Alan Wyn Jones
There’s a well known saying ’Fail to Plan, Plan to Fail’ but South Caernarfon Creameries is definite proof that a strategic plan certainly reaps rewards. It’s just over 12 months since Wales’ leading farmer-owned dairy co-operative announced that it had undertaken a review of their business and had implemented a comprehensive, five-year strategic plan to develop and safeguard the future of the Creamery.
Since following the strategy, South Caernarfon Creameries has seen great success. They have reinvested in the business and their brands and enjoyed a significant growth in retail sales as well as introducing additional benefits for its member farmers.
In the past 12 months the Creamery introduced strategies to ensure that member milk price returned to a competitive position. Over the year, prices increased by 4.15 pence per litre to the current price of 26.25 pence per litre. "South Caernarfon’s milk price is now better than many other dairy purchasers in north and mid Wales" explains Alan Wyn-Jones, Managing Director at South Caernarfon Creameries. "We have also introduced additional benefits to our 150 or so member farmers. Changes to member supply contracts have now been implemented which encourage volume and offer rewards for a high constituent product. Going forward this will be of huge benefit to both sides, the Creamery will be supplied with a consistent high quality raw material and the member farmers will be rewarded for producing it. We have also just announced that due to an improved financial performance than was originally forecasted, we propose to pay our supplying members a dividend payment equivalent to 0.1 pence per litre on an annual milk supply."
Investment has also been paramount with over £500,000 assigned to new systems and equipment. "We are simply investing in our future" adds Wyn-Jones. "The new stock and yield control system has helped productivity and efficiency and we also invested in some new equipment. Essentially, we bucked the trend and invested £250,000 in a traditional butter churn. New ultra-modern equipment wouldn’t have worked as we needed to make traditional Welsh butter as authentically as possible. The traditional production methods provide us with a point of difference and also address our strategic resolve to have products with extreme provenance; our butter is traditionally Welsh, produced and packed in Wales using Welsh milk from our member farmers."
There has also been considerable growth in retail sales with an additional £770,000 of products being sold direct to retailers during the past financial year which is in direct line with the strategy to continue to move away from commodity driven markets. South Caernarfon has sold more liquid milk, Welsh butter and pre-packed cheese and also undertaken major investment with their own brands. Their Dragon brand was relaunched earlier in the year and seen huge success. "The new packaging has definitely helped us to gain more listings with the major multiple retailers." The company has also worked with the major retailers offering a range of promotions.
It has also been a record breaking 12 months with the Creamery receiving 24 awards for a wide range of cheese and milk products. These were bestowed from various prestigious organisations including, amongst others, The British Cheese Wards, Royal Welsh Show, Great Taste Awards and the Nantwich International Cheese Show.
There have also been changes internally too. The company’s board structure changed and Bernard Harris, a past Chief Executive of Wynnstay plc, joined the Board of Directors as Non Executive Director Chairman on 1st October 2010. Alan Wyn-Jones said "This appointment, the investment that we have made and the benefits introduced to our member farmers has all demonstrated how committed we are to our independent strategy and how we are investing in our future. We are pleased with the progress we have made in year one of our five year plan but we have no plans to be complacent. We have a sound platform in which to build from, a clear strategy to work to, so we are very positive for the future."