Everything But the Cluck

Down the disassembly line flows an unending stream of chickens, drumsticks pointing straight up, as white-aproned workers cut and dismember.

Feathers, beaks, combs and claws --nonedible elements--fall into a trough that flushes the refuse to a rendering plant across the street. The refuse is then converted into chicken feed that is recycled into the next generation of broilers, who become unwitting cannibals. This super-streamlined operation, which uses everything from the chicken but the cluck, is run by Stratford of Texas Inc., a company less than four years old. Chief Executive Officer Robert Gow formed it in order to apply the computerized principles of industrial engineering to the task of pleasing a nation of hungry consumers.

Gow is a lanky, talkative New Englander who resigned as president of a successful offshore-oil-drilling business because he thought that organized agriculture is the new frontier of business. "The day when agriculture is called upon to save the dollar is already here," he says. "Just as Japan may be able to make barbed wire, nails and transistors more cheaply than we can, the U.S. can produce broilers and beef more cheaply and ship them all over the world." Thus far, Stratford's three basic operational areas are cattle, chickens and potted plants, and Gow organizes each division down to the last moo, cluck and root. Centralized production is one principle: the cattle operation is typical. Stratford's three yards are concentrated within a 30-mile radius, in keeping with Gow's belief in concentrated locations, and they feed a total of 150,000 head. (By December Gow plans to expand to 250,000.) The yards fatten a 650-lb. steer at the rate of 3.1 lbs. per day. Five months and some 490 lbs. later, the steer is shipped off to a packer. "It's a big operation," Gow says. "We have vets and nutritionists; the cattle are checked twice a day. We have a good drainage system, which means our cattle don't have to stand in mud. It's a hotel for cattle." In order to cut costs, Stratford grows its own feeds, which are fertilized by manure from its own cattle. A division of the company enriches waste rice hulls with nitrogen for feed. To speed up digestion of grain in a cow's four stomach cavities, Stratford converts corn and milo into flakes. All these cost-shaving techniques mean that Stratford can fatten cattle at 30 to 40 per pound below the national average. The chicken branch, centered near Tenaha, Texas, and the floriculture operation, in Apopka, Fla., produce along comparably canny lines.

Stratford's progress is reflected in its figures: last year profits were $3,400,000. The company's revenues rose from $27.8 million in 1969 to $78.8 million in 1972. The year 1971, however, was bad: though sales rose to $60.3 million, from $37.5 million in 1970, the company showed a loss of $4,000,000. Gow explains that although only a small fraction of Stratford's income stems from oil, a blowout in one of its natural gas wells cost the company $6,000,000. The company's stock sells these days at about $7 per share, eight times earnings, which is roughly on a par with companies like Ford and Bethlehem Steel.

Gow himself owns 69,000 shares (out of 3,600,000 outstanding), with options on 46,000 and a call on 37,000 more. His salary is $80,000 a year, a sizable drop from the $125,000 he made in the oil-drilling business. "It's not a Texas fortune-making story," he says. "In terms of the great Texas rich, I'm not there at all." But he has no regrets about his switch into agriculture, despite the temporary skid in income. "I thought it would be more fun," says Gow, "and eventually more profitable. I felt that if I was ever going to do something that would make a lot of money, I had to start again."

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