A Humble Mike Cavallero Discusses Four Decades Of Leadership At Dole
Jim Prevor’s Perishable Pundit, January 13, 2015
The Pundit was supposed to be swooping down to Palm Springs to join in the festivities to honor Mike Cavallero as he receives the United Fresh Produce Association’s Lifetime Achievement Award. A sudden need for a dental implant waylaid that plan, but recognizing the accomplishment is a worthwhile endeavor.
We asked Pundit Investigator and Special Projects editor Mira Slott to talk with Mike.
Mira caught up with Mike as he headed to La Quinta to play in the United Fresh midwinter golf tournament as well as to be honored. He reflects on transformational moments in his tenure and shares well-honed insight amassed during his distinguished career at Dole, spanning four decades.
Retired President of North American Tropical Fresh Fruit
Dole Fresh Fruit Company
Westlake Village, California
Q: Congratulations on being honored with United’s Lifetime Achievement Award! In looking back, what were the pivotal events that shaped your tenure at Dole? I imagine you could write a novel with the experiences you’ve undergone and the industry transformations that have occurred in that timeframe…
A: I don’t know about a novel. I started with Dole in ‘74 in the customer services area, called the technical services department; that was in San Francisco, when the company was headquartered there. I worked in that area for 10 years then moved on to sales at Dole Vegetables down in Salinas. While I was there, I was just a salesperson for central sales accounts, which were a lot of the major chains buying in the Salinas area.
After some time, I moved to New York and ran the New York Dole Vegetables office. To be honest with you, that’s when I learned the most — when I went to New York and was on that sales desk. I was in charge of the whole eastern division, but I sold a lot of the customers myself in the Detroit/Toledo area. That was very helpful in learning the business, and I had a lot of customers that helped teach me. There was LaGrasso Bros. Produce, Sam Okun Produce, and Seaway Food Town; those were some key accounts in the area that I sold.
I believe it was in ’86, I came back to take over the entire sales and marketing group for Dole Vegetables in Salinas.
Q: That was before the packaged salad phenomenon. Were you on the ground floor of that development?
A: At that time, value-added salads were starting to come in. I was there during some of the early introductions of the packaged salads, nowhere near the details and all the SKUs that are there now. The concept was in its infancy and just getting underway.
Q: Wasn’t there a lot of retailer skepticism to the whole idea of the value-added salad category?
A: I can’t take credit for breaking through that barrier. I was already switched over to the fruit side when packaged salads really took off. When I was at Dole Vegetables, the concept was just being tested with coleslaw and head lettuce, before all the different product lines and proliferation of the category. It was a major change, and I will tell you that a lot of the buyers weren’t willing to try it. They weren’t sure it was going to work. That was a big hurdle for suppliers to get the buyers to accept the idea that packaged salads could be a real growth item for their operations.
Q: Winning retail buy-in was something you surely mastered…
A: In ’92, I was brought down to Westlake Village to run the sales and marketing group for fresh fruit. From there I got promoted a few times, and in 2001 became President of North American Tropical Fresh Fruit, where I was in charge of all the operations on the fresh fruit side, until my retirement.
Q: Experiencing the business from multi-faceted vantage points, what other important shifts occurred within Dole, and within the industry as a whole? On the product side, you mentioned packaged salads, for instance. Could you point to innovations, notable challenges, unexpected opportunities that have rocked the competitive retail landscape and the supply chain?
A: I think contract pricing on both commodity vegetables and commodity fruits has been a big change in things. We never had contract pricing; we only did day-to-day pricing. And now on some of the major items like head lettuce, bananas and pineapples, there’s contract pricing, where retailers are making a commitment to you and you’re making a commitment to them, rather than selling on a day-to-day basis. That was a significant development during my tenure in my two latter jobs.
Q: Is there any pushback from major retailers on their commitments to contract pricing? Have you witnessed any backward movement from long-term contracts?
A: I believe contract pricing is still very strong now. I think everybody feels more comfortable with it, especially retailers because they know what they’re going to pay for product and they can work their margins in. For the suppliers, it’s less risky because you’ll know you have volume placed, and it helps you go out and secure volume that you’ll be able to move. The downsides are you’re set on contract-pricing, so there probably won’t be any huge market swings. Most of the time, contract pricing is on a yearly basis, and sometimes two years. There are pros and cons, but that’s been the biggest change in the industry for me.
