01 September 2000
YEO Valley Organic, based at Cannington, Somerset has been rated the fastest-growing dairy product brand in the UK, by a huge margin.
It is the second year running that the companys sales have taken the top spot in an annual survey by grocery research specialist AC Nielsen.
Figures, based on monthly audits of grocers, showed sales of Yeo Valley Organic products increased by 85.6% in the year ending April 30 compared with the previous year. The next fastest growing dairy brand saw its sales rise 29%. In 1998/99, the company recorded an increase of 34%.
When supermarket own-label organic products are included, YVO production almost doubled. In the 1999 calendar year YVO branded organic yoghurt had 68% of the market and a substantial part of the 22% own-label sector. Overall the market for pot desserts grew by 11.7%.
Graham Keating, Yeo Valley Organics managing director, sees growth continuing strongly and for the first time will be running a promotion campaign in the new year.
He believes the key to ensuring organic milk supplies keep pace with demand lies in redressing the balance between producers, processors and retailers.
“We aimed to get economies of scale by taking decent loads of milk, and to pay decent prices for organic milk and fruit. We said from the start that farmers must get a decent return, and for the past two years have been paying a year-end bonus to OMSCo (Organic Milk Suppliers Co-op) who supply all our milk. That bonus is to help fund growth.”
It is possible to import organic milk for 1-2p/litre less than the OMSCo price. But Mr Keating does not do so. “We have a dairy farming family background and we see organic as a way to empower the supply side again and ensure we have supplies in the future. Some who duck that responsibility by importing a lot could find that supplies get tight and very costly.”
OMSCo chairman Sally Bagenal is confident that her company will be able to meet further growth in production and sales by Yeo Valley Organic.
“Weve always worked very closely with them and look for long-term planning, as we do with all our customers. In the past weve had to import organic milk for them to enable our own producers to supply the growing liquid market.
“But we are not currently doing so, though some others are. Yeo Valley Organic is an extremely good company to work with.”