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Located in Little Chute, Wisconsin, Bel/Kaukauna USA is the American subsidiary of Paris-based Fromageries Bel. The company makes a variet y of processed cheese products. Kaukauna spreadable cheese is package d in cups and tubs and is available in a wide variety of flavors, fro m sharp cheddar to port wine. The Kaukauna brand is also found on che ese balls and cheese logs, which are offered in flavors similar to th e spreadable product, and on a variety of Mexican sauces & dips, which include cheese items as well as salsa and French onion and ranc h dips. In addition, the company manufactures and markets a number of brands picked up from its corporate parent, including spreadable che ese brands WisPride, Merkts, Owl's Nest, and Connoisseur; The Laughin g Cow processed cheese wedges; Mini Baybel natural cheeses; and Price 's pimiento cheese spreads. In addition to its Wisconsin operation, B el/Kaukauna also operates a plant in Leitchfield, Kentucky, and a sat ellite sales office in Fort Lee, New Jersey.
Founding Family Immigrates to Wisconsin in the 1800s
Kaukauna Cheese was founded by Hubert Fassbender in Kaukauna, Wiscons in. His father, Peter Fassbender, was born in Prussia in 1838 and mov ed with his mother and stepfather to the United States in 1856, landi ng in New York and settling in Wisconsin. In 1862 he was married and a year later bought farmland in Outagamie county, where he and his wi fe raised nine children, including Hubert, the sixth in line, born in 1875. Over the years the elder Fassbender bought more land to grow a dairy operation and in 1887 built a cheese factory, with the milk co ming from his own cows as well as neighboring farms. When he was 14 H ubert Fassbender began to learn the cheese making trade in his father 's factory. In 1901 Peter Fassbender sold his farm to a son, Joseph P . Fassbender, and sold the factory to Hubert, who rebuilt the facilit y, turning it into one of the largest creameries and cheese factories in the area. Using Appleton, Wisconsin, as his main distribution poi nt, Fassbender began shipping his product all over the country.
In 1918 Fassbender started a distribution company known as South Kauk ana Dairy, which became known as Kaukauna Dairy Company, and eventual ly took the name of Kaukauna Cheese. When Prohibition came to an end in 1933 his distribution company handled another favorite Wisconsin p roduct: beer. According to the Wisconsin Center for Dairy Research, F assbender became a pioneer in spreadable cheese through his beer depo t business. Known as cold pack cheese, spreadable cheese, unlike proc essed cheese, mixed cheeses and other ingredients together with the u se of heat. It was a good way to make use of old cheese beginning to dry up and was no doubt produced by frugal people long before Hubert Fassbender began tinkering with the idea. After he had started delive ring beer, tavern owners asked if he had something the patrons could wash down with that beer. The idea of the free lunch was hardly new, and cheese makers had long depended on the sale of cheese to barrooms , which offered it along with bread, ham, eggs, pickles, and the rest of the usual spread of a free lunch.
Early 1930s Introduction of "Club Cheese"
Using his extensive background in cheese making, Fassbender looked fo r a way to make use of excess cheese while satisfying the request of his beer customers. After some experimentation he perfected the produ ction of cold pack cheese that could be spread at room temperature. I n brief, the method combined finely ground natural cheese with whey s olids, dry milk, and any number of flavorings. In 1933 he began provi ding the cheese to customers--taverns, clubs, and hotels--if they bou ght enough beer. It proved popular with patrons who nicknamed it "clu b cheese." According to great-nephew Gary Fessbender, interviewed by the Wisconsin Center for Dairy Research, customers after a while were more interested in Fassbender's club cheese than his beer. Thus, in 1933, Fassbender created the Kaukauna Klub brand of cold packed chees e, marketed in a gray stone crock container about four inches in diam eter, using the slogan, "It spreads like butter." After first establi shing the business by selling the crocks to taverns, Fassbender sold it in retail channels and gradually made it into a national brand. Ot her Wisconsin cheese makers followed his example and began launching their own brands of club cheese. A major reason why Kaukauna Klub had staying power was that its founder did not simply see the product as a way to make use of scraps. According to company information, he on ce said, "We must never waste our care nor risk the flavor of Kaukaun a Klub trying to work with cheese that isn't worthy of the effort."
