Steven Neil knows nuts: how they are harvested, who buys which kinds and why, what packaging works best, and what supply-chain strategies keep all the players in the food chain happy. A 25-year veteran of finance jobs, most recently as CFO of contact-lens maker Cooper Cos., Neil is a roll-up-your-sleeves kind of guy who loves getting out of the office and studying every facet of the business up close.
He must like what he sees, because Diamond Foods, one of the largest handlers of culinary and snack nuts in the world, has weathered the recession quite well. For its fiscal-year 2009, which ended in July, the company’s net sales grew 7%, to $570.9 million, compared with $531.5 million for 2008.
The economic downturn has helped rather than hurt the company. Instead of going out for their entertainment, families have been more likely to watch a movie at home, a bowl of popcorn or nuts at the ready. Diamond is not the leader in either of those categories, but it will have an increasingly large presence in every home’s pantry if Neil has anything to say about it.
CFOs often wear many hats, but your collection is, uh, nuts.
I am the CFO, but I’m also responsible for operations, logistics, IT, treasury, grower relations, and purchasing. I view them all as one and the same. I’m the type of finance guy that looks at a financial report and sees it as just numbers on a piece of paper unless I’m out in the plant and can see how the product flows, how we can reduce our unit costs, and how we can improve our logistics. Then the numbers mean something.
How often do you get out of your office? Do you visit growers’ sites?
Not as often as I’d like, but I think for the CFO to really understand his or her business you need to be out in the field and close to the widgets. I’m at our primary nut facility in Stockton, California, several times a month. I’m in our Indiana facilities — our second nut facility and our popcorn facility — once a quarter. And I visit the walnut growers out in the field at least twice a year, usually once during harvest and once during some stage of the bloom, either at the beginning or during the middle of the summer. At least once a year I will go to an international conference where our primary suppliers are. It’s important to put a face with a name for your primary suppliers. And I meet with our larger customers periodically.
What do you like doing best?
Learning. It sounds funny, but learning how to source Brazil nuts is an example. We are the largest buyer of Brazil nuts in the world. The Brazil nut is not a cultivated nut. They’re harvested in big pods, about six clusters in a pod, high in the Amazon Basin in Brazil and Bolivia. The local citizens will actually go in with shields over their heads to do the harvesting, because these things weigh 50 pounds and you don’t want to be hit by them. They gather up the nuts that are on the ground, put them in 50-pound bags, and take them out of the forest.