Gem Tomato rising to the challenges

Gem Tomato Sales Inc. began in 1982 with offices in Arkansas, Florida and Michigan, marketing and promoting fresh market vine-ripened summertime tomatoes.

Thanks to a reliable supply from multiple states, progressive packaging options and overnight delivery to most major markets, regional promotions proved to be a powerful marketing tool for the company.

In 1999, Gary Margolis, president of the company, teamed with Hamburg, AR-based Triple M Farms owners Wendell Moffatt and James Meeks to deliver the best of Arkansas tomatoes with direct marketing, rather than the auction system that predominantly took place before then.

Today, the shipper handles nearly 150 acres of conventionally grown round, Roma and grape tomatoes sourced from the state.

“Traditional field-grown tomato growers continue to see increased challenges in the industry,” Margolis said. “The most obvious are unpredictable input costs and rising labor costs.”

With marginal profits already thin, higher volumes of production were not the solution to being profitable. Margolis explained that in previous years margins were thin, but there was plenty of acreage with good yields to scratch out a profit.

“But that’s not the answer and is no solution to profitability,” he said. “Triple M Farms and I took a hard look at production costs and our marketing strategy and made some decisions where changes were necessary.”

The first area of focus was on production to serve the company’s specific customer base, targeting the Arkansas tomato companies that have remained loyal and been with Gem Tomato for decades and want to support it.

“We made marginal cuts in our acreage to match the known committed demand from our Arkansas customers,” Margolis said. “We’re not trying to be just another tomato shipper in the pie, we’re treating Arkansas tomatoes as a specialty item. Hopefully, this will enable us to get a little more money and help us continue what we’ve been doing for three generations.”

Another thing it’s doing is recognizing that the tomatoes are packed with No. 1 standards, are full food-safety compliant and that the product is ready for retail display, wholesale customers or foodservice.

“We have many packaging options,” Margolis said. “With labor costs on the other end being high also, you need to do anything you can to fit the value-added segment.”

Gem Tomato recognized that diversification is important, and having all the eggs in one basket is a tough formula to succeed with. So, Gem Tomato markets rounds, Romas and cherry tomatoes, and this year, for the first time ever, will add yellow tomatoes to its offerings.

“We will have limited acreage at first, and if it’s successful, we will expand for those customers that are looking for yellows on their mixed loads,” Margolis said. “Being a full-service tomato company can attract customers, so now they can buy all their tomatoes under one roof. Anything we can do to diversify.”

This year’s crop is outstanding, according to early reports and images Margolis has seen, and harvest is expected to start in early June and go until about July 20.

While tomato acreage at Triple M will be down this year, the farm will grow a diverse mix of vegetables, including watermelon and cantaloupes, expected to attract a large number of customers from multiple nearby states.

“They’ve seen exceptional demand locally,” Margolis said. “We’re all very optimistic this season. We have had a lot of calls and interest coming in for Arkansas.”