Kaukauna Cheese was sold to Minneapolis-based International Multifood s Corporation in 1971. Multifoods had started out as a flour milling operation, best known for the Robin Hood brand. At one point the comp any, along with General Mills and Pillsbury, was a member of the "Big Three" in U.S flour milling, but Robin Hood always lagged behind the others in brand recognition. In the early 1960s the company began an aggressive diversification effort into the consumer foods markets an d over the next decade acquired more than 40 companies, including a n umber of niche-market food products companies like Kaukauna Cheese.
With the financial backing of its new corporate parent, Kaukauna Chee se in 1974 opened new facilities in an industrial park in Little Chut e, Wisconsin. With more specialized equipment now at its disposal, th e company would emerge during the 1970s as America's largest manufact urer of cheeseballs and cheeselogs. Then, in the 1980s, Kaukauna Chee se expanded its product offering to include a line of Mexican-style c heese dips and other sauces.
Multifoods was a billion dollar company by 1980, having enjoyed a dec ade-long period of strong growth. The increases continued until 1984, but disturbing signs were emerging. Nearly all of its consumer produ cts were losing market share and only one, Kretschmer Wheat Germ, was a market leader. Multifoods lacked focus, the byproduct of an indisc riminate buying spree as well as meager brand recognition for the Mul tifoods name. The company now undertook a restructuring program, a se lling and buying of assets that over the course of several years tran sformed Multifoods from a flour milling and consumer foods company in to a major foodservice distribution and manufacturing company.
Regaining Independence in the Mid-1980s
One of the subsidiaries Multifoods chose to divest was the Kaukauna C heese operations. In 1986 a Kaukauna management team, led by Robert G ilbert and private investors, formed Kaukauna Cheese Corp. to buy the business. The transaction was completed in early 1987 and Kaukauna C heese was once again an independent company, with Gilbert serving as president and chief executive officer.
That independence lasted a decade. During that time Kaukauna Cheese m ade headlines by becoming the first company, in 1991, to use the all- natural fat substitute, Simplesse 100, developed by NutraSweet using a whey protein concentrate. The "light" cheese category was extremely competitive, and for several years Kaukauna Cheese's entry had exper ienced flat sales. The new product, called Kaukauna Lite 50, reflecti ng a 50 percent reduction in fat, was produced in four varieties and sold side by side with the company's other cold pack products. Other cheese makers would soon follow the company's lead and introduce thei r own products using Simplesse 100.
Kaukauna Cheese was doing well in the mid-1990s, generating annual sa les in the $50 million range, but when it was approached by Froma geries Bel about selling the business, management listened. "I'm not going to live forever," Gilbert told the Milwaukee Journal Sentine l. "In life, you can't pick your moments, and this is a company w e respect, they approached us, and discussions took off from there." In February 1996 the two parties announced they had reached an agreem ent. Fromageries Bel's New Jersey-based subsidiary, Bel Cheese USA, I nc., would purchase the assets of Kaukauna Cheese, which included a m anufacturing and distribution facility in Little Chute, a retail stor e in the town, and a refrigerated warehouse in Neenah, Wisconsin.
Gilbert also received a contractual assurance that the operation woul d not be relocated. Given that Kaukauna Cheese had recently moved int o a new $3.5 million plant and produced as much sales as all Bel Cheese USA products combined, there was no desire on the part of the new corporate parent to move the operations. But it was an important commitment nonetheless, given the problems Bel Cheese USA had encount ered with another Wisconsin cheese spread maker, Wispride. About a ye ar earlier Wispride's plant was closed, costing about 120 people thei r jobs, as Wispride production was moved to Leitchfield, Kentucky. In November 1995, Wisconsin Attorney General Jim Doyle filed suit again st Bel Cheese USA, alleging that its use of the Wispride trademark, w hich indicated the cheese products came from Wisconsin, amounted to f alse advertising.
