers make almost nothing.
“When those farmers choose to farm organically, they receive a better premium which means a better standard of living including educational opportunities for their children,” Audette continued: “When a farmer in Thailand converts to organic he stops getting sick from the pesticides and herbicides he previously had to apply by hand.”
Ciranda has built an enviable reputation, trusted by its U.S. customers, global processors and farmers, by interfacing extensively with certification agencies then substantiating those certifications with audits by their own quality sourcing group.
“We work with our suppliers to help them meet the quality standards of the North American market and to obtain the certifications they need especially related to organic, non-GMO and fair trade,” Audette said. “We also conduct our own quality audits to make sure they are doing what we want or need them to do and that it’s accurate.”
Fair trade stories
Because Ciranda has invested, in many cases, years of face-to-face effort advocating for organic and fair-trade practices, it has been able to cultivate dependable, productive relationships directly with farmers.
“Trust is truth over time,” Audette explained.
Today those farmers have the education and resources to farm safely, efficiently and maximize their production and they are receiving a fair price for their produce.
Ciranda is more than a business partner. It is about cultivating a larger relationship with more depth, a comprehensive concept of care leading to better production and better lives for farmers and their families.
Those relationships are the cornerstone of Ciranda’s success.
“Taking advantage of people is not sustainable. The currency of (our) business is trust,” Audette continued: “That goes all the way back to our founders Hans and Joan. They believed it’s about building those relationships and networks and building that trust especially as it pertains to our suppliers. A lot of these relationships have been built on trust that’s been established for years. We need to nurture that, be stewards of that legacy.”
Those stories were documented in a book “Stories of Impact” published by Ciranda in 2020.
Audette explained, “A story can be about how somebody in South America or Southeast Asia grows their food and how they are treating their farmers making sure that they have a living wage. That story translates really well to this market.”
He believes human connection, respect for one another is integral to the success of Ciranda and that extends to processors as well as farmers.
“We want to be partners in their business. When you are a partner you don’t tell the other person what to do. You learn about each other and you respect each other. You grow together, he said. “They are for-profit businesses as well. They understand when we do better, make more money, they do better and they can offer more opportunities to their farmers and employees.”
According to the Organic Trade Association’s (OTA) 2024 Organic Industry Survey, the industry is continuing to grow with organic food sales totaling $63.8 billion in 2023.
Ciranda’s customers are paying attention. And with the access made possible by social media, younger consumers want to know more about the stories behind their food.
“Our clients, some of the largest food companies in the U.S., are gravitating toward the sustainability side of things and the importance of growing food in the right way. They want to tell those stories because it’s good for their brands and because consumers, essentially younger consumers, want to hear those stories,” Audette said. “We have those stories ready-made, It’s about connecting the stories across the supply chain.”
Risk — Balancing pragmatic considerations with human relationships
On the other side of the equation Ciranda’s success depends on a single fundamental challenge, its ability to fill an order by securely moving a physical commodity from one part of the world to another. In today’s climate of global unrest that challenge is fraught with risk.
“It’s a challenge. From a very pragmatic business standpoint, it’s about having contingency plans. So, with any given ingredient, we try to have more than one supplier and usually located in more than one geography,” Audette explained: “For example, if something happened in Pakistan, can we get the rice syrup from Vietnam?”
Once the ingredient is secured, transporting it to the U.S. can still be very challenging.
Audette cites several current challenges on the horizon: water levels in the Suez and Panama canals becoming too low to navigate; and the potential for labor strikers at east coast ports.
“There’s a lot of risk in logistics, just plain old getting stuff from here to there around the world,” he said. “We start by forecasting what our customers are going to need. Then we look at the risk and assess ‘do we need to get ahead of that? Do we need to carry a little bit more of that inventory so that if the port strikes happen on the East Coast later this year we aren’t left saying ‘Oh we can’t service our customers.”
Beyond the logistical challenges of shipping and inventory the perception is that the world is in turmoil and it’s a dangerous place to do business. Unpredictable events beyond your control from climate change to political upheaval to military incursions can stress relationships with processors and farmers.
Caring for those communities, keeping those relationships safe and productive while dealing with circumstances beyond your control requires a combination of faith and mitigation.
“Those situations are out of our control. There are a lot of human relationships at play requiring timely compassionate judgment. We need to determine how we can leverage our long-standing relationships to mitigate the risks around some of these situations,” Audette said.
He believes that under stress, the mettle of those relationships comes to the fore with transparent communication and collaboration.
“I think it matters when there are businesses like ours working with businesses like the ones we have on both sides and we’re having really productive conversations, establishing that we care about each other. I think that matters and that those relationships ripple out in all directions,” he said.
Ciranda’s long-term investment in these communities can have a stabilizing effect. The financial advantages of organic farming and fair-trade practices lead to the building of schools, water and sanitation infrastructure, access to medical services and better nutrition to strengthen the community ahead of the storm.
A culture of sharing
Ciranda also makes direct investment in projects locally and globally.
The company became 100 percent employee owned in 2017. At the time Founder Hans Friese said, “Our employees inspire us every day with their passion and creativity. The ESOP (Employee Stock Ownership Plan) allows us to transition the company into the hands of those who have helped build it, and those who will join us in the future.”
An enduring commitment to the philosophy of “We do well when they do well,” is reflected in the company’s committed to donate 2.5 percent of its profits annually to projects like a new school in Pakistan.
In 2022 Ciranda teamed up with TCF-USA to build and operate a much-needed school in Karachi, Sindh Province, Pakistan. The $20,000 contribution toward construction and operation of the school for the first two years was made possible by the owner employees of Ciranda who donate 2.5 percent of their company’s profits each year to projects locally and globally.
Ciranda’s sales have increased by 34 percent from 2019 -2024, Organic still makes up 80 percent and fair trade certified is up to around 50 percent.
“We had record years through the COVID-19 spike when everybody was loading in ingredients. 2024 will be our second-best year behind those years. We’re on a good track,” Audette said.
Looking ahead he wants to strengthen the customer side of the equation.
“Strategically we’re starting to evolve and mature the organization working to build that same kind of depth on the customer side of the equation. Operationally, doing more things with technology and business processes. We’re getting the right team in place to do an even better job of connecting customers with suppliers.”
Biggest challenge
The global state of unrest poses an outsized risk to the future security and feasibility of Ciranda’s 100 percent import-based business. Audette recognizes that it is prudent to consider other options.
“One of the things that we are looking at is are there some domestic ingredients that we could get into to diversify a little bit. We have a lot to offer to other companies to help them become successful in terms of our connections, sales and marketing and customer service resources, he said.
For Audette, determining the path forward always comes back to people, the farmers, manufacturers and customers but more importantly, the team he works with every day. Their character, curiosity and courage inspire his optimism.
“We’re always going to have situations that are challenging. The best we can do is, work to mitigate it, collaborate and communicate and there’s nobody I’d rather be going through those challenges with than this team. We have great people who care about each other. Maybe we need to change how we look at these situations and recognize how blessed we are to be working together. What happens next is totally up to us.”
Just the Facts
Ciranda, Inc.
Doug Audette – CEO
Formed: 1994
Address
708 2nd Street
Hudson, WI 54016
715-386-1737
Website: https://www.ciranda.com
Employees: 60