Karen and Jerry Dakin offer a full line of fluid milk, including chocolate, full fat cream and half & half.
Florida Dairy vertically integrates
Grocery store fluid milk prices are the frustration of every dairy farmer—$3 per gallon for store-brand milk and $4 per gallon for a branded product translates into $35 to $45 per cwt. retail.
That frustration—and the fact that dairy co-ops and processors treat milk like a commodity—led Jerry and Karen Dakin, Myakka City, Fla., to start bottling fluid milk from their 2,100 cow herd in March 2009. The farm and plant is 45 minutes west of Sarasota on Florida’s Gulf side.
And while they’re now capturing a couple dollars per cwt. of that retail margin, their four-year slog to vertical integration has been a steep, uphill climb. "Vertical integration is quite the animal to take on—it’s quite the gorilla," Jerry says. "Processing milk makes dairy farming look easy."
"You can’t establish a market until you have the product," Karen adds. "And you can’t make the product until you have the market."
The Dakins did have one advantage. They attracted the interest of a large, natural foods retailer who was seeking a partnership with a local, "sustainable" dairy producer.
The dairy had to have some volume to supply the retailers many stores, but it didn’t have to be organic or purely pasture based. But the farm couldn’t use rBST, and its reputation for sustainability, animal welfare and labor management had to be stellar.
A Bemudaand rye grass mixture is green chopped daily as a major component of the Dakin Dairy diet—and a major selling point for Dakin Dairy products.
The Dakins’ farm fit the bill. Cows are housed on sand-bedded freestalls. The climate in central Florida allows them to green chop forage year round.
"Our fame to glory is green chop. It’s a combination of Bermuda grass inter-seeded with rye grass," Jerry says.
Last year, the Dakins chopped over 19,000 tons of the stuff off of 400 acres, taking a cut every 28 days or so. Cows get 50 to 70 lb. of green chop each day.
And the Dakins market the heck out of this fresh, grass-fed milk that they can rightly claim has higher, year-round levels of conjugated linoleic acid and natural levels of beta-carotene and vitamins D and E. "This truly is why our milk tastes so good—it’s the ‘fresh’ grass, 365 days a year, blended with hay, grains and minerals that makes the Dakin ‘taste’ difference," proclaims their website.
"Green chopping every day gives us this real niche," Jerry says.
"Once we started processing, even I was amazed at how delicious our milk was," Karen says.
As the Dakins did their early market research, they quickly came to realize they needed to supply stores with a full line of milk products. Distributors and dairy managers weren’t going to be bothered with a niche marketer who could only supply whole milk in gallons.
So the Dakins knew they needed a processing plant that could handle gallons and half gallons of whole, 2%, 1% and fat free along with a chocolate milk offering, fresh heavy cream and half and half.
The Dakin Dairy brand offers a full line of fluid milk products, displayed here in the retail farm store on the dairy.
All this equipment doesn’t come cheap—even if much of it is used. The Dakins’ emergency generator, for example, was found on eBay. Much of the stainless steel, valves and monitoring equipment came out of fruit juice factories. Dakin budgeted $750,000 for the plant and equipment, and ended up spending $1.4 million.
The Dakins also quickly learned that glass bottles weren’t an option. "I really wanted to go to glass bottles, but that just doesn’t work because of breakage and liability," Karen says.
And then there’s the issue of bottle returns and sanitation. Glass bottles would quickly become a logistical nightmare, and the idea was almost immediately shelved.
The dream of having their own "Dakin" dairy brand was not the same pipe dream. It did, however, take several years to gain traction.
- March 2013