Who
we are
- Questions and Answers
- Membership Presentation (ppt presentation)
Below are a series of questions about Innovative Growers (IG) and their corresponding answers. The answers to these questions provide a summary of how we expect to structure IG. However, as we go through the business development process, the responses to some of these questions may change.
These questions and answers are for informational purposes only.The decision to invest in Innovative Growers should be based solely on the information contained in the company's Form U-7 Disclosure Document.
What
is IG?
IG is a
supply network for specialty grains.
What is the Vision
of IG?
A successful
farmer-owned, specialty-grain supply company that increases grower-member
profitability.
What is the Mission
of IG?
To increase
grower-member competitiveness & profitability by building long-term
business relationships with seed companies, processors, end-users, and
others.
How will IG meet
its mission and achieve its vision?
We will
accomplish this by providing valuable services to our customers that
are not provided by individual growers or other networks. These services
will result in higher premiums than can be obtained by individual growers
on their own.
What is IG's short-term
goal?
Our short-term
goal is to bring profitable contract opportunities to our grower-members.
What is IG's long-term
goal?
Our long-term
goal is to build long-term relationships with end-users that are of mutual
benefit to both parties.
When was IG started?
IG was
organized as a legal entity in January of 2000. We started taking members
in late August, 2000
How is IG legally
organized?
IG is organized
as a Limited Liability Company (LLC).
Who formed IG?
It was
formed by a group of Iowa farmers with the assistance of Iowa State University
Extension.
Where is IG's
office located?
Our office
is:
Innovative
Growers
2023 South Federal,
Mason City, Iowa 50401
Phone: 641/423-0844
Fax: 641/423-2642
Email: info@innovativegrowers.com
Who are IG's customers?
Our customers
are companies and/or individuals wanting specialty grains. Types of
customers include:
- Food processors wanting a specialty food ingredient or food grain,
- Companies wanting specialty grains to produce "pharmaceuticals", "neutraceuticals" or "functional foods",
- Feed processors wanting a specialty feed ingredient,
- Livestock producers wanting a specialty feed grain,
- Industrial producers wanting a specialty grain,
- Seed companies wanting certain specialty grain varieties produced for end users,
- Foreign buyers wanting a specialty grain for food or feed uses,
- Others
What services
does IG plan to provide for their customers?
IG plans
to provide a variety of services to customers including:
- One-stop shopping -- a large number of growers and a variety of services that can be accessed at one location.
- Large-scale production -- a state-wide network of skilled growers that can produce large quantities of a specialty grain.
- Production risk reduction -- the specialty grain can be produced over a wide geographic area to reduce production risk.
- Geographic specificity -- the specialty grain can be grown in a specific geographic region (based on delivery site requirements, growing season, soil types, etc.) of the broad geographic area covered by IG
- Identity preservation -- the identity of the specialty grain is preserved through the production, storage, and delivery stages up to the time it is delivered to the customer.
- Trace-back -- the ability to trace the identity of a specific lot of specialty grain back to the individual grower.
- Just-in-time delivery -- delivery of the specialty grain can be coordinated with the time and location needs of the end user.
- Tight production controls -- specialty grains can be produced under tight control restrictions.
- Quality assurance -- Some of our members are ISO 9001-2000 certified and more are going through the training. Protocols are being established for all members to follow.
- Dependability -- due to its focus on quality, IG will develop a reputation for dependability.
- Transportation/Logistics -- IG will deliver the grain or provide transportation and logistics assistance to its customers.
- Research -- IG will have the ability to provide research data and research analysis to end-users about yield and levels of specific traits based on variables such as soil types, production practices, climatic conditions, seed varieties, etc.
Who can belong
to IG?
Any farmer
who produces crops.
What does it cost
to join IG?
A "membership
unit" costs $250 and gives the member the right to grow up to 10
acres of specialty grains for IG.
Is there a minimum
investment?
To join
IG you must purchase a minimum of 10 membership units ($2,500 and the
right to grow up to 100 acres). There is no maximum investment limit.
Can I grow more
specialty grains for IG than the acreage allowed by my investment?
If IG has
more acres of specialty grain contracts available than its grower-members
have allowable acres (based on their investment), the allowable acreage
of its grower-members may be increased.
If I join IG,
can I sell my interest in the company at a later date?
You can sell your membership units to an eligible grower for market
price (price negotiated between a willing seller and a willing buyer).
The market price of the membership units will fluctuate based on the
success of the company. You are responsible for finding a buyer.The sale
is subject to approval by IG.
If you quit farming you must sell or otherwise transfer your membership units to an eligible grower. If you die the membership units can be transferred to an eligible grower through the estate settlement process. However, if the units will not be transferred to an eligible grower, the estate must sell them to an eligible grower.
What does IG plan
to provide me that I cannot achieve by contracting directly with
end users on my own?
The potential
benefits of joining IG include:
- Access to contract opportunities generated by IG's marketing staff.
- Benefits from IG's marketing and legal staff who will negotiate contract terms with end-users.
