July 2019 Magazine

Doing Good, Doing Well

Scott

After Alltel, Scott Ford’s Westrock Coffee sees 300 percent growth while helping move farmers from poverty to productivity 

by Dwain Hebda | Photo by Jamison Mosley

Scott Ford strides purposefully through the arteries of Westrock Coffee’s international headquarters, a deceptively modest, low-slung building tucked into a North Little Rock industrial park. The company’s co-founder is in tour guide mode, but he’s moving and talking in his own gear, that is to say, fast. 

Over here he shares the origins of a hundred burlap bags of raw beans, each the size of a bean-bag chair. Two strides later, he’s over there, shouting over the deafening snake rattle coursing through pipes overhead to or from roasting equipment. 

He ducks out a door and under the skeletal steel frame of a forthcoming multi-million-dollar expansion, then without breaking stride, pops back to the packaging floor. Here, leviathan machines sprawl across an area the size of a jumbo jet hangar, marrying product with packaging. One tentacle fills and seals gleaming metallic pouches for hotel kitchens; another fattens bags headed to retail outlets and still another whisks strident rows of single-serve cups through to their nesting boxes. 

Employees referee the action or test random samples while unblinking electric eyes root out the misshaped or ill-sealed. A finished pallet pirouettes until it glistens in plastic wrap, ready to ship.

Ford narrates every step in the process, his voice tinged with the wonder of a kid who’d just built his first robot. He’s quick to defer to others – “These are the real experts,” he says of workers nearby – but there’s something life-giving for him in the frenetic, jittery hum of these machines. And it’s a song that has yet to approach its crescendo.

“I feel great about what we do here,” Ford says. “If I had another tech, media, big public company CEO job, I’d have made a lot more money, but I don’t think I’d have had as much fun. I don’t think I’d have had the impact. And I don’t think I would have dealt with issues at a deep level about why we do what we do, where can you really be helpful.”

From that platitude, the slightest steely growl enters Ford’s voice, echoing the free-market shark swimming constantly within.

“I’m high on corporate combat. Real high on it, you know?” he says. “We’re going to rock the coffee world 18 months from now.”

It’s been a decade since Arkansas-born Alltel passed into history, leaving Scott Ford and hundreds of others pondering their next move. Born in 1943 as Allied Telephone & Electric, the company grew into one of the most profitable and most-admired corporations in telecommunications history. 

Ford’s kinfolk founded the company and sixty years ago his father, Joe T. Ford, joined Allied as a Yellow Pages ad salesman, on his way to his ascent to the role of president. Always astute at visualizing the future, Alltel (the name changed in 1983 via a merger with Ohio-based Mid-Continent Telephone Company) entered the wireless business in North Carolina in 1985. 

By the time Scott became president in 1997, the company had distinguished itself in the industry’s free-wheeling mergers and acquisitions era, something he continued with aplomb. At its peak, Alltel operated one of the largest networks in the country, boasted 13 million customers in 34 states and generated $10 billion in annual revenue.

The end came in 2008, just 13 months after Alltel leadership made the strategic decision to go from a publicly-traded company to privately-held, agreeing to a buyout by TPG Capital and GS Capital Partners, the private-equity division of Goldman Sachs. Almost immediately thereafter, the stock market melted down, eviscerating firms like Alltel’s new owners. They agreed to a $28.1 billion offer from Verizon Wireless for the majority of Alltel’s assets, effective January 2009.

Westrock sources its coffee beans from more than 2,500 Rwandan farmers.

Alltel’s unceremonious end stunned and stung anyone who worked there, including the uber-competitive Ford. A decade later, the wounds aren’t as fresh, and he’s gained a measure of perspective.

“I hated letting people go. I hated turning the reins over to Verizon,” he says. “But I would have really hated, and really had a hard time sleeping, if people had entrusted me with their money and I could see the train wreck coming, and I didn’t have the guts to step aside and deal with the fallout. To hand them back less money than they had given us to build this business, that would have been a moral travesty. And that was the reality.

“Four days after we agreed to sell Alltel to the private equity investors in 2007, the bond markets on that Thursday threw up, and it never got well again. Wireless equity prices never recovered. We got out by four days. People give me crap for doing what we did, and when my dad’s in the room he goes, ‘What are you talking about, you idiot? Four days later, we’d have been broke with everybody else.’”

Smarting or not, Ford wasn’t wired to sit still, and before long he’d jumped back into what he knew and loved most – building businesses. Westrock came to pass in his post-Alltel era even as job offers from corporations and other new business ventures tugged at his sleeve. 

“I’m the last of the unrepentant free-market capitalists,” he says. “It is the only system that lifts the poorest of the poor out of poverty. They don’t have to be born into their position. They can get out of the position they’re in. That’s the beauty of free-market capitalism. That’s why I’m a big believer in it.