Also, in my lifetime, another transformational product was the pineapple, with the propagation of varieties that came out. Del Monte was first on that. The pineapple became much more consistent in terms of sweetness and taste, so then, obviously, consumption was much better received when consumers were consistently getting a sweeter pineapple. It really changed the industry.
Q: Could you talk about Dole’s leadership role in the battle to combat childhood obesity by increasing produce consumption, and David Murdock’s fervent health and nutrition mission? Were you connected with those programs?
A: Mr. Murdock is really into everything you just mentioned, but the person who really got us started in nutrition, and in the importance of reaching children, was Lorelei DiSogra. I think the world of her. She worked for Dole and launched important initiatives, like the Adopt a School program. Lorelei DiSogra, to the best of my knowledge, paved the way for Dole on this health and nutrition course when she was at Dole; showing the value of teaching kids at schools about fresh fruits and vegetables to build interest and enthusiasm, as well as educating them on how to eat properly.
Mr. Murdock decided sometime after that to champion work on good nutrition. It was very important to him. In fact, our entire product line was good-for-you type products. It was our job in the sales and marketing group to work programs into those themes. [Editor’s note: David Murdock shares more about his vision and progressive health and nutrition programs in an enlightening Q&A piece here. You can read more about Lorelei DiSogra’s more recent efforts while at United Fresh to increase produce consumption in children here and here]
Q: What happened with your venture into fresh produce in vending machines?
A: We tested vending machines with fresh fruit, putting a couple in different schools, but for us it didn’t work so well. They have to be serviced quite often because you’re putting fresh products in there. It was hard to manage and make it work logistically. [Editor’s note: you can read our coverage about the pilot here]
Q: Can you address major issues facing the industry such food safety?
A: On the fresh fruit side, we didn’t have quite the issues in food safety they had on the vegetable side. Bananas have a thick peel and so do pineapples. On the veg side, I wasn’t there for that long, but I did work with United Fresh on different programs to address food safety issues. We didn’t have cantaloupes all the time, but I know cantaloupes did present problems.
Q: You’ve received praise from major retail executives on your ability to nurture meaningful partnerships. Could you talk a bit about how you navigated through the competitive retail landscape?
A: What we tried to do from our sales standpoint, when I was in vegetables and on the fruit side, was to develop trust -- where we and our customers trust each other and make it a win/win situation, not something where one person has to win and one person has to lose. We’re all in this together, and we’re here for a long time. That is what we centered on, and I tried to hire people in key positions capable of doing that with the customers.
We would talk to everybody, find out their specific needs based on their different formats and try to come up with programs beneficial to both of us. We did need to make money, but generally we could work things out with retailers and foodservice people to do the special packs and make a deal that would work for both of us. That was our main objective.
Q: Do you have any advice you can relay to industry executives based on lessons you’ve learned through your career?
A: Stay as active in the industry as you can, and learn as much as you can about the various businesses. That would be my best advice. If you’re a supplier, you need to comprehend and appreciate the retail side, and if you’re a retailer, you need to understand the supplier side as well. It’s important that everybody is on the same page of how things happen, so you can work together to get to those win/win situations.
Q: How do you bridge this understanding in the trade to consumers?
A: At Dole we have consumer-focused departments and 800 numbers to get out as much information to consumers on different issues as we can. But I can tell you on the fresh fruit side, we didn’t spend a lot of marketing dollars on consumers because, quite frankly, it’s very costly to do consumer advertising. Our idea was to work with our customers and their advertising programs, and to help them get their message out to consumers that they are carrying safe, good quality products and that we’re hooked in with them. We do have a lot of consumer calls into our consumer affairs department, and Dole is always very responsive.
Q: In your experience, though, do you find getting your product on the retail shelf is half the battle?
A: You can have the best product and best service available, but if can’t find the buyers, it won’t do you much good. That’s why it’s critical to build those relationships, not just maintain them. You can have the best product in the world, but a customer might not buy it because of a personality conflict.
Q: In an industry where there are only a handful of recognized consumer brands, do you think Dole gains a significant advantage?
A: People rely on our brand. When they see Dole, they feel comfortable with it. If we can get our product on the retail shelves, then we can get it to consumers. With bananas, very seldom do you see a chain carrying more than one brand of bananas at one time. You’re not going to see a retailer merchandising three or four labels of bananas. They pick one brand. So you can build up your consumer following through the retail side.
Q: Would you say that bananas remain the core of Dole’s business?
