FRESHMILK FINDSASUPERMARKETNICHE
FRESHMILK FINDSASUPERMARKETNICHE
With current devastatingly
low milk prices, many
producers would like to
secure a 10-15% premium.
Jeremy Hunt finds out
how one small group of
producers has achieved
just that, with minimal
financial investment
MILK producer William Slinger had no idea that life for him and 14 other producers was about to undergo a radical change when he made a chance phone call to a local supermarket.
That phone call, made in January 2001, led to the launch of Bowland Fresh Milk, which now sees these 15 Lancs producers buying their milk back from Zenith (Dairy Farmers of Britain) and selling it to a regional supermarket chain.
The group has formed a company called Connect Plus and they are supplying the entire production from their 15 herds, which have quota for 6m litres.
The scheme, launched in early August, is earning them 10-15% more than they would be paid for their milk sold to Zenith. Within the first week of Bowland Fresh Milk going on to the shelves, sales reached a target set for 12 months hence.
Mr Slinger, whose family milks 100 cows at Dickinsons Farm, Pendleton, Clitheroe, admits he was surprised at how quickly and easily links were established with supermarket chain Booths. Booths, which has 24 branches in the north-west, has a reputation for supporting local food producers.
"As an industry, I think weve been playing trench warfare tactics with the retail trade for too long. Its amazing what opening up a dialogue can lead to.
"My opening gambit was to ask Booths what it needed and what could be sourced directly from farm to leave us some profit," says Mr Slinger, who has taken on the role of administrative director of Connect Plus.
No staff are employed. Ensuring all parts of the milk supply chain run smoothly – from farm to processor and to the supermarkets distribution depot – is the job of Connect Plus members.
The first job for Mr Slinger was to assess how much milk Booths would need and what its retail price would be. The minimum daily volume required was 12,000 litres.
Approaches were made to local producers and the 15 members of the Connect Plus partnership were signed up. "We have all made a small investment in the company. But its not been a project demanding a large financial stake," says Mr Slinger.
Year-round supply
Quota profiles from each farm ensure a year-round supply of milk can be maintained and take into account anticipated rising demand. Fortunately, all Connect Plus members are contracted to Zenith and the status quo remains.
"If the venture fails, none of us has jeopardised contracts with our primary milk buyer," says Mr Slinger. Milk is collected daily in one tanker from the 15 farms and delivered to a processor in Preston, close to Booths main distribution depot.
Bowland Fresh Milk has been the subject of a thorough marketing evaluation by Booths in the months prior to launch. A meticulous examination of every detail of the packaging, logo and wording on the carton has been completed, using top designers and marketing consultants. Even special foil-tops carrying the brand logo – believed to be a first for foil topped milk cartons – have been manufactured for Bowland Fresh Milk in Chicago.
"Its been a fascinating journey seeing the whole concept develop over the past 18 months. We, as producers, have been involved at every stage," says Mr Slinger.
The marketeers settled on a quirky carton logo which epitomises the regions reputation for milk production. The black-and-white photograph of a cow leaning cheekily over a typical Lancashire stone wall has been a huge success. Despite Bowland Fresh Milk carrying a retail price of 35p/pint – 6p more than Booths own brand of cartoned milk – sales have been booming. It is being sold in one- and two-pint cartons.
Marketing motives
"One of the principal motivations has been learning how marketing is undertaken and which elements work and which dont. But Ive been amazed at how simple the whole thing has been. And all through making a phone call."
The future for Bowland Fresh Milk looks exciting. Already there is talk of marketing cream under the same label and possibly other value added milk products, including cheese, in the future.
A web-site has been created to explain to consumers the rationale behind the Bowland Fresh Milk brand. Producers hope consumers will become involved in product promotions and competitions via, the internet. *
Earning an extra 10-15% premium for his milk needed little financial investment and is a low risk enterprise, says William Slinger.
Confidence quest
Each Connect Plus farm will be signed up to a farm assurance scheme, independently verified by ADAS, to ensure it meets the companys dairy welfare and husbandry code.
"Theres more to winning consumer confidence than simply sticking a local label on a product. On the day we launched our milk we spent time in the supermarket talking to shoppers about their food buying preferences," says Mr Slinger.
"Its clear that consumers want assurance that the food they eat is produced to high husbandry standards. They are prepared to pay extra for that reassurance."
The Connect Plus code of practice covers all aspects of milk production from hygiene and food safety to housing, maintenance of equipment, herd health, feed quality and detailed record keeping.
Booths marketing director Chris Dee adds that the producers have been the real drivers of this project. "We have worked closely with them throughout and are pleased they are now receiving a decent proportion of the retail milk price."
• 18 months to set up.
• Little financial investment.
• Low risk enterprise.