Financial Clarity for Entrepreneurs

Moving Up The Value Chain

This article in Startup Journal describes the renaissance in dairy home delivery. I think this is an excellent example of widespread relative affluence and a desire for experience (by way of nostalgia) creating an opportunity for higher value products. Consumers aren’t just buying milk – they’re buying a piece of their childhood along with a healthier lifestyle. And they have the money to do so.

Crescent Ridge isn’t alone. There are home-delivery dairies and distribution services, big and small, from Connecticut to California, that are seeing stronger demand. Some have old roots like Crescent Ridge, while others are newcomers.

In 1994, Tom Rubino opened a delivery service called Hudson Milk Co. in Shrub Oak, N.Y., with just six customers. Today, his operation reaches some 300 homes. His biggest seller is the nostalgic half-gallon glass bottle of milk that Mr. Rubino gets from Byrne Dairy in upstate New York.

Older customers remember the glass bottles fondly and want convenience, Mr. Rubino says, while younger families are more interested in buying locally and making sure their foods don’t have unnecessary additives or hormones. “We were lucky and got on a particular trend at the right time,” he says.

In addition to milk, Hudson Milk also delivers items like cream, organic eggs, yogurt and Poland Spring water for a flat delivery fee of $2 — which has boosted his average order to $25.

I do have one quibble with the author…

And that appetite for wholesome fare, coupled with rising gas prices, is giving an unexpected marketing boost to some tiny dairies and local milk distributors, helping them compete against larger rivals who saturate store shelves.

I can’t remember the last time I made a special run to the store just to buy milk. I doubt that saving gas has much to do with this trend.

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