- IG assistance in helping you analyze contract opportunities, submit bids, grow crops to specification, properly store and transport crops to their final destination, etc.
- Purchasing specialty grain production inputs from IG at discount prices.
Are you accepting
new members?
We welcome
new members. Call our office for more information.
To join IG, what
do I have to do?
In addition
to purchasing membership units, you need to submit information on your
operation as outlined in the information section.
Will IG actually
enter into contracts with end-users or will they simply negotiate
contract opportunities between the end-user and the grower-members?
IG plans
to actually enter into contracts with end-users to deliver specialty
grains and contract with their individual grower-members to produce the
specialty grains.
How does IG fund
its operations?
Initially,
IG will be funded by membership fees from its members. However, the
on-going operation will be funded by the margin between the premiums
generated from contracting to end-users and the premiums it pays to grower
members for the production of the specialty grains.
How will IG allocate
contract acreage among its members?
IG may
allocate acres to its members in a variety of ways. Below are methods
that may be used:
- Allocate contract acres based on "membership units" owned,
- Allocate contract acres by region of the state (distance to end-user), certification qualifications, etc.
- Allocate contract acres based on a "bid" procedure.
- Other methods
What if IG makes
a profit (return above the amount needed to cover operating costs)?
Profits
will be returned to grower-members as a return on their investment in
the company. Alternatively, profits may be used to expand the company
if desired by the grower-members.
Will IG members
be ISO 9000 certified?
ISO 9000
is a self-created checklist of functions, policies and rules considered
necessary to assure the quality of a company's products and services. You
will have the opportunity to become ISO 9000 certified? Over time, we
expect that most of our members will want to become certified. You will
not be required to be ISO 9000 certified. However, all members may be
required to conform to minimum certification requirements established
by IG.
If I join IG,
what kinds of assistance will be provided to help me produce the
specialty grains?
When needed,
IG plans to provide assistance to individual grower-members. The types
of assistance provided may include:
- producing specialty grains to specification,
- meeting production and storage control measures,
- delivery logistics,
- ISO 9000 certification and/or other certification
- Other
What if a grower-member
does not meet the contract terms?
Because
IG is under contract with the contract entity (end-user), it is liable
for breach of contract. This may result in recourse against individual
grower-members who contribute to the breach of contract.
Examples of breach of contract by grower-members include:
- not meeting crop specifications due to grower error,
- not following proper production practices in producing the crop,
- improper storage of the crop,
- late delivery of the crop,
- other.
How will IG be
assured that they will receive damages from a grower-member due to
a breach of contract?
In certain
situations, grower-members growing high-value crops may be required to
post a "performance bond" or "performance deposit".
Can I obtain production
inputs through IG at a reduced price?
When possible,
IG plans to offer production inputs to grower-members at a reduced price
due to volume purchasing. Relevant inputs may include seed, fertilizer,
pesticides, crop insurance, etc.
Do I need to provide
information to IG?
Members
will provide specific information about their operation to IG.
What types of
information are required?
When a
grower joins IG, specific information must be provided about the operation.This
information will be used as a "resource base" by IG to
negotiate contracts with end-users and may need to be updated periodically.
Also, when a grower-member enters into a contract to grow a specialty grain, information on certain production practices may need to be provided to the end-user.
What are examples
of information that need to be provided when I join IG?
Examples
of information you must provide when joining IG are:
- Personal information: information about yourself as an individual grower-member.
- Resource information: information on available acres, exact field locations, soil types, on-farm storage capacity, crop drying facilities, farm equipment, etc.
- Agronomic information: information on past production practices, pesticide applications, fertility levels, etc.
What are examples
of information that may need to be provided for a specific contract?
Specific
contract examples may include:
- Planting and harvest dates,
- Tillage practices,
- Chemical applications,
- Yield levels,
- Levels of specific attributes,
- Other types of information.
How will I provide
the information to IG?
You will
input the information directly into the IG web site. IG will provide
computational and programming support for normal maintenance and management
of the database.
Will IG provide
assistance to members for inputting data?
Yes, IG
plans to provide technical training for member-growers and offer on-farm
visits to assist with specific problems.
How will the information
be used?
The information
will be used for:
- Negotiating contracts -- IG will be in a stronger bargaining position to negotiate favorable contracts with the grower information on past production,
- Determine grower eligibility for specialty grains with special production and/or handling requirements,
- Individual member decision-making -- grower-members can use the information to increase their profits by increasing their efficiency,
- Conduct in-house research -- IG can conduct proprietary research on how and where to grow, under what growing conditions to grow, and with what seed varieties, specialty grain should be produced to maximize yield and/or specific attribute levels.
Who is responsible
for the accuracy of the information?
You, the
grower, own the information provided to IG. You are also responsible
for the accuracy of the information.
Will the information
I provide to IG about my operation be shared with anyone outside
of the company?
No, information
on any individual grower-member will not be shared with anyone outside
of the company. he only information shared outside of the company will
be aggregate information (averages, ranges, etc.) of many grower-members.