Thrushwood Farms, located in Galesburg, Ill., is known for its high-quality fresh pork products, as well as its selection of smoked meats. The company was founded by Jim and Kae Hankes in 1977. Thanks to the energy crisis that was occurring in the country then, they were unable to get a natural gas permit.

“The utility companies had quit giving those out because there was a shortage, so we built the building as an all-electric building,” says Jim. The Hankes worked with a nearby company to install a heat reclaim unit to warm the offices, retail space, breakrooms and bathrooms in the facility. It also installed a system for pre-heating hot water before it went to the water heater.

“It was cutting edge back then, but it was common sense,” Jim recalls. “It’s probably a good thing we did that, or else we might not have survived for 30 years. Looking at the last three decades, the meat industry has been a real roller coaster. It’s an ongoing challenge.”

Thrushwood Farms has expanded its facility three times. Twenty years ago, it added new office space. Around 10 years ago, the company added a cooked area, separating raw and cooked processes to satisfy HACCP requirements. The latest expansion took place in 2008, when the retail area was expanded to make the company even more energy efficient.

Over the years, Thrushwood Farms has become extremely diversified, adding to not only its available products but also its services. Barbecue is very popular in the area, and the company’s retail store has long offered hundreds of sauces and rubs. It also sells grills and accessories, such as wood pellets.

“The nice thing is that if customers come here to buy the pellets, chances are they’ll buy pork loins, ribs, brisket … something to smoke or cook,” Jim says.

The company also offers catering services, which it started doing when Jim realized that he could utilize his smokehouses for more than just the company’s sausages and other smoked meats. It also slaughters and custom-processes hogs for customers, who either use the meat for their home freezer or re-sell it at farmers’ markets. Hankes says that regulatory issues make it difficult for smaller companies to provide that service, but the company will continue to slaughter as long as it is able.

“It’s important for businesses our size to be out there for people,” he says. “You can’t go to one of the big companies and say, ‘I want you to harvest my two head of cattle and private label it for me,’ It can’t be done.”

Jim says that Thrushwood Farms has capitalized on the niches that have been left behind by the larger companies. “Especially since the boys have come home and gotten into the business, we’ve accepted the challenge to go after some of the markets in those niches.” Two of the Hankes’ three sons, Doug and Jeff, joined the business after graduating from college within the last three years, and they have brought many positive changes to the company. Jeff has a knack for the retail area, and he helped set up a successful cheese display, among other changes to the store.

“If you would have told me that we’d be selling cheese for $18 a pound in Galesburg, I’d say you’re nuts,” Jim says. “But he’s proven me wrong.”

Doug has been the driving force behind equipment upgrades, and he helped the company go from a state-inspected to a federally inspected operation three years ago. Both brothers also have been active in product development, leading to a new and popular line of snack sticks.

Expanding while conserving

“In the last seven months since we’ve completed the addition, realizing that the production in the back has increased and the sales in the front have increased, we’re actually using 5 percent fewer watts a day,” Jim says. “For us, that’s pretty exciting, and we’ve got more work to do.”

The energy savings have come from several different areas. Thrushwood Farms received a grant from the state of Illinois to work with the Smart Energy Design Assistance Center (SEDAC) through the University of Illinois. SEDAC provides advice to private companies to help increase energy savings and performed an audit on the Thrushwood Farms facility. With the results of that audit, the Hankes took action.

The newer equipment uses servo motors, which are more efficient than the company’s older equipment.

“That’s encouraging, that as we replace equipment, we’ll use more efficient equipment,” says Doug, noting the decline in energy usage between the company’s old stuffer and one the company recently purchased.

The retail area was the largest source of savings. The company’s older freezer case and its 5-horsepower compressor was removed and replaced by two cases with 1/8-horsepower compressors. Jim says that the older case went into automatic defrost twice a day. The newer cases will have to be defrosted manually, but they may only have to be defrosted once a year, if the environment in the area can be properly controlled.

Lighting was another area where Thrushwood Farms was able to make significant savings. Jim said he was going to go with standard T8 fluorescent bulbs but instead opted for the more expensive but cost-efficient T5 bulbs. He says that the T8 lights have a ballast that is on all the time, even when the light switch is off. The new lighting uses an electronic ballast that only turns on when someone flips the light switch. The lights also have two bulbs per fixture.

