Some things are beyond a single farmer’s control: Global markets are among them.
In 2008, Anheuser-Busch, the beer giant and longtime Coleman hop farms client, merged with InBev, an international brewing company. Coleman was left holding the bag, literally. The new AB-InBev canceled its growing contracts, forcing the Oregon hop farmers to reduce 1,000 acres of hops to 100.
The Colemans, headquartered in St. Paul, Ore., didn’t get to be seventh-generation farmers because they give up easily. Today, thanks to partnerships with craft brewers and hop innovators and researchers, Coleman Agriculture is now growing and managing over 2,000 acres of hops in the Willamette Valley. This time around, the company is raising 23 varieties of hops, 20 of them at their Alluvial Farm in Independence. The hops include a variety of public, private and, in some cases, experimental breeds soon to be found in your next favorite beer.
Keeping costs low and quality high is at the core of other Coleman innovations. In the hop dryer, computerized sensors will go online this fall to increase speed, reduce fuel costs and increase quality consistency, with an aim to improve the bottom line and important flavors.
This year, equipment and staff will be outfitted with GPS equipment to coordinate work between the 12 Coleman Agriculture entities spread across more than 8,000 acres in Oregon. In addition to hops, the company farms hazelnuts, seed and vegetable row crops.
How does a multi-generational family farm stay intact?
“We kick-started change to a 20th-century farm into 21st-century practices,” said Liz Coleman, one of six Coleman owners. The game-changer, Liz said, was the family’s investment in a new business structure.
That business model was established four years ago, based on the company’s old-school collective mission, which reads: “Deeply rooted in our farming heritage, we cultivate the future for the prosperity of those we serve.”
Their obstacles to survival are not uncommon in multi-generational farms. As more Coleman relatives developed farms and sidelines, complexities grew — it was hard to communicate new ideas between generations, and harder still to plan for future generations.
In the past, succession — passing the farm from one generation to the next — had been easier. Fourth-generation owners Robert and Martha Coleman helped their sons, John F., Bob and Bill, get started with their own farms. When Robert and Martha died their farm ground was passed to their descendants.
Eventually, John F. and his wife, Kathleen, and Bill and his wife Kathryn’s children — Generation 6 — graduated from college and married.
The new model was based on the idea that operating independently limits Coleman Agriculture’s potential for a stronger business and best practices, said Liz. Combining their diverse talents, the partners are working toward a more organized and collaborative way of doing business aimed at sustaining the family farm for future generations, she said.
“We asked ourselves: How can we do this differently?” said Liz.
With advice from Oregon State University’s Austin Family Business Program, the Colemans formed an ownership board that works closely with the company’s president in overseeing the crop management of its 12 entities. The land is owned by individual family members but decisions about farming it falls on the ownership board, board of directors, and its non-family president, David Henze.
Henze has 20 years of experience in managing, marketing and selling agricultural and food products, most recently at Fourth Leaf Fruit Co. in Yakima and Idahoan Foods in Idaho.
Organizational and technical innovations have made their business more nimble and as a result, more profitable, according to Henze.
The new business model is working well for the six members who incorporated. “We took a new look at our family business. We needed to move forward and strengthen the positives in our current generation and plan for future generations,” said John P. Coleman, another of the six owners.