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(UK) IFE March 2009 – Wyke Farms

Industry Comment from Richard Clothier, third generation family member & Managing Director, Wyke Farms

A Call for Collaboration…

Desperate times call for desperate measures – that’s what we’re told anyway. With the current state of our challenging economy and dwindling milk supplies, the question over who controls the supply chain is becoming more and more prominent.

For retailers, ‘exercising caution’ in the current economic downturn inherently means they must resist the temptation to be aggressive with suppliers. Although this may feel like a natural course of action under growing pressure, retailers must keep in mind that the farmer supply-base is extremely fragile.

As we all know, the supply of dairy commodities sourced from within the UK remains very low in comparison to previous years, and putting additional pressure on cheese, butter and liquid-milk prices could push yet even more dairy farmers out of the industry. In effect, this means that if the market were to experience another increase in world demand for milk products, we would not have a milk supply base to support our UK demand.

In the end, retailers cater to consumers’ needs, which we naturally assume means the cheaper the better. However, the consumer feedback we’ve received at Wyke Farms clearly shows that whilst people may have less money to spend, they wish to spend it more carefully and their key drivers for purchase remain the same.

Even though shopping budgets are becoming tighter, consumers have not discarded their affection for provenance, health, green issues, and local products. To this end, retailers must resist using primary producers to finance outdated ‘pile it high – sell it cheap’ forms of vending, ensuring that quality products still command their share of the fixture. In return, even greater responsibility lies with Brand Managers, Manufacturers and Farmers to sell these values harder than ever to shoppers. Cutting marketing budgets in periods of tough trading is like raising the white flag to the oncoming charge of cheap supermarket own-label products.

Ultimately, it’s up to us as an industry to work together to get through this time. Maybe it’s time we change the old saying to ‘Desperate times call for better collaboration’. It’s more apparent than ever that the only way for our industry to get through this economic crisis unscathed is by doing a better job of working together, rather than passing the pain down the line, which will inevitably end up at the door of the primary producer – the poor old farmer.

Tags: Richard Clothier