“The fixtures [in the shop] are giving me the same light as the fixtures [in the office] with four bulbs, and it’s only 104 watts per fixture,” Jim says. Before making the change to the newer lighting, he went to an electrical supply company and asked about the return on investment. The estimated payback for the company was just 15 months.

The building’s exterior in the expansion was given extra insulation and thermal-pane windows to help conserve energy. Extra insulation was added above the ceiling, and the water and refrigeration pipes in the building were also insulated. Jim says that he sometimes checks temperatures on the walls, windows and coolers with an infrared thermometer, checking for leaks.

There is still work to be done, he admits. Finding a more efficient way to heat water, replacing more of the older lighting and replacing older compressors with more efficient scroll compressors are all on the agenda. While Thrushwood Farms is a smaller company that just became federally inspected three years ago, he says that the changes are ones that all companies, regardless of size, should make. It does require a change in thought process to focus on controlling costs.

“If I can make a payback [on lighting] in 15 months, in 16 months I’m making money by saving money,” he says. “It’s no different than buying pork trim for 10 cents a pound cheaper.”

He notes that some people had a habit of leaving lights on in the back rooms, so he installed motion sensors to shut off the lights when there’s no activity in the room.

“We worked with an electrician, spent that hundred bucks, and I’ll guarantee you over the next few years we’re going to get that money back,” he says.

Snack stick successes

The company offers hams, a holiday favorite, as well as ground beef, and it recently purchased an automatic clipper to produce better ham packaging and ground beef chubs. It also bought a stuffer with an automatic lift that dumps the beef into the hopper. Both pieces of equipment have the twin benefits of increasing productivity while reducing the wear on employees.

“One of the biggest challenges we had was finding equipment that would fit in our facility,” comments Doug Hankes. Fortunately, he says, the ceilings were tall enough to accommodate the stuffer and lift. “We can load 200 pounds, bring in our clipper and chub off meat at a really rapid pace. Our overall efficiency has greatly increased from using technology.”

Another recent purchase was a rollstock machine, bought to greatly increase the number of snack sticks Thrushwood Farms could produce. The increase in popularity for the company’s snack sticks is a point of pride for Doug and his brother, Jeff. Both brothers enjoy the product development aspect and have expanded the snack stick line to include six flavors: barbecue, original beef stick, sweet teryiaki, “little Zip” (with jalapeño peppers), pizza and spicy.

Doug notes that the company had been producing sticks for as long as he could remember, and he’s tried many snack sticks that didn’t have much flavor.

“With meat, you can do so many things with flavoring, and I enjoying playing with those flavors,” he says. The sweet teryiaki stick alone went through about 30 different flavors before they settled on the right kind to introduce to the market. The snack sticks have become brisk sellers, not only at the retail level but also through the company’s online store (www.thrushwoodfarms.com). The company also sells boxes of the snack sticks to groups for fund-raising efforts. The sticks have sold so well that the facility has an entire room filled with snack sticks, so that employees easily can pull from the existing inventory to fulfill orders. Doug says that they try to keepv15,000 to 20,000 sticks on hand at all times, and that inventory turns over every 30 days or so. He says that the company’s snack stick sales for the first three months of the year topped sales from the first eight months of 2008.

The company’s rollstock machine, purchased last year, has helped the company keep up with the demand. With it, they are able to produce 80 fully packaged snacks a minute, complete with barcode labeling, as opposed to 10 or 12 a minute done by hand.

With plenty of opportunities for further cost savings and areas of growth for the company, Thrushwood Farms has managed to stay successful through the difficult economic times that have caused other companies to falter. Jim notes that the town of Galesburg has a population of 32,000 people, about 7,000 fewer than when the company started. The city has had several large employers shut down and put people out of work.

“What that has done has hardened us as a community toward this current recession,” he says. “There are a lot of businesses that learned to survive these current challenges in the ’80s, when we started taking our hits. It made us stronger today, so we’re not feeling the recession as hard.”

The company has seen an increase in its food-stamp customers, opening another market.

“If you’re a small business, you’d better target that,” Jim notes. “That’s just another way to market your products."