More salt for Delamere

Goat milk is going strong. In the UK, the 20 million litre consumption mark was reached last year, and thus purveyors of the goaty goodness are seeing improved results, after a turbulent few years of recession. Delamere Dairy, based in Knutsford, UK, has recently named Ed Salt as its managing director, with a view to expanding the international side of its business. “Right now, export is about five per cent of our business,” he explains. “The largest area of growth for us is the Middle East – Dubai, Saudi Arabia, etc. We opened an office in Hong Kong last year, to explore Asia – Singapore, Japan, South Korea, Vietnam. Hopefully we will have double digits for our export markets by the end of the year.”

This plan is based on research done by the company, he says. “We conducted our own regional assessment as Food from Britain is no more, and we looked at where the possible demand would be for goats milk and soya products.” What they found was that their cow’s milk products were acting as gateways for people to try goat milk. “Over the past 25 years, one of challenges has been education, and giving people a reason to purchase goat’s milk. We also produce sterilised cow’s milk, and this is an entry product to our other lines, such as the goat milk. We are successful with the cow’s milk product, then they move onto goat milk,” he notes.

“Overseas, we hope to get to 30 per cent of our business eventually, but this will take a couple of years. In China, for example, food habits have changed in a whole generation. Back in 1993, they didn’t know what cheese was. Hopefully we’re well positioned for that change,” Salt says.

The challenge lies in adding to the number of goats milked in the UK. “We continue to grow the goat herd base, to produce milk for cheese, butter and so forth. We try and increase the base with an ongoing process of regular supplier meetings. People often think that goat farming is easier than it is – there is a lot of investment needed,” Salt points out. “We have a supply of around 10,000 goats, and we get regular phone calls from others looking to supply us. We like to have the herds as close to each other as possible – we have wound up with a northern milk pool and a southwestern UK milk pool. There are only about 50 commercial goat farms in the country.”

As for product innovation, goat milk continues to be a staple. “Goat’s milk is still a niche product, and even skimmed milk was considered an innovation in the category a few years ago. Retailers have to offer consumers a choice for their baskets, but still have restricted shelf space. Our core product range is nothing too far-fetched.”

That being said, there is growth in the non-human side of the business for Delamere. “In our pet products area, TopLife makes up 10 per cent of our business and is made with goat milk. There is a lot of innovation in that category. We launched Pet Powders last year, and we have seasonal products such as Advent calendars, which are all goat milk based,” he notes. “Last October, we introduced new soya products, and increased the category range into areas such as convenience. We are in a lot of different categories to keep on top of new developments.”

The business model for Delamere is also slightly different to the usual producer and packager, which benefits the company. “In early 2001 and 2002 we changed our business model,” Salt says. “Previously we had a lot of underutilised, expensive equipment to make our products. We then talked with co-packers and made agreements to help fill up their space capacity on their lines with our non-competing products. We now have sites in the UK that are closer to the herds, and those businesses have cost savings by running their equipment all the time and collecting fees from us.”

Like most UK businesses, the recession hit Delamere. “We saw 17 per cent growth in 2004, and this continued until 2008, when the recession started. Our £4 million (€4.9m) turnover went up to £15.5 million from 2004-2008,” Salt says. “After that, growth slowed, but it never dipped. We are now starting to see expansion again.”

He attributes this to the loyal customer base. “We are lucky: 76 per cent of our customers are consuming goat milk for health reasons. They can’t buy other milk and it’s not a luxury purchase for them,” he points out.

Going forward the business is back to increased growth and being consumers’ product of choice, he says. “There is a huge drive this year in the UK about health – the Olympics, and the FSA guidelines. We have two product lines, the cholesterol reducing soya and good for health goat milk, that we plan to promote. Dairy products benefit athletes and we are seeing growth in all dairy.”

The founders, Liz and Roger Sutton, are still very much involved in the business and Salt’s promotion is part of an expansion that includes a new sales and marketing director. The firm also won Farm Business of the Year at the Farm Business Food & Farming Industry awards in 2011. “I have the satisfaction of a business going well, with employees working in a safe, secure business. We must be doing something right. The challenge is to keep it going on that footing. We plan to be around for the next 25 years and to double the business overall.”

• 20 million litres are now consumed
• 50 commercial goat farms in the country
• Delamere Dairy collects milk from 10,000 goats