Ozark Mountain Poultry of Rogers is not your typical chicken company.
Bonnie and Joe — as well as Isabella and Penelope — kind of give that away with their friendly eyes, wagging tails and excited barks. They’re dogs, by the way, as welcome in the front offices of OMP as anyone else.
Joe, the bird dog of CEO Ed Fryar, is the most astute of the four, and he knows that if he jumps up on a visiting photographer, he’ll get sent to timeout with a treat. Bonnie, the aging golden retriever that belongs to Executive Assistant Ashley Fryar Hiller, is content with her comfortable spot on the floor.
Don’t let the relaxed atmosphere of the front office fool you, though, because Ozark Mountain Poultry is serious about business. And it has become increasingly successful since OMP’s modest start in April 2001.
Fryar, a former agriculture professor at the University of Arkansas at Fayetteville, is the brains of the operations, although he is loath to take individual credit for any of the company’s success. OMP generated $250 million in revenue in 2014, employs approximately 1,300 with plants in Rogers and Batesville and is the majority owner of Blue Rooster, which opened a deboning plant in Warren.
OMP has established itself as a leader in a niche market, namely antibiotic-free chicken that isn’t raised in cages or fed animal byproducts. Fryar said that when the company first started, he bought whatever chicken was available, but now he has vertically integrated the company to control the raising, harvesting and processing of the chicken.
“That was something over the last 10 years, I’ve been more and more interested in that,” said Fryar, who earned a doctorate in agriculture and applied economics from the University of Minnesota. “When we could raise our own birds, that was the way we were going to do it. It does cost more. Consumers are willing to pay a premium. We’re a small company in a niche market.”
A Commission System
Fryar started OMP with four stainless steel cutting tables and 25 employees in a processing space the size of a large conference room. While 16 employees deboned chicken by hand, others carried the precut or post-cut chicken from station to station in 60-pound tubs; little wonder the company produced only 22,000 pounds of chicken the first week.
From those humble beginnings, OMP has flourished. OMP, whose chicken is sold under its Forester Farmer’s Market brand, produces more than 3 million pounds a week for distribution to retailers such as Sam’s Club and to restaurants such as Chipotle Mexican Grill and Panera Bread Co.
“The first year in business, you’re not worried about what you’ll look like in 15 years,” Fryar said. “Just getting to the first anniversary is a milestone. Your goal the first year is to just exist.”
Fryar said the business plan he devised required 300,000 pounds a week to be successful. To get that much meat produced, his deboners would have to vastly increase their output, but deboning by hand is a skill that takes months of repetition to master.
One of the strategies that make OMP unique is that the company pays its deboners by the pound. Fryar compared the system to the commission that car salesmen earn for each automobile sold.
The more money they make for the company, the more money they make for themselves.
“What we’re doing in the chicken business, I don’t know anyone else who pays like we pay,” Fryar said.
The pay method may be unique to the industry, but the reliance on hand deboning is a staple. Fryar said he wanted to reward the often thankless job because of the importance of getting every available gram of meat off a bird.
Fryar said in the early going, deboners were struggling to produce 200-250 pounds a day, so the company began to “play games” and offered a $100 bonus for the first worker to produce 350 pounds in a single day. Sure enough, a couple of weeks later a worker reached the goal, and Fryar handed him $100 in cash.
“He went out and got drunk, and we never saw him again,” said Fryar, laughing. “The role model of the company.”
Through incentives and fine-tuning the production process — automation has replaced hand-carried tubs of meat — OMP began producing enough chicken to become profitable. A top dark-meat deboner can now produce 1,400 pounds a week, thanks to expertise, automation and really sharp knives, which are provided after each break.
In the deboning rooms, a running total of each station’s production runs on a tote board, which serves as an incentive to workers, as well as letting them know their work is being accurately tabulated.
Fryar said the top third of deboners of the company can make $35,000 a year. If he had his way, all of his deboners would be making that kind of money because that would mean they were major producers for the company.
“The people who create value are the ones with knives in their hands,” Fryar said. “It’s skilled manual labor. You’re not going to get rich, but you can live the American dream. We have the lowest cost per pound for deboners who make the most money. It’s a classic win-win.”
‘A Pretty Good Team’
As OMP grew more successful, Fryar hired former Baldor Electric executive Terry King as CFO in 2004. When King showed up at the plant to meet Fryar, he was momentarily taken aback by the small plant and gravel parking lot, but Fryar erased any doubts.
King served as an outside consultant for two months before hiring on full time, and now he is a minority owner of the company. He is also the owner of Isabella and Penelope, two excitable Portuguese water dogs.
“We felt we made a pretty good team,” King said. “It was kind of like a blind date. We had a lot of the same philosophies. I liked how he would build his business on the same philosophy. I saw how he treated people.
“How far we’ve come has just been incredible. It has been surprising we’ve done as well as we’ve done. It is not surprising we’ve done well.”
OMP is a company where if the CEO parks in a visitor’s-only spot in the parking lot, his truck will be plastered with a hard-to-remove orange sticker. Gleefully, King and Fryar add, because there is an unofficial bounty on catching one of the executives in a forbidden spot.
In the past 18 months, OMP has started an expansion project that saw the company buy two recently abandoned chicken plants in Batesville formerly owned by ConAgra and Pilgrim’s Pride. Fryar and King said the company’s expansion plans are nearly over, except for a small transaction they expect to finish in a few months.
“We need to digest what we’ve done in the last year and a half,” Fryar said. “For the next year, two years, we’re in a consolidation phase. We have to get our hands around what we’ve done.”
King said the company needs to take a “deep breath” after acquiring the two harvesting plants in Batesville. Fryar said there are no plans to move harvesting plants closer to Rogers or open up a deboning station closer to Batesville.
For one, hand deboning is a learned skill that takes time to develop, so opening a new plant would mean a couple hundred deboners producing less than break-even amounts of chicken for probably three to six months. The second reason for the distance is Fryar believes the eight or so hours that elapse from the time the chicken is harvested to the time it is deboned ages the meat for optimal taste.
“Our birds are much more tender than others you’ll find on the market,” Fryar said.
When Fryar decided to leave the teaching profession, he started a company with Maynard Anderson called A&F Exports, which soon led to the creation of Twin Rivers Foods, a poultry brokerage firm, with Anderson and two other partners in 1994. After six years, his partners bought out Fryar, who wanted to vertically integrate the company as he has been able to do with OMP.
He started OMP a year later.
“If I had known what I know today when I left campus, I would have left sooner,” Fryar said. “It has been extremely rewarding.”
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