Compounder shares industry goal of raising standards and productivity

BOCM PAULS has been named as the main sponsor of this year’s National Pig Awards. Pig World editor Graeme Kirk sat down to talk to the company’s marketing manager, John Cessford, to find out more about the business and its reasons for getting involved in this new awards initiative

Graeme Kirk: July this year will mark the second anniversary of the ForFarmers group buying BOCM PAULS, what effect has that had on the business?

John Cessford: Yes, the acquisition was confirmed in July 2012. The EU competition authorities looked carefully at the deal and its implications in terms of a number of factors. The owners and ourselves had to produce a significant amount of facts and figures as part of that process. In the end it was a good outcome with the authorities allowing the deal to proceed.

In general terms it was a relatively routine process. The authorities had noted the rapid growth of ForFarmers in recent years, tripling in size in the process, through the acquisition of Hendrix from Nutreco and BOCM PAULS from the company’s management team.

Although there have been changes in management reporting lines in several functional departments, it’s very much business as usual as far as our customers and supply-chain partners are concerned.

The integration of the Hendrix business took up a significant amount of management time throughout 2012/2013, including changes in the IT systems. All mills within the enlarged group on the continent have been retained, although some have changed their product mix, including the two mills in Lochem, in the eastern part of The Netherlands.

This is quite a contrast to when BOCM Silcock and Pauls Agriculture merged in 1992. At the time the enlarged company had 34 mills, but within a year this had reduced to 20 through a consolidation exercise. The feed business is all about efficiency, and to obtain that position, mills have to operate at or close to capacity.

GK: So how does that compare to the shape of BOCM PAULS today?

JC: You have to remember that at the time there were 850,000 sows in the UK, now there are approximately half that number, through a variety of factors. We have had to adapt our business model accordingly and now have 11 mills, 12 if you include the recent acquisition of HST at Crewe.

At the time of the merger we were manufacturing about 2.0 million tonnes from 20 mills, now it’s about 2.2 million tonnes from 12. So we have fuller, busier and more-efficient mills as a result of an investment programme focused on continuous improvement in our operational efficiency as a business.

GK: Would you describe the purchase of HST as consolidation?

JC: No, not really. HST is a well-run, efficient company, with excellent long-term relationships with its customers. They operate in one of the ruminant heartlands in the country. It’s in these heartlands that we want to compete, so HST was a great strategic opportunity for us. HST also has an excellent poultry feed business that provided further synergistic opportunities. The HST brand is well-established in its trading area and the “fit” was a key factor in our parent, ForFarmers, purchasing the business.

GK: How is BOCM PAULS currently performing in the pig feed market?

JC: Without giving away any trade secrets or divulging confidential information, I would say we’re doing quite well at the moment, and have been for the past five to six quarters in the pig sector. Our market share is growing across all the market segments, notably pre-starter creep feeds, sow feeds and finisher feeds also.

It’s a very competitive market, however, and many of our customers deal with more than one supplier. Our aim is to provide the right products for each of our customers’ specific needs, and service those farms as well as we can to deliver the right production and commercial outcomes. If we do that consistently, we’ve a good chance to grow our share of our customer’s business. The key is product consistency, providing value for money and great service. We’re always looking to grow our business and, of course, attract new customers.

GK: Do these new customers include newcomers to the pig industry?

JC: Yes, in some cases, but they’re more likely to be lapsed customers, where we may have serviced their needs in the past, but for whatever reason we lost them. We then manage to regain the customer back again for a variety of reasons. This is normal in a competitive supply chain.

Our primary focus is to retain existing customers, and we do all we can to achieve this. My sales colleagues are highly experienced practitioners whose first priority is to service the needs of their customers as best they can. Our dedicated customer services departments play a key role in servicing customer and business retention – as do our delivery drivers, they’re our front-line brand ambassadors.

So, we defend what we have, but we’re continually looking to seek out new sales opportunities, as, of course, are our competitors.

GK: So it’s all about competing with a good proposition?

JC: Yes, we need to ensure our propositions are attractive and connect positively with our customers. In recent years we’ve designed a new product development system that has resulted in a stream of unique and differentiated brands such as STIMMULATE, VitoStart and Piglet’s Choice in the pre-starter creep area. There’s also GPN Pig Breeder feeds, Olympic Finisher feeds, together with VitoGP Nursery and HiGro Grower feeds. In our system, it’s nutritional innovation that provides the “fuel” to drive our product differentiation and branding programmes that we present to our customers in a variety of propositions.

It’s this commitment, investment and support for innovation, our customers and the British pig industry that enabled us to accept the invitation to become the lead sponsor for the new National Pig Awards. We believe passionately in supporting initiatives that are designed to increase the industry’s productivity and innovation capacity. I don’t think there’s any other company with a better record in this area of supporting the industry. It’s embedded in our core values and is a part of our DNA.

The new awards are absolutely consistent with our own objectives of helping to raise standards and production output. We strongly support BPEX’s 2TS and Breed+3 initiatives, and we’re getting behind the National Pig Awards because the aims and objectives are identical to our own philosophy. It’s all about highlighting best practice and innovation, showcasing the industry and promoting British pigs.

GK: Coming back to the BOCM PAULS product range, when will we start to see innovations from ForFarmers finding their way onto UK farms?

JC: We manage our product range with a life-cycle model that’s unique to our company. Our aim is to keep our ranges fresh, innovative and provide our customers with the most up-to-date technology possible.

At the moment, ForFarmers’ companies have product ranges specific to their markets in The Netherlands, Germany, Belgium and the UK. The company recognises that the markets in different countries can vary according to a number of variables. That will continue, although I think there’ll be a growing need to co-ordinate activities and product ranges across ForFarmers. The company has signalled this with the soon-to-be-appointed main board marketing & innovation director.

I can see huge opportunities to tap into the ForFarmers R&D network to fast-track new ideas, technologies and adapt them to our local market situation. That, to me, is a no-brainer and a win-win situation. We’ll be able to bring new products to the market much faster and this will improve our competitive position in the future.

Prior to the takeover we had excellent relationships with research institutions in the UK and Europe, as well as the opportunity to conduct commercial scale trials in the UK. Now we’re part of ForFarmers, we have access to a network of research and development that’s on a totally different scale, with the amount of work we are able to use tripling. I have seen some of the output of this work for myself and it’s mind boggling with huge potential and opportunities for implementation in the UK market in the next five to 10 years.

GK: What can we look forward to seeing launched in the short term?

JC: We’re working on the full life and growth cycle. Specifically, there’s a huge amount of effort, focus and resource going into the area of pre-starter nutrition. If you get the piglets off to a good start and establish them on an elevated growth curve and maintain that curve, the end result at slaughter will lead to greater profitability for our customers. We have a number of practical models that demonstrate this very clearly.

So, we’re working on this key pre-starter area of nutrition and will be looking to introduce new products later this year, and in 2015 we’re looking at some very exciting opportunities opening up for us in the growing and breeding animal.

We’re continually focusing on the sow all the time. We believe there’s a very strong link with the way you feed your breeders and the piglets you get. Our Generation Programme Nutrition (GPN) concept has proven to work successfully for many years now, although we are continually refining and fine-tuning the process.

Our aim is to move forward with our innovation and new product development programmes faster in the future, in the knowledge that our access to a far deeper knowledge pool provides opportunities on a scale we couldn’t have imagined two years ago, prior to the purchase of BOCM PAULS by ForFarmers. This gives guys like me, and my sales colleagues, a huge amount of confidence going forward.

For more information on the National Pig Awards visit: www.nationalpigawards.co.uk

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