Poultry in motion
Any part of the meat industry, whether its beef, lamb pork or poultry, is tough to work in. It is not a job for the faint hearted.If you're not prepared to work 14, 15, 16 hours a day, don't come into this industry.
But it's all I've ever known. I've been in the poultry industry for 27 years, most of them with Grampian Country Food Group, andspent the first five years of my working life on the factory floor as an operative. In poultry plants, no-one can get away with things withoutmy knowledge because I've seen it all.
I worked my way up through the ranks. I've been team leader, supervisor, department manager, factory manager, general manager,md, national trouble-shooter, individual mentor and regional director. My current position came about in the autumn of 2003 when I was asked tobecome md of Grampian Prepared Meats (GPM), here on Anglesey, and also to take charge of wholesale and by-product sales for Grampian'sentire integrated primary chicken (IPC) business, which totals about 3,000 tonnes of product a week.
So my role in GPM is a little bit unique within Grampian because I don't just oversee manufacturing and distribution. Ourretailer-focused sites share a central sales function, so the individual site directors don't get involved in that. But I'm responsible foreverything, including the bottom line. And I also sit on the IPC board. I find it exciting to have that wider role.
Grampian Prepared Meats leans more towards the manufacturing sector, in that we sell to manufacturers of pies, ready meals and rawadded-value meals - customers such as Ginsters and Northern Foods. We also sell a lot of breast meat (about 180t a week) to Cambuslang andSandycroft, two of our sister companies within the Grampian group. And we export heavily to Europe and the Caribbean. Nearly all our chickenwings go to the West Indies. They eat a huge amount of chicken over there.
The output of this site is 75,000t/year of primary product. We've got a single, integrated killing line, and then, post-chilling,two automated butchery processing lines, including two auto-filleters that we've just installed as part of a £1.2m investment.
When I came here it was definitely a turnaround situation. The board basically said to me: We've got a problem and we need someoneto sort it out. The problem wasn't the product, it was the bottom line. The business had struggled to make money for four years. Strategically,it wasn't aligned with the right products in the right markets. It was flooding its existing markets, which meant it couldn't get the rightmargins, and, at the same time, volumes weren't big enough to get the right cost per kilo, and the meat yields needed to be improved. Thebusiness could easily have closed.
The first thing I did was a management review. Some individuals had to leave the business and the responsibilities of the managersleft behind were broadened. That was the start of the process. It was all done in two weeks.
Then we very quickly had a strategic review of the business. First, we set ourselves the target of being one of the top three primary chicken producers in western Europe, to enable us to fight against our main competitors, the Dutch. Then we had to look at realigning our sales away from a few flooded regional markets and into a broader number of areas. We quickly moved some products out of low-margin sectors in the UK to high-margin areas in Europe, especially Spain, Portugal and Germany, and we increased the prices of our leg-meat products and wings.
In the factory, we focused our management team on improving the meat yield from the carcase. We also reduced our direct labour costs, mainly by cutting down on overtime and contract labour. And we reduced the number of machinery breakdowns very quickly, which improved our throughput productivity.
A lot of our savings came from indirect costs - we were carrying a lot of unnecessary indirect labour. We've now reduced theheadcount overall by about 50 people, but at the same time we've increased throughput by 10% and increased turnover by 15%, all bytargeting new markets and realising the right price.
We did have to make some management changes, but our line workers have been fantastic. They've helped us all the way.Whenever we ask them to do something, 99 times out of 100 they'll do it. We've actually put more people on the lines and slowed the linesdown, so they have more time to recover the meat. Before, they were actually trying to do things too quickly.
I've got a top-class sales manager here at GPM, Alasdair Gordon, and a manufacturing manager, Dave Broxton. Dave has led ourlatest project, which was to automate the butchery process for breast meat. He scoured the world for the best machinery and after spendingsome time in the US, benchmarking the two best suppliers, he narrowed it down to Stork.
We already had two main cut-up lines that break the birds down into thighs, legs, wings and breast cap. Our leg de-boning isdone manually, as there's no machinery available at present that could handle that more efficiently. But the breast caps are now put on tothe Stork machines and butchered out automatically. Typically, in the past, that had been a skilled butchery job, but we're actuallyachieving 1% better yield from the machines than we did butchering by hand. We put the first machine in about three months ago, the secondone went in eight weeks later, and they're already proving extremely successful in terms of improving profitability.
The £1.2m investment included a 513m2 factory extension we had to relocate despatch into a new building to give more spaceto production. But we only started the extension four months ago and it's already complete. In this business, you can't hang around.Time is money.
Dave selected the Stork machines because they were particularly suited to the large birds we process here. Because we areproducing for the manufacturing industry, not for retail, it's not important to size the product for portions. It's all about maximisingthe kilo per bird on each shackle. So we grow a 3.9kg live bird and, with the new machinery, we're now producing more meat per shackle andmore kilos per head of labour than most manufacturers in western Europe.
I took over GPM in September 2003. By December the factory was in profit. We've achieved my initial target of top three statusin terms of cost per kilo produced and kilos per man hour. Now we want to be number one, which will mean looking at our next steps interms of volume and throughput, looking at how we can add value with things like marinades and coated products to move us up the valuechain, and also looking at how we can add more automation. We've gone about as far as we can in automating the process, but there'spick-and-place robotic equipment available off-the-shelf that could help us automate our end-of-line operations.
The UK cannot possibly compete with Asia, South America or even eastern Europe on hourly rates. But no matter what happens,people in the UK like fresh meat that hasn't been pumped full of brine. They want a sound, quality product, produced in the UK. But we areat the point where we are going to have to get the price of meat up in the UK. Packaging and diesel costs have been driven up by the priceof oil, and the cost of electricity is ridiculous. So we need 7% on the price of chicken just to stand still. Then you have labourinflation - and we need to make money too. People have to decide whether they want a British meat industry.
I remember thinking 15 years ago that the British poultry sector couldn't survive, and it has. But you have got to be fullyautomated and volume-driven with a quality guarantee, otherwise the UK market won't entertain you. Anyone who hasn't got those thingsin place within the next five years should seriously consider getting out of poultry, because it's very, very tough.
Personal
Name: Mark Theobald
Age: 43
Career highlights: Has worked in the poultry industry since leaving school, chiefly with Grampian Country Food Group.Spent five years on the line, and a further five years working his way through the ranks to general manager and divisional md level.
Domestics: Lives in Lancaster, North Lancs, with wife Colette. They have three children: Rebecca (26), Natasha (15) andJordan (12).
Outside work: "This will sound funny, but to relax my wife and I play cards with our best friends, Tony and Tania!It's only poker for matchsticks, but you to have to concentrate so it really helps you relax your mind can't drift on to work.Also, I've got this absolute love of Leeds Utd. I follow them home and away."
Factory Facts
Location: Grampian Prepared Meats, Llangefni, Anglesey, Gwynedd, LL77 7UX
Tel: 01248 722025
Main products: Primary processed fresh chicken, including breast meat, legs, thighs, wings and minced and diced meat
Factory size: 3,513m2, including the latest 513m2 extension
Number of employees: 520, on a two-shift system
Output: 75,000t/year
