Vital Farms doubles size of egg plant

Vital Farms has doubled the size of its Springfield egg washing and packing plant, with a goal of more than doubling its revenue.

According to Carl Kicklighter, director of plant operations, an expansion to its Partnership Industrial Center West facility is now functional.

“The expansion is basically a mirror image of what we had before, minus the administration area,” Kicklighter said. “All the same equipment that we have in the original footprint is included in the new expansion.”

The company, which produces pasture-raised eggs and butter, has grown faster than expected, said Kicklighter, whose facility is the only egg plant in the company.

“The growth trajectory of the company as a whole has been really strong,” he said. “We knew when this facility was put in that we would eventually run out of capacity.”

Vital Farms’ Springfield plant now spans 150,000 square feet. At capacity, a team of 225 will be able to process 6 million eggs daily.

In Vital Farms’ May earnings call for the end of the first quarter of 2022, president and CEO Russell Diez-Canseco told shareholders the expansion puts the company in position to support over $650 million in annual revenue from the Springfield facility.

He added in the call that the initial work of design and site selection has begun for the next Vital Farms egg packing center.

Last year, the company reported a year-over-year net revenue bump of 21.8% to $260.9 million, and in the first quarter of fiscal 2022, Vital Farms recorded $77.1 million in net revenue.

Another growth factor is a continuing shift in awareness of where food is raised, Kicklighter said. Vital Farms contracts with 275 farms across the pasture belt, which includes Missouri and 11 other states.

“At Vital Farms, the business model that we have just leads to really strong, sustainable growth,” Kicklighter said. “The way we treat our chickens, they’re living their best life on the farms right now.”

Austin, Texas-based Vital Farms (Nasdaq: VITL) is the largest pasture-raised egg brand in the U.S. as well as the fastest-growing egg brand by dollar share in the country, Kicklighter said.

Expansion details
Vital Farms cut the ribbon on its Springfield plant – dubbed Egg Central Station – in October 2017. The facility originally measured 85,000 square feet, including a 65,000-square-foot production floor and a 20,000-square-foot administration space. The new addition is 65,000 square feet, mirroring the original production floor, Kicklighter said.

Kicklighter said the employee count will soon grow to staff the expansion, with hourly pay starting at $16.

Kicklighter declined to disclose the amount of the capital expenditure for the expansion, but Springfield Business Journal’s 2017 reporting put the cost of the original building at an estimated $6 million.

Matt Morrow, president of the Springfield Area Chamber of Commerce, praised the cooperative spirit of Vital Farms and called the expansion a tremendous story of what’s good about Springfield and the company.

“They embrace collaborative partnerships and community – have since before they got here, and they continue to do that,” he said. “That’s been the key to their success, and they’d be the first to tell you that, but it’s also a great example of what makes businesses grow and thrive in our community in particular.”

Morrow said when Vital Farms was considering Springfield, community members, including City Utilities, city government and education providers, sat around the table to answer questions and listen to one another.

“They saw something that was consistent with the culture they wanted,” Morrow said of Vital Farms. “Not every company has a collaborative culture; they do, and they saw that here.”

Sustainability features
Vital Farms’ website says the company is rooted in a commitment to conscious capitalism, prioritizing long-term benefits to its stakeholders, including farmers and suppliers, customers, communities, crew members and stockholders.

Vital Farms is also a certified B corporation, which requires businesses to consider other motives aside from generating profits.

Environmental consciousness is front and center at the 11-acre Springfield site, where natural grassland surrounds the building.

“You’ll notice we don’t have a manicured lawn that we spend a bunch of money watering,” Kicklighter said. “We don’t mow the lawns at all. It’s all native wildlife – that’s why you’ll see a bunch of deer and turkey walking through. It just lessens our impact in this footprint here.”

Kicklighter described the facility as a greenfield build.

“We want to assume if we were literally to take the building away, it would just go back to the native landscape,” he said.

The parking lot is constructed of pavers, not blacktop, and that helps to manage runoff, he said. In a big rain, retention ponds and vegetative channels allow the company to release water in a controlled manner, rather than just passing a problem downhill.

Additionally, the building’s windows automatically raise and lower to control sunlight levels, saving energy in the process, and officials say LED lights on the premises improve energy efficiency by 50%.

In the plant, a water filtration system allows egg wash water to be reused for up to four hours.

Luxury product
April Horton, store manager at Natural Grocers in Springfield, said Vital Farms eggs sell well. She said the store carries regular and organic varieties, priced at $5.79 and $7.29 per dozen, respectively.

“I think it’s a good product,” she said. “I had it at my other locations in Colorado, and there, people asked for that product.”

Kicklighter acknowledged Vital Farms eggs are priced on the higher end.

“We’ve made no bones about being positioned as a premium product,” he said. “But when you look at the value proposition, I think folks understand what they’re getting when they buy that.”

Vital Farms’ products retail in 21,000 stores, and over 6.4 million U.S. households buy its products.

Customers say they value being able to see a live feed from the farm where their eggs were sourced, Kicklighter said.

“They can literally see their chickens, live and in person,” he said.

The company requires each farm it contracts with to provide 108 square feet of space for each chicken to roam.

In 2021, the company collected eggs from 3.4 million hens, each raised with access to the outdoors.