Value Added Producer Grant Case Study: Challenge Dairy Products

For more than a century, Challenge Dairy has provided its customers with the highest quality butter and dairy products, rising from a small company that had to rent a horse for its deliveries to the most popular butter brand in the Western United States.

As a cooperative, Challenge Dairy markets and distributes dairy products for its 425 California dairy producers. Established in 1911, Challenge began with just four employees and 132 pounds of butter. Over the past 100 years, Challenge has become one of the leaders in the nation's dairy industry and is credited for developing the first lab sampling of butter and the first corrugated paper packing for shipping cubes, introducing the first half gallon carton of milk, and being the first butter manufacturer to develop a metal churn.

Today, Challenge Dairy Products' cubed, whipped, and spreadable butter can be found on grocery stores shelves in 32 Western states, including California, Oregon, Washington, Arizona, Colorado, Illinois and Texas.

Challenge Dairy Products was a 2012 Value-Added Producer Grant recipient and will be leveraging USDA funding to support the launch of a new Light Spreadable Butter that features extra virgin olive oil as a key ingredient. The new product will join Challenge's traditional Spreadable Butter and Tuscan Style Spreadable Butter.

Morrison was honored to prepare an independent feasibility study and business plan for the light spreadable butter project, including assessments of the business organization, production feasibility, competition and markets , marketing and distribution, project personnel, the project work plan and budget, capital needs, risk analysis, and multi-year financial projections. The feasibility study and business plan were used in support of the 2012 VAPG proposal, which we wrote for Challenge.

We are looking forward to bringing Challenge's Spreadable Light Butter into our office kitchen very soon!

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