The Welsh Milk Company opened its new ₤1.4m dairy late last week on the site of a former Dairy Crest site (closed in 1994) and said it was trying to buck a trend whereby processing facilities moved to England.
Sales and marketing director Richard Arnold told DairyReporter.com that the opening of the new facility meant that tankers carrying Welsh milk did not have to freight it out of the country for processing, and then transport it back to the country for retail distribution.
Bringing milk back home
He said: “We’re bringing production back close to the farms. If the farmers are required to bear the cost of transport for the first leg of the journey, then clearly bottling in Whitland for a Pembrokeshire or Carmarthanshire farmer is preferable to bottling in, say, Droitwich or Southampton in England”
“There was another dairy just up the road that closed 2 weeks ago, and moved to Tewkesbury. So it’s not like this trend [processing Welsh milk in England] isn’t continuing. We’re trying to turn back the tide, but others are already giving up.”
Nonetheless, Arnold insisted that the Welsh Milk Company’s business model that involved deliveries to multiple retailers locally was sustainable. “We wouldn’t be doing it if it wasn’t,” he added.
The Whitland Creamery site in Carmarthenshire comprises a new dairy facility that has been converted from an old storage building.
Initially, the Welsh Milk Company hopes to process 14,000 litres of milk for delivery via a tanker every other day, but plans to increase full-size tanker visits to 5 per day in time.
Arnold said: “Capacity is a question of finance. There are buildings there. We can do keep going provided we get the model right, but we have got to get the sales right first to deliver the quality people expect.”
The dairy will initially create around 10 full-time and 4 part-time jobs at the site, but the firm hopes it could employ as many as 60 staff within 5 years.
‘Getting milk right’
Asked whether the firm had plans to produce added-value dairy products, Arnold said: “Certainly we’re looking for added-value going forward, that’s very important.
“We’re going to start doing cream in the New Year. But as it stands at the moment, we’ve got to get milk right first, and then we’ll keep things moving along.”
Arnold added: “We’ve got to get the brand established, and get customers aware of the difference between our products and what else is on the shelves, the mileage, and a few other nuances.”
“We talked to several multiples concerning the investment, and Tesco were the keenest to get behind us and they’re massive store base in Wales – shifting more milk than anyone else – so it was a logical step to get them on board, and they were supportive,” he said.
But Arnold also acknowledged that Tesco’s involvement provided the retailer with a “great story” from a corporate social responsibility (CSR) standpoint, following the disappearance of its ‘local choice’ (Welsh processed product) from shelves around 2 years ago.
“They’ve obviously got massive contracts with the big players in England, we know that. We know they’re not going to stop those anytime soon. But it’s a good news story to have this option.”