Ruling the Roost

Sparboe Companies is known for producing eggs. Lots and lots of eggs. More than 3 billion a year.

But would anyone know a Sparboe egg by its appearance or taste? Not likely. And that fact is always on the mind of Beth Schnell, for the past year CEO of Sparboe Companies.

Sparboe Farms, a division of the Litchfield-based companies, owns more than 12.5 million laying hens that it keeps at 13 farms in Minnesota, Iowa, Colorado, and California, and it markets eggs from another 23 contract farms. It sells fresh shell eggs to grocery distributors around the country, including Twin Cities–based SuperValu and Nash Finch. Retail chains, including locally based Lunds, Byerly’s, and Super Target are also customers. And about 40 percent of Sparboe Farms’ eggs are bought by another division of Sparboe Companies, Sparboe Foods, which breaks them and sells them in liquid or dried form.

Every day at plants near the farms, Sparboe Foods fills 50,000-gallon tanker trucks with plain eggs and custom mixes: eggs with salt, eggs with sugar, just yolks, just whites, specific blends of yolk and white—whatever customers want. An “egg further processor” like Sunny Fresh Foods, a division of Cargill that’s based in Monticello, buys Sparboe eggs to resell—as cartons of liquid egg, bags of diced eggs, or egg entrées for its food-service customers. “Industrial users” are another market that includes makers of brand-name foods. They buy eggs to use as ingredients in packaged cookies or bottles of salad dressing.

"I want Sparboe to be the best producer we can be, and the premier egg-marketing company in the U.S."

“For the most part, we are in every market in which eggs are used,” Schnell says.

That makes it a much different business than the one her father, Bob Sparboe, started in 1954. He began as a distributor of day-old laying hens, and Schnell worked beside him as he tried to grow and diversify his business. As a kid, she helped him deliver hens; as a teenager, she packed eggs; at 26, she became a salesperson; at 30, vice president of sales and marketing.

Her father died unexpectedly last October, and Schnell, then 45, suddenly became chief executive of a 625-em-ployee agricultural conglomerate that is the fifth-largest egg producer in the United States. She faces intensifying competition from other producers that keep getting bigger after more than a decade of industry consolidation; increasingly stringent standards for food quality and safety, and for bird welfare; the threat of avian flu; and the reality of rising product-delivery costs.

But above all, she has to contend with the constraints of a commodity business. With little to distinguish one egg from another, price can be everything.

Schnell is working to change that. Without abandoning the legacy of the business her father built, she points to the new direction she wants to lead it in. “I want Sparboe to be the best producer we can be,” she says, “and the premier egg-marketing company in the U.S.”