For the past several years, the Indianola based catfish processing company,
Delta Pride Catfish, Inc. has seen some very hard times. In fact, in as
many years almost as many CEO’s have passed through the company’s corporate
doors. There has been setback after setback and according to many, the
company’s future had been uncertain. Until now.
Just over a year ago, Delta Pride named it’s current president and CEO, Bill Allen of Belzoni. Allen has been the director of The Catfish Institute for the past thirteen years and oversaw that organization from it’s infancy to the powerhouse it is today. Many are hoping that Allen can bring some of that magic to Delta Pride. Reports say that Allen’s magic is just beginning to take affect.
Delta Pride operates three catfish processing plants in Belzoni and Indianola employing 700 - 900 depending on the season with an annual payroll of $13 million. Annual sales are $100 million.
“Delta Pride Catfish means a great deal to Sunflower County and to Indianola especially,” says Sunflower County Board of Supervisor president, Clanton Beamon. “As far as the local economy, there are several hundred jobs at Delta Pride that contribute greatly to the livelihoods of so many people and families in Sunflower County. Another benefit to having
Delta Pride here in our county is that Delta Pride is a market for our Delta grown products. The company just means so much on both ends of the spectrum from an economic standpoint, for farmers being able to market their products, to jobs for people in the community. I know I speak for the other four Sunflower County supervisors in expressing support for Delta Pride.”
Sunflower County itself is doing their best to help Delta Pride such as sponsoring a CDGB grant-loan which will give the company $1 million working capital loan and helping Delta Pride sell their unused plant in the small town at Sunflower. Additionally, the county is applying for funds in order to help refurbish the plant to sell.
Others on the state level also see the great value Delta Pride adds to Sunflower County and the Delta.
“I have visited with Bill Allen and was very impressed with his commitment, ability and track record,” says J. C. Burns, executive director of the Mississippi Department of Economic and Community Development. “It is evident that he has the needed knowledge of the industry and sound business principles to make Delta Pride a real success story. I am looking forward to
working with Bill, local officials, producers and employees to make Delta Pride preeminent in its field.”
“We are on the way to a recovery,” says Allen. “Many things have been put into place during the past several months that will help us reach profitability. I am very confident about our future.”
A 1973 University of Mississippi graduate, Allen farmed cotton, soybeans, and rice for ten years, later becoming a commodities broker, until he accepted the position of president for The Catfish Institute.
“A lot of my clients were catfish farmers and feed millers and I was hedging soymill and grain futures,” says Allen. “Several of these catfish farmers came up with the idea of putting together, for the first time, a promotional program for catfish similar to what Cotton Inc. or The National Beef Council were doing to promote their agendas nationally. We formed The Catfish Institute which was a non-profit corporation made up of catfish feed mills in order to promote catfish on a national level. I was approached by this group to be a fund manager for them and that led to me becoming president and helping build The Catfish
Institute.”
Begun in May of 1986, Allen played a major role in that organization’s development and success. In order to give a snapshot of this industry, in 1986 total sales for finished products were less than $200 million. Thirteen years after in 1999, sales were almost $800 million.
Back in 1986, one of Allen’s first hurdles was getting the funding for the Institute. In fact, Allen’s first landmark was getting feed mills to agree to put $5 or $6 per ton into an account generating about $4 million per year to use for promotional purposes. Allen identified some of the most talented marketing and advertising professionals in New York
and Dallas to help launch a national campaign promoting the consumption of Mississippi Delta-raised catfish.
“We wanted top of the line help in promoting catfish, training chefs, educating food service operators, consumer magazine and television ads, recipe booklets, and various promotional events,” says Allen.
Those campaigns proved to be very successful resulting in an increase in numbers across the board within the industry.
