Vegetable oils, agricultural commodities, industrial oils

Turning a commodity into a brand at Cargill

Cargill, Inc. - Regional Account Manager (Gainesville, GA), prior roles as Commercial Manager and Commodity Merchant

A vegetable oil business created differentiation in industrial channels instead of competing only on commodity price.

Situation

Vegetable oil was sold into industrial, non-food channels by the truckload and priced off the board.

Margins were compressed by suppliers doing exactly the same thing, while the conventional playbook fought for share on price.

→Built unique marketing channels by branding the product for specific industrial end uses.
→Used Chicago Board of Trade futures positions to hedge price exposure on the volume.
→Captured premium customers rather than chasing the lowest-price buyer.

→Net margin increased 500% in the branded industrial channel.
→Gross profit margin increased 51% over a five-year period.
→Highest per-pound net margin in the Southeast Region and third-highest nationally for the Industrial Oils Business Unit.
→One of three account managers responsible for selling over 675 million pounds of vegetable oil.

The category had decided it was a commodity. The customers had not - they just had not been offered anything else.