(June 21) PASADENA, Calif. — Fallout from the e-commerce collapse apparently has settled, and the economy appears to be rebounding — at least where the salaries of produce industry executives are concerned.


In the case of the Mixtec Group’s latest salary survey of produce industry executives, however, consolidation is leaving its mark in the form of higher compensation.

“We’re definitely seeing an upward tick on salaries,” said Chris Nelson, president of the Mixtec Group, an executive search firm based in Pasadena, which had conducted the survey yearly until it skipped the project in 2001.

It’s a good-news, bad-news scenario, however, with fewer management positions available in an increasingly consolidated industry.

“With consolidation, you need more horsepower to trump the size and scope of operations,” Nelson said. “Businesses are bigger, so getting someone to run them has a bigger price tag.”

COMPANY PRESIDENTS

Company presidents increased their average base salary from $221,000 to $230,000, or 4%, between 2000 and 2002. Total compensation for that position rose 3.8%, from $288,000 to $299,000. That bump followed a 2.4% decrease from 1999 to 2000. In 1995, company presidents averaged $205,000 in total compensation.

At the higher end of the scale, Larry Kern, president and chief operating officer at Dole Food Co. Inc., Westlake Village, Calif., posted a salary of $583,846 and bonuses totaling $585,000, according to papers filed with the Securities & Exchange Commission in April.“ Again, it’s supply and demand,” Nelson said. “There are so few people that understand how to run a produce business because it’s so different from most businesses. It takes at least a year to understand the produce business. People who do so can demand top remuneration.”

The average annual base salary for general managers increased from $149,000 in 2000 to $155,000 in 2002, or about 4%. Total compensation for that position increased from $202,000 to $209,000, or about 3.3%, during that time frame. The U.S. Consumer Price Index rose 4.1% during that time.

Total compensation for general managers, which had slipped from $209,000 to $202,000 from 1999-2000, has increased by $61,000 since 1995, when the average was $148,000.

DOT-COM BOOST

The short-lived boom in dot-com businesses had only a limited impact on salaries between 2000 and 2002, Nelson said.

“It inflated it (the salary structure). There was definitely a jump in demand,” he said. “But it was such a short run that there was a flood on the market that influenced a down tick (in compensation). But life has gone on, and we’re back to normal.”

The terrorist attacks of Sept. 11 brought much business activity to a veritable standstill, temporarily, but the produce industry — and, by extension, executive compensation — was more insulated than other businesses, Nelson said.

“There were some hard times, especially in foodservice, because restaurant business got hurt,” Nelson said. “But people still have to eat. We’re in the best business in the world. Our business is almost counter-cyclical to the rest of the economy. We’re driven by other factors that often don’t come into play.”

BIGGEST BOOST

Top sales executives got the biggest two-year boost, Nelson said.

The base salary for vice president of sales and marketing increased from $148,000 in 2000 to $154,000 in 2002, or little more than 4%. Total compensation for that position jumped about 12%, from $178,000 to $200,000.

“It gets back to consolidation,” Nelson said. “There are only six or seven key retailers that are directing the market. If you don’t understand how these people go to market, you’re on the outside looking in.”

The 2002 survey was released in January, Nelson said. Although Mixtec skipped a salary survey in 2001, the company plans to release another, perhaps, in October, he said.