After the acquisition of Kaukauna Cheese, Fromageries Bel reorganized its U.S. subsidiary, not only streamlining the operation but elimina ting the nettlesome problem with Wispride. In late 1996 and early 199 7 Fromageries Bel announced a number of sweeping changes. First, the production of Wispride products was transferred to the Little Chute p lant. The move was not made to settle the pending lawsuit with the st ate of Wisconsin, but was just an ancillary benefit. The company main tained that cost studies it conducted revealed the Wispride line woul d be less expensive to produce in Kaukauna's newer plant. Fromageries Bel also decided to downsize the Fort Lee, New Jersey office, making it a satellite sales office and shifting administrative positions to Little Chute. The New Jersey office and its marketing team would con tinue to market the Bel brands and Price's brands, while Wispride mar keting would be taken over by the Kaukauna marketing group. Moreover, the sales force of Kaukauna Cheese and Bel Cheese USA were to be int egrated, resulting in staff reductions. Regional managers would now b e responsible for the line of products produced by Bel Cheese USA and Kaukauna Cheese. Finally, Fromageries Bel decided to rename its U.S. operations Bel/Kaukauna USA. The head of Bel Cheese USA, Patrick Rob be, a French native, was reassigned to Paris, and Kaukauna's Robert G ilbert took over the presidency of the combined enterprise. While the changes resulted in the loss of jobs in Kentucky and New Jersey, it also meant that Little Chute would be adding about 40 production jobs , several managers, and another half-dozen clerical employees. The Li ttle Chute plant would increase its poundage volume by about 25 perce nt over the previous year. "I would say that the latest round of deci sions solidified our position for the future," Gilbert told Appleton, Wisconsin's Post-Crescent, "and shows that Fromageries Bel is fully committed to its operations in the United States."
To accommodate its enlarged business in Little Chute, Bel/Kaukauna ex panded its offices and production facilities. That extra room would b e needed in 2002, when the company acquired a number of brands from O hio-based Lakeview Farms Inc. It added the Merkts and Owl's Nest chee se spread brand and several private-label brands.
Over the years Kaukauna Cheese had won an abundance of awards for its products. Under French ownership that would not change. In 2003, for example, the company's sharp cheddar cold pack cheese won first plac e in a countrywide contest sponsored by the Wisconsin Cheese Makers A ssociation. In that same year, at the Wisconsin State Fair, the same product won the Governor's Sweepstakes Award.
Bel/Kaukauna received a major break in 2003 when "The South Beach Die t" book, which became a runaway bestseller, included a wedge of Laugh ing Cow light cheese and a pear as an afternoon snack in a sample mea l plan. As a result the demand for Bel/Kaukauna's Laughing Cow wedges skyrocketed. The company could not make the product fast enough and had to expand production in its Kentucky plant and import product fro m France, where it originated in 1921. The logo came from the smiling cow pictures stenciled on the trucks that supplied food to French so ldiers in the field during World War I. "If you are an old cheese war rior like me, this breaks your heart," Gilbert told the Wisconsin State Journal. "I fought and clawed for every pound I could get i n this business and it breaks my heart that we aren't able to ship mo re." He had to be content to take advantage of the trend as much as p ossible while he could. "If other fads are any indication, if other d iets are any indication, people will tend to slip away and fall away, " Gilbert told the Journal. "But hopefully when they do, they are going to remember that Laughing Cow tastes great."
Principal Operating Units: Kaukauna; WisPride; Merkts; Owl's N est; Price's; The Laughing Cow; MiniBabyBel; Connoisseur.
Principal Competitors: Kraft Foods North America, Inc.; Saputo Cheese USA Inc.; Sargento Foods Inc.
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