“I had developed a level of comfort that the free market system would be allowed to flourish in Rwanda and that part of East Africa if you could find the right seed. So, I went over there looking for the right seed to plant.”

Ford didn’t have coffee in mind until he heard about buyers from other companies paying farmers below fair market rates for their beans. It made him mad enough to launch Westrock in large part just to prove there was a way to do good while doing well. 

“We’re running a commodity processing business, and to be able to have the impact we wanted to have on the ground, we had to run it efficiently, effectively,” he says. “That’s just like Alltel. You get the right team, you get a mission that you agree to, you get the right boundaries and incentive structure. Then you support them, and you work the issues and you roll through that. Over 10 and 20 years you’re amazed with what can happen.”

In Westrock’s case, that included a corps of 2,500 Rwandan growers, the very epitome of mom-and-pop operations. Ford was as moved as anyone to help them improve their and their children’s lot in life and was convinced the tenets of capitalism was the answer.  

“They’re just like everybody else. They want to make more money; they want to work smarter,” he says. “Well, there is no extension service over there; we’re it. We’d take them through the training, basic, simple building blocks. Agronomy – when to mulch, when to fertilize, when to prune, what to pick, what not to pick. Second, you are your own business. Do you know how to keep records of your crop and of your money? Can you keep production records, can you keep up with your money? 

“Now you’re an accomplished farmer. Now you’re a profitable farmer. And now that you’re an accomplished farmer that’s profitable, what do you want to do to invest back and build your community? We quit trying to tell them what they needed. We think they need a school. Well, no, they need a water well. We let them pick.”

Ford’s approach didn’t fit what Western groups typically employed in such regions, something he acknowledges unapologetically. He wasn’t running a philanthropy after all, but by positioning Westrock as a no-nonsense business first, the feel-good stuff followed naturally.

“Simple answer is, it’s very difficult to capture their imagination through a nonprofit mentality,” he says. “When you approach them through the for-profit model, they get it instantly, like everybody else in the world. With training, they doubled their output and tripled their cash income.

“You get them the basic information, and you quit telling them what they’re supposed to think, and you start letting them work their way through it, just like we did here. Pretty amazing what happens.”

“Amazing” is a term applicable throughout Westrock Coffee. In addition to what it’s done for farmers overseas, the company has quickly become a player in a variety of market segments under its brand name and as a product manufacturer under Walmart’s Great Value and Sam’s Club’s Member’s Mark brands. 

Its United Kingdom-based trading company, Falcon Coffees, serves the highest end of the coffee spectrum, maintaining a business presence in 21 countries worldwide. New physical offices are opening or planned, $50 million is being spent on an expansion to the North Little Rock facility, employee headcount is nosing toward 400 worldwide. Sales have grown from $1 million to $300 million in 10 years. And that’s not even the best part.

“So, here’s the big news; we haven’t shared this with anybody,” he says. “We’re partnering to deliver the first-ever, in the history of the world, digital trace of coffee. Go pull a cup out of that box, shoot the QR code, and it’ll tell you the coffee in this box was purchased from the following people – Mrs. Smith, Mr. Jones – this quantity, this quality, this price, on this date. Full digital traceability from the retail product through the roaster, through the importer, through the exporter, through the dry mill, through the wet mill, through the cooperative, back to the farmer with a name. 

“Why? Because when you remove her anonymity you give her power. When she is no longer anonymous, she is empowered to demand a fair price. When you’re in a blind supply chain, you don’t know who she is, and you don’t know what she’s been paid. You have no idea what’s really in it. And if you’re a major retailer, you can see all the way back down the line, and you know who’s down there versus, ‘Hey, are there any six-year-olds working in your supply chain?’ and they look around and go, ‘Hell, I don’t know. Hope not.’ It’s the first fully digitally-traced coffee; it’s coming out of Rwanda and it will land here in the U.S. this summer.”

With that, Ford leans back in his chair, as if visualizing the ramifications of such technology for the first time. It’s a look of wonder, of glimpsing a new frontier’s unlimited possibilities. Having shaken the dust off long-held incongruities between commerce and compassion and conjoined first and third world ethics, Westrock flexes for that road ahead. And somewhere between bare-knuckle brawler and camp-meeting revivalist, Scott Ford is ready.

“I think we’re on the verge of doing something unbelievably special,” he says. “Building that business, we have to compete in the developed world as aggressively and tenaciously as any commodity processing trader in the world, and if we beat them, the benefit flows all the way back. That’s life-changing for literally millions of children.

“So why didn’t I go run a big tech or media business? Well, how can that compare to that? Yes, I’d have made $100 million. Who gives a crap? It has not been easy. It has taken everything I’ve had, but it has been unbelievably worthwhile.” 

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