“It took a lot of work to get farmers and associations to agree to come up with the funding to get our campaign underway,” says Allen. “We achieved this without a referendum or government intervention. It was all on a voluntary basis by the individual member feed mills. The first five or six years, we promoted Mississippi-raised catfish with Mississippi money, but in 1993 we reached a milestone when we convinced the other feed mills in Arkansas, Alabama, and Louisiana to join the Institute. From 1993 on we promoted U.S. farm raised catfish.”
According to Allen, The Catfish Institute operated efficiently, spending less than 6 percent of its funds on administration and 94 percent on actual promotional programs.
During his thirteen years at the Institute, Allen worked closely with all of the catfish processors in Mississippi and other states. According to Allen, when The Catfish Institute started, Delta Pride was the dominant “player”, with 40 percent of the industry’s market share. However, through the years, the company remained somewhat stagnant as the industry grew, with it’s market share shrinking from 40 percent down to approximately 15 percent. When Allen came on board just over a year ago, he knew much work had to be done.
“I was keenly aware of the problems that existed when I came to Delta Pride. For the last 13 years I worked closely with the company and was well aware of their challenges,” says Allen.
After much thought and prayer, Allen accepted the position at Delta Pride and came on board with a plan that, according to many, is just beginning to take affect. During the past year, Allen has applied the same mode of operation that he brought to The Catfish Institute, and that is to locate the top talent in the country, hire them, motivate them, and lead them. Another strength that Allen brings to Delta Pride’s table is that he has worked with the same farmers for 13 years and has established good relationships with them building much trust.
Since arriving at Delta Pride, Allen has gone to work on the fundamentals: first downsizing administratively, and earlier cutting about $1.5 million in annual payrolls.
“It was an extremely difficult step to take,” says Allen. “A lot of good people had been working here for a long time, but we had to do it.”
Allen says that the next step was “beefing up” on the technical side, maintenance side and some of the other key positions, by bringing in a new vice president of operations who has a background at Sanderson Farms; a new vice president of sales and marketing who has a background from Bee Gee Shrimp and Coca-Cola Foods; a new director of maintenance, director
of live fish procurement, and several others.
“These new people, as well as all of the employees here at Delta Pride, are making a difference helping to turn the company around,” says Allen. “As far as this year, we have improved our fundamentals such as our processing yields, we’ve lowered our processing costs, improved our sales margins in spite of lower operating volume and paying a higher wage rate to our employees, and we’ve been able to show bottom-line results in at least 50 percent improvement over the prior year. We’re not in the black yet, but we are on track with a three year plan for profitability and stability here. Actually, we are ahead of our planned projections.”
Allen says that the essential component to continue the path of progress for the company and meeting it’s objectives while being around for the long term and is financing.
The company has just secured a new $7.5 million revolving line of credit from the CIT Group, committed for three years, giving Delta Pride the ability to build more inventory when they need it during key periods of the year making sure that the company has plenty of catfish to serve customer demand. Additionally, Sunflower County has approved applying for a $1 million CDGB grant-loan for the company which is now at the state level for approval. Delta Pride hopes to have have this approved in the next 30 days.
“All of these are ways of making sure that we are able to complete our transition to get this company turned around,” says Allen. “The bottom line is that we are going to run this company like a business and that the days of losses and paybacks are over. There are too many options for the farmers to sell fish to other processors without having to worry about paying a co-op
loss money back. We are committed to getting the company into the black and running it as an industry leader.”
Allen says that he feels optimistic about the company and where it is headed.
“I feel better at this point than at any time during the 16 months that I have been here,” says Allen. “I see now that we are going to survive the great fish shortage of the year 2000 and I feel great about the things we have going on here for the long run such as new products and new packaging, plant renovations and better utilizations of offal. We currently have a lot of projects on the table that are going to make this company be profitable for the long run.
We have been given the mission to come up here and turn Delta Pride back into being a profitable company and that’s what we are going to do,” says Allen.
“I feel very good about them turning things around,” says Sunflower County Board of Supervisor’s president, Clanton Beamon. “I am confident that they are going to be successful.”