A: Bananas have always been the foundation of our success. We used to have packaged foods; the company was separated, but the packaged food company actually bought the banana company in the late 60s. The banana company over the years has been the key driver of the company, worldwide now.
You have to get your product on the shelf, and bananas go through a ripening process, so we spent a lot of money working at the retail level on ripening. We want to make sure we have good product on the shelf. That means we have to make sure our bananas are ripened properly, and our technical service department goes around helping the ripeners, and we also follow up on the transportation side and on the retail store side as well. If we see problems we’ll go into the warehouse, stay as long as it takes -- two to three weeks -- to work with the ripeners to make sure the process is done properly.
Q: Some retailers want a display that has a range of bananas in different ripening stages, from green to ready-to-eat. Is it challenging to customize programs like that?
A: We call it the two-color system. We’ll work with customers on it, but I will tell you that’s extremely difficult to do. Everything has to be done the right way at every phase. The ripeners have to do it right, the order-pickers have to do it right, and then when it gets to the stores, the clerks have to take the lids off and make sure they know which ones are more green and more yellow so they know which ones are the right ones to put out. So I always tell people, it might be more valuable to be consistent on one color so everybody is aware of what the ripener can do, and no one is guessing on a given day. A two-color system can work but it just has to be managed properly and everybody has to do their job right.
Q: And that’s another issue when you talk about labor…
A: How many times do you walk in a store at 6:00 or 7:00 at night when it’s busy and there are no bananas, or potatoes, or other produce items on the shelf? Labor is a big problem at retail as well as on the supply side.
Q: What is your projection of where the industry will be five years from now, ten years down the line; the most poignant issues facing produce executives going forward?
A: Labor will be a key issue, trying to get enough people to harvest the product. Food safety is going to continue to be an issue because there may not be any single-set solutions for everything that’s out there. I think those two are the most important issues that need to be addressed quickly, rather than ten years down the road. I guess water issues should be included in that urgency as well.
Q: These are broad-sweeping and complex issues, also fraught with politics. Can you explain your involvement in joining together with colleagues that are often business competitors to brainstorm industry-wide solutions?
A: Sometimes that’s difficult because sometimes people have different agendas. But as an organization, you have to come up with the best solution for the group. Things just have to be worked out among the members, and you move forward from there. I can’t point to anything specific, but the issues are put on the table and the board members have an opportunity to express their views, and then we try to find solutions to various problems together from there.
Q: That approach has served you well throughout your career. What are your personal plans moving forward?
A: I promised myself, I’ve been with the company for years and I’m up there in age now, so for a year I won’t do anything, and then after a year, I’ll decide whether I’ll get back into doing something. But right now I’m enjoying my time, and it is well taken. I miss the people at Dole and I miss the customers, but at this time, I have no plans to get back into anything specific.
Q: What are your fondest memories?
A: I was given some great opportunities when I first started with Dole, with people I consider to be Dole legends. I’ll always remember them, and I get a lot of calls from them; the Charlie Palmer’s, the David DeLorenzo’s, the Bob Fishers’… that type of person that worked with me and believed in me. When I got into my management positions, I remembered the people and the teamwork and the great goals we worked to achieve. We didn’t always reach them, but we did our best to get where we wanted to be. The same is true with customers. Those are the moments I remember the most.
Looking for pyrotechnics? Dramatic over-the-top histrionics? You won’t find it here… that has never been Mike’s style. He has always been a kind of quiet leader, a consensus-builder who made things happen, by being generous with credit, unwilling to take claim for things he didn’t do and gently encouraging people to work together effectively.
There is a lot of learning in a lifetime in the business if you are willing to listen. Want to boost consumption? Sell better products like new varieties of pineapple. Want to learn the business? Get out and see your customers.
Mike is an insider’s insider, and so it is not surprising that when outside observers might point to a hundred things, Mike sees the big change as being an inside game — contract-pricing.
It is difficult, even now, to get Mike to talk about Mike — he would rather thank his customers, or ex- employees, such as Lorelei DiSogra, now United’s VP of Nutrition and Health. He even credits competitors when they took the lead.
There is an easy-going and honest way about Mike; no great explanations or attempts to obscure the truth, just, “We tried some things, such as vending machines, and they didn’t work for us.” Then on to the next.
In the end, Mike chooses to remember the industry giants that guided his career.
He is too humble to mention the many industry leaders who look up to him.