more co-operation
Consider
more co-operation
NORFOLK potato grower and BPC council member Tony Bambridge reckons there is scope to cut costs, without hitting crop margins.
Co-operating to make better use of harvesting and grading equipment, improving crop management and organising logistics better can all help. But industry co-operation is the over-riding factor.
"Farmers need to organise themselves to be of sufficient scale to give the significant input processors are looking for." That means groupings of more than 200ha (500 acres) working with factories direct or through co-ops or efficient merchants.
Co-operation must also extend to equipment use. Working a harvester across 120ha (300 acres) rather than 40ha (100 acres) drops the cost from £7.10/t to £3.39/t. A similar approach to grading cuts annual cost from £10.31/t to £5.16/t.
Haulage could be better organised too. Occasional loads typically cost £9.50/t. Five loads a day drops to £8.50/t and 1000t over eight days is £7/t. "If we were really adventurous and got a commitment from our processor that he would turn lorries around quickly because he had already done the quality control in-store that could drop to £6/t."
Labour for grading could also be cut, grading 48t slowly over eight days costing £5.58/t compared with £2.57/t grading 150t a day.
"Combine all those savings and the processors target of a 15% cut in contract price is met without hitting margins," Mr Bambridge says.
Stripping out adversarial disputes would help too. He calculates that staff and overhead costs within the supply chain typically add £7.10/t to costs. "There is at least £2/t there to save by minimising disputes."
But that demands dedication, commitment and trust. "And that must be reciprocated," he says.
Better crop management is also needed. "It may pay to get someone else in to manage your potatoes, they may be better at it." Growing for processing as a primary outlet, rather than as a fall-back for failed pre-packs is vital.
Tony Bambridge… Scope to cut costs